Gov't ethics probe turns into probe of gov't waste

September 8, 2010 3:44:53 AM PDT
Our investigation of a Houston city councilman gets taxpayers a possible windfall. We've been exploring why a city councilman likes to recommend one construction company for business in his part of town. His answer: Their office is in my district. But wait until you see what happened when we followed that trail.

Tucked behind a row of school buses, we find what we're looking for, and it's proving to be a major embarrassment for HISD.

"This is not defendable. It's inexcusable. It is not unacceptable," said Issa Dadoush with HISD's Building Services.

There's a freshly painted patch on a metal building; the decals are now crumpled in a trash bucket, and we know why.

"I did not know. I did not know until you, your team called us," Dadoush said.

It's a story about how an investigation of government ethics turns into a story of possible government waste.

"What I can tell you is it's not acceptable," Dadoush said.

It's no secret we've been investigating Councilman Jarvis Johnson and his relationship with construction company Jamail and Smith, a city contractor who's tried to get business fixing up dilapidated apartment complexes in Johnson's council district.

Jamail and Smith has a lawyer and consultant named Michael Harris. He's the councilman's longtime friend, adviser and now his criminal lawyer, too.

So when the developer of the Sterling Grove Apartment had a meeting with Johnson, only one contractor was invited -- Jamail and Smith.

"I would agree with you that that type of thing needs to be looked into," Houston City Attorney Dave Feldman said.

Here's an excerpt of an e-mail sent to another apartment complex manager from the councilman's chief of staff: "The contractor for the district is Jamail and Smith."

The councilman won't answer our questions on camera, but he's always claimed he just tries to get city business for companies from District B.

Jamail and Smith's corporate office is in Clear Lake, but the company's website talks of a Houston regional office at 228 McCarty. The address was familiar to 13 Undercover, and so was the greeting.

"You cannot shoot that way," a security guard told 13 Undercover. It's HISD maintenance headquarters.

Remember that metal building tucked behind the school buses? That's Jamail and Smith's regional office. It used to say 'Jamail and Smith,' but not anymore.

"My reaction was, 'What is it doing on our site?'" Dadoush said.

HISD says the company has admitted doing non-HISD work from its building on taxpayer-owned property. And all along, you've been footing the bill.

"Who pays their light bill?" 13 Undercover asked Dadoush.

"We do," he replied. "It's connected to our warehouse."

"Who pays for their security?" we asked.

"We do," Dadoush responded.

Dadoush has been at HISD only four months.

"We hand delivered a notice to Jamail and Smith Construction, giving them 30 days notice to vacate the premises," he said.

And then there's the little issue of back rent.

"We need to sit down with them and make it very clearly that they owe us seven years of rent," Dadoush said.

Jamail and Smith is an HISD contractor, and the company claims the contract allowed them to have a construction trailer at the site they are working.

But Dadoush says that meant at the schools they were fixing up. And the he-said, she-said could get ugly.

Jamail and Smith told us their contract, "specifically provides for the district to furnish space and utilities on district property for the contractor without charge."

But the guy in charge of the HISD headquarters says that didn't mean office space for seven years at HISD's maintenance headquarters, especially when the place is also used for non-HISD work.

"This is kind of a 'What the ...?' moment," 13 Undercover told Dadoush.

"If you want to say, 'What the ...? moment,' it was the 'What the ...?' moment," he responded.

We asked the councilman if he knew about the possible abuse of taxpayer money. He did not respond.

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