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Describing the Paris Economic Development Corp. as “ineffective,” Bill Strathern told the City Council on Monday that PEDC needs major changes in its structure and management.
“I would like to see the PEDC board get a chance to clear up the mess,” the former City Council member said in his half-hour presentation. “It’s going to take a lot longer than we think.”
Strathern said he found a pattern of waste, abuse and misinformation and lack of oversight by the PEDC board. He suggested the economic development corporation halt all unnecessary expenditures until changes can be made. He also recommended PEDC update policies to enforce “adherence to sound business practices.”
Strathern said he conducted his “transparency study” of the PEDC because it involves taxpayer money, and he wanted to look at the successes the PEDC “and his sycophants say he has accomplished.” PEDC has had little if anything to do with recent decisions by larger companies such as Kimberly-Clark and Campbell Soup to expand their operations in Paris, he said.
“There’s no way we could give them enough of an incentive to stay here if they weren’t making a profit,” he said. “So to take credit for that kind of stuff is like pulling apples off of low-hanging branches.”
He said the issue first came to him when he read an article in a Dallas newspaper that questioned job creation claims in Texas. That made him wonder about local reports of 1,750 jobs saved and 600 new jobs created.
“We only have 2,800 jobs. How can you save 1,750?” he said. “It casts severe doubt on what the people have been told about job creation in Paris.”
District 4 Councilman Dr. Richard Grossnickle and District 5 Councilman Matt Frierson sought to table the presentation, saying that it was better suited for the PEDC board than City Council, but they were voted down.
Grossnickle said after the presentation that it seemed like an attempt to run PEDC Director Steve Gilbert off or force him to resign. “That’s fair enough,” Strathern said.
“Steve Gilbert is the guy spending the money and approving the money — I can’t see how that’s good business,” Strathern said at one point. “I’m not saying these are wrong. I’m saying there’s no explanation.”
Gilbert was not at the meeting and declined to comment afterward.
PEDC’s expense reporting lacks sufficient detail, Strathern said. There’s little to say what money is spent on or why, which provides no “corporate memory” of past financial decisions, he said.
“If Mr. Gilbert gets a job tomorrow and leaves, we won’t know what happened in the last two and a half to three years,” he said. “It is ripe for fraud, waste and abuse — and I’m not saying anyone did anything.”
Vendor invoices show expenses such as charter flights, attorney’s fees and $8,000 in one year for local advertising.
“How many people reading the paper are going to bring a factory here?” he said. “They spent a lot of time selling PEDC to the city.”
Strathern filed an open records request in July for PEDC’s credit and debit card transactions for the last two and a half years, including “copies of any and all credit and/or debit card receipts, statements, slips, transaction reports or any document which in any way tends to identify the date, involved merchant, item(s) and/or service(s) purchased and identity of the person using said credit or debit card or authorizing or requesting said transaction.”
He filed a second request in August that included total expenditures for the 2013 Paris and Lamar County Days; the internal financial control documents used by the executive director and the PEDC board; all activity, trip and expense reports submitted by Assistant Director Shannon Barrentine and Gilbert for October 2011 through July 2012; and compliance documents for companies that had received incentives.
Strathern said he filed the second request when he heard a rumor Lamar County Days in Austin cost about $35,000. He said the Lamar County Chamber of Commerce spent about $6,000, PEDC around $14,000, plus $15,000 to consultant Richard Seline. He pointed to three meals, two of which totaled more than $2,100 and only had a few people not from Paris in attendance. The other cost $60 for what Strathern called “the real volunteers.”
“We went through every page once, twice, sometimes three times, trying to figure out what was going on with the money,” he said.
In all, the requests totaled more than 2,000 pages. Aside from a few examples and the Lamar County Days summary, the resulting presentation offered few numbers.
“Not only is the competition tough, but we can’t waste the $1.2 million,” Strathern said, referring to the funding PEDC gets in sales tax revenue each year. “This is about attracting manufacturing jobs to Paris and not wasting money doing it.”
By Jeff Paris, eParisExtra