Buzbee calls for contract process overhaul
Mayoral candidate Tony Buzbee on Friday called for an overhaul of the city’s system for awarding contracts and its program intended to help small, minority- and womenowned businesses, alleging Mayor Sylvester Turner had used both to reward campaign donors with city business.
“This program, with the help of this mayor, has been perverted and hijacked by people with political connections, by people that provide campaign donations, by people that are cozy with our current mayor, to the detriment and to the exclusion of the people that it was intended to help,” Buzbee said of the city’s Minority, Women and Small Business Enterprise program.
Buzbee’s allegations, leveled in a news conference at his campaign headquarters, drew a response from Turner’s office minutes later, categorically denying
the claims.
“There is no corruption in the City of Houston Office of Business Opportunity or any other city function,” a statement from the mayor’s office said. “It is unfortunate that an individual has made false allegations without regard for the truth or an understanding of how the OBO operates.”
Buzbee’s allegations centered on several people who have contributed to Turner’s campaign and own, have management roles in or lobby for firms certified under the city’s MWSBE program. Buzbee ticked through the list of people — Barry Barnes, Tony Chase, Cindy Clifford, Darryl Carter, Bobby Singh — and, in documents provided by his campaign, compiled each person’s campaign contributions to Turner, their connections to city contractors and the contracts or subcontracts the companies received.
In a news release Thursday, Buzbee also singled out three firms: Chase’s staffing and real estate firm, ChaseSource; Miles Insurance Agency, owned by state Sen. Borris Miles; and McConnell & Jones, LLC, where Turner’s former campaign treasurer, Thomas Jones, serves as partner. Buzbee said OBO Director Carlecia Wright “overturned” each firm’s “graduation” from the MWSBE program, allowing them to remain certified.
Under Houston’s MWSBE program, vendors and contractors generally are required to make a good faith effort to hire certified small and minority- or womanowned businesses as subcontractors to obtain city business.
In a statement, Turner’s office said each of the three firms has done business with the city as far back as 2011. The mayor’s office also noted the OBO certifies MWSBEs but does not pick vendors, who must go through a separate procurement process.
Meanwhile, Wright said in a letter released by Turner’s office that only ChaseSource and Miles Insurance Agency had been granted waivers to remain certified as MWSBE firms. McConnell & Jones “graduated” from the program May 19, 2017 without receiving a waiver, according to Wright.
To determine whether certified firms should remain in the program, the OBO conducts periodic reviews using standards laid out by the U.S. Small Business Administration, Wright said. The standards call for a review of the company’s average gross receipts for the last three years or the average number of employees for the last 12 months.
Since Turner took office in January 2016, the city has granted seven graduation waivers, including those given to Miles Insurance Agency and ChaseSource Real Estate Services, according to Wright. The firms were granted waivers in 2016 and 2017, respectively, because they “provided sufficient evidence establishing that the company was unable to compete on a level playing field.”
The three firms received seven contracts overlapping with their time classification as MWSBEs, according to the OBO. McConnell & Jones is listed as the prime contractor for a $9.4 million contract to audit the city’s finance department, spanning 2014 to 2020.
Miles Insurance Agency received $12,000 as a subcontractor on a 2011-2014 contract for city employee and retiree health benefits, and $56,771 as a subcontractor on a 2014-2019 insurance contract with the Administration and Regulatory Affairs Department.
ChaseSource is listed as a subcontractor on four contracts, including one for delinquent tax collection under Linebarger, Goggan, Blair and Sampson, for which ChaseSource received $231,372; and the expansion of the Mickey Leland International Terminal at George Bush Intercontinental Airport, for which the firm has received $361,670 out of an approved $1.47 million amount.
During his news conference Friday, Buzbee said he did not think Turner and the business people he mentioned did anything illegal, but accused them of “gaming the system to the detriment of the people that it was intended to help.”
Sue Davis, communications director for Turner’s campaign, blasted Buzbee in a statement.
“The City has provided the facts to thoroughly discredit Mr. Buzbee’s accusations,” Davis said. “Once again, Mr. Buzbee has shown that he will say anything to get elected, regardless of the truth.”
Buzbee, a businessman and trial lawyer, is one of several candidates challenging Turner, who is running for re-election in November.
Other candidates include businessman and lawyer Bill King, Councilman Dwight Boykins and former Councilwoman Sue Lovell, along with seven other lesserknown candidates.
The news conference came more than three months after Buzbee filed a lawsuit on behalf of two companies who alleged they were fraudulently listed as subcontractors by two companies that later secured contracts worth as much as $66 million for Hurricane Harvey relief work from the city of Houston. The case ended in July in a non-suit.
To change how the city awards contracts, Buzbee said he would order an audit of the entire process and seek stricter oversight over the way work is delegated to subcontractors, alleging that prime contractors “manipulate who’s actually doing the business.”
Controller Chris Brown, who is up for re-election in November, has said he plans to audit the OBO in 2020, which Turner’s office said is “part of (Brown’s) normal course of business.” Turner said he welcomes the audit.