in Houston, Texas

Houston inspector general probing Councilman Stephen Costello's engineering work for city; firm inked $1.7m contract two months before Costello elected

Wednesday, Mar 23, 2011, 11:47AM CST
By Steve Miller
Houston City Hall

Houston City Council member Stephen Costello and his engineering firm's ongoing contract with the city are under investigation by the city’s Inspector General’s office, records obtained by Texas Watchdog show.

 

Costello Inc. signed a $1.7 million contract to fix water lines in the Memorial Plaza, Shadywood and Regency Square areas of the city in October 2009. He was elected to council in December of that year.

 

Costello, chairman of the city’s Flooding and Drainage Committee, did not return a call, but a representative of the councilman defended the contract, which Costello disclosed on a conflict-of-interest filing last February.

 

(Editor's note: See update to the story by clicking here.)

 

"He had said that if he won, he would not go after city contract work, and he has not done so," said Kathryn McNiel, a consultant to Costello. When he won the bid, Costello had no idea that he would win, McNiel added.

Stephen CostelloCOSTELLO

But opponents of a long-term, $8 billion city drainage project known as Renew Houston, which will be paid for with new fees on property owners, question Costello's close ties to the engineering and construction trades.

“We had seen enough information throughout this process of Renew Houston over the months that raised questions about Costello’s role,” Dave Welch, executive director of the Houston Area Pastor Council, said. “His support for Prop 1 financially and the overlay between his professional work, and we wondered if he had any current active contracts with the city. It turns out that he does.

 

"And we aren’t sure that he should be able to have a stake in setting our taxes when it could benefit him.”

 

It's not clear whether Costello's contract just creates the appearance of a conflict or constitutes a violation of ethics rules.

 

A passage in city law speaks strongly to the issue of council members getting city business: City Council members shall not "be pecuniarily interested, directly or indirectly, in any contract let by the city, or in any work done by the city, or in any matter wherein the rights or liabilities of the City of Houston are or may be involved."

 

However, a mayor's office spokeswoman said she "believed" the investigation had been completed and found no wrongdoing, but the office could offer no further documentation of that at press time. A phone call to the city attorney's office was not returned.

The investigation stems from public comments during one of a series of community meetings this year about the implementation of Renew Houston, which was approved by the voters in November. The meetings were attended by Mayor Annise Parker, who, along with Costello and a large portion of the city's engineering firms, advocated the plan.

Parker was met with a series of questions concerning the tax implications of the measure, and about Costello’s engineering contract. The mayor confirmed the investigation in an email to Welch. Shown the email, the mayor's office confirmed its legitimacy to Texas Watchdog.

Welch's group and others have said that churches and local schools should be exempted from the drainage fees, just like they are from certain taxes, and state legislation has been proposed to carve out an exception for those groups. The mayor has said she believes everyone should pay.

 

Shortly after his election, Costello became an advocate for Renew Houston, which appeared as Proposition 1 on the ballot. He was joined in his support by a number of local engineers who had collectively made more than $12 million from the city in the previous five years for their work on city projects.

 

Costello loaned $80,000 of his own money to the Renew Houston effort, and Costello Inc. donated another $11,889, according to election records.

 

The plan will levy a tax on residents and businesses to fix infrastructure in the city, including water lines and streets. City council members have not yet decided the exact fee rate, but during the runup to the referendum backers said it would cost the average homeowner about $5 a month.

The city in December announced a new inspector general, Robert Doguim, who came armed with a revised ethics policy at the behest of City Attorney David Feldman. Parker issued an executive order on March 1 outlining the responsibilities of the inspector general’s office.

***

Contact Steve Miller at 832-303-9420 or stevemiller@texaswatchdog.org.


Keep up with all the latest news from Texas Watchdog. Fan our page on Facebook, follow us on Twitter and Scribd, and fan us on YouTube. Join our network on de.licio.us, and put our RSS feeds in your newsreader. We're also on MySpaceDiggFriendFeed, NewsVine and tumblr.


