Adler aide’s nonprofit benefited from lax oversight on city contracts
It was possible thanks, in part, to a city procurement system that allows departments to award millions in contracts with little oversight or accountability -- or even having to put the work up for bid.
The insider, mayoral aide
Before joining Mayor
Documents from 2014 show then-commission member Rodriguez sponsored two budget requests, which the
Rodriguez and his commission submitted more than three dozen budget requests to the council that year. Only those two were adopted. While neither request identified the
Rodriguez denies any wrongdoing in how his charity came to win the pair of
That first year, the
Rodriguez stepped down from his commission chairmanship and his position as the forum's executive director to join the mayor's office in spring 2015. In subsequent years, contracts stemming from Rodriguez's initial budget requests would net the forum an additional
All told, the
The Statesman examination found little about the budget requests and contracts conformed with the city
A review of more than 3,800 pages of government documents, tax returns and emails shows:
--Rodriguez obtained
--Interviews and records show Rodriguez did not disclose the conflict to his fellow commissioners or the
--A top
"He should have announced these conflicts, made them clearly public and recused himself in any and all dealings between the government and his nonprofit," said
Rodriguez said he carefully complied with city regulations governing his relationship with his nonprofit as both commission chairman and as the mayor's adviser.
Adler also defended Rodriguez's actions on the commission.
"Frank made a recommendation without providing a specific vendor. He did that. I think that's his job and his role on the Quality of
He added, "Frank has been dedicated to public service for decades."
After an interview with the Statesman in August, Adler renewed his push to overhaul how the
Two weeks later, on
Unproven contract winner
Under state law, social services contracts -- like the ones given to Rodriguez's charity -- are exempt from competitive bidding requirements, and the city allows
"A lot of the preliminary legwork to request the applications and vet the applications is done by Public Health," said purchasing officer
The department's selection then goes to the
The city's health department awarded 86 no-bid social services contracts worth
Typically,
The nonprofit Foundation Communities is one such organization. When council members debated budget requests from Rodriguez's commission for the city's 2015 budget, they focused on its
Foundation Communities, Martinez told his colleagues, had secured
Foundation Communities only got
Instead,
What tipped the scales in the forum's favor?
Hayden told the Statesman she was instructed to give the work to the
"He informed us that we needed to work on this contract with
Rivera denied issuing any directive and accused the Statesman of making up Hayden's quotes.
"You're barking up the wrong tree," said Rivera, who left city government in 2015. "I'm an ethical and moral guy."
Hayden said she stands by her account. She told the Statesman that Rivera's directive came at a meeting after an email from Rodriguez, which Rivera forwarded to her.
In the
riguez noted the council's approval of the ACA enrollment and Rundberg grants.
"Both of these proposals are targeted to Latinos," Rodriguez wrote. "Let me know if you wish to discuss further details."
Rodriguez did not explicitly mention
Yet it's the sort of work that Rodriguez said he envisioned doing when he co-founded the forum in 2011 with the goal of improving health care access for Hispanics. Rodriguez was inspired, in part, by his own struggle to get insurance because of a pre-existing condition, he told the Statesman.
But, he said, he had no expectation of winning the
"All I know is that I was approached by the city to do the work, and we were gladly going to do the work," Rodriguez said.
A pitch, another win
The contract award for the Rundberg health care study strayed from the city's usual bidding process and potentially violated conflict-of-interest laws, ethics experts said.
Local activists have long pushed to improve health care access in the
He proposed a health care study on
According to a
Meanwhile, as chair of the Hispanic/Latino Quality of
Documents explain why:
Rodriguez defended the council request, saying that Restore Rundberg asked the forum to conduct the study and that he go to the
Restore Rundberg meeting minutes at the time only note Rodriguez's application for the
Ethics experts contacted by the Statesman described Rodriguez's actions as a probable violation of the state's conflict-of-interest laws.
"I think that's a conflict. I truly do," said
McDonald of Texans for Public Justice, agreed: "You can make the case he had an interest in the nonprofit and was steering funding to the nonprofit."
Adler defended Rodriguez's actions as appropriate.
"There was an attempt to meet this need through the money that the city had available, plus private donations, and it didn't make," Adler said, adding that Rodriguez "says, 'Hey, this need still exists. ... We need the money to be able to do it.'"
Lax oversight
The contracting problems highlighted by Rodriguez's budget requests are not new. Over the years, the city auditor's office has detailed in piecemeal fashion how
The Statesman's investigation could not identify a part of the city bureaucracy charged with preventing potential conflicts of interest or ensuring departments, like
The city's purchasing department, which manages bids and contracts for many smaller departments, simply records and executes
The city's law department is not required to review draft contracts for conflicts of interest or to ensure the council's intent is followed, a city spokesman confirmed.
Instead, policing contracts falls to the city auditor's office, which investigates allegations of wrongdoing when complaints are filed.
The auditor's office -- part watchdog, part accountant and part think-tank -- examines the effectiveness of city policies, recommends ways to improve efficiency and investigates complaints. It also polices the city bureaucracy and its
"It can be very difficult for our office (to investigate) when we receive allegations related to where certain contracts have originated from," said
For instance, the city's online checkbook offered no details about the initial
The result is a slow-moving, after-the-fact, watchdog process. For instance, two conflict-of-interest complaints Wiebe filed with the
A 2014 audit of
Two earlier examinations turned up major failures at the health department.
An
Investigators found Public Health staffers failed to perform required on-site monitoring, failed to confront a contractor that inappropriately commingled money and failed to address oversight shortcomings discovered during a 2009 fraud investigation.
In 2012, auditors found contract oversight in
Meanwhile, oversight issues continued to persist with the
The public health department did not ask the forum or Foundation Communities to report how many people the health insurance effort enrolled in ACA plans in 2016, even though it required the figure in both 2015 and 2017.
WHAT WE REPORTED
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