The Insider

All in the Family
Over the past 15 years, the contentious, opinionated Hotze clan of West Houston has carved out a high political profile on conservative issues, with various members championing anti-abortion efforts, campaigning against gay rights and pushing an unsuccessful initiative to force city council to seek voter approval for tax and fee increases.

Now the two youngest of Margaret and Ernest Hotze's eight children are suing the four eldest for "oppression" in the context of a closely held corporation, the family-owned Compressor Engineering Corporation (CECO), which Ernest headed until his death in 1995.

The Hotzes are no strangers to media coverage, but previous exposure mostly involved political issues rather than family feuds. Mother Margaret was a city council candidate and organizer of the 1985 "Straight Slate" to promote conservative family values and counter the influence of gays in city government. The oldest of her sons, Dr. Steven Hotze, is a GOP kingmaker and political action committee director.

Another brother, former congressional candidate and GOP activist Jim Hotze, is not involved in the latest litigation; he left CECO 18 years ago to be a CPA. He calls it "an unfortunate little chapter" in the family history -- and a painful one. "I think if you had a choice of this happening or going to get a root canal," says Jim. "you'd probably go and get the root canal."

Jim professes amusement that people lump the Hotzes together. "Forever and ever, everybody's thought we all get together for breakfast and we agree on everything." The reality, he says, "is we have a fair share of differences of opinion. We're not monolithic."

That seems an understatement, judging by the lawsuit filed by 35-year-old Gretchen Hotze Heerensperger and 30-year-old Chris Hotze in Fort Bend County early this year. They seek unspecified damages from Bruce, Mark, Rick and Steven Hotze. Bruce, one of the organizers of the recent, unsuccessful city tax initiative, is the CEO of the company, and Mark and Rick are salaried executives.

The specifics of the younger Hotzes' grievances against their brothers are difficult to discern from the broadly worded suit. A deposition of Gretchen indicates that one point of conflict involves a transfer of CECO stock to the children of Rick Hotze shortly after Ernest's death. She also complains that the older brothers did not see her as an equal in managing CECO's affairs. After her father's death, says Gretchen, "I was getting signals from my brothers, saying, 'Hey, we're not going to take care of you.' So I thought to myself, I'd better get involved, and real quick."

A family acquaintance says that Gretchen, the sole sister, has always been ignored by her brothers. Age also plays into the dispute. "It's an interesting thing between older siblings and younger siblings," says Jim, who falls between the factions. "There's a lot of age difference and sometimes not as good communication as people should have."

The suit includes a declaration by the plaintiffs that they "love and care for the defendants." During the deposition, that statement prompted defendants' attorney Fred Hagans to ask Gretchen, "Did you feel that you needed to file a lawsuit to tell your brothers that you loved them?"

Citing her experience as a mother of seven children, she replied, "If my child is out playing in the street, and I pull them in the yard and spank them, I would consider that an act of love. And along those same lines I can stand here before all my brothers and say, yes, this was an act of love." Tough love, to be sure.

Gretchen testified that the suit was filed in Fort Bend County rather than Harris, where most of the family lives and the business operates, in hopes that it might slip past the media: "We would be able to protect the family name, my mother, from any negative coverage." That is apparently not a large concern to the four brothers, whose attorney has filed a motion to transfer the case to Harris County.

Gretchen also recounted a late-night visit to her home earlier this year by her mother, who "out of the blue and very out of character" popped in equipped with a pen and legal pad to weigh the pros and cons of the dispute and otherwise dissuade Gretchen from the lawsuit. At one point, Margaret tried explaining to her daughter how Hotzes usually work out their disputes. According to Gretchen, the spiel went like this: "Boys will be boys, and I've seen these boys wrestle and they've always made up and they're good friends afterwards. They can fight it out and wrestle ... [but] you're just too sensitive."

Gretchen testified she rejected that advice and decided to go ahead with the suit, hoping to convince her mother that her sons are manipulating her. The breaking point, Gretchen says, occurred when the stock was transferred to Rick's children, using the recently bereaved Margaret as signatory.  

"What was so critical about this transfer of stock?" asked Gretchen rhetorically during the deposition. "It smells. And I adore my mother, but I don't think she was thinking clearly at the time." Gretchen also claimed some CECO functionaries were uncomfortable with their roles in allegedly postdating the stock transfer to make it appear the transaction had been approved before Ernest's death.

