Off the Kuff Rotating Header Image

July 31st, 2008:

Pete’s strip club buddies

The DCCC has some fun with Pete Sessions’ strip club fundraiser.

A March 2007 evening at a Las Vegas strip club is creating a great deal of controversy throughout the country, including in Minnesota. The event raised money for the leadership PAC of Republican U.S. Representative Pete Sessions of Texas. Sessions was joined by casino executives and payday lenders at Ivan Kane’s Forty Deuce nightclub, located in the Mandalay Bay Resort and Casino.

According to Sessions, the club is a harmless burlesque. Kane, the club’s owner, shared his definition of a burlesque to NPR: “The key component would be to have girls who were dancers taking their clothes off, not just girls taking their clothes off.”

Sessions’ leadership PAC, People for Enterprise, Trade and Economic Growth picked up the tab for the event. NPR noted in a report that “just days before the party at Forty Deuce, casino interests donated $5,000 to his PAC. Payday lenders threw in another $2,500.”

The PAC has contributed $5,000 to the congressional campaign of Erik Paulsen and $2,500 to Rep. Michele Bachmann’s reelection campaign.

“Michele Bachmann and Erik Paulsen have spent their entire careers pushing an extreme right-wing agenda that has been out-of-touch with the views of everyday Minnesotans. Yet at the same time as they say they are pro-family, they take money raised from Casino owners partying at a strip club,” said Carrie James, regional press secretary at the Democratic Congressional Campaign Committee. “The hypocrisy of this is astounding- a do as I say, not as I do approach to leadership.”

Boy, sex and gambling all rolled together. I’ll bet it was fun, in that “what happens in Vegas, stays in Vegas” kind of way. And given some of the attendees, it’s almost as if he’s an extra Congressman from Nevada, as Wick Allison put it.

Chris Bell easily reached his goal of $10k raised online in considerably less than 10 days, and now he’s shooting for $20k, to offset one of Bob Perry’s donations. The boys at BOR are on strike till they raise $1000 for him – they’re almost halfway there already.

You’ve heard of John McCain’s $500 shoes? That wouldn’t even be enough to buy one of John Davis’ boots.

The Higher Education Opportunity Act of 2008 sailed through the House today. See a brief video on it here.

Diane Trautman having a volunteer appreciation breakfast on Saturday morning at 9 AM in the King’s Crossing Apartments clubhouse up in Kingwood. Click that link for a map. And don’t forget White Linen Nights in the Heights later in the day.

Finally, Rick Noriega will be hosting a live virtual town hall tomorrow at 1:30 PM. Just go to his website and submit your questions. Noriega was in College Station today for a more old-fashioned town hall. You can read some blog coverage of it here and here.

Landfill power

Interesting.

Anheuser-Busch, the top U.S. beer seller, said today it will begin using landfill gas to help power its massive Houston brewery in a move designed to lower its soaring energy costs and keep beer prices from climbing higher.

The St. Louis-based brewer will use the landfill gas to help run boilers that today are fueled by natural gas.

When the landfill gas begins flowing into the plant later this year, about 70 percent of the brewery’s energy needs will be met by renewable fuels, Anheuser-Busch officials said today during a Houston news conference announcing the initiative.

“It’s going to help us keep beer affordable,” said Doug Muhleman, group vice president of brewing operations and technology at Anheuser-Busch.

The beer maker will purchase the gas from Framingham, Mass-based energy firm Ameresco, which has a partnership with Houston landfill operator Allied Waste Services.

The Houston brewery, the company’s second-largest behind its flagship plant in St. Louis, will receive the gas via a six-mile pipeline into the plant from Allied’s McCarty Road landfill in east Houston. Still under construction, the pipeline will be completed later this year, the companies said.

Other landfill operators, including Houston’s Waste Management, have launched similar efforts to harvest and sell methane gas created by decomposing organic material in trash dumps. In addition to providing alternative energy, the practice reduces emissions of methane, a greenhouse gas.

Well, it’s good to know that our predeliction for landfills has a positive side to it. Kudos to Anheuser-Busch and to the landfill operators for taking advantage of this opportunity.

How many eligible voters are there?

