PEDC Agrees Upon Full Disclosure of Investigatory Report
by Nick Murillo
The Paris Economic Development Corporation (PEDC) met for its monthly meeting on Tuesday August 12, 2014 at 4:00 p.m. in the Community Room of the Depot, located at 1125 Bonham Street.
With a busy agenda containing twenty-one items, PEDC Chair Stephen Grubbs called the meeting to order. After welcoming everyone, Mr. Grubbs began by saying, “We’ll jump right into our agenda items. One thing I do want to mention before we do that though, so many of us have careers in town, so I just want to be sure that I remind everyone, just look over the agenda and just be aware of topics on there that you may or may not have any type of business influence over and that type of thing and just be ready to make whatever decisions you need to make if we have items like that come up. I’m not saying there are any, but I just think it’s probably good practice for us to mention that at the beginning of every one of our meetings.”
Mr. Grubbs announced the second item on the agenda after the call to order:
Discuss and possibly take action on Paris EDC Board Members (including Ex-Officio members and Staff) to execute a non-disclosure/confidentiality agreement pertaining to any and all information obtained in Executive Session discussion.
Mr. Grubbs continued, “In conversations with Attorney Moore, we were talking about non-disclosures and confidentiality agreements. We have them in place for the staff, but we’ve really never done this as a board and he suggested that we consider that and I thought it was a good suggestion. So what we have here to handout to you is just a draft of that that we as board members would read over and then agree to. I think there were some other issues, some things that were said before about things showing up on Topix and Facebook inappropriately and so forth. This is just a reminder for us that what we do here is in many cases confidential and we need to keep it that way. This is not intended to be any type of discipline; it’s just something that every prudent business I think does, especially with their board members and their leadership. With that said, any questions, any thoughts?”
After all members received the handout, Board Member Mr. David Turner said, “I have several comments. I don’t know who wrote that trash, but I object to it. The first amendment of the Constitution says that we shall have freedom of speech. This is a public entity, funded by public taxpayer money. All this is is an attempt to obscure what we do with the taxpayers’ money. The Attorney General in 1989 said, ‘You can’t do this.'”
Mr. Turner continued, “I’m not going to sign it.”
Mr. Grubbs replied, “Ok.”
Mr. Turner went on to say, “I object to it. I think it’s obviously an attempt to hide from the public what we’re doing, and this is public money. This is public property. It’s not ours. This is not your business. This is the public’s business and they need to know everything that’s going on, and to hide something, and that’s what this is an attempt to do. Who’s going to pay for writing this piece of trash? It’s not going to be me, and it isn’t going to be this board if I have anything to do with it.”
Mr. Grubbs responded, “He’s an attorney,” in reference to Attorney Jeff Moore.
“Whose attorney is he?” asked Mr. Turner.
“He’s your attorney,” Mr. Grubbs answered.
“He’s not my attorney,” Mr. Turner replied. “Mr. Grubbs, you went up in front of the City Council several weeks ago and you perjured yourself. You told the City Council that we, this Board, had authorized you to find somebody. That is as far from the truth as it can be. The first time I ever heard of Jeff Moore was when you got up in front of the City Council and told them that. Then you come dragging this guy in, and you say, ‘Well, he’s been hired by the Board.’ There is nothing in the Board minutes that we’ve ever hired this guy.”
Board Member Mr. Don Wilson interjected, “Mr. Turner, just a minute.”
Mr. Turner responded, “You can talk when I get through.”
Mr. Wilson said, “Ok.”
Mr. Turner continued, “The only person that hired this guy was Steve Gilbert who is the subject of the investigation. Then we go in on what’s supposed to be a personnel discussion, and we didn’t talk about anything but Defenbaugh’s report, which is absolutely contrary to the law. It was an illegal meeting. You know it, and I know it.”
Mr. Grubbs responded, “I think what I would tell you is, there were a lot of personnel matters that were discussed in that meeting.”
