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Advocate editorial board: Goliad's $1 million waste cries out for action

By By the Advocate Editorial Board
Sept. 7, 2013 at 4:07 a.m.


If you go

The Goliad City Council meets at 6:30 p.m. on the first and third Tuesdays of the month in City Hall, 152 W. End St.

Government cannot operate without the public's trust.

The town of Goliad has shattered that bond by wasting $1 million of taxpayer money during the past five years. Using a little-known economic development program, Goliad went around all normal business practices for cities and handed out cash with almost no questions asked.

During a six-month investigation, the Victoria Advocate uncovered a program riddled with poor record-keeping, questionable loan practices, missing documents and virtually no accountability. To put it more bluntly, Goliad's business practices are shameful.

For the sake of all Texas taxpayers, this has to change:

• Goliad residents should be outraged and hold their City Council members accountable.

• The Goliad district attorney needs to conduct a full investigation.

• State legislators need to review the 2005 law that Goliad has bastardized.

Many Texas cities, including Victoria, have an economic development corporation that operates under strict state guidelines and oversight by the comptroller's office. By providing information and arranging tax incentives, they work properly with state and local officials to recruit and retain businesses. They don't routinely hand out loans or grants, as Goliad has done since it created a municipal development district in 2008, collecting a half cent in sales tax.

Since then, Goliad has operated like a bank - or, more accurately, like a bank where no one pays attention or is held accountable. The town has made loans and grants without those involved signing documents, without proper collateral and without observing standard ethical business practices.

City Council members, their relatives and their friends have benefited from this unchecked cash bonanza. In one particularly egregious example, a City Council member defaulted on his $31,000 loan, yet continued to vote on issues about how the program operates.

One example, however, does not adequately cover how utterly broken the program is. Supposedly set up to promote economic development, the Goliad program is fundamentally flawed.

Instead of attracting a job creator like a Caterpillar manufacturing plant, Goliad has handed out tax money to business people who started a video store at a time when Blockbuster was going bankrupt, to a self-serve laundromat that generated no new jobs and to a welding company that never even opened. The Advocate outlines all of this and more in a special report starting on Sunday's front page. All who care about good government should read the entire report, which spans six newspaper pages.

Along with not actually promoting economic development, Goliad has not accounted for how the money was spent and has run roughshod over normal concerns about conflicts of interest. It is being generous to say Goliad has wasted $1 million. Waste means to spend thoughtlessly or carelessly without adequate return. It is being generous to say those involved in Goliad's program have been thoughtless and careless.

In Aransas Pass, where a development district resulted in a civic center and an aquatics center, the city manager said she can't imagine using the program to hand out loans to private businesses. Aransas Pass and Goliad are two of 24 development districts in Texas. They appear to be the best and worst examples of how these programs can operate, but the state should investigate all 24. State Sen. Glen Hegar, R-Katy, who is running for state comptroller, said his office is researching the issue.

Presented with all of this evidence, Goliad officials have shrugged, pointed the blame at others and offered no indication they will even consider changing how they operate. Such an irresponsible attitude must be challenged.

The power to change this starts with Goliad residents. Goliad is a charming town of 1,900 known for its historic ties to the founding of the United States and Texas. If townspeople don't want to be known as a prime example for government waste, they need to start by packing the next City Council meeting.

Through the development district, Goliad City Council members spent $1 million with almost no questions asked. The public needs to demand answers - now.

This editorial reflects the views of the Victoria Advocate's editorial board.

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