On Tuesday, I asked the question how many eligible voters there were in Harris County, so we could put the number of registered voters into some perspective. Yesterday, I got an answer to that question. The folks at Houston Votes sent me an analysis they had done by Dr. Richard Murray, which gives a pretty good estimate. I’ll go through the elements of Dr. Murray’s math. First, how many people are there?

Based on the Jan 1, 2007 US Census number, Harris County had, as of that date, approximately 3,935,000 residents. If the annual population increase for this decade holds true for 2007 and 2008, which is around 75,000 people per year, then as of November 2008 the population will be probably around 4,080,000 (3,935,000 + 75,000{2007} + 62,500{2008 – 2 months}= ~4,080,000).

1) Under 18 years old: -1,179,120 (28.9% under 18, US Census 2006 for Harris) of 4,080,000).

2 ) Non-Citizens: -300,000 (22% of the general population are foreign born according to the US Census for 2000 . Dr. Murray estimates that of that population in Harris County (897,000), about 300,000 are non-citizen adults).

3) Felons on probation/parole: -100,000 (High estimate of 100,000, according to Dr Murray).

Put all that together, and you wind up with about 2.5 million people who are eligible to vote in Harris County. That answers my first question, as it suggests we’re at around 75% registration. But there’s more to this, as Dr. Murray elaborates:

1) Projected fully registered voters: 1,900,000. As of 3/4/2008, 1,809,000 were people were registered to vote in Harris County. We are awaiting latest numbers from Paul Bettencourt, which are likely to be around 1.9 million.

2) Current suspended voters: -307,000. These voters were on the suspense list as of 3/4/08, meaning they have left, died, or moved. (Voters who have moved must go to their new precinct and file an affidavit and are therefore not classified as fully registered in this count.)

3) Projected new suspended voters: -100,000. Approximately 150,000 additional otherwise eligible people will die, move etc and are added to the suspended voter list each calendar year. (The estimate of 100,000 new suspended voters takes into account the fact that there are only seven months between the last count, 3/4/2008, and the voter registration deadline of 10/6/2008.)

So, if you subtract the names that are or will be on the suspense list, you’ll be at about 1.5 million fully registered voters by the registration deadline, as your baseline. That means there’s room to add a million more people to the rolls.

Now, as I understand it, the folks on the suspense list who have moved can still vote, even if they don’t do the affidavit; I’m told about 100,000 to 150,000 of them will correct their registrations on their own. Generally speaking, if they vote early, the discrepancy between their current and registered addresses will be caught and fixed. If they vote on Election Day and they’re in a different precinct, they’ll be sent to the new precinct to vote. That of course may be problematic for some of them, depending on when they arrive at the polling place, and one assumes that some of them will wind up not casting a ballot. I have no idea what the numbers there may be.

So, depending on how you look at it, there’s between 600,000 and one million people who are not correctly registered to vote. Looked at in that context, you can see why there will be so much effort put into registration drives. You can also see why Diane Trautman has made this issue part of her campaign. Maybe if Bettencourt’s office made registering voters as much a priority as they did scrubbing them, we’d have a higher ratio of eligible adults on the rolls.

One last thing: Using Dr. Murray’s numbers, I estimate the total eligible population in Harris County in 2004 was a bit more than 2.3 million. If as the earlier story said 1.94 million of them were registered to vote, then we would need to have almost 2.1 registered voters this year just to have the same percentage as we did in 2004. That means another 200,000 registrations between now and October 6. I’d say we have our work cut out for us.

It sucks to be a school district

And it’s not going to get better any time soon.

School districts across Texas are likely to face extreme fiscal hardships over the next two years as transportation costs spiral out of control, enrollments continue to grow and the transition from textbooks to technology progresses.

That was the word from a panel of educators and advocates at the Texas Education Agency’s school finance summit Tuesday. They and Texas Education Commissioner Robert Scott began laying the groundwork for what they would seek from lawmakers when the 81st Legislature convenes in January.

“We just don’t have enough money, basically, to provide a quality education experience to our students,” said Sharon Shields, superintendent of the tiny La Vega school district near Waco.

Like several of her counterparts who participated in the six-hour discussion, Shields said her district needs more financial aid from the state and greater flexibility to raise and spend the money it receives from local taxpayers.

