in Houston, Texas

The Houston city government could be in a pickle over the city airport system's work overseas, building and running airports in Latin America and elsewhere.

But the two most obvious solutions -- giving City Hall a bigger hand in directing those foreign affairs, or pulling the plug on them all together -- could put the city in an even bigger pickle.

Maybe even a whole pickle jar.

The airport-linked nonprofit at the center of the controversy appears to be the key to millions of dollars that were borrowed to finance an airport project in the South American nation of Ecuador. If the city tries to take greater authority over the firm's finances -- and the nonprofit's lawyer says the city is considering doing that -- it could make $200 million in loans from the U.S. government suddenly evaporate, causing financial collapse of the international consortium that is doing the Ecuadoran work.

In turn, there are also questions about whether that increased city oversight could then leave the city saddled with that debt or get it sued by the nonprofit's for-profit business partners if they feel the city ruined their big-bucks business deal.

"It is a little strange that we're talking about this oversight, which is exactly what we didn't want to happen back" in 2001, when the nonprofit was launched, "because, if something went wrong, the city wouldn't be on the hook," said Anthony W. Hall Jr., the city's chief administrative officer and director of an internal review of the nonprofit's foreign work.

Said Hank Coleman, attorney for the nonprofit: "I am amazed that the city is exploring ... trying to take control of this." The nonprofit's board, he said, is "amazed at this hoo-ha."

What's more, the contracts signed to allow the airport system's overseas work -- which were approved by votes of the City Council -- could require the city to keep the nonprofit around and working in South America for decades to come.

"There are deals the city agreed to, I'm talking about council-approved, that go out 35 years," Richard Vacar, former director of the city airport system and architect of its overseas work, told Texas Watchdog in a recent interview. "This isn't going away."

Continued on ...
Page 2: Nonprofit gave Canadian firm access to Uncle Sam's money
Page 3: Nonprofit becomes linchpin to Quito financing
Page 4: City could become villain in killing off Ecuadoran project

Pickle jar photo by flickr user spanginator, used via the Creative Commons license.

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