By Chris Lane
By Jeff Balke
By Aaron Reiss
By Angelica Leicht
By Dianna Wray
By Aaron Reiss
By Camilo Smith
By Craig Malisow
By Brian Wallstin
Two weeks after Bob Lanier's first inauguration in January 1992, the new mayor's administration began looking for a consultant to oversee the Greater Houston Wastewater Program, a $1.5 billion project to overhaul the city's sewer system.
A selection committee was formed, and Lanier dispatched his executive assistant, Doug O. Williams, to monitor the selection for his office. In the summer of 1992, the committee chose a joint venture between California-based Montgomery-Watson Americas Inc. and Brown & Root, one of Houston's largest contractors. Lanier promoted Williams from executive assistant to director of the wastewater program, and charged him with administering the management contract for the largest public works project in Houston history.
It was an awesome responsibility: from day one, Montgomery-Watson/Brown & Root was doling out hundreds of lucrative city contracts, worth millions of dollars, to nearly 200 engineering, architecture and construction firms. Outside of the Lanier administration, Williams might have seemed an odd choice to direct such a massive undertaking. He had never before worked in city government, having spent his 25 years with R.G. Miller Engineering, where he helped the firm grow from two employees to about 50.
But Williams had one key credential that made him uniquely suited for the Lanier administration. A former chairman of the Houston Contractors Association, he had cachet with every building-trades firm in the city. And he had been one of Lanier's most effective fundraisers during the former banker/developer's first bid for office, paying particular attention to the engineering, architecture and construction firms that might have an interest in working on the Wastewater Program. Without their help, it's unlikely Lanier would have had $3 million with which to run his initial campaign.
So the atmosphere at City Hall -- already made tense by the FBI's bribery sting of councilmembers -- must have darkened considerably last week after the Chronicle reported on its front page that the wastewater program had also become the subject of an FBI investigation, and that investigators were "raising questions" about Williams.
The Press has since learned that although Williams was, in fact, contacted by the FBI, he is not the target of any investigation. Neither, apparently, is the Greater Houston Wastewater Program. Still, the story brought a unprecedented amount of unwanted attention to the low-profile Williams, who is universally recognized as both a nice man and one of Lanier's key advisors. He was on hiatus from that role for most of last year after making an ill-advised move from City Hall to take a position with a subsidiary of Montgomery-Watson. But he left that job after less than a year and is back with Lanier, serving as the mayor's "deputy assistant for housing and inner-city revitalization." It's a position that has once again put Doug Williams at the center of the action in the Lanier administration -- once again with almost no outside oversight.
Williams' current boss is developer Michael Stevens, Lanier's unpaid "special assistant" and president of the Houston Housing Finance Corporation. Beyond that small fact, however, information about what Williams does and how he's paid is remarkably hard to come by. Calls by the Press to Lanier's staff about the mayor's deputy assistant were met with an annoying ignorance. At first, no one professed to even know Williams' phone number. It took several calls to finally confirm that Williams is not a city employee.
Repeated calls to Williams' office were not returned. Stevens' secretary requested that questions regarding Williams' employment with the finance corporation be put in writing, but she reported having had no luck pinning either man down to answer them.
Finally, Stevens returned a call. But he seemed to know precious little about Williams, including his status at the housing finance corporation.
"He functions as a staff employee," Stevens said. "I just do not know whether or not he is paid as a consultant, or whether he is an employee."
Ironically, in light of last week's events, Williams was gone from the wastewater project when someone did raise serious questions about the city's contract with Montgomery-Watson/Brown & Root. An audit released in July 1995 by City Controller George Greanias concluded that the contract lacked oversight and was susceptible to possible "waste, loss and misuse." According to the audit, the city had no independent means of determining if it was getting the best deal, because costs and expenses were first reviewed by Montgomery-Watson/Brown & Root.
"These weaknesses," Greanias' auditors reported, "result in the potential for concealing design or construction problems from the city."
The audit also pointed out more than $630,000 in overpayments, though that amount was later reduced to $30,000 when Public Works and Engineering director Jimmie Schindewolf produced a separate "supplemental agreement" between Montgomery-Watson and Brown & Root. The agreement revealed an increase in salary costs that was never reported to City Council. Auditors estimated that the agreement would cost the city an additional $1 million or more.
The audit also discovered that much of the documentation accumulated during the selection process was either "lost" or discarded, including the charts and graphs used by committee members to evaluate the finalists. That particular finding led Greanias to question the process the city followed to award the lucrative contract.