'FDOT BOB'

TAMPA — If you think of this as a good caper movie, like Oceans Eleven or The Thomas Crown Affair, then you already know the last scene.

The camera pulls back from Robert G. Erickson living happily ever after on the beaches of Costa Rica, having made at least $1-million off Florida taxpayers, probably more.

Back in Florida, meanwhile, the thwarted inspector-types are throwing up their hands and the bureaucrat-types are saying, why, yes, we did pay him, what else could we do?

Now, back to the beginning. The story opens more than a decade ago, when the state Department of Transportation sets out to widen Tampa's interstates — I-4, I-275, and their intersection downtown at "Malfunction Junction."

Enter Erickson, a former DOT employee who saw a golden opportunity. He pitched his services as a private property appraiser to landowners along the route, helping them to fight his old bosses at the state.

Don't worry, Erickson told his prospective clients, you won't pay me a dime — the taxpayers will. Under Florida's generous system, the state pays the expenses of owners fighting land-taking cases.

Erickson's sales pitch worked. Half of the landowners who wanted an appraisal to counter the state's offer hired him.

Of course, once he won the work, Erickson had to do it. And when he turned in his appraisals, state reviewers repeatedly found the work substandard, even "nonsense."

Later the DOT turned in Erickson for a state and federal investigation that found he had billed the state for more hours than he paid out to the associates named on his bills. But investigators said that under Florida's laws, they could not prove fraud.

So Erickson was paid.

These days Erickson lives in Costa Rica, splitting his time between there and Panama, he told the St. Petersburg Times in a series of e-mails.

He says he has plenty of enemies at the DOT who resented him for sticking up for the little guy, homeowners the state wanted to railroad into unfair deals.

"I have been through a few witch hunts over the years,'' Erickson says, "and nothing has ever come from all the examinations we have gone through."

'FDOT Bob'

Everywhere the DOT turned, there was Erickson. Often, by the time the state notified homeowners it wanted their property, they already had heard from him.

Erickson started with a "Dear Property Owner" letter and followed up with more letters and postcards. He put on "town meetings" at churches, community centers, clubhouses and hotel meeting rooms.

"Will your settlement from the state be fair?" his letters asked. "Will you be able to replace your home?" He urged owners not to wait for the state's offer.

"The fee we charge for our services," he assured owners, "are by law paid entirely by the state." He added, with emphasis: "You will not receive a bill for our services."

His personalized license tag said, "FDOT Bob." The sign on his car featured an official-looking logo. He placed Erickson Appraisers Inc. signs in his clients' front yards — on some blocks, there was one in front of every house.

Along I-275, where today mountains of construction dirt loom between the bay and downtown, the project wiped out block after block of older homes, many worth less than $100,000.

Some residents had lived there for decades. Some spoke no English, some were sick or dying. Many were bewildered by the bureaucracy reaching out to grab them.

On the I-275 project, 97 out of 182 property owners who chose to have an appraisal hired Erickson.

On I-4 between downtown and 50th Street, Erickson worked for 60 of the 142 owners who hired an appraiser. On the downtown interchange, he worked for 11 of 14 owners.

Erickson's clients who were interviewed remember him vaguely, if at all — he was just one more face during a stressful time. They were more likely to remember the Tampa attorney Erickson usually worked with, Kenneth Montgomery.

Annie Solomon, forced out of her Laurel Street home after 20 years, remembers meeting Montgomery at Erickson's meetings at a church. The state offered her $64,000, but, she says approvingly, "Mr. Montgomery wouldn't go for that." She ended up with $84,000.

So Erickson's clients were generally satisfied, especially with the taxpayers footing the bill.

The DOT was not as satisfied.

'That's nonsense'

As Erickson submitted his appraisals to the state, each jacketed neatly in a white vinyl notebook with a color photograph of the property on the cover, the DOT's complaints grew.

It wasn't that Erickson's appraisals were higher than the state's estimates. They were — but so were those of every other private appraiser. The two sides either compromised or went to court.

