AP NEWS

Hidalgo County sues firm involved in border fence

November 26, 2018

EDINBURG — Hidalgo County is taking a second crack at recuperating funds from a former employee who it alleges collected millions of dollars worth of unwarranted commission while overseeing construction of a section of border fence in the county about a decade ago.

On Wednesday, the county filed a federal lawsuit against Godfrey Garza Jr., his wife and sons and a slew of project contractors, including Dannenbaum Engineering. The Houston-based engineering company has been in the headlines recently after the chief of its South Texas office, Louis H. Jones Jr., committed suicide amid an FBI investigation that has targeted officials in Webb County for bribery.

The 54-page filing in the lawsuit alleges that Garza — who ran the Hidalgo County Drainage District No. 1, first as an employee and then a contractor — charged an inflated commission on a project the drainage district carried out in partnership with the U.S. Department of Homeland Security to build a border fence atop rehabilitated Rio Grande levees. Garza oversaw construction of the Bush-era barrier. He earned more than $3.5 million in commission on the project.

Some of that commission was covered by federal tax dollars. The suit also alleges he worked out deals with Dannenbaum and two South Texas-based firms, TEDSI Infrastructure Group and Dos Logistics Inc., to hire a company run by his wife and two sons. That company, Valley Data Collection Specialists, received more than $1.5 million, but didn’t actually work on the project, the suit claims.

Garza’s lawyer did not immediately return a request for comment. But he told The Texas Tribune and ProPublica last year that everything his client did was above board, approved by county commissioners — who double as the drainage district board — and never objected to by the federal government.

Hidalgo County had already sued Garza in state district court, describing a vast kickback scheme worked out between Garza, Jones and other engineering firm officials over drinks and steak dinners. It appealed an unfavorable ruling earlier this year.

A spokesman for Dannenbaum did not immediately respond to a request for comment.

The county did not name Dannenbaum in the previous suit filed in state court.

Dannenbaum also was not named in a recent federal indictment against a Webb County commissioner and Laredo city councilman alleging bribery, although it appears to allude to the company, referencing “a civil engineering firm headquartered in Houston with satellite offices in Laredo, McAllen, San Antonio, Austin and Dallas.”

Jones, the now-deceased head of Dannenbaum’s South Texas office, is mentioned in the Hidalgo County suit filed Wednesday, which alleges that he once told a representative of another engineering firm that he paid off a local official. Jones and Dannenbaum’s chief executive, James D. Dannenbaum, are prolific political donors. Records show Dannenbaum and his wife have donated millions to candidates in local, state and national elections in the past dozen years, most of it to members of the GOP.

The lawsuit comes two weeks after Hidalgo County voters selected new county commissioners and a successor to outgoing Hidalgo County Judge Ramon Garcia, who is retiring. Garcia championed the lawsuits against Garza and the contractors.

AP RADIO
Update hourly