Photo of Houston City Hall by flickr user J Jackson Photography, used via a Creative Commons license.

Comments
Be the first to post a comment.
Video
KTRK: On Big Screens for Billionaires, Comptroller Susan Combs Silent
Related Blogs and Media
JULY 24 / Little David, the shepherd boy, explains . . . . . . to an uncomprehending giant what is about to happen: David said to the Philistine, "You will come against me with sword and spear and...
Update:17 hours 34 min
Unca Darrell
Houston Home Listing Photo of the Day: Little Boxes 3018 Conway St. [HAR] … Read...
Update:2 days 1 hour
Swamplot
Former Montrose Berryhill Baja Grill Space To Reopen with New Peninsular Allegiances The strip-center position formerly held by Berryhill Baja Grill at the corner of Montrose Blvd. and Hawthorne St. is getting new signage...
Update:2 days 1 hour
Swamplot
Metro Might Never Need To Change a Station Name Again If It Just Changes 28 of Them Now In response to word from the Chronicle‘s Dug Begley this week that the Red Line’s Reliant Park light-rail stop might get its...
Update:2 days 2 hours
Swamplot
Chevron To Sell Old Bellaire Campus, All That New Land on Clay Rd. Nancy Sarnoff notes this afternoon that Chevron will be selling off that 103-acre Clay Rd. tract it bought in 2014, along with the...
Update:2 days 4 hours
Swamplot
Black Lives Matter well-positioned to win concessions on police, if ... Black Lives Matter is formally an organization and has a chapter here in Austin, but really #Blacklivesmatter is an amorphous, broad-based...
Update:2 days 5 hours
Grits for Breakfast
Swamplot Sponsor: Boulevard Realty’s White Linen Night Pre-Party at 1035 Harvard Today’s Swamplot sponsor is . . . a party! It’s the gathering Boulevard Realty is putting on before White Linen Night...
Update:2 days 7 hours
Swamplot
CenterPoint Energy Work To Cause Extended Outage of Dog Park on Westpark Dr. Update, 2:30 pm: Commissioner Steve Radack tells Swamplot that the dog park itself will also be closed while the parking area is...
Update:2 days 7 hours
Swamplot
For Roy Blunt, one staff salary makes up most of PAC spending Sen. Roy Blunt (R-Mo.) campaigning at Lauf Equipment Co. in Jefferson City, Mo. in March — at the same time Donald Trump was 130...
Update:2 days 8 hours
Open Secrets
JULY 22 / "I alone can fix it," sayeth . . . . . . Donald John Trump in his acceptance speech. In context, “No one knows the system better than me, which is why I alone can fix...
Update:2 days 9 hours
Unca Darrell
Tweets
Karen Townsend | 4 years 1 month
"Patrick F. Kennedy is a career foreign service officer" - http://t.co/GOrCe0IS
Peter Corbett ✈ | 4 years 1 month
I'm at McCarran International Airport (LAS) w/ @almacy http://t.co/KvmId07i
KERA Public Media | 4 years 1 month
TONIGHT at 7pm on KERA TV: Presidential Debate: Learn more at PBS NewsHour. http://t.co/Z9kYdun8
PBS MediaShift | 4 years 1 month
Tech Snafus Make Bill O'Reilly/Jon Stewart 'Rumble' More of a Stumble http://t.co/4OfeBlrG (@kegill | @pbsmediashift) #rumble2012
Will Sullivan | 4 years 1 month
Great addition, been burned too much by bad subs. "Google Play Announces Free Trials For In-App Subscription Services" http://t.co/TOLgRVak
TxDOT | 4 years 1 month
I-35W/North Tarrant Express #constantcontact http://t.co/QDzrQumu
keyetv | 4 years 1 month
Serial shotgun robbers suspects arrested. http://t.co/ka8T4U9B
Karen Townsend | 4 years 1 month
Aren't State Dept career people suppose to be non-partisan? Not the political appointees, the career people. #Libya
© 2016 TEXAS WATCHDOG and USELABS. All Rights Reserved. Terms of Use and Privacy Statement