Payments to travel firm growing in 2010; HISD insists services being scaled back

planetickets.jpg

Story Highlight

	Payments to travel agency increasing
	No contract in place
	Board president Greg Meyers 'taken aback'

While the Houston Independent School District's finance head insists it is striving to cut fees paid to a travel agency, the district has instead nearly doubled payments this year compared to 2009.

Chief Financial Officer Melinda Garrett claims the use of Advantage Travel is being reduced – yet the payments are on pace to increase more than threefold this year over last, when the district paid almost $6,200 to the Houston-based firm. The district pays Advantage a fee of $20 to $30 for each ticket booked, records show.

The district's bills are increasing despite the hiring of two dedicated travel employees since 2007 -- and the use of a third worker who spends some time on employee travel.

Superintendent Terry Grier has refused to answer questions about the district's travel practices, and Garrett has declined to discuss the arrangement with Advantage. In June she offered a written statement regarding the service.

GARRETT

“Several years ago, the district changed from charging out-of-district airfares to the district’s American Express Card to a central MasterCard in the district’s ProCard program used by the district. This change enabled the district to earn a rebate under it MasterCard contract [sic] with J.P. Morgan Chase. These funds enabled the district to add a second travel clerk. A second position was critical if the district was going to start purchasing tickets via the Internet. At the same time, the district made the decision to have tickets purchased directly through the Internet and to start reducing the services the district uses with Advantage Travel.  This current fiscal year, over 60% of tickets have been purchased online. In 2010-2011, the district will continue to reduce the need to use the travel agency firm.”

Which does not explain the fact that travel expenses paid to Advantage through July 12, at $11,198, already exceed what it paid in the previous year-and-a-half: $4,293 from June through December 2008 and $6,194 in 2009, according to the district check register.

Many times, the fees are paid on routine ticket purchases that are first found by district employees, a Texas Watchdog investigation earlier this year found. And district records show the travel agency is not leveraging deep discounts beyond what any user of an online price-comparison service might find.

The district pays Advantage without a contract, which appears to be in violation of district policy: Service contracts over $10,000 "require a formal, written, competitive solicitation method," according to HISD's financial procedures manual.

The district has refused to discuss the parameters of its contracting procedures.

After submitting multiple public information requests to HISD and having administrative workers search HISD board agendas dating back to 1996, not a single contract, ratification document or request for proposal for the travel services Advantage Travel provides was found.

But Carol Embesi, vice president of Advantage, said there may be a contract that was signed when Advantage was first formally brought on by HISD “over 10 years ago, maybe 15.”

“The district put contracts out for bid, and we bid,” said Embesi, who cofounded Advantage in 1985. “There was a lot of interest in that contract, 30 to 35 people from travel agencies at the meeting for the contract. But I think we are the only ones that bid their requirements.”

She said HISD had strenuous requirements and wanted whoever was going to take the deal to work on account and be paid monthly, which was not agreeable to other agencies.

Advantage, with five employees, was one of the smallest agencies at the meeting and could be nimble in response to the contract rules, Embesi said. She said she does not recall the terms of the contract, but that the district invoices her firm each month.

"We had done the travel booking for the district at the time of the big meeting," Embesi said. "We did not have a contract for that. But I would think that there would have been one after the meeting, and we were chosen to continue."

Doing any district business without a contract impedes transparency in addition to being a poor business move, said HISD board president Greg Meyers.

MEYERS

"I'm a little taken aback," Meyers said. "I know there are certain things that legally need to go out for bid. ... I am one that even if it doesn't have to go out for bid, I have always thought that although we don't have to, it is in good practice. There needs to be as much transparency as we can show when we are dealing with money and the public's trust."

Meyers said the board would review district travel as part of a larger financial review this fall.

The district's legal firm, Thompson & Horton, did not respond to questions about the district doing business without a contract.

Contact Steve Miller at 832-303-9420 or stevemiller@texaswatchdog.org. Contact Lynn Walsh at at 713-228-2850 or lynn@texaswatchdog.org. Follow news about the Houston Independent School District on Twitter, #HISD.

Photo of plane tickets by flickr user uncleboatshoes, used via a Creative Commons license.

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Alma S. Tuesday, 08/10/2010 - 08:51AM Really? Should Greg Meyers be commenting at all on money and transparency??? He needs to be more honest and open about his campaign finances!