Neither the attorneys nor Bruce or Margaret Hotze returned phone inquiries concerning the legal action. Jim Hotze, from his position outside the line of fire, predicts cooler family heads will prevail before long: "All you've got is a difference of opinion and a generation difference. Maybe somebody thought they were going to get someone's attention and get somebody to face up to answering some questions."

It's an expensive way to get your big brothers' attention, but it probably beats wrestling.

Never Can Say Good-Bye
When it comes to doling out taxpayer dollars to smooth the departure of longtime administrators, the University of Houston has few equals. The school leads all state institutions in distributing nearly a million dollars in severance packages to the plethora of chancellors, presidents, vice presidents and provosts ousted in the academic bloodbaths of the last several years.

Now the latest sweetheart deal involves, of all places, the main campus library. Late last year, library dean Robin Downes, in ill health, decided he could no longer handle his administrative duties and recommended that acting provost Dr. John Ivancevich appoint Downes's longtime protege, personnel manager Dana Rooks, to the position at the substantial salary of $110,000. Both Rooks and Downes have been at the library 17 years.

At the same time, Downes proposed that for three years, he act as library director, retaining his office and a salary of $86,000; then, after that time, he would retire with a tidy 20 years' service to the school. During the interim, Downes would report to his longtime subordinate, upgrading electronic information services and helping plan the construction and fundraising for a new library wing.

"Not a bad retirement package," commented one tipster in the UH bureaucracy. "You create it, you determine the salary, you put yourself in it."

Rooks was appointed to the deanship without a national search -- the method that originally selected Downes 17 years ago. There was no input from faculty or students, and the approval of the regents for the move last November contains only a passing reference to Downes's new arrangement. A memo of justification accompanying the Rooks appointment says only that "Robin Downes has provided excellent leadership for 18 years and has agreed to retire after two more years, which would constitute 20 years of outstanding service." Actually, the agreement as signed by provost Ivancevich gave him three more years at the same salary -- in effect, creating a new library position requiring $258,000.

Incoming faculty senate president Robert Palmer says he was unaware of Downes's arrangement, partly because the library does not run academic programs and partly because there have been no objections voiced by library staff. But he agrees the school has been very reluctant to bid old hands farewell.

"We have to get into a situation where we realize a person isn't functioning the way they have to function and just terminate them without continuing salary forever and ever," says Palmer. "That's a continuing problem right across this university, and this gets us some problems with the legislature."

Downes was unavailable for comment, but Rooks defended her mentor's continuing role as library director: "We had some very critical things that were coming up that basically he was interested in undertaking." As for her appointment as dean without a search, she says, "The provost offered me the position, and I was ecstatic and delighted and said yes."

One person who wouldn't have said "yes" without a national search is Dr. George Magner, the acting provost under newly installed chancellor-president Arthur Smith. Magner originally appointed Downes to his post after a national search, and says he and Dr. Smith have agreed that all future deanship appointments -- including several under consideration this fall -- will involve national searches.

As for why Rooks's appointment and the Downes position were approved without any outside input, Magner says he doesn't know. He suggests that the administrative upheaval on the campus may have had something to do with it. "That was a time of really substantial tumult in the management of this institution. Some of the contracts we made, some of the parachutes that were given, were really unusual."  

Plumbing New Depths
City Controller Lloyd Kelley's political stock seems to be falling faster than barometric pressure before a Gulf hurricane -- and his problems are likely to intensify in coming weeks.

While councilman Judson Robinson III and chief municipal judge Sylvia Garcia consider challenging Kelley in November, KTRK-Channel 13 undercover man Wayne Dolcefino is on Kelley's case as well. According to the reporter, a Channel 13 investigation of malfeasance in the controller's office will likely air in two weeks. Dolcefino visited Kelley's office last Friday while Kelley was vacationing in Fort Davis. According to the reporter, the absent controller's top aides cowered out of camera range till he left.

Over the past week, Kelley's image has already taken a drubbing from negative media reports concerning his hiring of his campaign treasurer, Steven Plumb, to a $75,000 computer consulting contract for which, other than signatures on documents, there is little record of actual work performed by Plumb. The controller's fundraiser, Sue Walden, notes that as far as she knows, Plumb never contributed to Kelley or attended any finance committee meetings in his role as treasurer. She also says she hasn't seen any evidence that Plumb did any work in the campaign.

At least the guy's consistent.

Help The Insider clean out the corruption that clogs the pipes of our fair city. Call him at 624-1483 or 624-1496 (fax), or e-mail him at

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