Dallas Superintendent is a Paid Consultant With a Law Firm Billing His District $ Thousands
Is this corruption, conflict of interest, an ethical question, another example of spending money anywhere but in the classroom, business as usual, or all of the above?
Dallas Superintendent Dr. Mike Moses is a consultant with the law firm Bracewell & Patterson and has made thousands of dollars in consulting fees while the law firm billed DISD for more than $700,000 in legal fees. Moses told the Dallas Morning News [published May 8, 2004] that the school board knew and approved of this relationship. Were they told that they had to agree? Was the board's approval contingent on reviewing the cases brought to Moses' attention, before he consulted with Brace & Patterson?
Moses works as consultant for lawyers on DISD payroll
He says Houston firm is clearinghouse for work; board was aware of ties
By SCOTT PARKS / The Dallas Morning News
A Houston law firm has paid DISD Superintendent Mike Moses tens of thousands of dollars in consulting fees while simultaneously billing the district for more than $700,000 in legal fees, The Dallas Morning News has learned.
David Thompson, a partner in the firm Bracewell & Patterson, and Dr. Moses are longtime friends.
The men said they became business associates in 2000, the year before Dr. Moses came to the Dallas Independent School District. He was deputy chancellor at Texas Tech University at the time.
Several DISD trustees said that he informed the board of his consulting relationship and that they do not have a problem with the arrangement. Under the law firm's banner, Mr. Thompson used Dr. Moses as a paid consultant to help him find new superintendents for Texas school districts.
According to records, Dr. Moses formally recommended that the school board add Houston-based firm Bracewell & Patterson to DISD's stable of outside legal talent. The school board, just weeks after his arrival, unanimously approved the recommendation Jan. 25, 2001.
Before 2001, the law firm had done a little work on a spot basis for DISD – about $7,500 worth in the late 1990s. But since February 2001, DISD has paid the firm more than $718,000.
Dr. Moses acknowledges that the law firm has paid him tens of thousands of dollars during the three-plus years he has been in DISD. Public records aren't available to determine exactly how much. Texas' financial disclosure laws don't apply to superintendents.
Even though Bracewell & Patterson pays his fees for superintendent searches, Dr. Moses said in an interview, "I guess I saw my relationship more as with the boards I was doing searches for."
"Bracewell & Patterson has been the clearinghouse for the searches that David and I have done, and that way, they've handled all the billings to the school district and that kind of thing. I've been paid by Bracewell & Patterson, but I have worked with David Thompson."
Rebecca Rodriguez reports:
Roxan Staff, DISD board president in 2001, ardently defends Dr. Moses. She said he disclosed his consulting relationship before trustees hired him in late 2000. And, she said, trustees knew they were voting to do business with the same law firm that periodically used Dr. Moses as a consultant.
"I think what clears the ethical hurdle is that he put his cards on the table and the board had every opportunity to say they didn't want to do it," Ms. Staff said. "We knew it when we hired him that he and those folks were friends."
Others who know Dr. Moses and who have worked with him praise him as a great school district leader and manager. They say his dual relationship with Bracewell is not an ethical lapse because his nine bosses, the school trustees, knew about it.
But two experts in professional ethics and the president of the American Association of School Administrators - neither of whom lives in Texas or knows Dr. Moses or has any interest in DISD - said the appearance of a conflict of interest exists.
"I could not do what he is doing and pass a review of appropriateness with our state ethics board," said Dr. John Leonard, president of the administrators group and a school superintendent in Missouri for 28 years.
"I'm not passing judgment from a thousand miles away because our cultures are different and I don't know what goes on there, but it's something I would not do."
Mr. Thompson, who served as general counsel at the Texas Education Agency before going into private practice, said he does not see Dr. Moses' recommendation to hire his law firm at DISD as a conflict of interest because school trustees made the final decision.
"If the board ever expressed any concern about it, we would stop doing it," Mr. Thompson said. "I don't want the appearance, and I don't think Mike does either."
Robert P. Lawry, director of the Center for Professional Ethics at Case Western Reserve University in Cleveland, said the argument that the school board knew everything about Dr. Moses' relationship with Bracewell rings hollow.
"My reaction is that even though it's transparent and the board signed off on it, we've seen some boards sign off on some stupid things. That doesn't rectify it. The cure is not transparency but prohibition."
After the school board added Bracewell to its outside counsel list, monthly billings to the district began at $220 to $250 an hour, depending on which lawyer was doing the work.
DISD paid its first monthly bill April 26, 2001. The check for $18,860.40 was described as "legal fees for February 2001."
Jack Elrod, DISD's general counsel, supplied The Dallas Morning News with an analysis of district payments to outside law firms from 2001 to present. Seven other firms have earned more money from DISD than Bracewell & Patterson during those years, according to Mr. Elrod's figures.
The Dallas firm of Vial Hamilton Koch & Knox LLP heads the list with $2.9 million in billings.
Other firms handle the district's real estate business, employment dispute resolution and legal issues involving bonded indebtedness.
