Report details gifts to HISD school officials

July 27, 2010 12:08:32 PM PDT
Technology vendors bidding for business with the Houston school district gave free tickets to Rockets playoff games, free cell phones and a fishing trip on a yacht to district employees, a law firm hired by the district has found. The law firm Bracewell & Giuliani, in a recently released memo, outlined the findings of its investigation into allegations of gift-giving that cost taxpayers an $850,000 fine and froze access to the program for a year, the Houston Chronicle reported Tuesday.

A federal investigation found that that technology vendors trying to get business in the state's largest school district gave the perks over several years.

The U.S. Department of Justice accused the district of violating competitive-bidding rules, saying the gifts could influence who got contracts. In 2006, the department froze the district's access to federal funding through the so-called E-rate technology program.

Houston Superintendent Terry Grier settled the case with the federal government in March. As part of the deal, the district paid fines of $850,000 and hired a compliance officer to monitor the E-rate program.

Richard Patton, the district's E-rate compliance officer, said the district has tightened its policies, forbidding employees from accepting any gifts from E-rate vendors. They are also required to report any offers.

"There is no tolerance," Patton said.

Patton said the district's current application for $89 million in E-rate funding is pending.

The federal E-rate program, funded by fees from telephone users, allows schools that serve mostly low-income children to apply for funding for discounted hardware and Internet access.

No Houston school district employees have faced criminal charges over the allegations. But a similar scheme in the Dallas school district resulted in criminal convictions of it's former technology chief, Ruben Bohuchot, and a Houston-based business owner, Frankie Wong.

Evidence showed that Bohuchot had shared inside information to help Wong's company, Micro Systems Engineering, get E-rate contracts in the Dallas school district. Both are now in federal prison on bribery and money-laundering charges.

A Justice Department spokesman told the newspaper he could not comment on the Houston school district investigation.

The Houston school district used to have multimillion-dollar contracts with Wong's company and with another computer reseller, Analytical Computer Services, which is run by one of Wong's business associates, Frank Trifilio.

In all, the Houston school district paid Wong's business $26 million. Analytical Computer Services received $104 million in Houston school district contracts.

Former Houston Superintendent Abelardo Saavedra, who retired last year, watched three Rockets playoff games from a suite belonging to Analytical Computer Services. The next month, he sent a $300 check to Trifilio as reimbursement, according to the memo from the school district's lawyers.

Saavedra said in an interview that he was invited to the games by "a trustee or some trustees," whose names he said he could not remember. Once there, he said it was obvious it was a vendor's suite, so he wrote Trifilio a check to reimburse him for the tickets.

The memo said Analytical Computer Services paid for cell phones for 26 school district employees for five years, until the district's chief financial officer stopped the practice in 2007.

The memo said the Houston district's top technology official, William "Bill" Edwards, reported to the district's inspector general that he and a co-worker, Laura Palmer, accepted Wong's invitation to go fishing on his $305,000 yacht at least once between January 2005 and December 2008.

For Palmer's birthday, one of Wong's employees bought dinner for about 15 people at an expensive restaurant.

Edwards, the assistant superintendent of technology, resigned in 2005. District records show that Palmer was promoted to the spot in 2006 and retired the next year.

Trifilio has not been charged with wrongdoing. He did not immediately respond to a phone message Monday from The Associated Press seeking comment.

The Chronicle reported that none of the school district employees could be reached for comment.

The AP could not find numbers for Palmer or Edwards.

Four current and former Houston school board members received several thousand dollars each in campaign contributions from Wong, Trifilio or another business associate of Wong's. The trustees all have said that the campaign donations did not influence their votes on contracts.


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