Tag Archive for: Tom McCasland

New GLO Review Slams Houston on Five Counts Relating to Harvey Relief

Two months ago, the Texas General Land Office (GLO) launched a review of Houston’s Housing and Community Development Department (HHCD) after Mayor Sylvester Turner allegedly tried to steer a $14 million affordable-housing contract using HUD money toward his former law partner. The GLO review, released Tuesday, notes both findings and corrective actions required of Houston to ensure a fair, open, and competitive award process in the future.

The GLO review criticized HHCD for five major problems listed below. The City has until December 10, 2021, to address the GLO review’s findings by delivering a Corrective Action Plan. Houston then has another 90 days to implement the plan. Hanging in the wind: the fate of the City’s entire multi-family rental program, Harvey multi-family relief projects in the pipeline, and millions of dollars in past awards now being questioned.

Image courtesy of HUD. For more on the need for affordable housing, click here.

The GLO review was triggered on September 22 when the HHCD’s former Director Tom McCasland accused the Mayor during a City Council meeting of overriding his department’s recommendations. The Mayor recommended a project that would have benefited his former law partner. McCasland alleged that his department’s recommendations could have built four times the amount of affordable housing units in poorer neighborhoods for roughly the same amount of money. McCasland also alleged that he was being forced to participate in what he called a “charade of a competitive process.” The Mayor promptly fired McCasland, leading to multiple investigations. The GLO review was just one.

Summary of Five Main Findings

The GLO never uses the word “charade” in its findings, but one could easily infer a charade from their substance.

The GLO’s objective was to evaluate whether the City had adequate controls in place to meet program and contract requirements for the allocation of $450,050,472. At a high level, the five findings released on Tuesday 11/23/21 require the City to:

  1. Strengthen NOFA/RFP Issuances – GLO found inconsistencies among the way NOFA/RFPs (Notice of Funding Availability/Request for Proposals) were issued, evaluated and scored. Inconsistencies included program content; threshold criteria; and award processes.
  2. Strengthen the NOFA/RFP Scoring Method – GLO found the City does not have controls in place to ensure it follows criteria for awarding projects.
  3. Ensure Documentation Supports Project Awards – GLO found that Houston does not document subjective criteria used by HHCD and the Mayor’s office when evaluating applications.
  4. Strengthen Conflicts-of-Interest Provisions – GLO found the City does not have internal controls that screen out Conflicts of Interest.
  5. Produce Documentation Justifying Award Recommendations – GLO found inconsistencies between grant requirements and recommendations. Subjective factors – not based on the competitive process – were often used to recommend projects without explanation.

Full Text of Findings and Exhibits

Here is the GLO’s entire 11-page letter to HHCD’s Interim Director Keith Bynam, and three exhibits referenced in the letter:

  • Exhibit 1 – Scoring results for four NOFAs
  • Exhibit 2 – A memo to the Interim Director from an Assistant Director attempting to justify the Mayor’s intervention on a low scoring project
  • Exhibit 3 – Examples of HHCD responses to appeals from developers. The responses do not document specifics for rejections.

If you read nothing else, make sure you see Page 1 of Exhibit 1. It recommended making an award to one project that 25 other projects outscored. Those 25 higher scoring projects were either wait-listed or not recommended. Hmmmm!

Egregious Examples of Specifics Cited in GLO Report

Here are some of the more serious infractions that support the five major findings.

GLO complained about Houston’s lack of consistency, accuracy and fairness. For instance:

  • Data for 40% of tested applications was entered incorrectly, resulting in incorrect scoring.
  • Submission deadlines for some RFPs were shortened in a way that excluded some applications and diminished the quality of others. This resulted in competitive disadvantage for some applicants and presumably an advantage for others.
  • Conflict of interest disclosures were excluded from some rounds of funding.
  • 9 of 12 applications in two other rounds of funding did not have conflict of interest forms actually signed by applicants or co-applicants.
  • Some NOFAs contained language giving the Mayor’s office the right to approve or deny applications in accordance with the Mayor’s priorities, but the Mayor was not required to explain why.
  • The City frequently did not give specific reasons for approving or denying a grant.

ABC13’s Ted Oberg ran this story Tuesday night about the millions of dollars now at risk for poor people who still need help after Harvey.

Here is the Mayor’s response to the charges in GLO review.

Posted by Bob Rehak on November 24, 2021

1548 Days since Hurricane Harvey

The thoughts expressed in this post represent opinions on matters of public concern and safety. They are protected by the First Amendment of the US Constitution and the Anti-SLAPP Statute of the Great State of Texas.

Flood Digest: Updates on TWDB Grants, Affordable Housing Investigations, Subsidence

Below are updates on three items recently in the news: Texas Water Development Board (TWDB) Grants, Affordable Housing Investigations, and Subsidence.

Texas Water Development Board Grants Affecting Houston Region

Last week, I posted a story about flood mitigation assistance grants being considered by the TWDB. The Houston region qualified for eight and the TWDB approved them all…unanimously. However, the checks aren’t in the mail yet.