Mr. Turner added, “We didn’t talk about anything but that Defenbaugh report, and that is absolutely contrary to the law. I was a party to an illegal meeting, and I take great exception to that.”
Mr. Grubbs replied back, “I think you have totally misrepresented what happened.”
“I haven’t misrepresented anything,” Mr. Turner continued. “What did we talk about when we were in here with Defenbaugh? We talked about his report.”
“Yes, and comments that were made in that report about personnel,” Mr. Grubbs said.
Mr. Turner then said to Mr. Grubbs, “You misrepresented the agenda.”
Mr. Grubbs followed, “Ok. Let’s get back on point. Our attorney recommends…”
Before the Chair finished his statement, Mr. Turner interjected, “I’m not signing this and I object to it. He is not our attorney Mr. Grubbs,” referring to legal counsel Jeff Moore. “If you look back at the minutes, we were talking about who to hire, I suggested Brad Hutchison. It’s in the minutes and we all agreed we were going to look for somebody else. Then you show up with this guy. I haven’t voted on it. She hasn’t voted on it. He hasn’t voted on it. The only person that signed anything with him is Steve Gilbert who was obviously squandering money beyond belief.”
Mr. Grubbs replied, “I think you’re way off base on this.”
Mr. Wilson then asked, “Where is the contract?”
Board Member Mr. John Brockman mentioned that there was an engagement letter, and while others were looking for the document, Mr. Wilson began to read in detail from the document between attorney Jeff Moore and the PEDC.
Mr. Turner then interjected Mr. Wilson’s reading of the document by saying, “Find me a place in any minutes where the Paris Economic Development Board voted to hire that guy. It’s not there, and the only person that signed that was Steve Gilbert. Whose signature is on it? Is any Board Member’s name on that contract? No. That’s not a contract with this Board.”
Mr. Wilson replied, “It’s with PEDC.”
Mr. Turner responded, “It’s not with PEDC if PEDC didn’t authorize it. Basic contract law.
Mr. Grubbs then noted to Mr. Turner, “What your saying is if you didn’t authorize it, it’s not a contract.”
Mr. Turner continued, “You find me anywhere in the minutes of this organization where they authorized this guy to be hired. I defy you to do that. It’s signed by Steve Gilbert.”
Mr. Wilson then noted, “Ok. If Steve Gilbert signs a contract for anything and that contract is still going on, you don’t, contract law just because you change the CEO of a company or just because you change a Board of Directors. By the same token, if this Board and CEO signs on to bond and everybody’s gone, we don’t know you’re in a bond. That’s a contract.”
Mr. Turner responded, “That is a contract with Steve Gilbert and no one else.”
Mrs. Rebecca Clifford then remarked, “According to the bylaws, the executive director does not have contracting authority. It’s left up to the board to authorize the contract.”
After several minutes of debate about the validity of Jeff Moore as legal counsel, the point of order returned to the second item on the agenda.
Mr. Grubbs redirected to Mr. Turner’s initial objection regarding the confidentiality agreement, “Now you have strong objections to this, saying it’s illegal and unconstitutional. It looks like it only applies to executive session type information.”
President of Paris Junior College Pamela Anglin commented, “As Ex-Officio member, I have a few questions on it. As an EDC, we’re under the Open Meetings Act, and so I had assumed we followed the other state laws where, as soon as you are appointed to an organization, a Board, a City Council, from the time you’re seated, you have ninety days to take the open meetings training offered by the state of Texas, and then you get a certificate that has to be on file with that organization that you have completed open meetings training, and in that open meetings training, it’s very clear on what can be discussed in closed session, and it’s also very clear that what is discussed in closed session is to be kept in closed session and that you cannot discuss what is talked about in closed session outside, and if you do, you’re subject to being fined. It’s a class C misdemeanor. So that’s when I see a non-disclosure agreement, and I’m thinking why would we do this when we’re already under state law.”
“So it seems like it’s a little repetitive,” Mr. Grubbs said.
Mrs. Anglin continued, “When you take that open meetings training and you go through what’s allowable and not allowable in closed session, it’s very clear that that is to be kept in closed session.”
