Blowing the Whistle?

illustration by Doug Potter

A former top-level city official, Hector Fabela, has filed a "whistleblower lawsuit" against the city. If what he alleges is true, the tale of his harassment provides an introduction into how a few key bureaucrats wield power at City Hall. According to Fabela, they are members of an elite club that illegally influences the awarding of lucrative government contracts, and is not afraid to use its power to cripple the lives of nonconforming employees.

Fabela is a former acting director of the Department of Small and Minority Business Resources (SMBR). His lawsuit, filed February 13, alleges that Fabela suffered an inexplicable wage reduction and faces imminent dismissal because he blew the whistle on illegal procedures by other city supervisors. In an interview with the Chronicle last week, Fabela said that he informed City Manager Jesus Garza that Purchasing Officer Sue Brubaker and Assistant City Manager Marcia Conner had violated the city's minority procurement ordinance, only to become Garza's scapegoat in last year's airport terminal debacle, even though he was only marginally involved. Garza would not comment on the lawsuit. "We'll deal with the issue in court," says Garza.

Fabela's former place of employment, SMBR, awards minority status to qualifying businesses, thus increasing their eligibility for city contracts. SMBR helps determine who gets what contracts, and Fabela, 50, says that the powers-that-be, like Brubaker and Conner, were hell-bent to control it. Fabela was hired as SMBR's assistant director in January, 1994, when it was still known as the Office of Minority Business Affairs (OMBA), and was a division of Brubaker's Purchasing Office. OMBA was founded about ten years ago through the minority procurement ordinance, which was designed to procure minority participation on city projects. Fabela's task was to ensure that such participation occurred as proposed. Through his attempts to enforce the ordinance, he says, he quickly learned that breaking it is part of City Hall culture.

Here are the principle events that led to the lawsuit, as told by Fabela:

Three months after being hired, Fabela got his first lesson in city "management." He was appointed to a committee of city staff that was to recommend a company to provide insurance, bonding, and technical assistance to small and minority businesses hoping to work at the new airport. The stakes were in the millions. Amid intense competition, the process was flawed from the outset, claims Fabela. According to the ordinance, brokerage house Marsh & McClennan should have been disqualified from bidding on the contract because it was late in filing the necessary paperwork. But Fabela says that Brubaker advised him that all was hunky-dory, and that accepting late paperwork is standard practice. "I couldn't believe that she didn't have any respect for the ordinance," says Fabela. For her part, Brubaker says she does not recall that particular instance, but she admits that "it wouldn't be against practice or law" to give companies slack on filing papers.

The committee also flouted the recommendation process, Fabela says, by twice changing its vote on the recommendation. That's when Fabela delivered a letter of complaint to Garza detailing what he thought were a number of illegal breaches in procedure. The council, and city watchdog Leonard Lyons, heard whisperings and demanded a copy of the memo. None was produced. Fabela says that's because Garza had ordered that the memo be burned. In fact, Fabela says, he and SMBR certification supervisor Chuck Woods complied with Garza's alleged request by burning the memo in Fabela's backyard barbeque pit. (Woods, who still works for the city, says that Fabela's story is completely false.) In the wake of the flap surrounding possible irregularities in the process, Garza ordered the airport project rebid as three separate projects.

In the fall of 1995, Fabela became SMBR's acting director; his duties were increased to overseeing both compliance and certification of minority businesses. It was at about that time, says Fabela, that a Capital Metro representative asked him to certify a list of minority businesses for a joint Capital Metro/City of Austin rail line project, and to do it within three days. Fabela refused: The city certification process required a 30-day public input process. But four days after the meeting, Fabela says, a fellow employee informed him that Brubaker and Conner had certified the companies without his knowledge. Fabela says he complained to Garza, who promised to handle the matter, but did nothing. (Again, Garza will not comment while the case is pending.)

After a similar incident in January 1996 in which bidders were allowed to file late paperwork with regards to a project at the Ullrich water treatment plant, Fabela sent a protest letter to Jim Clarno, the project manager at Ullrich, and ordered that the bidders comply with the law. Garza caught wind of the memo, Fabela says, and called a meeting with Fabela. A crowd of bureaucratic intelligentsia was on hand. Among those in attendance, Fabela recalls, were Public Works chief engineer Leno Rivera, Assistant City Manager Conner, and Brubaker by phone. Fabela says that Garza told him to desist with such memos, and to allow some "leeway" with the new ordinance.

