AUSTIN (KXAN) — An investigative report from The Office of the City Auditor reportedly found evidence that one Austin Energy employee violated city code after making several decisions regarding his family’s business.
The allegations against Project Coordinator Alex Perez stem back to last fall. Perez was accused of several actions, including signing off on hourly logs for family members, including his children, and of using his position to hire relatives for an Austin Energy repair project the Mueller area.
AE says Perez’ family’s company worked as a subcontractor on the emergency repair in October 2019 — which the City says is a conflict of interest.
The City of Austin says in-county paperwork filed in 2013 identifies Perez and his wife as owners of the company, while state paperwork indicates Perez as one of the company’s directors and tax records indicate that Perez and his wife currently own property related to the company.
When asked about his involvement with the company, the City says Perez denied owning or directing and claimed he was no longer involved. He did, however, explain that his sister-in-law and father-in-law own the company, his wife is a full-time employee, and two of his children are employees.
The City says based on conflict of interest rules, Perez has similar interests as his family members, so any decisions he makes regarding the business are violations.
As part of his role as project coordinator, Perez was required to make site visits to make sure work logs were accurate. The City reports Perez said he visited the site and saw his children, but didn’t think it would be an issue because they work for the subcontractor.
Additionally, the City says Perez requested a permit related to the leak repair for his family’s company and listed himself as the “contact” on the permit.
In October 2019, Perez was also accused of selecting members of his family to work on the Mueller repair, but the report says there was no evidence found that Perez played a role in selecting or approving contractors.
The City adds that in May 2018, Perez’ supervisor, Lora Teed, became aware of Perez’ family company and asked the Law Department’s Ethics and Compliance team for advice on handling the matter.
The Law Department responded, in bold, that Perez “may not participate in a decision affecting” his family’s company. Teed then reportedly sent Perez a copy of the department’s guidance.
Nevertheless, the report says Teed kept Perez on the Mueller project because she wanted Perez to train other employees on how to fill out paperwork — but that she did not intend for him to complete the paperwork himself.
Teed told the City that she was “absolutely positive” she was clear about keeping Perez away from his family’s business. But this goes against what Perez and another employee told the City. In a response to the City, Teed says the report makes it seem like she had full visibility of the situation and willfully put Perez into a position of conflict.
Teed says she didn’t know the names of Perez’ children and that the surname is also very common. Once she realized he was signing off documents, Teed tells the City she removed him immediately.
But the City says the conflict of interest had already happened.
In a response letter, Perez says the report is misrepresentative, incorrect and based on “a shallow records search that brought up outdated information.” He says he was willing to work with the city auditor’s office to show proof of his statements and refute the allegations, but that they never followed up with him.
“The investigation did not pursue any follow up actions with me in order to correctly and accurately reflect the truth. If the investigators would have inquired further, I could have worked with them to demonstrate that the 2013 tax records were filed in error by the county and that in subsequent years there was correspondence sent by the company accountant to the county to correct the miss‐information,” writes Perez.
Perez said he made specific efforts to make sure no decisions were made regarding his family’s business and that those decisions were deferred to AE inspectors when they came up.
“I only interacted with the AE inspector and the general contractor directly and never with any of the subcontractors which it turned out that my sister‐in‐law’s company was one,” Perez writes.
Perez writes that while he did have to sign daily documents, they did not have to do with his family members or their company. He adds that it would take the help of the entire group involved in the project for him to be able to perform what he’s accused of.
He explained that because the repair was an emergency, not signing daily reports would have caused delays — he acted in the best interest of the city, he argues.
“In closing, from the start the term “misuse” in the title of the investigation is just the first incorrect characterization & goes to show just how biased this report really is,” Perez ends. “The investigators could not find any evidence that I “misused” my position, authority, or influence because I did not do so. They could only demonstrate that there could have “possibly” been misuse if a large amount of effort was exerted from not just from myself, but from the project team as [sic] hole.”
The City Auditor says it believes its findings stand on both findings against Teed and Perez.
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