Most of the educators agreed that the school finance overhaul enacted by lawmakers two years ago — an attempt to settle the ongoing dispute between rich and poor school districts — is already falling short on generating the funds needed to sustain public schools.

“We always pull up with a penny-wise, pound-foolish solution,” said Richard Kouri, who represents the Texas State Teachers Association.

The crux of the problem is that the funding for school districts didn’t include any room for cost-of-living increases. Which might not have been a big deal in some years, but when things like gas and food prices skyrocketed, it put a huge hole in their budgets. Their operating expenses have gone up while their financial resources have not. As you might expect, that has been disastrous for them.

Now, the Legislature could choose to do something about this in 2009. Perhaps with a new Speaker, some help could be on the way for the schools. But thanks in part to the maneuvering that separated the property tax cuts from the rest of the budget in 2007, and in part to the slavish devotion to property tax cuts uber alles, it’s hard to picture anything other than more penny-wise “solutions” coming forth.

Harvey Kronberg reported on this as well.

The informal consensus of the group appeared to hinge on the fact that a significant new infusion of money was not expected for education next session. Indeed, the business margins tax already is showing a lower-than-expected return. That means that lawmakers might have to dig even further into the anticipated $10.7 billion surplus in order to bridge the 50-cent reduction in property taxes.

With all these factors in play, the minimum the group appeared ready to accept was a three-pronged approach to the problem: First, that some type of floor be set on target revenue so that every district hits a minimum target revenue of around $5,000 per student. That amount would be adjusted by various weights.

The second measure would be some type of funding put in place to address the inflation that is eating up school district budgets. If the revenue targets were increased by 1 percent a year, the cost would be about $630 million. If the revenue target were increased 1 percent in the first year and an additional 1 percent in the second year, for a total of 2 percent, the total cost would be about $950 million.

Then it would be the fervent hope of those who have dealt with the school finance system the longest – and especially [Lynn] Moak and Bill Grusendorf of the Texas Association of Rural Schools – that lawmakers start to move the system back to one driven by formulas and not the various past hold harmlesses.

The “hold harmlesses,” added each time the school finance system is revised, is funding intended to make sure no school district is worse off going into a new school finance system than they were going out of the old system. The system has been changed so many times in Texas that the amount of the past three hold harmlesses – or “hold harmli,” as Scott calls it — is now $2 billion, an amount that means the hold harmlesses have more impact on the system now than any aspect of the school finance formula.

What needs to be done is to close the gap between the basic school allotment and the target revenue amount. Either aspects of the funding formula can be adjusted or, as Grusendorf suggested, the guaranteed yield on tax effort can be increased. Right now, in an effort to equalize funding between poor and wealthy school districts, the state guarantees about $43 per penny of tax effort. By raising that yield to $50 per penny, about $1.8 billion can be shifted into the basic allotment, Grusendorf said.

Good luck with all that, that’s all I can say. I just hope everyone can hang on till 2011. Eye on Williamson has more.

Pai pays up

Been awhile since there was an Enron-related story that interested me.

A former top Enron executive who sold nearly $300 million in Enron stock before the company cratered has agreed to pay regulators $31.5 million to settle civil allegations of insider trading.

The amount Lou Pai, 60, agreed to pay is the highest Enron-related settlement reached between an individual and the Securities and Exchange Commission, and the agency said it is one of the highest individual settlements in its history.

Other SEC fines gained in numerous Enron settlements since 2002 range from $30,000 to almost $2 million for individuals, though some higher amounts were split between the SEC and the Justice Department.

But Pai’s settlement is a fraction of the $270 million or more that shareholders who sued him and other executives say he gained from stock sales.

“I’m just shaking my head. That makes me sick to my stomach,” said Diana Peters, one of the thousands of employees left jobless when Enron collapsed in December 2001, months after Pai quit the company.

“He’ll just move down the road and it won’t even be a drop in the bucket for him,” she said. “But if you’ve got that kind of money, I guess you can afford to buy yourself out of anything.”

[…]

Pai, who was chairman and chief executive of Enron’s retail energy division, Enron Energy Services, was among the more colorful yet elusive figures at Enron.

He was known to frequent strip clubs as part of enjoying the great wealth he gained from the company’s generous bonuses and stock options, a former employee told the Chronicle for a story in 2003. Yet he avoided the spotlight while at Enron, and has done so since he resigned from the company in May 2001.