TWDB approved the following subject to FEMA final approval:

  • 32 structures in Houston, Jersey Village, Pearland and Taylor Lake Village will receive financial assistance for elevating structures.
  • 1421 structures in Bear Creek Village (near Addicks Reservoir and Highway 6) will see their drainage improved by Harris County Flood Control District HCFCD).
  • 61 repetitive loss structures will be bought out by HCFCD.
  • 1 hotel with a severe repetitive loss history dating back to 1979 will also be bought out by HCFCD.
  • 40 repetitive-loss structures in Montgomery County will also be bought out.

FEMA requested more information for further review on each project. So when/if FEMA gives final approval to each of the above, they should be good to go. That usually happens by January.

Texas projects considered for further review by FEMA

Clear Lake Apartment Complex Recommended by Mayor

On September 21, the former director of Houston’s Housing and Community Development Department (HCDD) turned whistleblower and accused the mayor of recommending a multi-family housing deal in Clear Lake that was not in taxpayers’ best interests. It turns out the Mayor’s former law partner would have benefited by $15 million from the deal, but the department’s recommendations would have provided four times more affordable housing for essentially the same amount of money.

That ignited a firestorm in the media and on City Council. HUD, GLO, the County Attorney, and the City Attorney (with the help of two US Attorneys) and City Council are all investigating.

In the face of this withering onslaught, the Houston Chronicle today reported that the Mayor has dropped his recommendation to back his former law partner’s project in Clear Lake. The Mayor said he didn’t want it to become a “distraction.”

However, getting the genie back in the bottle may not be that simple. Since the Clear Lake deal imploded on September 22, 2021, more allegations of financial mismanagement arose in City Council last week.

Also this afternoon, investigative journalist Wayne Dolcefino issued a press release about a Federal lawsuit he filed. It alleges a cover-up at the Houston Housing Authority on other housing deals that appear to be linked to the same players Tom McCasland and the Mayor.

This has the stink of Watergate about it.

Houston Mayor Sylvester Turner at Kingwood’s last town hall meeting in October of 2018.

GMA-14 Makes Subsidence DFC Optional

For several years now, the state’s Groundwater Management Area 14 (GMA-14) in southeast Texas has struggled to define Desired Future Conditions (DFCs). These are long-term goals that address groundwater conservation and the maximum amount of subsidence allowable.

The Lonestar Groundwater Conservation District has denied subsidence exists in Montgomery County and stonewalled efforts to include a subsidence metric in DFCs.

Going into a board meeting last week, GMA 14 had proposed DFCs that read:

In each county in GMA 14, no less than 70 percent median available drawdown remaining in 2080 and no more than an average of 1.0 additional foot of subsidence between 2009 and 2080.

Initial DFCs

However, days before the final vote on this statement, State Senator Robert Nichols, intervened. He wrote a letter to each of GMA-14’s groundwater conservation district leaders “urging” them to make the subsidence metric optional. At that point, the debate ended. The final DFCs adopted by GMA-14 read:

In each county in Groundwater Management Area 14, no less than 70 percent median available drawdown remaining in 2080 or no more than an average of 1.0 additional foot of subsidence between 2009 and 2080. 

Final DFCs

This “opt-out option” defeats the purpose of even having a GMA and a subsidence metric.

This revised statement was quietly approved on October 5, 2021. At its January 5, 2022, meeting, GMA-14 will approve the report that accompanies the DFCs when they are submitted to the TDWB.

Of the five groundwater conservation districts in GMA-14, four voted for the new DFCs and one abstained. The new DFCs will likely be challenged in court by areas threatened by subsidence.

Makeup of Groundwater Management Area 14

Posted by Bob Rehak on 10/11/2021

1504 Days since Hurricane Harvey

The thoughts expressed in this post represent opinions on matters of public concern and safety. They are protected by the First Amendment of the US Constitution and the Anti-SLAPP Statute of the Great State of Texas.

Blowup Between Mayor and Housing Director Triggers Fraud Investigation over Harvey Funds

Tuesday, City of Houston Mayor Sylvester Turner and Houston Housing and Community Development Director Tom McCasland got into a verbal brawl over alleged improprieties in the distribution of Harvey relief funds.

Houston Mayor Sylvester Turner
Houston Mayor Sylvester Turner photographed in February of 2020.

The trigger was the award of $15 million to build a Clear Lake multi-family housing complex in which the Mayor’s former law partner is a co-developer. (Here is the group’s full application.)

The Mayor overrode the recommendations of McCasland and his staff, who pointed out that $16.2 million could have created four times the number of affordable units in poorer neighborhoods. Those projects all scored higher in the competition for funding.

General Land Office Response

Brittany Eck, a spokesperson for the Texas General Land Office (GLO), issued a statement within hours. She said, “The GLO is looking into the serious allegations of fraud or corruption regarding projects by the City of Houston’s Harvey Multifamily Program. The GLO is responsible for ensuring all money allocated through the Community Development Block Grants for Disaster Recovery (CDBG-DR) are spent appropriately. These projects and funds are intended to be utilized to aid the greatest number of low-income Texans as possible.”

