Money and Politics at the Texas SBOE, Part II

(Click here for Part I of this series.)

The Texas Freedom Network and other observers have long been puzzled about why Rick Agosto, a San Antonio Democrat, has often sided with the State Board of Education’s far-right faction since his election in 2006. He has done so even when all other Democrats — and even some Republicans (who are not part of the far-right faction) — have refused to do so.

The revelations this weekend in the Dallas Morning News and the Austin American-Statesman about ethics concerns surrounding the board’s hiring of an investment consultant raise more questions about Mr. Agosto’s relationship to the board’s far-right faction. More importantly, perhaps, they reinforce the need for the Legislature to ensure that decisions about what Texas children learn in their public school classrooms are not held hostage to political games involving management of the $20.5 billion Permanent School Fund. Read on.

Agosto and the Far-Right Faction: Vote Trading?

The Morning News and American-Statesman stories suggested that Mr. Agosto was a champion for New England Pension Consultants (NEPC), which in July won the board’s contract as investment consultant for the Permanent School Fund. But events leading up to the July vote showed that NEPC seemed to have another important advocate on the state board: David Bradley, a Republican from Southeast Texas.

It was Mr. Bradley who wanted the board’s Finance/Permanent School Fund Committee in July 2008 to begin searching for a new investment consultant. He did so even though the board had voted just months earlier to extend its consulting contract with R.V. Kuhns & Associates. That contract was due to run until the end of 2010. At the time, Mr. Bradley was not a member of the Finance/PSF Committee, and the committee voted 3-2 not to begin a search for a new investment consultant. (Mr. Agosto and fellow committee member Don McLeroy, R-College Station, who was then the SBOE’s chairman and also a member of the board’s far-right faction, supported Mr. Bradley’s request.)

Undeterred, Mr. Bradley took the issue to the full board the next day anyway, much to the dismay of the majority of the Finance/PSF Committee members. Interestingly, the board was also scheduled to vote on new curriculum standards for public school Bible classes the same day. TFN and several state legislators were warning the board that the standards under consideration were too vague to meet legislative requirements. Those requirements called for specific standards that would help guide teachers and school districts offering classes about the Bible’s influence in history and literature. Nevertheless, the board’s far-right faction, joined by Mr. Agosto, pushed for and won approval of the vague guidelines.

Shortly after the vote on Bible course standards that day, Mr. Agosto joined with the far-right faction again in voting to ignore the Finance/PSF Committee’s objections and begin a search for a new investment consultant. That motion passed 8-6 (with one board member absent).

The Bible class issue was not the only time Mr. Agosto had helped the board’s far-right faction win a controversial vote. In November 2007, he had abstained from voting on a motion to reject a third-grade mathematics textbook that the far-right faction opposed. Had Mr. Agosto joined the board’s other Democrats and three Republicans in voting “no,” the motion would have failed. Members of the far-right faction subsequently boasted that the vote to reject the textbook would set a precedent allowing the board to get around a 1995 law that limits the board’s ability to censor textbook content.

One other interesting sidelight involves recent State Board of Education votes on new science curriculum standards. In January of this year the board was scheduled to consider on first reading the proposed new curriculum standards. Despite intense pressure from constituents, it was apparent to us that Mr. Agosto was reluctant to say whether he would oppose including in the standards a measure that challenged the scientific theory of evolution. The board’s far-right faction supported that measure, but all of the board’s other Democrats plus three Republicans opposed it.

Why was Mr. Agosto so reluctant to take a position? It is impossible to know for sure what his reasons were, but could it be that the board was scheduled at the same meeting to make a final decision on hiring a new investment consultant? When the board took up the science standards, Mr. Agosto (to his credit, we should say) finally voted to oppose the measure challenging evolution. The next day (Jan. 23), Mr. Agosto went ahead and asked the board to hire NEPC as its investment consultant. But members of the far-right faction, who had been bitterly disappointed by their defeat on the science vote, then argued that they needed more time to study the investment  issue and voted with other board members to postpone a decision until July. Were they punishing Mr. Agosto for his votes against watering down instruction on evolution in science classrooms? (The vote counts are archived here.)

As we now know, in July the board finally approved Mr. Bradley’s motion to hire NEPC. Mr. Agosto was absent for that vote.

Strange Donation

But there’s another twist in this story. Finance reports filed with the Texas Ethics Commission show that in September 2008 — just months after the state board’s vote to begin searching for a new investment consultant — Mr. Bradley received his biggest single campaign donation that year: $5,000 from Edward J. Theobald. Mr. Theobald is a New Hampshire man who, according to news reports, had been ousted from his role as chairman of the New Hampshire Retirement System in 2005 partly because of ethics concerns.

