Kaufman’s Costly and Illegal Scandal- Part 3

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For Part 1, click HERE. For Part 2, click HERE.

Kaufman County Judge Bruce Wood, along with District Attorney Erleigh Wiley, have gone unchecked for years and have cost the county dearly.  The ticketing scandal we’ve previously reported on is even worse than it appears on the surface.

In 2014, Kaufman County entered into a contract with American Traffic Solutions that caused the county to act outside its legal authority – issuing illegal traffic citations to its citizens – and imposed a significant cost to county taxpayers. The unlawful contract also resulted in illegal financial transactions and a lack of transparency.

By championing the ATS contract, Wood violated the public trust. By failing to blow the whistle on the entire scandal, or investigate any wrongdoing by those involved, Wiley is derelict in her duty to Kaufman taxpayers.

The illegality of the county’s actions was not exposed until the county consulted an outside law firm—Wynne and Wynne. In a detailed report, they discovered the county’s breaches of state statute.  Kaufman county had originally consulted the law firm to find an exit strategy from the ATS contract without being liable for a stiff penalty. Instead, they found the county was breaking state statute while remaining bound to the contract’s terms.

Most government contracts contain a clause stating the contract is void, if any portion of it compels the entity to act illegally. Wiley not only failed to ensure this protection was included, she failed to recognize the illegality of the ATS arrangement. She failed to protect the county she was elected to serve, and is now refusing to investigate any wrongdoing.

Counties Cannot Take on Unfunded Debt

County Judge Bruce Wood knew when he signed the ATS contract that the county would assume a large deficit before it would see any revenue.  This arrangement is in violation of state statute, as all counties must have a balanced budget.

The upfront training and setup fees would cost thousands and the 30-day warning period would cost thousands more. During that 30 days, the county paid ATS $2,900 per camera plus $2 for every issued notice.  They did not account for these losses anywhere in the budget, gambling that the revenue would eventually catch up by the end of the fiscal year.

-Excerpt from the Wynne and Wynne letter to Kaufman County

Counties cannot incur debt “unless provision is made, at the time of creating the same, for levying and collecting a sufficient tax to pay the interest thereon.” (Tex. Const. Art. XI) Judge Wood and ATS presented this contract as something that would not incur cost because the revenues would pay all the fees.  Those revenues were not guaranteed.  As a result, the county relied on drivers continuing to speed and illegally pass school buses in order to support the camera system. Wood failed to present the taxpayers a complete and honest budget.

To further complicate the situation, the ATS contract had a term of 10 years.  If the contract allowed for termination after each year, it would have been a commitment of current revenues and not a debt. This contract, however, did not allow for termination until the 10th year and early termination resulted in huge penalties of almost $200,000.  During the April 2014 Commissioners Court meeting, ATS sold Wood and his supporters on the length of the contract with the promise that they would keep their cameras even in the event the Texas Legislature declared them illegal.

Under ATS’s terms, Kaufman was obligated to continue to illegally squeeze ticketing revenue from taxpayers for the lifespan of the contract, even if the Legislature banned the cameras.

County Money Must Stay in the County

Fortunately, Texas laws are in line with common sense and promote fiscal transparency and accountability. According to the Local Government Code and two Attorney General opinions, any proceeds from traffic enforcement must be deposited into an account controlled by the County Treasurer.  (LGC 113.004) (AG Op. JM-158 & DM-396) The contract with ATS stated, however, that money collected from the civil penalties would first be transferred into an account controlled by ATS.  The County only received its money after ATS took its cut.

-Excerpt from the Wynne and Wynne letter to Kaufman County

In addition to being illegal, this practice is unethical. Transparency all but disappeared when ATS held the money. The county could claim that they were not paying ATS because the fees were taken directly from the revenues.  No checks were written so citizens could not track the fees. Judge Wood denied taxpayers the right to know how much the traffic camera scheme actually cost the county.

Will Local Residents Hold Officials Accountable?

Few Texans can name their County Commissioners. Even fewer have attended a commissioners court meeting. Unfortunately, this apathy often allows local officials to make decisions that harm the very citizens they were elected to protect.

Instead of receiving praise for standing up to Judge Wood, the two former County Commissioners Kenneth Schoen and Jimmy Vrzalik who opposed the ATS scandal are now facing indictment for improving a small road.  According to an interview with WFAA, Wood initiated the investigation after he saw the improvements while driving to and from the courthouse.

Wood has announced he will not seek reelection, but he has numerous supporters still in office including Wiley up for reelection in 2018. It is time for accountability in the DA’s office.  Wiley has got to go, and anyone involved in subverting the law should be investigated and prosecuted.

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