Yes, the movie “The Smartest Guys In The Room” talked a bit about Pai and his stripperphilia. He himself did not appear in the film, but there is an image of a jet plane taking off as whoever was speaking talked about how Pai cashed out and headed off to Hawaii with one of the girls from (I think) Rick’s Cabaret.

The bulk of Pai’s stock sales occurred as part of a divorce settlement more than a year before Enron crumbled. Pai has never been charged with crimes, and earlier this year was dropped as a defendant from a massive shareholder lawsuit in Houston.

[…]

The stock sales at the heart of the SEC complaint that Pai settled on Tuesday took place from May 18 to June 7, 2001. The SEC said he sold nearly 573,000 shares at $53.78 based on insider information that a division he once ran had financial troubles unknown to investors.

Specifically, the SEC complaint said Pai knew that Enron Energy Services faced substantial losses in the first quarter of 2001. The complaint notes that Enron’s CEO and senior accounting personnel, along with Enron Energy Services management, “secretly revised” division reporting to avoid disclosing those losses. That revision came about by moving the retail division’s trading arm into Enron’s larger trading franchise, Enron Wholesale Services.

That action received much focus in the 2006 fraud and conspiracy trial of Skilling and Chairman Ken Lay. Skilling testified that the retail trading arm was moved into the larger division to combine like functions for efficiency’s sake.

But David Delainey, Pai’s successor as the head of Enron Energy Services, testified that the move was intended to hide millions of dollars in losses, the disclosure of which could threaten Enron’s stock price and credit rating.

Reading this story reminds me why I was bothered less than folks like Tom were about the criminal cases that were brought against the likes of Ken Lay, Jeff Skilling, and so on. Pai was (eventually) punished through the civil process, but the punishment he received doesn’t come close to balancing the scales, in my view. He’s still a millionaire many times over – assuming he hasn’t blown it all, of course – while so many other people, employees and shareholders, got wiped out. I think the only way the civil justice system could really make these guys pay for their wrongdoings is if it left them in the same shape as the people who were affected by their actions – namely, in a situation where they’d have to work for the rest of their lives because they no longer had any accumulated wealth. Here’s a bit I wrote from my review of “The Smartest Guys In The Room”:

There’s a really poignant scene in which Portland General Electric lineman Al Kaseweter matter-of-factly states that he sold his entire retirement portfolio, which was worth $348,000 at its peak, for $1200.

PGE had been bought by Enron before the crash; like most Enron employees were encouraged to do, Kaseweter put the bulk of his retirement funds into Enron stock. Put Lou Pai in Al Kaseweter’s shoes, and I’d agree that justice had been served. Same with Skilling and the rest of that crowd. But that’s not how it works, so despite the problems associated with the Enron prosecutions, I think they were necessary.

Bye-bye, trees

And away they go…

Some of the live oak trees that lined Kirby Drive were removed [Monday] night as part of a controversial reconstruction project between Westheimer and Richmond.

The oaks, as well as crape myrtles, were taken down on the west side of Kirby from Richmond to Kipling. Trash bins placed along that stretch were full of the destroyed trees early today.

“We knew it would be done at night,” Barry Ward, executive director of the nonprofit group Trees for Houston, said [Tuesday] morning.

“That is fairly typical,” he said. “There is some justification when you do that, so it doesn’t disrupt as much traffic. But, you’d also be naive to think it wasn’t done so they wouldn’t get so much public scrutiny.”

[…]

“You don’t want to do it during peak traffic times, and you don’t want to interfere with retail businesses during the non-peak times during the day,” said Travis Younkin, the district’s capital projects director. “This just makes the most sense.”

Overnight on Tuesday, contractors removed the oak trees and crape myrtles on the west side of Kirby from Richmond to Kipling. Trash bins placed along that stretch were full of the destroyed trees. The trees likely will be turned into mulch.

I took Kirby to get to work Tuesday, partly because I was curious to see if any removal work had been done. I saw a bunch of trees with orange construction mesh around them, but didn’t spot the empty spaces where the cuttings had taken place. It’s probably more obvious today. It’s sad to see it happen, and I do think this could have been done a different way, but what’s done is done. I just hope that Upper Kirby is right about what it will all look like afterward.