Kenneth Underwood operates LowestPriceTrafficSchool.com.
By Ralph De La Cruz
Florida Center for Investigative Reporting
Money in politics is so pervasive, perverted and convoluted that it makes the rhyme about the old woman who swallowed the fly seem logical and predictable.
To appreciate how ridiculous the problem has gotten in today’s Florida, check out this amazing story by St. Petersburg Times reporters Susan Taylor Martin and Dan Sullivan.
On the surface, their story is about of how the state is trying to cancel a contract with the traffic school owner who publishes the Official Florida Driver’s Handbook. It’s a fascinating piece about how even the simplest and most mundane of items is a potential gold mine when you have 700,000 people a year using it. But what the serpentine tale of Kenneth Underwood and his LowestPriceTrafficSchool.com is really about is the ubiquitous nature of money in Florida’s statehouse.
By the time you finish reading, you’ll think that an old woman eating a spider, bird, cat, dog, cow and horse as a prescription to swallowing a fly makes sense.
In 2005, Underwood entered into a five-year agreement with the Department of Motor Vehicles. Underwood agreed to print the handbook, which is the authoritative text for new Florida drivers. And in return, the DMV would allow Underwood to run ads in the handbook. There was an option to renew the contract for five more years.
Underwood used his position as handbook publisher to grow his schools into the overwhelming market leader in Florida. In 2006, the year after he entered into the DMV agreement, his schools had about half as many customers as his leading competitor. By the next year, enrollment in Underwood’s schools almost doubled and his competitor dropped slightly, making Underwood No. 1. Today, 53 percent of all new drivers take the required Traffic Law and Substance Abuse Education course at one of Underwood’s schools.
And that doesn’t take into account the money Underwood makes selling ads in the handbook to other businesses. The DMV estimates it costs about $300,000 a year to print the handbook. An insurance company was charged $200,000 to run just one full-page in the handbook. And then there’s the $6.95 per copy that Underwood’s companies charge for shipping and handling.
With those kind of numbers, it’s not surprising that Underwood has been eager to continue the arrangement.
After entering into the agreement with the DMV, he began contributing to politcial campaigns. For example, he incorporated 14 companies and each gave the $500 maximum ($7,000 in one day) to then-Atty. Gen. Charlie Crist during his run for governor. And when language banning ads in the handbook was later attached to a legislative bill, Crist — who had won the gubernatorial election — vetoed it. Underwood also hired Sherry Dickinson as a lobbyist. Dickinson is the wife of Fred Dickinson, who was DMV executive director at the time.
Since 2005, Underwood has spent $700,000 — more than $100,000 a year — on lobbyists and campaign contributions. We’re talking about the owner of a traffic school.
His story reads like a primer on how to do state business in Florida.
But apparently, Underwood went just a little too far.
It wasn’t long before competitors and parents were calling their representatives complaining about the ads and the handbook. And someone at the DMV must have also noticed the big numbers associated with the handbook.
Last year, the DMV moved to cancel the contract. Underwood sued and won the first round. The state won an appeal. More court action is pending.
All this over a little booklet that lets new drivers know the rules of the road.
If a driving handbook is worth this kind of fighting and money, think about what public health care and prisons — two areas that state politicians are trying to privatize — are worth.