CEIDC Receives Internal Affairs Report

By Greg Ritchie

Messenger Reporter

CROCKETT – After a lengthy four-hour budget meeting the morning of Monday, July 1, Crockett City Council reconvened for a 6 p.m. meeting to officially receive the internal affairs report regarding the forensic audit of Crockett Economic and Industrial Development Corporation (CEIDC).

The report was initially scheduled to be presented June 17, but due to the absence of three council members, the meeting was delayed. Attending by perhaps one of the biggest crowds to come to a city council meeting, there were a number of public comments, many calling out individual council members by name and warning them their actions could bring serious consequences, if evidence of collusion could be proven. 

Before each meeting, Crockett Mayor Dr. Ianthia Fisher tells attendees they will each have three minutes for their comments and warns them the council cannot respond in any way. “We love you,” the mayor says, “but we are not allowed to answer any questions or respond in any way.”

Once the comments had concluded, Fisher asked the council members if they would like to make any comments, warning them, too, they would not be allowed to respond directly to any of the citizens or any of the comments they may have made. 

“I’d like to say something,” Precinct Four Councilman Elbert “Wayne” Johnson said, adjusting his microphone. “I ran for this seat to help this community. No matter how anyone feels about me. I have been here three times, man. And you all are not going to put this problem on me.”

“Excuse me,” Fisher interrupted. “Councilman..councilman…”

“I have been here three times,” Johnson continued. “It’s not my problem what’s going on.”

“Councilman, you are responding to a comment,” countered Fisher. 

“No, I am not. I am just saying I am not responsible for what is going on right now. I ran to try and make the community better.”

Precinct Four Councilman Elbert “Wayne” Johnson (right) shares some comments of his own, after the public comment section at the recent Crockett city council meeting.

The exchange ended, the public was ushered out as the council went into a nearly two-hour executive session to discuss the internal affairs report with City Attorney Bill Pemberton and representatives of the law firm who prepared the report. 

Returning to the open meeting, Councilwoman NaTrenia Hicks moved to make the report public, accept the recommendations and requested a special meeting to be held to propose a new employment contract for CEIDC Executive Director James Gentry. 

There was no presentation of the report or its findings to the people, but having obtained a copy, The Messenger can summarize the findings for our readers. 

The report established some facts about CEIDC itself, and its relationship to city government. 

Any amendments to the CEIDC bylaws must be approved by the city council

Failure of CEIDC to adopt recommendations from city council can results in the removal of a CEIDC director, which is legal and authorized 

Both current and former directors and executive directors can be held personally liable for their actions

Many of the actions of CEIDC employees and executive directors would likely have resulted in a denial of liability coverage due to negligence or misconduct

“Any person or business who were either given or denied assistance by the board. or even contracted by the board or purchased land from the board, would have a potential case of action against CEIDC and the directors and officers individually, if the decisions of the board were improperly handled.”

This would include failure to follow state and federal employment law for hiring, firing, improper payment of funds or failure to follow required withholding provisions

Now that City Council is acting as the CEIDC board, they must be very careful in appointing any former directors, officers or employees back to their prior positions before final decisions are made as to criminality or other possible improprieties

The report goes on to criticize CEIDC decision making, without prior council approval, saying since city council is CEIDC’s authorizing unit, they must approve all business activities of CEIDC, something CEIDC has not followed on a regular basis. 

“Such failure constitutes, at a minimum, negligence on the part of CEIDC directors and Executive Director and could constitute misconduct depending on the program and/or expenditure, and potentially puts at risk previous projects not properly approved.”

The report goes on to note the many violations of the Texas Open Meetings Act, and any action taken after a violation of this act are voidable and interested parties could seek to prevent or release any such action. 

By statute, actions by CEIDC should benefit CEIDC, city council and the city they serve. CEIDC has an obligation to make sure any proposed program presents a clear benefit to CEIDC. Any actions must supply the public with transparent information about the benefits to the city. 

CEIDC operates and exists at the pleasure of city council, which must approve its budget, activities, and every program. City council can change the structure, organization, programs and activities, including eliminating the existence of CEIDC altogether. 

The report concludes with some concrete recommendations, some of which have already been addressed by council members doubling as CEIDC board members and bringing CEIDC bookkeeping into the city’s hands. 

  1. Including city council members in CEIDC board meetings should continue, allowing the council to make sure their goals are being pursued and achieved by CEIDC. 
  2. Contracting with the city for services and staffing needs and using the city’s already well-defined policies and practices in the management of CEIDC, for which CEIDC must pay the city. 
  3. Revisions to the bylaws to make sure CEIDC is following rules and laws.
  4. Scheduling regular joint sessions between CEIDC and city council, at least once per quarter, and making sure the Executive Director briefs the council in executive session at the earliest possible moment about ongoing negotiations with businesses. 

The final recommendations for a corrective plan were laid out in plain language. 

  1. Immediately look for opportunities to increase the level of transparency surrounding CEIDC operations with the public. 
  2. Maintain city council as the working CEIDC board for at least fiscal year 2024-2025 and then reevaluate the structure needed to run CEIDC. 
  3. Negotiate a comprehensive management agreement between CEIDC and the city. 
  4. Engage a special counsel well versed in economic operations law in Texas. 
  5. With a management agreement in place, the city must immediately consider the findings of the forensic audit as they plan budgets and operations, including required training for CEIDC employees, reviewing CEIDC bylaws, preparation of budget amendments, administration of employee compensation, implementing a purchasing policy, outside accounting and centralized storage of records. 

Greg Ritchie can be reached at [email protected]

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