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March 1st, 2005:

TRMPAC lawsuit, Day One

The lawsuit against the Texans for a Republican Majority PAC is underway, and one of the first witnesses says they shoulda known better.

Texans for a Republican Majority, formed by Republican U.S. House Majority Leader Tom DeLay, should have reported some $600,000 in expenditures on state disclosure forms, Trevor Potter testified.

Some of the money was spent for political consultants, printing for mailouts and other items that five Democratic plaintiffs claim were political expenses. Potter, a former chairman of the Federal Election Commission, agreed.

“They’re all reportable, and corporate money can’t be used for those expenses,” Potter said.


Potter testified that TRMPAC was “a highly sophisticated political operation” that used nationally known pollsters, dealt with large amounts of money, had experienced consultants and targeted specific House races.

Under cross-examination, he acknowledged that a highly sophisticated political operation would be more likely to comply with the law.

Another claim by the Democratic plaintiffs — that the Republican political committee coordinated its efforts with other groups — was addressed in questions posed to Texas Association of Business President Bill Hammond.

The business association and Texans for a Republican Majority worked together on a mass mailing to voters in 15 House races, Hammond said. He said his association also shared information with TRMPAC about its issue-oriented “public education program” during the 2002 election season.

But the two groups made separate decisions about involvement in House races, Hammond testified.


Hammond said his association repeatedly sought the advice of a recognized Texas election law attorney so that it would stick with “issue advocacy” in its election activities and avoid “express advocacy,” or the urging of the election or defeat of a particular candidate.

He said issue advocacy is protected free speech under the First Amendment.

Potter was asked about $190,000 that Texans for a Republican Majority sent to a division of the Republican National Committee. Some Texas House candidates later received that same amount of money from an arm of the Republican National Committee.

“It raises an obvious question. That is, whether it was money laundering,” Potter testified.

However, attorney Terry Scarborough, who represents Ceverha, said in opening statements that money from the Texas committee went into a Republican National Committee account from which corporate dollars could legally be spent in other states.

In a separate criminal investigation, two people associated with TRMPAC — John Colyandro and Jim Ellis — have been charged with money laundering based on the $190,000 transaction.

As noted here, Trevor Potter has a long list of Republican credentials, which if nothing else makes him a provocative witness.

Elsewhere, Save Texas Reps has a roundup of recent news coverage, while Drive Democracy is attending the trial and blogging from there. See Nathan’s coverage of the opening statements by the plaintiff and Bill Ceverha’s testimony. Last but certainly not least is In the Pink Texas, also at the trial and on the lookout for a double espresso and an open window. Stay tuned for more.

UPDATE: Two more from Nathan, on Trevor Potter’s testimony and Bill Hammond’s testimony.

MALDEF on the pending Edgewood case

Something I meant to link to when discussing the forthcoming Democratic alternative to HB2 but forgot was a series of posts by Greg Moses covering the Mexican-American Legal Defense and Educational Fund (MALDEF)’s position on the upcoming Supreme Court review of Judge Dietz’ ruling. Here’s part one, part two, and part three. Check it out.

Reports from the Dallas Dems meeting

Byron sides with the disgruntled precinct chairs. Vince, Pink Dome, and Kerry sympathize with DCDP Chair Susan Hays. However you slice it, it sounds like it was ugly. I just hope it all gets settled soon.

UPDATE: Kerry explains his position more fully in the comments, since a forced server move is delaying his full bloggage on the meeting. I’ll link to that when it’s ready. StoutDem is definitely in the camp of the disgruntled.

Accenture to get HHSC call center

Following up on this post regarding the new call center system in Texas’ Health and Human Services Commission (HHSC), we see that they have made a tentative award of a contract to Accenture.

Notice of Tentative Award

HHSC announces the tentative award of a contract under request for proposals (RFP) #529-04-334 for Integrated Eligibility and Enrollment Services to Accenture LLP for all components prescribed by the RFP.

The tentative award is contingent upon, among other things, a final determination that a contract for call center services is cost-effective, the successful negotiation of a contract for the services, and obtaining federal agency approval for the portion of the contract that is subject to such approval. If negotiations with the selected vendor are unsuccessful, the tentative award will be withdrawn and HHSC may initiate negotiations with the next highest rated respondent or respondents. A tentative contract award becomes final upon successful execution of a contract.

As Pink Dome notes, that means that Accenture must have their “principal place of business” in Texas. I’m curious how that squares with this:

The General Accounting Office has concluded that four of the 100 largest federal contractors are incorporated offshore in tax haven countries as a way of lowering their corporate taxes.