"Obviously, if the effort was to enrich Bracewell & Patterson, I would have said give these guys all the real estate and personnel work," Dr. Moses said. "In the assignment of attorneys, I don't try to call [Mr. Elrod] and say would you make sure this firm or that firm handles this piece of business. He knows what the firms are doing and what they can and cannot handle."
A review of Bracewell & Patterson bills to DISD shows that the bulk of the firm's work has come in two specialties: school finance litigation and special-education law.
Before Dr. Moses came to Dallas, state regulators had reported that DISD services to special education students did not comply with the law. The Texas Education Agency was closely monitoring the district's compliance, which often requires formulation of complex education plans for children with mental and physical disabilities.
DISD needed specialized legal help that it was not getting, Dr. Moses said.
"We were in a ditch with regard to special education," he said. "Twenty-five days after my employment started, I was not trying to feather anybody's nest. I was just trying to say, 'Here's some good people who do good work and we need to try to use them.' "
Lonnie Hollingsworth, chairman-elect of the State Bar of Texas' school law committee, said Bracewell & Patterson "is among the top practitioners" of special-education law in Texas.
"Would I say they are the best? No," said Mr. Hollingsworth, director of legal services for Texas Classroom Teachers Association in Austin. "There are a number of firms that are good. It is clearly too subjective to say who is best."
Mr. Hollingsworth and James Walsh, another Austin lawyer who specializes in school law, praised Bracewell & Patterson's commitment to school law. They said David Thompson, the Bracewell partner and business associate of Dr. Moses, is one of Texas' most knowledgeable attorneys in school finance law.
Mr. Thompson and his Bracewell associates represent DISD in two school finance-related lawsuits that revolve around how the state allocates tax money to support public education.
Mr. Thompson "is a major inside player," Mr. Walsh said. "In terms of that issue [school finance], I think Bracewell is absolutely unique."
Dr. Moses acknowledged that he recommended Bracewell & Patterson to school trustees based on his friendship with Mr. Thompson and belief that the firm does excellent legal work.
Legal experts and ethics experts said public bodies sometimes set up a committee to decide which lawyers to hire.
Daniel E. Wueste, director of the Robert J. Rutland Center for Ethics at Clemson University, said Dr. Moses could have created a mechanism "to get an objective set of eyes on a committee" to decide which firm would be best to handle the district's legal business. Bracewell & Patterson also could have been deemed best in that system, he said.
Ethics experts say the danger in the relationship between Bracewell and Dr. Moses is that it has the potential to cloud his judgment if questions about the firm's performance were to arise.
Bunk, said Ken Zornes, a DISD trustee.
Dr. Moses, who earns $340,000 a year as superintendent, could easily maintain his objectivity about Bracewell, Mr. Zornes said.
"He does not need their tens of thousands of dollars," Mr. Zornes said. "I think he's capable of firing his firstborn or anyone he just met off the street if they need it."
Letter to trustees
When DISD went searching for a new superintendent in late summer 2000, trustees were desperate to regain a sense of stability after years of criminal investigations and public turmoil.
In Dr. Moses, they believed they had found someone with the skills and reputation to right the ship before it sank.
During contract negotiations, Dr. Moses wrote a letter to trustees Oct. 25, 2000, in which he listed five organizations he was involved with as an adviser or consultant. He pledged to resign from all of them by Dec. 31, 2000.
But he asked for a clause in his DISD employment contract that would allow him to take up to 10 personal days a year away from the district to conduct "consultation activities."
Trustees agreed to the clause.
That Oct. 25 letter, which Dr. Moses supplied to The News, did not mention his work for Bracewell & Patterson.
"School districts have also contacted me to assist them with superintendent searches," the letter said to trustees.
Dr. Moses said he and Mr. Thompson do two or three searches a year. He said he has never taken all the 10 days allowed.
DISD policy allows employees to engage in outside employment. Some public entities and companies do not allow it.
As a longtime Texas school superintendent and former commissioner of Texas Education Agency, Dr. Moses says he has developed an extensive network of professional contacts that he calls on to help make DISD a better district.
Last month, Mr. Thompson and Dr. Moses completed a superintendent search in Richardson. Jim Nelson, who succeeded Dr. Moses as TEA commissioner, was named the lone finalist.
The contract calls for the district to pay Bracewell & Patterson $20,000 plus expenses. Dr. Moses said he has not received payment but expects his share of the Richardson job to be about $10,000.
Searches "are not big money-makers," Mr. Thompson said. "We are friends, and we like doing these together and we like working together."
Hollis Brashear, current school board president, said he doesn't see anything wrong with the continuing relationship. "He told us about this from the beginning and we have full trust in the superintendent," he said.
Dr. Moses said he doesn't care what some commentators outside Texas think.
"I've worked in Texas all my life," he said. "I think I know what the laws and the culture and the rules and expectations are in this state. I don't know that anyone else can put themselves in my place unless they are privy to everything that I've done and tried to do."