in Houston, Texas

Houston ISD tech vendors spent 'significant funds' to entertain trustees Larry Marshall, Manuel Rodriguez, court filing alleges

Thursday, Jun 23, 2011, 09:08AM CST
By Lynn Walsh and Jennifer Peebles

Vendors selling computer equipment to the Houston public schools spent "significant funds" to entertain school trustees Larry Marshall and Manuel Rodriguez, attorneys representing whistleblowers and the federal government allege in court documents, calling the payments "unlawful" and "designed to secure business from" the Houston schools.

Meanwhile, the court documents also allege that one of the Houston Independent School District’s top officials in the early part of the last decade, Cathy Mincberg, had an extramarital affair with a consultant whom the school district paid more than $5 million -- a consultant she was reported by the local press to have had a hand in hiring.

The federal government has taken over as lead plantiff in the lawsuit, and court filings do not elaborate in court filings on what, specifically, the "significant funds" included or how much money was involved. Calls for comment to the plantiff's lawyers were not returned.

The revelations come on the heels of reports that a Houston schools vendor, insurance agent and state Rep. Borris Miles, offered to arrange all-expenses-paid trips to Costa Rica to most of the school system's trustees last year -- and that Marshall went on two of the trips. It also follows reporting by Texas Watchdog that school trustees president Paula Harris voted on $28 million in contracts that included work for a company owned and run by one of her closest friends.

Rodriguez disagreed with the federal government's claim that "significant funds" were spent on him. "I wouldn’t say anything over $50, I don’t think," Rodriguez told Texas Watchdog earlier this week, recalling receiving nothing other "other than a dinner or two and a possible (ball) game."

Marshall referred questions to the Houston schools' press office.

Neither Marshall nor Rodriguez -- nor former trustee Diana Davila, who was named along with them in court documents -- have been charged with any crime; in fact, the case in question is a civil matter. In it, the plantiffs accuse an intertwined network of tech vendors of showering Houston Independent School District trustees and administrators with gifts and freebies and of using their close connections to HISD personnel to keep competitors at arms' length from the school system.

"These unlawful payments, designed to secure business from" the Houston Independent School District, the court filing reads, "were part of the reason that HISD has been unable to participate in E-Rate funding and has incurred substantial fines/penalties, all to the detriment of HISD students."

Federal officials recently unfroze $70 million in federal technology funding for HISD through the program, called E-Rate, which puts computers and networking equipment in schools. To settle the case, the school district also agreed to pay an $850,000 fine and stepped up its ethics policies governing swag from E-Rate vendors, such as implementing a "quiet period" during the bidding process, in which E-Rate vendors can't communicate with school officials.

The E-Rate scandal at HISD has largely focused on a handful of former top administrators in the district's technology department, who are alleged in court documents and other public records to have received tickets to sporting events, trips out of state, fine meals, gifts of the latest gadgetry and even a $60,000 personal loan from those doing E-Rate business with the school system. But HISD's trustees' names have rarely come up in the mess -- until now.  

Davila she didn't recall any of the E-Rate vendors spending any money on her or giving her any gifts, perks, meals or ballgame tickets, beyond some campaign contributions worth a total of $1,500.

"I wasn't privileged," Davila, who stepped down from the HISD trustees last year. "Maybe I wasn't privileged, or I should be saying 'Thank God I didn't,'" she said with a laugh. "I guess I didn't look like the athletic type or something -- they figured I'm a female I don't like sports, and they'd be right."

Even when she got the campaign contributions eight years ago, she said, she had no idea who the donors were -- and no idea of the controversy they would cause in the years to come.

"I had no idea who they were, just like so many others who give money," Davila said. "I don't know what business or what type of business they do with HISD, or if they do any business with HISD. When you have these fundraisers and people host them for you, you don't think to sit there and ask, 'OK, are you doing business with HISD?', because, you know, that's not relevant at a fundraiser, I don't think."

The vendors spent the "significant" entertainment funds for the three trustees even though HISD specifically warned vendors about such actions when it put out "requests for proposals" for E-Rate projects in late 2002, the plantiffs alleges in another court filing.

"Supplier conduct: No gratuities of any kind of will be accepted including meals, gifts or tips. Violation of these conditions will subject the supplier to immediate disqualification from the proposal process," the school district's RFPs said, according to the feds.

However, Houston school trustees have said in the past that they have accepted travel and gifts, such as tickets to sporting events like Houston Rockets basketball games, and that they feel allowed to do so under a provision of the HISD ethics policy that allows them to receive freebies as "guests." For instance, when queried about his acceptance of the Costa Rica trip, Marshall told the Houston Chronicle that he understood he did not have to disclose such gifts because Miles, the arranger of the trip, was present on it.

The suit also alleges Mincberg, who was HISD's chief business officer from 2000 to 2004, was having an extramarital affair with an HISD consultant.

The consultant in question was one the school system was paying $1,400 a day, Wade Jacobs, whom the Houston Press in 2001 called "HISD's $2 million man":
... in the last three years he's become HISD's Mr. Fix-it, master of its computer universe and major project guru to everyone from the superintendent on down. Since inking a district contract in 1999, Jacobs's California-based Infinet Technology Group has been paid $1.74 million. A contract extension is potentially worth another $1.3 million through next year.

Jacobs and his firm stopped working with HISD in 2004, as did Mincberg, “around the time a story broke about on an HISD E-Rate investigation,” the lawsuit says.

“Jacobs was able to use his intimate relationship with Mincberg to benefit his friends who wanted technology business with HISD,” including several of the companies in the intertwined tech vendors who are the defendants in the case, the suit says.

A former biology teacher at Lamar High, Mincberg served as an HISD trustee from 1982-95 and did two stints as president of the trustees, but, according to the Press, she may be most widely remembered for once floating the idea that teachers should also drive school buses for an extra $10 an hour. She also made an unsuccessful bid for Houston City Council.

The suggestion that Mincberg and Jacobs were having an affair is not new and was mentioned in the Houston Press story from 10 years ago, which noted that Mincberg had divorced former Harris County Democratic Party chairman David Mincberg around the same time.

Mincberg later became a top official with the Portland, Ore., school system. She is currently the head of a Portland-based education nonprofit, the Center for the Reform of School Systems. She did not return a call for comment this week.
Houston E-Rate civil suit - third amended complaint

Texas Watchdog Editor Trent Seibert contributed to this story.
Contact Lynn Walsh,, 713-228-2850 or on Twitter, @lwalsh. Contact Jennifer Peebles at jennifer@texaswatchdog, 281-656-1681 or on Twitter at @texaswatchdog or @jpeebles. 

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Photo by flickr user neonmarg, used under a Creative Commons license. 

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Thursday, 06/23/2011 - 06:36PM

Finally, light at the end of this long dark tunnel these thieves have forced the professional educators of HISD to travel.

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