Thursday, September 5, 1996

Lawmaker: COG role in distributing funds needs re-examining By STEVE RAY
Harte-Hanks Austin Bureau

AUSTIN - The Texas lawmaker in charge of a committee investigating the state's 24 Councils of Government says the councils' role in distributing federal, state and local money needs re-examining.

State Rep. Rob Junell, D-San Angelo, said Wednesday that lawmakers are committed to solving problems uncovered in an statewide inquiry - including questionable expenses at luxury resorts and Austin topless bars - with or without the help of council of government officials.

"We're going to clean this up and get some uniformity (in the way money is spent)," promised Junell, who heads the House Appropriations Committee and helps set the state budget. "You can come forward and help us do it, or I'm going to do it, either through the Appropriations Act or a separate bill."

The councils have come under increasing criticism after a legislative probe and an investigation by Harte-Hanks Newspapers revealed questionable spending across the state, including thousands of taxpayer dollars spent at Austin topless bars and nightclubs, conventions at luxury resorts and on travel expenses for spouses.

Junell said he will see that lawmakers approve tighter oversight of the councils next year despite promises from council officials to adopt a 12-point policy they say would help protect public funds.
Critics say the councils, which control millions of dollars in local, state and federal money for such programs as Meals on Wheels, 911, economic development and job training programs, are largely unregulated and have lax policies dealing with how funding can be used.

"I think there is certainly a place for many of the activities (performed by the councils of government)," Junell said after the hearing. "But times change. We need to look at what services the councils provide, see which ones are still valid ... and then which ones don't need to be done at all or (could be given) to the cities and counties to do."

Officials in the state organization that represents the councils - including West Central Texas Council of Government director Brad Helbert and Knox County Judge David Perdue - testified at the second of an expected four- part hearing by the committee.

Helbert, who is the Texas Association of Regional Councils Intergovernmental Relations Committee chairman, told lawmakers that oversight was already being used by local boards in most areas.

Knox assured lawmakers that "every dollar you spend through the Councils of Government has value added to it" especially in rural communities.

"I specifically urge that in your final report you recognize fully the good work on behalf of the state and local governments that is done by Councils of Governments and the hundreds of local officials and citizens who are active on their boards," Knox said. "The value added is enormous, and the professionals who work for us in regional councils deserve your commendation and support."

All the officials who testified said the problems uncovered in the probe are overshadowing the good the councils do.
"We do recognize there have been some errors, and we have attempted to deal with those," Dimmitt Mayor Wayne Collins, president of the association, told lawmakers.

Collins noted that many of the boards governing local councils had passed accountability principles that will serve as guidelines for daily operations.

"These principles deal with conserving public funds, allowable and unallowable expenses, travel, use of credit cards for fiscal control and benchmarking council of government salaries and benefits to other public sector employers," Collins said.

The policy pushed by Collins would prohibit spending for alcoholic beverages, personal entertainment and personal services, such as dry cleaning. It would allow travel reimbursement for official business only. And it would outlaw travel spending for staff members' or commission members' spouses.

Lawmakers, while noting their appreciation for the programs run by the COGs, questioned whether all of the state's 24 councils would adopt the principles and live by the voluntary rules.

"There is no excuse for some of the policies we have discovered in the course of this inquiry," said state Rep. Pete Gallego, D-Alpine.

But Association Secretary Gary Pitner said "for every one of those horror stories there are hundreds of very positive stories."

"There was clearly no justification for (spending taxpayer's money) on alcohol and personal entertainment," said Pitner, who is the executive director of the Panhandle Regional Planning Commission. "Quite frankly it was an embarrassment to all COGs and I'm confident they will be taken care of by the local board."

Lawmakers weren't quite so confident, especially after learning that the Midland-based Permian Basin Regional Planning Commission had given Executive Director Ernie Crawford a vote of confidence last month after he admitted using taxpayer dollars to pay for alcoholic beverages at Austin nightclubs - including Sugar's Uptown Cabaret, a bar known for $20 table dances by topless women.

"You heard today some of the COG directors say 'we can handle this ourselves' but I'm not sure that's the case," said state Rep. Richard Raymond, a Benavides Democrat. "When they were asked point blank 'what have you done to punish those who have misused these funds?' (we found out) they haven't done anything to them. This state may have to get tough and basically make sure these funds are not misspent the way they have been misspent in the past."

That could include state statutes that set new policies for the COGs on how, where and how much taxpayer money can be spent on certain expenses. And it could include new laws that dictate accountability for taxpayer money, Junell said.

He said he will be spending the next 35-40 days getting preliminary lists together to help develop some proposals to present in the next legislative session on the councils of government.

"My understanding of what Mr. Junell is referring to (is that he wants to) clean up in the sense that he feels there should be some uniform state requirements placed ...on expenses of various kinds," said Jim Ray, director of the Texas Association of Regional Councils. "We would argue that is the responsibility of our local elected officials and that they are doing that quite adequately. But that is his view."

Junell said it was a view honed from experience.

"We have seen the abuses," said Junell, who has served on the Concho Valley Council of Governments board for about six years. "I appreciate the (COGs) coming forward with this policy statement and I think that is something we need to put into statute. But I'm going to put in the Appropriations Act that they can't spend money doing those things (that are questionable expenses).
I'm concerned that we have a situation ... where (the board) gives a vote of confidence to the executive director of the Permian Basin. That's not right.

"That's just poor, poor judgment ... both on the part of the executive director for doing what he did, and on that Council of Governments."