Saturday, March 7, 2015

FBI, STATE PROBING $3.3 MILLION BISD INSURANCE DEAL?

By Juan Montoya
Sources at the Brownsville Independent School District say that federal and state agents have been probing the details regarding the issuance of a $3.3 million insurance contract to a Houston firm without having been previously approved by the board.
The contract, purchase order and check were made out to McGriff and Seibels and Williams of Houston, Texas. The policies covered property, windstorm, hail, boiler machinery insurance.
 On January 13, a majority of the Brownsville Independent School District board told the administrators in charge they were not satisfied with the recommendation of McGriff.
Despite the fact that there had been four meeting of the Insurance Committee and that the Request For Proposals (RFPs) for the lucrative awards had been issued in early December 2014 and that four proposals had received, two were not considered and deemed unacceptable. The remaining two – although under two different company names – were said to come from firms associated with McGriff, also the insurance consultant to the BISD.
One trustee – Joe Rodriguez – said he was not satisfied with the choices recommended by the administration, namely Judy Cuellar, in charge of insurance, Rosie Peña, in charge of purchasing, Lucio Mendoza, Chief Financial Officer, and then-Superintendent Carl Montoya.
The administrators were told to rebid and to come back with a different recommendation.
"They thought they were paying too much to McGriff," said a BISD administrator.
From January 13 to the regular monthly board meeting February 3, the administrators did not come back to the board with an option for the board.
It wasn't until the day after the regular meeting, on Wednesday, February 4, that board members learned at the Budget Committee Meeting that under the item titled: "14. Discussion of Property Insurance renewal," that the district's administration had already approved the purchase and vendor of the insurance for the district without them being notified.
Under the pretext that an urgency existed because the insurance ran out on January 31, CFO Lucio on January 22, wrote Montoya and said that "after considering the time constraints to go out for new proposals for property insurance, trying to schedule committee meetings and the expiration of the property insurance policy...it is my fiduciary duty to protect the district assets to the bet of my ability. I would respectfully recommend that we renew the property insurance through the Texas Cooperative Purchasing Network (TCPN, or Texas Buy Board)."
That was the first of numerous irregularities surrounding the insurance contract.
The district insurance evaluation committee which recommended McGriff were Employee Benefits administrator Judy Cuellar, Payroll Administrator Kenneth Lieck, Warehouse Adm. Kent Wittenmore, CFO Lucio Mendoza, Finance Coordinator Mark Alaniz, and Belia Rodriguez, a representative from the purchasing dept.
The three BISD board members who head the insurance committee are Cesar Lopez, Jose Chirinos and Carlos Elizondo.
The other two companies who were not considered, according to Cuellar, was because they did not have the authority or permission to approach the companies McGriff already had contacted to be in their bid.
That strikes Klements as suspicious since Bordon's Insurance, the other company whose bid was allowed, lists the same identical insurance carriers as McGriff.
Insurance companies, experts say, only allow one agent to approach them and will not consider any others. To add insult to injury, they say that McGriff besides selling the BISD insurance, is also listed as its consultant (risk manager) with the Texas Cooperative Purchasing Network.
At least one representative of the companies excluded, Greg Kelment, of Klements Insurance, said the set up in effect prevents other brokers or their agents to offer any bids because McGriff has already "tied up" the bids.
Was the Bordon's quote simply a ruse to make the district believe that there were two different companies bidding when in reality the same insurance carriers are listed by both with the only difference being the lower quote price that favored McGriff?
The BISD board has since revisited the contract and now is in  a three-month service extension with McGriff while the district goes out for bids again in April.

13 comments:

Anonymous said...

It will be interesting to see what agency gets awarded the contract this time.

Anonymous said...

I think most contracts in BISD should
be scrutinized for corruption. Many of the passed and present Trustees have had their hands out for kickbacks from contractors and these contracts should be audited and investigated for fraud and corruption. Likewise....most contracts from the city and the Port should be audited and investigated.

Anonymous said...

Going to bid again in April will not produce different results unless bid specifications are cured. Certain conditions and contingencies must be included to ensure a competitive environment. BISD's insurance purchasing track record, procedures and contracts, lack of audits and transparent third party oversight, historical failure to compare awarded contracts to proposals and final binding contracts have had two effects: Higher costs and Red Lining.

Anonymous said...

You forgot to mention BISD is paying $1.3 million for the 3 month extension. This is a heavy duty price to pay to fill someone's pockets at Taxpayers expense! When is the FBI, Texas Rangers coming down on these guys???

Anonymous said...

I too am convinced that there is a good deal of corruption in the letting of contracts in Cameron
County. There is just to much borderline (and overt)shady stuff that seems to be going on but when I see statements like "Many of the passed (sic) and present Trustees have had their hands out for kickbacks from contractors" I want to ask: How do you know? Tell me how you know they are taking bribes and kickbacks. And, my cousin's neighbor's sister told me isn't going to be enough to convince me. Neither is "everybody knows" or "they all do". I'm not saying and want to see a document trail or a sworn statement, just tell me you have seen documents or statements or whatever and what they say. And Wightman style red herring statements that claim some anon "sources" told you are no different then rumor unless you say what they sources told you and why it is believable.
As I said, I suspect it is true but I am not going to be taken in by the old trick of repeating an allegation so often that people begin to believe it simply because they have heard it so often.

Anonymous said...

So, what's new that we don't know about. !!!

Anonymous said...

El Mendigo Mendoza might be a Jail Bird with Villawolfs.

Anonymous said...

Caesar will be holding hands with El Mendigo,et al.

Anonymous said...

The Rodents are coming out of the wood shed .

Anonymous said...

Rata de dos patas

Anonymous said...

The authorities already have the balls and tits of the culprits. Great job feebis.!!

Anonymous said...

Mendoza parece la gran Chet en la foto.

Anonymous said...

The problem with the Judge is that he uses Politiks in his judicial decisions. He would be content to take an assignment to the Dakotas where he can oversee the buffalo herds.

rita