Davis calls for investigation of Abbott over Enterprise Fund 'cover-up'

AUSTIN — Sen. Wendy Davis accused Attorney General Greg Abbott on Monday of covering up the award of taxpayer dollars to companies that didn't file formal applications, calling for an independent investigation into his actions.

The spokesman for Abbott's state office called her move “political posturing.”

The call by Davis comes a day before the two candidates for governor meet in their second and final debate in Dallas.

It's the latest development in the wake of a state audit that found Gov. Rick Perry's job-luring Enterprise Fund awarded $222 million to 11 entities that didn't submit formal applications or weren't required to create jobs.

At issue in the call by Davis are open records rulings from Abbott's office when Perry repeatedly sought to keep award information confidential.

For example, when the Dallas Morning News asked for the application and related materials regarding one recipient, Vought Aircraft Industries, Perry's office asked Abbott's office to block the release of information.

Texas state Sen. Wendy Davis, left, shakes hands with Texas Attorney General Greg Abbott, after participating in the Rio Grande Valley Gubernatorial Debate in Edinburg, Texas on Friday, Sept. 19, 2014. This was the first of two scheduled debates between the candidates. (AP Photo/The McAllen Monitor, Gabe Hernandez, Pool) less Texas state Sen. Wendy Davis, left, shakes hands with Texas Attorney General Greg Abbott, after participating in the Rio Grande Valley Gubernatorial Debate in Edinburg, Texas on Friday, Sept. 19, 2014. This was ... more Photo: Gabe Hernandez, Associated Press Photo: Gabe Hernandez, Associated Press Image 1 of / 15 Caption Close Davis calls for investigation of Abbott over Enterprise Fund 'cover-up' 1 / 15 Back to Gallery

That request was made even though the application didn't exist, according to the state audit, the Houston Chronicle reported.

Vought was among at least five Enterprise Fund grant recipients for which Abbott's office blocked the release of applications — even though last week's audit said there actually were no applications, the Texas Tribune reported.

“We need an independent investigation by appropriate state or federal authorities regarding the actions of the attorney general and his attempt to use the power of his office to cover up the transfer of millions of taxpayer dollars to companies whose applications he knew didn't exist,” Davis said at a news conference in Fort Worth.

Davis called for Abbott to release all internal documents, emails and communications “related to that cover-up” and to return more than $1.4 million of campaign contributions that she said he has received from Enterprise Fund recipients until a probe is complete.

She didn't say which entity should conduct an investigation. Her campaign spokesman, Zac Petkanas, said potential options might be the Travis County District Attorney's Office, which has a public corruption unit; the U.S. Department of Justice; a special legislative committee; or the attorney general himself appointing an independent investigator.

“The attorney general cannot oversee and investigate his own cover-up,” Davis said at the news conference.

The Republican attorney general's campaign didn't immediately respond to a request for comment.

But Jerry Strickland, spokesman for the state attorney general's office, said: “Calls for an investigation into the Attorney General's Office into this matter is just political posturing — or just ignoring the facts.”

Strickland said that the state auditor's investigation “found absolutely no wrongdoing by the Attorney General's Office.”

He said the only references to the attorney general's office pertained to efforts to recover money owed to the state by entities that got Enterprise Fund grants, then failed to fulfill their obligations. He said Abbott's office “continues to aggressively pursue grantees who owe money to the State of Texas.”

When the Enterprise Fund program was created by lawmakers in 2003, it didn't require a formal application, Strickland pointed out.

He said a document submitted to Abbott's Open Records Division in 2004 was entitled, “Request for a Grant from Texas Enterprise Fund and for Related Economic Development Assistance in Support of Vought's Business Expansion Plan for Texas.”

“Further, that document opened with the following sentence: 'Vought Aircraft Industries, Inc. respectfully submits this application for a Texas Enterprise Fund Grant and other economic development support to facilitate our company's expansion of its Texas operations,'” Strickland said in a statement.

Strickland provided a copy of the document, which was a letter from the company to the chief of Perry's economic development and tourism division. It was submitted to the attorney general's office by the company while the office was considering whether information had to be released.

Strickland said the attorney general's office ruled that the letter must be released but allowed material to be redacted from it.

He said that it's unclear whether Perry's office also submitted that letter because materials customarily are returned to a governmental body making an open records request. He said similar letters weren't part of a briefing file on the other entities, but that it is “inconclusive” whether they may have been sent by Perry's office.

Strickland also said it was the Legislature, not the attorney general, that established the requirement that proprietary business information be withheld from disclosure.

“To the extent the AG's Open Records Division ruled that information could be withheld, it was merely applying a provision of the Public Information Act that was passed by the Texas Legislature,” Strickland said.

Abbott's campaign launched its own attack Monday related to the Enterprise Fund, citing the state entity's decision to give $400,000 to Cabela's in 2004.

Davis, then on the Fort Worth City Council, was among council members who voted in 2004 to give Cabela's $76 million in local incentives. The title company for which she worked helped close the sale of a piece of land to Cabela's the same year, Abbott's campaign said

“Sen. Davis is already under scrutiny for voting on taxpayer-funded incentives to clients of her title company while on the Fort Worth City Council, now we know that Sen. Davis personally profited from Texas Enterprise Fund money. This is yet another instance of Sen. Davis using taxpayer dollars to benefit her clients without disclosing her conflicts of interest and the profits she pocketed. Sen. Davis' politically expedient attacks ring hollow given her unethical behavior that makes her unfit to be governor,” said Abbott campaign spokesman Matt Hirsch.

Petkanas struck back, saying of Hirsch's attack, “This is an outright lie and an attempt to distract from Mr. Abbott using his office to cover up the fact that tens of millions of taxpayer dollars were handed out to companies improperly.”

Davis was paid a straight salary by Republic Title, so Cabela's store opening didn't affect her compensation. Petkanas said the Fort Worth city attorney also cleared the work that Davis did for Republic Title.

In addition, Petkanas said, Cabela brought private investment and jobs to Fort Worth, and its agreement with the city called for it to be penalized if it fell short of its goals.

The state audit of the Enterprise Fund was conducted because of legislation championed by Davis.

pfikac@express-news.net

Twitter: @pfikac