But Erickson and Montgomery, who often refused to make a counteroffer and even threatened to sue in turn, presented a special challenge. DOT memos refer to "the Montgomery problem" and complain about Erickson's methods.

Erickson's appraisals often failed to pass muster when they were sent to a higher-up reviewer in the DOT. The reviews of Erickson's appraisals in the files, much more often than those of other appraisers, concluded that they did not comply with professional standards or failed to show a fact­ual basis for his conclusion of value.

Most of the problems dealt with "comparable sales." Erickson tended to use the same comparable sales over and over.

He employed one such sale — a $34,000 transaction from the year 2000 — as a "comp" in 49 of his 97 appraisals, for a variety of properties that he said ranged in value from $38,500 to $400,000.

Records show that Erickson used just six properties for nearly half of the 300-plus "comps" in his appraisals on I-275. The files are filled with complaints from reviewers about his comparable sales. Some examples:

• "The comparables chosen by Bob Erickson in the owner's appraisal are clearly taken from more upscale neighborhoods in the area."

• "Appraiser Erickson has chosen comparable sales that give a false picture of the subject."

• "Mr. Erickson uses very little factual discussion in his analysis and does not provide supporting documentation for the land sales."

• "Mr. Erickson's methods and techniques are typical and minimally up to professional standards."

• Two reviewers looked at Erickson's use of comparable sales and wrote the identical comment: "That's nonsense."

But in the end, an appraisal is just an opinion — an educated professional opinion, but an opinion.

"Nonsense" or not, the DOT still had to pay him.

$1.1-million-plus

The bills that Erickson submitted to the state for his work on behalf of homeowners ranged from $8,000 and up. The state typically negotiated him down to the $5,000-$6,000 range.

Almost all the fees paid to other appraisers for homes on the I-275 job were $3,500 or less.

One memo complained that because Erickson was doing so many appraisals, he had the same "economy of scale" as the department's own hired appraisers, who were paid $2,000 per parcel.

Still, DOT officials say that settling with Erickson was in the best interest of the taxpayers. It was a better alternative than dragging out each case in a fee hearing in court, driving up costs and tying up critical staff time. The main job, after all, was to build the road.

"The cost of going to a fee hearing is not just the actual cost of paying for another attorney,'' says the DOT's district right-of-way manager, Aurelie J. Anthony.

"It's also the cost of personnel that have to do research and attend to the case, and whether or not that personnel is on other issues of greater importance."

Besides, Anthony says, the DOT usually loses fee hearings. "If it's a gray area, typically the judge will side with the opposing counsel."

State law spells out a fee schedule for lawyers — if they get their client a higher price than the DOT's initial offer, they get 33 percent of the difference, up to $250,000.

But for appraisers and expert witnesses, Florida law says only that the state must pay "reasonable" fees. That leaves plenty of room for judges to side against the DOT.

Erickson — who was making $41,500 a year when he left his job as a senior DOT appraiser in 1992 — was issued $1.1-million in state checks between 1996 and 2007, with a peak of $439,080 in fiscal year 2001-02.

But that understates how much he was paid because his fee often was included as part of a single lump sum labeled "fees and costs," paid to the trust fund of the property owner's lawyer. Erickson's share was not broken out separately in state records.

Montgomery, the lawyer on almost all of Erickson's cases, was paid $763,824 in legal fees and an additional $584,280 in lump-sum fees for appraisers and expert witnesses on the I-275 project, state records show. Overall, the state has written Montgomery's law firm checks totaling $2.3-million since 2002.

Messages left with his office were not returned.

Fraud allegations

In April 2004, an anonymous tipster (later identified in state reports as Erickson's estranged wife) told the DOT that Erickson was inflating his invoices to the state.

The tipster said Erickson had far overstated the number of hours worked by the associates named on his invoices, then paid those associates less than the amount billed.

Both the state and federal DOTs investigated Erickson, along with the Florida Department of Law Enforcement.

Their conclusion: In fact, Erickson's invoices to the state billed more hours than his associates had been reimbursed. But that did not amount to a crime.

