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New documents raise questions about ‘unprecedented’ contract funded by CARES Act

Updated: Apr. 1, 2021 at 9:38 AM EDT
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GREENVILLE, N.C. (WBTV) – A fledgling nonprofit awarded millions of dollars in federal CARES Act money by state lawmakers entered into a contract with a company to provide pre-trial ankle monitoring for domestic violence defendants that the country’s leading expert on the industry says is far outside the norm.

Caitlyn’s Courage was organized in October 2019 by Judson Whitehurst, a Greenville businessman, after his daughter was killed in a domestic violence incident.

Less than a year later, the organization was awarded $3.5 million in federal money given to the state with the goal of managing the impact of COVID-19 on North Carolina and its residents.

The provision was tucked inside a larger bill passed by the North Carolina General Assembly in late June 2020.

Under the law, Caitlyn’s Courage would get the money and manage a pilot program to implement electronic monitoring of defendants charged with domestic violence crimes who were released from jail awaiting trial.

Some, but not all, cities and counties across North Carolina have electronic monitoring programs but the bill allocating money for Caitlyn’s Courage’s pilot program required the effort be implemented in at least three small, medium and large counties across the state.

But questions about the appropriation arose before the bill ever became law. They’ve continued, as the organization awarded the contract and spent the millions of dollars in federal funds.

‘The House got a little pot to spend’

The appropriation for Caitlyn’s Courage came from the House of Representatives, according to a question-and-answer session while the bill was in a Senate committee, WRAL reported at the time.

According to WRAL, Sen. Valerie Foushee (D-Orange) asked why a nonprofit was getting so much money for an ankle monitoring project.

The senator presenting the bill, then-Sen. Harry Brown (R-Onslow), responded to Foushee’s question by saying that provision came from the house.

Afterwards, Brown elaborated on the origins of the appropriation.

“The House got a little pot to spend, and we got a little pot of money to spend and the House chose to spend it this way,” Brown said.

The WRAL story also quoted Sen. Don Davis, a Democrat who represents Pitt County, where Caitlyn’s Courage is based, as supporting the funding.

A third lawmaker, then-Rep. Perrin Jones (R-Pitt), was first to introduce a bill that would have given Caitlyn’s Courage $100,000 for an ankle monitoring pilot program, the News & Observer reported.

The bill was signed into law on July 1, 2020. Less than a month later, the nonprofit put out a request for proposals dated July 15.

A winning bidder was selected on August 14, according to documents the nonprofit submitted to the North Carolina Pandemic Recovery Office. In a filing detailing the bid process, the nonprofit said it advertised the RFP in four local newspaper but did not specify any industry publications where bids were solicited.

Tarheel Monitoring, a Wilmington-based company whose owners have ties to several elected politicians and state officials in North Carolina, was selected as the winner.

At the time a selection was made, records obtained by WBTV show, the nonprofit did not have a conflict of interest in place, as required by law. The policy submitted to state officials in order to receive their $3.5 million is dated October 25.

‘I’ve never seen anything like this’

The contract between Caitlyn’s Courage and Tarheel Monitoring is unlike anything Joe Russo, an expert in the electronic monitoring industry, has ever seen.

Russo worked in the business for two decades before taking a job at the University of Denver where he studies electronic monitoring and related issues.

WBTV called Russo for his opinion of the contract after comparing the contract signed by Caitlyn’s Courage with other electronic monitoring contracts across the country.

According to the contract and an invoice from Tarheel Monitoring to the nonprofit, the organization paid $700,000 to purchase 1,400 ankle monitor units.

DOCUMENT: Click here to read the agreement in full

Russo said, typically, the physical monitoring units are leased—not purchased—because technology changes frequently, making it more expensive to upgrade.

On the same invoice, the organization paid another $2.8 million—the balance of the $3.5M awarded by the general assembly—for 126,000 days of active monitoring. In other words, Caitlyn’s Courage pre-paid Tarheel Monitoring for days when it would monitor the whereabouts of a device on a defendant’s ankle.

That works out to roughly $22.23 per day of monitoring.

Typically, Russo said, a company would send an invoice for days of active monitoring as the device is used.

“That’s not how the industry works and, in general, that’s not how government works,” Russo said of pre-paying for services not yet rendered.

“It’s so highly unusual, in fact—unprecedented—I can’t think of an example where an upfront payment would be made.”

As a result, Russo said, it becomes much more difficult to ensure taxpayers got the proper service they pre-paid for.

A survey of other electronic monitoring contracts across the country by WBTV showed the per-day rate

Caitlyn’s Courage pre-paid for was much higher than what is typically charged.

For instance, Robeson County commissioners approved a new contract with the same company that makes the device purchased by Caitlyn’s Courage, Satellite Tracking of People, that cost $3 a day.

A contract between STOP and the California Department of Corrections and Rehabilitation showed a per-day monitoring rate of $2.95 for the 2017-2018 contract year. That contract used the BluTag device, the same model purchased by Caitlyn’s Courage.

The negotiated pricing for Texas agencies, as negotiated by the Texas Department of Information Resources, is $3.10 per day of monitoring, according to the manufacturer’s website. That price includes the device, monitoring, officer kits, repairs and maintenance and shipping to and from the agency.

WBTV’s review found contracts ranging from $2 per day to $10 per day.

Russo, the industry expert, said the contract between Caitlyn’s Courage and Tarheel Monitoring was so unusual it was difficult to give an opinion as to whether the pricing was appropriate.

“You’re comparing apples to oranges,” Russo said.

“In my experience—and I’ve been tracking this industry for over 20 years—I’ve never seen anything like this. It goes against the grain at almost every turn.”

No comment, few answers

Whitehurst, who runs Caitlyn’s Courage, refused multiple requests to answer questions on camera and was not at his recycling business in Greenville, N.C.—where the nonprofit is registered—when a WBTV crew visited.

In an email, Whitehurst defended the RFP process and his organization’s contract with Tarheel Monitoring and justified the high cost by claiming Tarheel Monitoring was providing additional equipment.

“Caitlyn’s Courage purchased 1,400 defendant units and we are providing participating victims with another device – the Victim Notification Unit (VNU), which uses GPS technology, mobile exclusion zones, and nationwide cellular phone service to notify victims if the defendant is in close proximity. Thus, if every victim fully participates, that’s 1,400 VNU units, and the cost of service equates to roughly $11.11/day per unit,” Whitehurst said.

But there is no mention of a victim notification unit in the invoice and the contract says victims can download an app on their phone or Tarheel Monitoring would provide a phone if a victim doesn’t have one.

Whitehouse said Tarheel Monitoring was one of two companies to submit a bid.

“After reviewing the proposals submitted, we selected the best vendor for our pilot program,” he said. "

“To that end, what differentiated the submitted proposals, and from our perspective was the deal breaker, Tarheel Monitoring was the only proposal submitted that committed to have live / direct interaction with victims, versus Caitlyn’s Courage taking that task and liability.”

In addition to Whitehurst’s refusals to answer questions on camera, Jones, the House Member who originally proposed funding the pilot program, did not respond to a text message seeking comment.

An assistant for Davis, the Pitt County senator who supported the funding allocation, said he was unavailable for an interview and had no comment when presented with the facts for this story.

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