One of the four, Accenture Ltd. of Hamilton, Bermuda, is ranked No. 24 on Washington Technology’s 2002 list of Top 100 federal IT prime contractors. The company had $279 million in federal contracts in fiscal 2001, according to the GAO report. Overall, the four companies pulled in $2.7 billion in government contracts during 2001.


Besides Accenture, the other three companies identified as incorporating in tax havens were McDermott International Inc. of Panama, with almost $1.9 billion in federal contracts in fiscal 2001; Foster Wheeler Ltd. of Bermuda, with $286.3 million; and Tyco International Ltd., Bermuda, worth $206.4 million.

The report said that McDermott, Foster Wheeler and Tyco had conducted “corporate inversions,” the term given to companies that were incorporated in the United States and then re-incorporated in a tax haven.

Accenture spokeswoman Roxanne Taylor said the GAO report vindicates the company’s position that it was never a U.S. corporation.

“Our contention has always been that we were not a U.S. company,” Taylor said. “They have communicated very clearly the fact in their own report that Accenture is not an inversion.”

Accenture was part of Andersen Worldwide, which is based in Chicago. When it split from its parent, it operated as a series of related partnerhips, according to the GAO report. In April 2001, it conducted an initial public offering and incorporated in Bermuda.

Emphasis mine. I’m sure someone smarter than me can square that particular circle. In the meantime. State Rep. Dawnna Dukes (D, Austin) may have a spanner in the works for Accenture:

Rep. Dawnna Dukes, D-Austin, filed a bill Monday that would require the state to put the brakes on call centers until it has fully tested an electronic system that would be the centerpiece of the new program for determining how people are eligible for government benefits.

House Bill 1674 calls on the state to stop negotiations related to opening the centers — hubs where people would call to apply for or renew food stamps, cash assistance and other government programs.

Dukes’ bill states that if the Health and Human Services Commission enters into a contract with a company before the bill takes effect, it will not be able to renew that contract until it proves that the electronic system that will support call centers works.

On Friday, the commission chose Accenture as the company to which it would give a tentative contract for the centers. However, a spokeswoman said the state must still weigh the company’s proposal for running the centers against its own to see which is better.

I doubt that bill will go anywhere, but I’m sure it will cause a few concerns in the Capitol.

Father John has a different concern about the call center system (TIERS), once again looking to Colorado for an inkling of what’s to come:

More Colorado mothers are getting little or no prenatal care, and it’s beginning to show with more unhealthy babies, a hospital manager says.

“We’re seeing more women show up in labor having no prenatal care,” said Barbara Hughes, director of the Exempla St. Joseph Medical Center’s midwife program.

Hughes blames a change in state policy last year that no longer allows counties or doctors to “presume eligibility” for Medicaid for a pregnant woman who seems to have very little money.

She also blames the state’s new $200 million Colorado Benefits Management System, which is supposed to determine eligibility for welfare payments, but has been beset by problems.

If a pregnant woman applies for Medicaid, but then has to wait three or four months to be approved, she loses out on most of the crucial prenatal care, say health officials who want presumptive eligibility restored.

Medicaid covers about $1,000 worth of prenatal care for women of very low income who don’t have any other insurance.

That $1,000 worth of care can mean the difference between life or death, a healthy baby or one that will cost the health-care system millions of dollars, Hughes said.

She cited the example of one pregnant mother who applied for Medicaid last August, just before the change in presumptive eligibility.

“She decided to wait for her Medicaid application to go through,” Hughes said. “It took five months. She missed all her prenatal visits over that time.”

She finally showed up at St. Joseph, about 10 days before her baby’s due date. “The baby was already dead,” Hughes said. “It’s so tragic.”

Father John tells me via email that presumptive eligibility is still in place in Texas and that there’s no current plan to change that (though I must confess that given the re-enrollment shenanigans that came along with HB2292 last session, I’m not 100% confident that it is unassailable), but he fears that the new system, which will essentially be beta tested on live users, will cause the kind of delays that may have contributed to the tragedy described above. We should all be concerned about that.

Thanks to a nameless-by-request reader for the tip on this. A communication from HHSC to its employees about the upcoming changes (read: massive layoffs) is beneath the fold.


Woodfill responds

County GOP Chair Jared Woodfill responds to the earlier story in which he criticized City Council members for not being more in opposition to Mayor White and to the criticism he received for that story. There’s nothing here that I find objectionable, and nothing that I’d argue with if Gerry Birnbirg had said it (philosophically adjusted, of course), so maybe Jared ought to consider the advice that Kevin had for him. Or not. I mean, it’s not like I’m unhappy with how things are going around here.

More tomfoolery

The Raw Story follows up on their previous piece which outlined new allegations of inappropriate behavior by Tom DeLay. Will any Democrat step up and file another ethics complaint? Nancy Pelosi seems to be calling for someone to do so. Ball’s in your court, folks.