Florida law doesn't say a thing about appraisers' bills, other than the state must pay "reasonable" fees.

More importantly, the investigators said, the state had not paid Erickson the amount listed on his invoices.

Rather than fight Erickson along the way in court, the state had reached settlements with him. But now those same settlements "disproved'' any allegations of fraud, no matter what the invoices said.

"There was no question in the department's mind … that some of the invoices being presented by Mr. Erickson to the department were inflated over what he got paid in the end," says Michael Stewart, investigations manager for the DOT inspector general.

But because the DOT had paid him a flat rate anyway, "We can't show that we got shortchanged or taken advantage of."

The DOT closed its investigation in September 2006; the FDLE in September 2007.

"To say, hey, I think the law could be better or not is not our business or our place," says Michael Bowen, the DOT inspector general's director of investigations.

'A thorn in their side'

Erickson recently turned 64. He says he spends "a good deal of my time relaxing on the beach in the jungles of Costa Rica, near Panama on the Atlantic Ocean."

"At times," he recalls of his battles with the DOT, "I felt like a modern-day 'Robin Hood with his merry appraisers,' helping the small property owner against the state of Florida."

Erickson describes his role as helping homeowners fight a system that otherwise would overwhelm them.

"I worked for the FDOT and know firsthand that their first offer is usually on the low side," Erickson says. "They may do this because roughly 60 percent of the property owners settle without ever getting a second opinion."

He's right. Of 700 to 800 property owners in total along the Tampa interstate projects, only 338 had an appraisal done. For those who held out, the DOT usually increased its initial offer.

His "FDOT Bob" license tag, Erickson says, "was more of a spoof than anything." He was careful to make it clear he no longer worked with the state.

"My message was that I have firsthand knowledge having worked for the FDOT — what better person to have on your side?"

Erickson says the DOT's critical reviews of his work came from in-house appraisers whose job was "to poke holes and discredit the appraisers on the other side."

There was nothing wrong with using the same comparable sales repeatedly, he says: "Why not use a good comparable if one is available, especially if there are only so many sales in a given area?"

As for his bills, Erickson says they were carefully documented and reasonable. He attributes the DOT's investigation to jealousy and payback for his work on behalf of owners.

"I worked for the state and have been a thorn in their side ever since," Erickson says. "There were many jealous individuals that I worked with.''

'Incentive to litigate'

A few months before the DOT closed its investigation of Erickson in 2006, an unrelated report to the state Legislature recommended changing the way Florida pays owners' fees in land-taking cases.

The report said Florida's system, which pays open-ended fees to owners, gives them "an incentive to litigate."

Instead, the report said, Florida should consider imposing standard rates and fees on appraisers and other experts.

The report was produced by the state Office of Program Policy Analysis and Government Accountability, which advises the Legislature. It found that Florida is:

• One of 19 states that pay property owners for their legal fees.

• One of 18 states that pay an owner's appraisal fees.

• One of 17 states that pay for an owner's expert witnesses.

Put it all together and Florida is in the top handful of "owner-friendly" states, if not the friendliest of all.

"To an extent," says Gary R. VanLandingham, director of the agency that produced the report, "we're sort of paying people to sue us."

Private appraisers say there's a tradeoff between saving tax dollars and hurting property owners. Paying an owner's fees at least gives the owner a fair shot at fighting the government's superior firepower.

"If the state Legislature changes the method," Erickson says, "they will definitely save money, but it will be on the backs of the poor uninformed property owner.

"The state has hundreds of experts doing the takings, and without the ability of expert help for the property owner he is going to be all alone."

Three years since the recommendations on how to change the law, lawmakers have not acted.

Times computer assisted reporting specialist Connie Humburg and researcher Caryn Baird contributed to this report. Howard Troxler can be reached at htroxler@sptimes.com or (727) 580-4758.

'FDOT BOB' 10/12/08 [Last modified: Tuesday, October 14, 2008 6:59pm]

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