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The Mission Consolidated Independent School District received a federal grand jury subpoena in June for records on Performance Services Inc., an Indiana-based company that specializes in energy savings contracts.
Issued on June 1, the subpoena instructed Mission CISD to provide the FBI with audits, documents reviewed by the school board and other records.
“Mission CISD will comply and assist law enforcement in anything that they need or any information they need,” said school board President Jerry Zamora. “We are very transparent and we’re willing to assist in any way we can — in any investigation.”
The La Joya Independent School District, the Agua Special Utility District and the city of Mission also received subpoenas for documents on Performance Services Inc. They came with identical warnings.
“You are not to disclose the existence of this directive,” according to the subpoenas. “Any such disclosure would impede the investigation being conducted and thereby interfere with the enforcement of the law.”
Mission CISD, however, released the subpoena Monday after the Progress Times filed a public information request.
The subpoenas, along with other information obtained by the Progress Times, suggest the FBI and the U.S. Attorney’s Office for the Southern District of Texas are conducting a wide-ranging investigation that targets corruption in western Hidalgo County.
Performance Services Inc. didn’t respond to requests for comment.
La Joya ISD approved two contracts with Performance Services Inc. that totaled nearly $37 million.
Phase I involved the installation of LED lights, according to a summary published by Performance Services Inc. Phase II involved the replacement of old heating, ventilation and air conditioning systems; the construction of solar arrays and the installation of artificial turf, among other projects.
Agua SUD, meanwhile, contracted with Performance Services Inc. to replace standard water meters with so-called “smart” meters that provide more accurate measurements.
Performance Services Inc. touted the $11.6 million deal with Agua SUD as “the largest deployment to date in the Rio Grande Valley to utilize Advanced Metering Infrastructure technologies.”
The city of Mission approved a nearly $17 million contract with Performance Services Inc. in January.
Mission CISD, however, never approved a contract with the company.
Performance Services Inc. approached Mission CISD in 2017 and offered to conduct a “no cost” energy assessment. After reviewing the offer, administrators became concerned.
Allowing a company to conduct an energy assessment would provide that company with an unfair advantage when Mission CISD solicited bids for energy-efficiency projects. Administrators recommended Mission CISD issue a formal request for qualifications instead.
Performance Services Inc. and several competitors, including Schneider Electric and E3 Entegral Solutions Inc., responded. Mission CISD deemed Performance Services Inc. the most qualified company to conduct the energy assessment.
The company sent Mission CISD a draft letter of intent.
“If the Mission Consolidated Independent School District decides not to proceed with this retrofit program even though guaranteed annual savings and efficiency increases will exceed their annual costs, the Mission Consolidated Independent School District agrees to pay $297,612 to Performance Services Inc., which is their anticipated engineering and other costs associated with developing the Investment Grade Audit,” according to the draft.
Attorney David P. Hansen of Austin, who represents Mission CISD, had major concerns about the draft.
“Unless things have changed, the board’s expectation was to procure an energy savings audit at no cost to the district,” Hansen wrote to administrators in an email obtained by the Progress Times. “The cost for this audit is $297,612.00. It is, by far, the highest price I have seen for one of these audits.”
A source provided the email, which is marked “Attorney Client Privileged Communications,” to the Progress Times on the condition of anonymity.
Along with the cost, Hansen listed eight other reasons not to sign the letter of intent.
“This paragraph says that you have to use PSI to do the work or you will pay them $297,612,” Hansen wrote, emphasizing that state law requires construction expenditures of more than $50,000 to comply with certain requirements. “Satisfaction of an existing engineering debt is not a valid selection criteria for the procurement of these services.”
Hansen also warned that Mission CISD could run afoul of state law.
“Again, I give you the strongest recommendation that I can possibly give – do not sign this letter,” Hansen wrote. “It is entirely inconsistent with the expressed desires of the board and it is not consistent with existing Texas Procurement Law.”
The school board discussed the Performance Services Inc. proposal again in December 2018.
Trustee Patricia “Patty” O’Caña-Olivarez motioned to approve the audit. Trustee Sonia Treviño seconded the motion.
Nobody joined them. The motion failed 5-2.
During an interview, O’Caña-Olivarez defended her decision.
“You want to look at alternative energy solutions,” O’Caña-Olivarez said. “And try to see how you can save the district money.”
O’Caña-Olivarez said that she didn’t remember how the Performance Services Inc. deal came before the school board or the name of the company representative who Mission CISD dealt with.