Mr. Grubbs referred to Mr. Moore’s recommendation, “And this was his recommendation. He said he’s seen this done at other Economic Development Corporations that he’s dealt with. It doesn’t mean we have to do it, especially if we already have that covered in the Open Meetings Act orientation.”
The second item on the agenda regarding the confidentiality agreement was tabled and the meeting convened into Executive Session pursuant to Section 551.072 of the Texas Government Code to discuss and deliberate the purchase, exchange, lease, or value of real property. The second point of order in Executive Session pursuant to Section 551.087 of the Texas Government Code was 1)to discuss or deliberate commercial or financial information that the governmental body has received from a business prospect that the governmental body seeks to have, locate, stay, or expand in or near the territory of the governmental body and with which the governmental body is conducting economic development negotiations; or 2) to deliberate the offer of a financial or other incentive to a business prospect.
The PEDC reconvened into Open Session at 5:40 p.m. to address the remaining eighteen items.
All voting members approved the minutes from the July 15, 2014 re-scheduled monthly meeting as well as the meetings of July 21, 2014 and August 5, 2014.
Item number six (July 2014 Financials) was unanimously approved, with none opposed.
Interim Executive Director, Shannon Berrentine gave a report concerning Employers and Educators meetings that were held on July 29, 2014, saying, “All school districts were present except for Chisum I.S.D. I thought the turn out was good. They seemed to be excited. I think they actually get the benefits of the curriculum for House Bill Five, and we will move forward with that since it is part of our program.”
The second subject of her report (Status of appraisal on lots located on S. Church Street) was addressed in Executive Session.
Item number eight addressed discussion and possible action on Tax Abatement and Incentive Agreement Compliance. Mrs. Rebecca Clifford reported, “We’re still waiting on some information from Bodyguard. The rest of the companies have filled their compliance requirements. On tax abatements, there is some information that we are currently needing from T and K, Paris Warehouse, and PRMC. There are three companies with enterprise zone designations.”
Mrs. Clifford went on to say that they were waiting for the state to respond to the PEDC’s inquiry of what is required of the PEDC regarding enterprise zone compliance. No action was needed.
Mrs. Clifford spoke to item 9 as well, regarding the addition to the PEDC policy manual of non-solicitation clause for PEDC personnel. No action was needed.
For item 10 (Discuss and possibly take action on proposed amendments to the PEDC bylaws), a few wording changes were made. “The city will be reimbursed,” was unanimously changed to “The city may be reimbursed.”
Later it was approved by a 3-2 vote to extend the PEDC’s agreement with attorney Jeff Moore. Turner and Clifford were the dissenting votes.
Under unanimous approval, it was also decided to pay Defenbaugh & Associates for the full invoice of $50,000.
After several minutes of discussion, all were in favor of full disclosure for the release of the investigatory report by Defenbaugh & Associates, with the intent to do so in a joint meeting with the city council in an open forum.
PEDC Chair, Stephen Grubbs commented on the decision and the final investigatory report, “We did receive it yesterday. The idea is transparency and full disclosure. We’re going to get that report out as quickly as we possibly can. It was suggested during the meeting to get the report out to PEDC Board Members as well as City Council Members, and that we seek a joint meeting with the city council in a public forum, asking Mr. Defenbaugh and attorney Jeff Moore to be present to answer questions. We’re going to talk to the Mayor, and members of the City Council and see if we can come up with a date to have that meeting. As far as the report being released, it’s a little uncertain how long it’s going to take with sensitive items like account numbers, and social security numbers that need to be protected. We’ll get that done as quickly as we can and get that report out. We’re all weary. We’ve been through this investigation process for many months now. We just want to pack it up, and if there are any changes in our operations then we’ll make those changes. We want to get back to the business of recruiting business and industry. We’re pretty anxious to get it all packaged up and put to rest”
The meeting adjourned at 7:00 p.m.
By Nick Murillo, eParisExtra.com contributing writer