Mr. Theobald, it seems, has a long history of making campaign donations. Many of those donations, however, have gone to fairly liberal Democrats, such as then-Sen. Joe Biden, Jeanne Shaheen’s 2002 senatorial campaign in New Hampshire, and the late Sen. Ted Kennedy. We found this rather curious. Why would a New Hampshire resident who normally donates to liberal Democrats nationally suddenly support a right-wing candidate in an obscure state board election in Texas? One possible answer: Mr. Theobald and Mr. Agosto had been colleagues for a number of years at Harbor Capital Management, an investment management firm.

Unanswered Questions

So all of this raises some troubling questions that someone should answer:

1) Why were Mr. Agosto and Mr. Bradley so insistent that the board hire NEPC, which submitted the highest bid and was rated by professional staff below competing bidders? And why did the board’s far-right faction vote as a bloc to hire NEPC over R.V. Kuhns and Associates, which had support from both Democrats and conservative Republicans on the board?

2) Why was Mr. Theobald interested in Mr. Bradley’s re-election campaign? We have no reason to think his campaign contribution was illegal, but the circumstances surrounding it are very curious, at least to us.

3) Why didn’t the Texas Senate help solve this problem last spring, when it failed to follow the House in voting to remove the state board’s authority over the Permanent School Fund and place it in the hands of financial experts instead? (The constitutional amendment passed by the House would have put the issue before voters.)

4) Finally, how long will Texas parents continue to put up with having decisions about what their children learn in school overly influenced by vote-trading and political shenanigans instead of sound scholarship and expertise?

This article was posted in these categories: Permanent School Fund, Rick Agosto, State Board of Education. Bookmark the permalink. Follow comments with the RSS feed for this post. Post a Comment or leave a trackback: Trackback URL.


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6 Comments

  1. Robert
    Posted September 30, 2009 at 8:25 pm | Permalink

    Also check out Agosto’s and Bradley’s relationship with Courtland Partners, the real estate consultant hired by SBOE, at almost double the rate of their competition.

  2. cathy
    Posted September 30, 2009 at 9:41 am | Permalink

    Agusto began his slimy ways long before the science vote. He pretended to be a supporter of teachers during the ELA standards debacle. When it was apparent that the same group had decided to reject all teacher input, he made a last minute change of his vote so he could be viewed as siding with Bradley and his cohorts. The groundwork for these finiancial shenanigans was laid several years ago. Some, not all, members of the SBOE care much less about kids and education than they do about personal gain and personal politics. It is demoralizing to realize that the legislature has allowed all of this mess to continue. There has to be some oversight.
    SBOE member Pat Hardy tried to bring up ethics issues regarding the new investment firm at the confirmation meeting. Bradley and his group would not even allow her to share the information of ethics violations of the company. Bob Craig spoke eloquently about the shady information regarding the new firm and Tincey Miller called the process “compromised.” All three of these board members are Republicans so this is not a partisan issue.Bradley et al. had their minds made up, and undoubtedly their pockets lined. Once again, they do what they will with no repercussions. We shall see what happens when they lose millions of dollars of money that belongs to the school children of Texas.

  3. Charles
    Posted September 29, 2009 at 7:46 pm | Permalink

    Oh, I don’t know. Pork never really bothered me very much. As an archaeologist, I sometimes think back to ancient Egypt and admire the local politician (Ra Utmost) who could draw bigtime public works to his community. To do that, he had to be in tight with his pharoah (Neosynephrine).

  4. Pineyman
    Posted September 29, 2009 at 5:55 pm | Permalink

    Charles -

    I have to disagree with you. Remember Rep. Dan Flood? He represented my hometown about 30 years ago. Very powerful, no one ever ran against him & he usually got around 90% of the vote. He always “remembered his roots” by steering government funded work there. People thought pork because of his longevity & influence. Turned out he peddled the influence, even though he was getting jobs to the people.

    We still feel dirty 30+ years later.

  5. Charles
    Posted September 29, 2009 at 5:04 pm | Permalink

    Sounds like a classic case of: “If you scratch my back, I’ll scratch yours.” It’s pretty common in politics, but I am not sure that it could be classified as illegal or unethical in all cases. It would be unethical when someone “sells out” on doing what is right in exchange for some sort of financial or material gain by a second or third party. For example, if someone voted against giving women the right to vote in exchange for a vote in favor of strip mining coal, that would be a problem.

  6. PHarvey
    Posted September 29, 2009 at 3:57 pm | Permalink

    Keep digging TFN.

    Sounds like someone on the SBOE may have their hands in the Permanet School Fund for personal gain. That’s sure what it sounds like.

    This just smells too bad to be innocent. Where there is smoke, there is fire. If it looks like a duck, waddles like a duck, and quacks like a duck, …its a duck.

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