It has been uncommonly busy here in my little corner of the construction market thus these Saturday catch up posts ahead of a day watching U12 soccer. Next up is an update on a case we covered gavel to gavel, the Beef Plant Saga which cost the Mississippi taxpayers at least 55 million dollars. I’ll start with this puff peice from June, 2007 on Robert Moultrie courtesy “Smart” Business magazine:
A few years ago, one of Robert L. Moultrie’s best construction project managers came to him with a request.
“I’d like to go into sales,” the employee said. “There’s no way,” Moultrie responded. “You’re too valuable to us in our construction division.”
“Well, if that’s the case, I’ll leave,” he said.
Moultrie and the employee went on, and after much deliberation, Moultrie decided to let him try sales.
“The mistake I made was I should have put him in sales 10 years earlier,” he says. “He was awesome, and he knew what he wanted to do … and today the volume of business he brings to the organization is unbelievable.”
While that employee has brought great business to The Facility Group, it may never have happened if Moultrie, chairman and founder, had a different attitude. If he told the guy not to let the door hit him on the way out, or if he acted like he had 1,000 other things to do, his business may not be as successful as it is today, something he attributes to his employees, who grew the company to nearly $300 million in revenue last year, up from $10 million in 1986.
“My problem was simple,” Moultrie says. “I had so many weaknesses, I had to hire so many great people to take care of all my weaknesses, that it’s caused me to end up with a great organization.”
Of course what the article leaves out is the behind the scenes assistance Mr Moultrie gave his “salesmen” in terms of political contributions and the like that always seemed to follow large contract awards to The Facility Group. Spreading the wealth worked well as Mr Moultrie grew the Facility Group to a 300 million dollar company. But his luck ran out Thursday along with the “year and a day” concept when Mr Moultrie was sentenced to 16 months in the pokey. The Atlanta Journal Consitrution has that story:
Robert Moultrie, the founder of The Facility Group, the Smyrna-based engineering and construction firm who illegally funneled campaign donations to a Mississippi governor, was sentenced Thursday to 16 months in prison.
The story continues:
Moultrie, former president Nixon Cawood and former executive vice president Charles Morehead were accused of conspiring to bribe former Mississippi Gov. Ronnie Musgrove in hopes of winning the contract to finish building a meat-processing plant. The $55 million factory closed within three months of opening in 2004. Mississippi Beef Processors sued the Facility Group in Cobb County Superior Court last month for failing to deliver a fully operational plant.
At least $70,000 in campaign donations from Facility Group executives and staffers flowed into Musgrove’s re-election coffers. Musgrove, who lost the election, hasn’t been indicted and insists he did nothing wrong.
Moultrie, Morehead and Cawood pleaded guilty to reduced charges and resigned from the Facility Group. The company paid a $250,000 fine to the state of Mississippi.
Morehead was sentenced last week to 10 months in federal prison for withholding information during the federal investigation. Cawood will be sentenced Jan. 9.
Moultrie, 67, got 16 months and a $30,000 fine for making an “illegal gratuity.” His lawyers had sought a prison stay of one year and one day for “a singular instance of criminal bad judgment,” according to a pre-sentencing report given to the judge.
Singular instance of criminal bad judgement? Or a singular instance of being caught. The sentiment from our Georgia based readers, many of them architects and builders themselves runs overwhelmingly towards the thank goodness he was finally caught. And as I observed the challenges involved in keeping TFG running are huge and the same AJC story tells why:
Over 22 years, Moultrie built the Facility Group into one of Georgia’s most successful construction companies. Revenues hit $450 million last year; the company employed 450 people in Cobb County, Chicago, Irvine, Calif., and Amsterdam.
Projects, though, disappeared once federal corruption indictments against Moultrie and two other top executives were unsealed last March. Roughly $400 million in business evaporated in one day. Public works projects in Cobb and Chatham counties vanished.
Revenues may hit $190 million this year, according to new Chief Executive Ennis Parker, adding that the company cut more than half its jobs.
“This sentencing sort of closes the chapter on the whole series of events,” Parker said. The Facility Group’s return to respectability begins today, Parker said, with the appointment of a new chairman.
And the troubles are just beginning. Proving once again there is no honor among thieves Mississippi Beef Processors recently took their beef with Moultrie and TFG to court in Georgia. Kent Miles filed that report for the AJC:
A Mississippi beef-rendering company is suing the Facility Group, claiming the Smyrna-based company was responsible for the failure of a cattle processing plant in 2004.
Mississippi Beef Processors LLC contends in its lawsuit, filed Nov. 17 in Cobb County Superior Court, that the Facility Group failed to deliver a fully operational plant. The result was the closing of the plant and collapse of the company, the court documents say.
The company is seeking a jury trial.
The former CEO of the Facility Group recently pleaded guilty to making illegal campaign donations to then-Mississippi Gov. Ronnie Musgrove in an effort to acquire the plant project. Robert Moultrie is scheduled to be sentenced next Thursday. Two other Facility Group executives also pleaded guilty to related charges and are awaiting sentencing. The investigation would taint Musgrove’s U.S. Senate campaign.
What would be interesting to know is if MBP is also suing Carothers Construction. Our readers may remember it was Mr Carother’s who provided great assistance to the prosecutors in convicting Mr. Moultrie.
Finally more evidence things are unraveling for TFG. Evidently a group of former TFG employees left in mass and now has the Cobb County School Board’s construction management contract. TFG saw the handwriting on the wall of course, with all the criminal convictions their very name is radioactive in political circles. Alexis Stevens at the AJC has that story:
The same people who have managed $1.6 billion in improvement projects for Cobb schools for the past 10 years will continue to do so, if they meet certain conditions.
The school board agreed after a heated discussion Thursday that Garrard Construction Group would manage the nearly $60 million in projects still in progress.
Garrard Construction of Lawrenceville purchased the education division of the Facility Group, a Smyrna company hired by the school system to manage spending of the special sales tax monies.
The Facility Group had managed the district’s construction projects with little fanfare until earlier this year, when federal indictments were filed against the firm.
Robert Moultrie, former chief executive of the company, will be sentenced next week for making illegal campaign contributions in Mississippi.
The Facility Group’s new CEO, Ennis Parker, acknowledged last week that the education division was sold because it wouldn’t likely win the district’s next contract.
All 16 members of the Facility Group’s k-12 education arm were included in the sale, according to Ron Garrard, company president.
“I see no reason not to assign the contract if the interests of the district are covered,” said outgoing board member Lindsey Tippins.
Board member John Crooks disagreed. “It just seems to me that it’s a back-door way of getting the business to another company,” he said.
Before the board gives its OK for transferring the contract to Garrard, it wants to make sure Garrard assumes liability for all work in the current construction program, including work completed by the Facility Group, said school district attorney Glenn Brock.