Mystery shrouds “financial gain” claim around Texas contested cases

State Sen. Troy Fraser, R-Horseshoe Bay, on the Senate floor of the State Capitol in Austin, Texas, on Monday, April, 27, 2015.  (Rodolfo Gonzalez / AUSTIN AMERICAN-STATESMAN)

State Sen. Troy Fraser, R-Horseshoe Bay, on the Senate floor of the State Capitol in Austin, Texas, on Monday, April, 27, 2015. (Rodolfo Gonzalez / AUSTIN AMERICAN-STATESMAN)

One bill the governor appears certain to sign into law: a measure passed by both chambers that would make it harder for citizens to win standing to fight proposed industrial permits making their way through state agencies.

The bill’s author, state Sen. Troy Fraser, R-Horseshoe Bay, has said the effort is a way to streamline permitting to attract business to Texas and further improve the economy; environmentalists say it’s about bulldozing roadblocks to power plants, refineries and other major industrial sites.

One argument that caught my attention during a legislative hearing on the bill: Hector Rivero, president of the Texas Chemical Council, whose members include businesses that support the bill, had this to say: “The current contested case process is being abused by some who simply don’t support business expansion and growth in our state and are using it as a delay tactic to thwart investment opportunities, and what’s worse are those who are gaming the system for financial gain.”

That last bit especially interested me: Industrial shakedown artists? That sounded like a good story. I was curious who Rivero had in mind: Unscrupulous lawyers? Exploitative residents of fenceline communities, so called because they abut the property of an industrial facility?

But when I asked Rivero, he had me speak to the Chem Council’s PR man, Mike Meroney. Meroney said that he himself did not have knowledge of specific examples and said that non-disclosure agreements and “ongoing litigation” prevented Rivero from expanding on what he had said publicly to lawmakers.

Hm. I was surprised that the Chemical Council — as opposed to individual member-companies — would be subject to non-disclosure agreements. I asked for a brief in the ongoing litigation and was told I wouldn’t get one. I asked if

State Sen. Troy Fraser, R-Horseshoe Bay, on the Senate floor of the State Capitol in Austin, Texas, on Monday, April, 27, 2015.  (Rodolfo Gonzalez / AUSTIN AMERICAN-STATESMAN)

State Sen. Troy Fraser, R-Horseshoe Bay, on the Senate floor of the State Capitol in Austin, Texas, on Monday, April, 27, 2015. (Rodolfo Gonzalez / AUSTIN AMERICAN-STATESMAN)

Rivero had in mind a certain Central Texas landfill owner known to fight competition partly through the contested case process; I was told no, that it was a petro-chemical refining issue.

I asked Meroney to point me in the right direction, at least off-the-record. He wouldn’t.

I was starting to grow a little exasperated: I found it peculiar to claim something publicly as damning as the “gaming of the system for financial gain” and then not back it up, even off the record, to a reporter.

I asked state Sen. Fraser’s office if they could steer me – if they knew what Rivero had in mind since they were carrying the bill; an aide told me he was unaware of any information or testimony backing up the claim that there are people “gaming” the system.

I called Steve Minick, the government affairs guru at the Texas Association of Business, which also supports the legislation. He was, in a sense, more forthcoming, telling me a story of a European company that was considering establishing an industrial facility in Texas – he was foggy on the details — but he told me a neighbor of the proposed site approached a company executive at an open meeting about the facility’s design, and suggested the company pay him hush money to not bother filing a contested case. Instead, the company decided to locate its facility in another state. I asked for Minick for details – the name of the company, for example – and gave him a week: he had nothing for me.

And I reached out to Mike Nasi, a lawyer who represents coal interests, asking him if he could illuminate Rivero’s claim. He told me: “There are definitely situations where a protestant’s counsel uses a procedural burden to leverage a settlement less about the merits of application and more about monetary compensation.” But, he said, he didn’t begrudge lawyers who represent their clients that way. “I don’t know what the Chemical Council is referring to,” he told me.

There may yet be something to Rivero’s claim.

Otherwise, though, it has the ring of some of the debates over alleged voter identification fraud: How real is the problem and who are we talking about? The contested case process, whether overly cumbersome or not (one can honestly debate that question), is meant to protect members of the public who live near industrial sites. People who live near such sites, especially in petro-chemical refining areas along the Texas coast, tend to be poor and of color. Absent other context, context that’s been hard to come by from the very person and organization who made the claim originally, the declaration that there “are those who are gaming the system for financial gain” begins to carry some shadowy aspersions.

As I told Meroney, I’d love to write a story about industrial shakedown artists — so if you’re a company executive or a lawyer or the leader of a trade association and want to slip me some specifics, please get in touch. I can keep your name out of it.

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