Eck continued: “As such, we will re-review all requests for funding draws allocated to the City of Houston by the U.S. Department of Housing and Urban Development (HUD). The GLO will coordinate with HUD and other investigative entities to determine what actions should follow regarding these allegations. Fraud has no place in helping Texans recover from disaster.”

She concluded, “Anyone with information relating to potential fraud, waste, and/or abuse is encouraged to report it by calling 1-844-893-8937 or emailing cdr@recovery.texas.gov.”

Mayor’s Response

According to multiple news reports and a press release from the Mayor’s Office, Turner denied specific knowledge of the deal with his former law partner. He claimed there was no impropriety, that McCasland had raised no objections to the deal, and that he (Turner) had the right as Mayor to override McCasland’s objections.

The Mayor also asserted he was trying “to place affordable housing projects throughout the City…” Finally, he claimed he severed all ties with his former law partner before assuming his position as Mayor.

McCasland’s Point of View

McCasland insisted this was not the first time the Mayor’s office interfered. The Houston Chronicle, which broke the story, said “McCasland acknowledged the Mayor has the authority to overturn staff recommendations, but McCasland argued that in this case it represented a subversion of a competitive process to benefit one applicant.

McCasland said he was not alleging fraud, but said the pattern of behavior was emblematic of a broader problem in Turner’s administration, a “do-it-because-I-said-so” management style. McCasland did say that drives out public servants dedicated to integrity and breeds a “culture for corruption.”

Further, the Chronicle article quoted McCasland as saying he briefed the Mayor August 17 and again on August 24.

McCasland said the Clear Lake complex (Huntington at Bay Area) ranked 8th out of 12 proposals, and had the lowest percentage (60%) of its units reserved for low income tenants.

Here’s a 77-page document that catalogs nine months of correspondence between McCasland, MST (Mayor Sylvester Turner) and their staffs regarding the controversial project.

Note McCasland’s comments on page 4. He claims “The outcome of that process was predetermined before the funding opportunity was even issued.”

If you don’t read anything else, skip to the last page. It’s an email from McCasland to the Mayor dated September 17. In it, he summarizes all his objections to the Clear Lake deal. That would seem to contradict the Mayor’s claim that McCasland did not register his objections.

Mayor Fires McCasland

McCasland said to City Council, “I am being forced to participate in a charade that this was a competitive process, when I know it was not a competitive process. That’s the problem here and I’m being forced to ask my teammates to participate in that charade and that is not something that we can do and that is not something that we will do.”

According to those who watched the gripping testimony in City Council, it was like watching someone commit career suicide. By the end of the day, the Mayor issued a terse press release. He denied McCasland’s allegations, said he had lost confidence in McCasland, and that it was time to move on.

Why All of a Sudden?

The big question is this: Why now? McCasland and his embattled department have been under fire for years:

Coming forward when he did – as he did – almost felt like a Law & Order episode in which the DA flipped a witness with a promise of immunity. Some veteran City Hall observers felt McCasland was being unusually frank and fearless for someone at the center of such a huge mess. If there was a pattern of ethics violations, why wait years before objecting to them?

Mayor Likely Overstepped Authority

Both McCasland and the Mayor said the Mayor had the right to overturn staff decisions. But Eck pointed out the Mayor did not have the power to “rewrite” the Notice of Funding Availability (NOFA) to favor one applicant; any project selected must meet federal regulations.

She said that had the City written the NOFA to favor affluent neighborhoods, and had HUD and the GLO approved it that way, there would be no problem at this point. However, the City did not do that.

From McCasland’s report and the documentation provided, it appears the City’s award went against the scoring system laid out in the published NOFA, resulting in a competition that was not full, fair and open. The result led applicants to believe their projects would be considered against one criterion when other unknown criteria were actually utilized. 

We now know the City awarded the project to a former partner of the Mayor in a high-income area…ignoring the posted and approved scoring system. In that regard, the Mayor evidently overstepped his authority.

This was not the first time the presence of the Mayor’s former partner in a deal has raised eyebrows and questions. The Houston Chronicle reported in 2018 that several city council members complained about the optics of the partner’s role as a subcontractor for a firm hired to find Harvey victims.

What Next?

The GLO has been in touch with HUD, the Texas Department of Housing and Community Affairs, Gov. Greg Abbott’s office and the Department of Public Safety, according to Eck.

KTRK’s Ted Oberg said DPS would only be involved to investigate criminal matters.

Oberg also reported Wednesday that Chris Brown, the city’s controller, said, “This week’s revelations underscore an ongoing pattern concerning procurement processes and a continued lack of transparency at City Hall.”

Brown, who audits City projects, continued, “In the past several months alone, our office has been denied procurement documents required to conduct an audit of the Strategic Procurement Department and were told to stop all work on a financial transparency project that would bring much-needed insight into the city’s spending practices. Taxpayers deserve a city government that is transparent and above reproach. Unfortunately, recent events suggest that the city is falling short of that goal.”

Posted by Bob Rehak on 9/22/2021

1485 Days since Hurricane Harvey

The thoughts expressed in this post represent opinions on matters of public concern and safety. They are protected by the First Amendment of the US Constitution and the Anti-SLAPP Statute of the Great State of Texas.