May 25, 2018 • Local News
El Paso Times: El Paso city attorney apologized for failing to disclose husband's stake in company
Four days before El Paso Mayor Dee Margo and City Attorney Sylvia Borunda Firth began negotiating her departure, she sent an email to City Council apologizing for not disclosing that her husband was representing a company seeking incentives.
Emails obtained by the El Paso Times through the Texas Public Information Act show that Borunda Firth sent an email to the mayor and council at 12:32 p.m. April 16 informing them that two items on the agenda for the following day involved real estate in which her husband and his partners had an ownership interest.
Borunda Firth's husband, Victor Firth, is an attorney for the Firth, Johnston, Bunn, Kerr law firm.
"Items 24.2 and 24.3 on the agenda for next week involve real estate in
which my husband and his law partners have an ownership interest. I am sorry I did not disclose this earlier but I did not even know these items were on the agenda," Borunda Firth said in the email. "Please rest assured that I have not had anything to do with the processing of the applications, nor have I been involved with the work done by my husband, or on his behalf with regard to the development.
"When the matter is presented to council tomorrow, I will excuse myself from the room and allow Terri Cullen to provide any legal advice the council might need when considering the matter,” Borunda Firth said.
The email went on to say that Borunda Firth believed she had properly “shielded” herself from any involvement with the legal work related to the incentives sought by her husband and his partners.
At the time, city Rep. Cassandra Hernandez questioned the timing of the email sent by Borunda Firth, documents show.
“Correction: I'm sure you meant tomorrow and not next week? And I'm also sure that staff has agenda review a week/several days in advance,” Hernandez said in the email response.
Documents obtained by the Times do not show any response from Borunda Firth or any other discussion among City Council members on the topic.
The city posts agendas for public meetings 72 hours prior to the day of a meeting. Since City Council meets on Tuesdays, the notices are typically posted on Thursdays.
At about 9 a.m. the day before the scheduled meetings, city staff briefs the mayor and City Council on each item that is on the agenda during a legislative review. Borunda Firth was at the meeting, according to city documents.
On the agenda for the April 17 meeting, Brixwood LLC and Respco LLC sought about $61,000 in incentives for the renovation of a vacant building at 311 Montana Ave.
Hernandez made a motion to have the items deleted because the council had not been briefed by staff or Borunda Firth regarding the incentives.
Some city representatives have cited concerns about a possible conflict of interest, but did not say that was the reason for Borunda Firth’s departure.
In another email exchange from February, Borunda Firth and the mayor discussed an email they received from Channel 9-KTSM that asked about Victor Firth's involvement in the bankruptcy proceedings for businessman William "Billy" Abraham. The station asked Borunda Firth about her relationship to Victor Firth and whether the relationship affected her work on the multipurpose cultural and performing arts center.
City officials have been trying to acquire land in the Union Plaza area that has become known as Duranguito to build a $180 million arena. The effort has sparked opposition from historic preservation activists who are against the demolition of buildings in the area.
One of the buildings that the city is purchasing as part of its Downtown arena plan is the Chinese Laundry, 212 W. Overland. The building is owned by Abraham.
In response to the question, Borunda Firth emailed other city officials: “How about this: Victor Firth is my husband. He is a lawyer who represents creditors with liens against some of the properties Mr. Abraham owns. None of those buildings are within the proposed footprint for the MPAC. My husband’s work on behalf of his clients does not have any affect on the MPAC or my work representing the City.”
Mayor Dee Margo then replied: “For clarification, does Victor have any client involvement in Abraham’s Chinese Laundry bldg.?"
Borunda Firth responded: “No. He is not involved with the Chinese Laundry at all. The only liens against that property are one in favor of Bobby Malooly and the judgment liens in favor of Billy’s ex-wife, the City and the heirs of Juan Gabriel. Vic represents, Isha Rogers, Steve Santamaria and Charles Haddad. They hold liens on other buildings and land — nothing in the MPC footprint.”
On April 26, the city issued a statement that said Borunda Firth was retiring. Margo and Borunda Firth negotiated a separation agreement six days earlier.
The negotiations started about a month after the mayor and City Council cited several concerns about Borunda Firth's performance in evaluation documents obtained by the Times.
The separation agreement gave Borunda Firth $274,081, which included six months of severance pay, or $124,340, $103 for her vacation balance, $127,116 for sick leave and an additional $22,484 in "vacation runout."
Her employment contract stipulated that she would only receive severance pay if she was terminated by the City Council. If she resigned, she would have been entitled to accrued vacation and sick leave, documents show.
The public statement that was initially written was edited to change the word "resigns" to retires.
Text messages obtained by the El Paso Times show that Margo wanted the public perception to be that Borunda Firth retired.
The mayor at about 8:50 p.m. on April 26 sent Hernandez a text that said: “Public perception will be retires. No disparagement."
Margo said he was signing the agreement that day and that Borunda Firth was only being paid what she was contractually owed. Hernandez asked that the mayor call for a special meeting for the council to vote on any agreement being established.
A state open government expert and attorney said the severance pay may be a violation of the state constitution that prevents governing bodies from paying extra compensation to employees that already have established employment contracts.
"If she resigned, her contract restricts what she can be paid beyond her earned pay/benefits. It is not lawful to pay her any more than that, and any El Paso taxpayer has standing to file suit against the City to enjoin that unlawful expenditure," said Austin attorney Bill Aleshire, whose law practice is focused on government transparency and accountability.
City Council approved the separation agreement May 14. City Rep. Peter Svarzbein voting against it.
City officials have said that the separation and release agreement that was approved and ratified by the City Council makes the severance payment legal.
The agreement stipulated that the mayor and council would not speak with media about Borunda Firth's departure.
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