Victoria County commissioners authorized hundreds of thousands of dollars in payments for work that did not go out for bids after Hurricane Harvey.
The county exempted itself from legal bidding laws after the hurricane struck to handle repairs immediately after the storm. The county did this mainly to contract with the Kansas-based Virtus Group, which did both remediation and repairs.
Rather than operate under the standard legal procedures, which state that all projects worth $50,000 or more must go out for bid, the county voted unanimously Sept. 11, 2017, to hire the restoration and reconstruction company, now called Commercial Restoration Company, to do the work.
“It seems like we had an open checkbook, and that’s all of our mistakes,” Victoria County Commissioner Gary Burns said this week.
The county commissioners acted on a legal exemption that states that amid a public calamity, they can skip the bidding process and act immediately to relieve the necessity of the citizens or to preserve property.
How long counties can remain acting under an emergency exemption is unclear as the law doesn’t provide a strict time frame.
A representative from the county’s insurance carrier, the Texas Association of Counties, said in an email less than two weeks after the hurricane hit that “we are nearing the end of the emergency services phase,” but the county continued acting under the exemption and went on to authorize hundreds of thousands of dollars in payments to companies that also did work without the standard bid process.
More than a year after Harvey hit, in Sept. 10, 2018, commissioners approved four payments to Bassco Services that totaled $65,226 for work at the Victoria Regional Airport. During the meeting, the payments were approved among all the county’s payable accounts, which commissioners routinely approve with no discussion.
Nov. 13, 2018, commissioners approved two payments, one for $28,970 and one for $80,250, to King Consultants for work at the airport. During that meeting, there was again no discussion when commissioners approved the payments.
Benji Rumsey, an area manager with King Consultants, said the company was a subcontractor through Virtus, and he wasn’t aware of how the bidding process was arranged.
On Jan. 14 of this year, the county approved two major payments to AAR Incorporated for $178,046 and one for $156,973 for asbestos abatement on numerous buildings. Again, during that meeting, there was no discussion by commissioners.
Throughout 2018 and 2019, more than 30 payments were made to East End Lumber, totaling more than $150,000 for work at the Officers’ Club. Chip Dence, a part-owner of East End Builders, said Friday it was “inappropriate” for the Advocate to ask about work the company did at the Officers’ Club and would not comment further.
On four occasions earlier this year, commissioners approved payments totaling more than $62,000 to Wendt Electrical Services for work at the Officers’ Club. One of the payments, approved Feb. 19, was for $19,694.01; another in March was for $29,213.28. On both occasions, commissioners didn’t discuss the payments.
According to the county’s records of awarded bids, none of these companies was awarded the work after participating in the competitive bid process. Representatives from Bassco Services, AAR Incorporated and Wendt Electrical did not return requests for comment.
Airport Commissioner Dennis Patillo, who is among the airport commissioners calling for answers from county officials about the management of Harvey recovery, said bidding is an important practice.
“The only thing I can say about that is whether it’s for public work or private work, getting multiple bids for construction projects is always valuable,” he said.
Burns said that although approval of all payments in one sum is routine, the county can list big projects as individual items for discussion, comment and action during the court’s weekly meeting. For example, he noted, in late July, the court scrutinized a $10,500 invoice from Clegg Industries for work done at the airport’s maintenance shop.
In his 15 years on the county commission, he said, he’s never seen the court begin to bypass discussing major payments as it did after Harvey, and “it raises concerns.”
“We don’t scrutinize everything closely. All of these payables go through the auditor first, and they bring them to our attention, so I don’t think we even saw these, but we should have,” he said.
Also, if the court had seen and discussed together the email from the Texas Association of Counties representative that noted that the emergency phase was over, he said, he thinks the court would have moved to resort back to standard bidding practices. The representative recommended the county continue working with Virtus but added in the email, “I understand bid laws and the local political environment should be considered.”
A government expert previously told the Advocate that when Texas counties choose to bypass legal bidding laws and act by way of an emergency exemption, it can lead to enormous financial and political problems.
“State bidding procedures are designed to protect a county and its residents from paying too much and getting too little in quality and from undermining the trust of the process in regard to how money is being spent,” said Professor Donald Kettl, a government expert and professor at the University of Texas at Austin Lyndon B. Johnson School of Public Affairs.
Kettl said there are risks and “potentially huge” stakes that come with stepping outside of normal bidding processes in emergencies and it is important for county officials to step back and examine the situation to ask when the right time is to resume the standard bidding process.
Annually, the county exempts itself from bidding on other items, too. For example, on Jan. 2, 2019, county commissioners granted a discretionary bid exemption for county purchases through a state-licensed auctioneer.
At the same meeting, county commissioners granted a discretionary bid exemption for Victoria County vehicle and equipment repairs. There was no discussion by commissioners on either action during the meeting.
Burns said it’s time for the county to move toward transparency to “gain back the public’s trust.” He said this will come, he hopes, after a finished report from County Commissioner Kevin Janak, as well as results from an outside forensic group that examines the entire matter.
“I still think we need to wind this up, get everything out in the open and move on,” he said. “We’re just dragging it along, but we need to get everything out in the open and accounted for.”