Fabela says that in return for pointing out illegal activity, he was made the fall guy in the bungled awarding of the airport terminal contract, the most lucrative project in city history. City staff had recommended that Pelzel-Phelps -- a joint venture of a locally owned business, Pelzel & Associates, and the national construction firm of Hensel Phelps -- build the terminal for $100 million. On June 16, 1995, SMBR certified the joint venture as a minority business, since Hispanic-owned Phelps was a 51% partner in the venture. But the Austin American-Statesman raised questions about whether Phelps, with far more experience and capital, would indeed do the majority of the work. City staff ruled that the joint venture should not have been certified, and Garza ordered the project rebid. In an article in the Statesman last spring, Garza placed the blame on Fabela, and added that Fabela had been removed from his post. "I think there are issues that need to be dealt with that just require a different level of expertise," Garza was quoted as saying.

Garza must have meant a lower level of expertise. Fabela's replacement was Water and Wastewater engineer Reynaldo Cantu, whom Fabela says had no SMBR experience, leading Fabela to think that Garza and Brubaker wanted a minion at the helm. And despite Garza's slap in the face, Fabela says he had absolutely nothing to do with the certification of Pelzel-Phelps. Indeed, the company was certified as minority-owned on June 16, 1995. At the time, Fabela was still an assistant director overseeing compliance, not certification. Documents show that Director Jimmie Flakes awarded the certification, and that Assistant City Manager Joe Lessard had reviewed and approved the certification. But it was Fabela who took the beating.

Lending credence to his pleas of innocence, Fabela's punishment, at least financially, was a mere slap on the wrist. Instead of firing him, Garza moved him to an easier job at the Parks Department at the same $60,000 annual salary. However, in the summer of 1996, Human Resources Director Joe Canales cut Fabela's pay by $6,000 a year. Fabela protested to Garza's office that he had not been notifed about the cut, and threatened to hire counsel. In January, Garza asked Fabela to resign by April, and handed him a release form to sign which included a promise from Fabela not to sue the city under the Texas Whistle Blower's Act. Fabela refused and retained local attorney Joe James Sawyer, who met with Garza and Assistant City Attorney Charles Griffith. Fabela, who was also present at the alleged meeting, says that he was asked how much he would accept to resign. Fabela's lawyer offered $125,000, half the maximum penalty allowed under the Whistle Blower's Act. A February 6, 1997 letter from Griffith to Sawyer offered Fabela $30,000 to resign. Instead of taking the money, Fabela filed suit against the city on February 13. A court date has not been set.

Fabela is now working out of Central Maintenance, taking inventory at the Parks Department for $54,000 a year. Not bad for an inventory job, but with the lawsuit, he hopes to collect $250,000. He also wants a statement of apology from Garza. Most importantly, he hopes the suit will at least slow the alleged scofflaws and skullduggery among upper-level city managers.

He suspects that things have worsened since his departure, noting that after he left, the number of employees at SMBR has been reduced from 19 to 12, and that it was moved back to Brubaker's Purchasing Office, where, Fabela claims, she and other upper-level managers can now better control what goes on there: "They finally got what they wanted." Now if they could only get the canary to stop singing...

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Keel Throws Weight Behind Davenport MUD

The Davenport Municipal Utility District has a new ally, State Rep. Terry Keel. The former Travis County sheriff has filed legislation that would prevent Austin from annexing the MUD for at least another five years. The MUD has requested city sewer service, but refuses to link the deal to annexation. At least three councilmembers -- Beverly Griffith, Daryl Slusher, and Gus Garcia -- don't want to subsidize the MUD's development without benefitting from its property and sales taxes. Eric Mitchell is the swing vote on whether to provide service sans annexation.

A proposal to do just that has already passed the council on first reading. The second of three required votes will be held today, March 27. Third reading will be at a specially called meeting on Monday, March 31.