Subpoenas show Agua district investigation focuses on controversial severance payments

By Dave Hendricks
Progress Times
Originally published Feb. 23, 2018

The Hidalgo County District Attorney’s Office investigation of the Agua Special Utility District focuses on two former employees who received six-figure severance payments, according to grand jury subpoenas obtained by the Progress Times.

Prosecutors sent the first subpoena in November, requesting records on severance payments to former Community Relations Coordinator Oscar “Coach” Salinas and former utility Project Manager Armin Garza.

Prosecutors sent four more subpoenas in January, requesting employment records for Salinas and Garza. They also sought text messages between the utility board and the former executive director who approved the severance payments.

District Attorney Ricardo Rodriguez declined to comment on the investigation or the subpoenas.

“It’s still ongoing,” Rodriguez said, adding that the investigation remains merely a “review to determine if there has been a criminal offense committed.”

Prosecutors asked the Texas Rangers to join the investigation in January, days before the second round of subpoenas.

The move had wide-ranging political implications in western Hidalgo County, where Salinas and Garza serve on the La Joya school board.

While employed by the utility district, Salinas and Garza reported to former Executive Director Oscar Cancino, who reported to the seven-member utility board. A majority of the utility board works at the school district.

State Sen. Juan “Chuy” Hinojosa, D-McAllen, became concerned the reciprocal employment relationship posed a potential conflict of interest. He pushed a bill through the Texas Legislature, blocking school board trustees from working for the utility district.

While the bill remained pending, though, the utility district signed Salinas and Garza to five-year employment contracts — an unprecedented move for the utility district, which didn’t approve contracts for any other employees.

The utility district authorized Cancino, the executive director, to negotiate severance agreements with Salinas and Garza.

Salinas received $221,000, according to utility district records. Garza got $268,000.

The utility district kept the severance payments secret for months, refusing to release the documents and copies of the checks.

KGBT-TV broke the news on Nov. 3.
Critics immediately accused the utility district of corruption and demanded an investigation. Supporters blamed the state senator, who forced Salinas and Garza to choose between the school board and their jobs.

Prosecutors quietly sent the utility district a subpoena six days later. The subpoena included a boilerplate warning: “Do not disclose the existence of this request. Any such disclosure could impede the investigation being conducted and thereby interfere with the enforcement of the law.”

The Progress Times, though, requested the subpoenas under the Texas Public Information Act.

After reviewing comments submitted by the District Attorney’s Office and the utility district, the Texas Attorney General’s Office determined the documents must be released.

The Nov. 9 subpoena requested:
> All items relating to the employment and discharge of the following employees: Oscar Salinas and Armin Garza, including but not limited to: severance settlement packages and release documents and records, notes, papers, audio, video or digitally maintained records, agendas notes and documents of closed sessions of the Agua Special Utility District board, legal memoranda and documents, bylaws and employee personnel policy manual, and board policy manual.

The Jan. 22 subpoenas requested:
> Copies of all emails and/or text messages between Oscar Cancino and Rogelio Hernandez III during Oscar Cancino’s employment with Agua SUD, copies of all emails and/or text messages between Oscar Cancino and Lloyd Loya during Oscar Cancino’s employment with Agua SUD, copies of all emails and/or text messages between Oscar Cancino and Esquivel “Zeke” Ortiz Jr. (sic) during Oscar Cancino’s employment with Agua SUD and copies of all emails and/or text messages between Oscar Cancino and Homer Tijerina during Oscar Cancino’s employment with Agua SUD.

> A complete copy of the employment file of Oscar Cancino.

> A complete copy of Armin Garza’s employee file, a complete copy of all time sheets submitted by Armin Garza, a complete copy of all timesheets signed by Armin Garza, a copy of any and all documents reflecting number of hours worked by Armin Garza during his employment with Agua SUD and a copy of all checks issued to Armin Garza by Agua SUD.

> A complete copy of Oscar Salinas’ employee file, a complete copy of all time sheets submitted by Oscar Salinas, a complete copy of all timesheets signed by Oscar Salinas, a copy of any and all documents reflecting number of hours worked by Oscar Salinas during his employment with Agua SUD, a copy of all checks issued to Oscar Salinas by Agua SUD and a copy of all employment contracts entered into between Agua SUD, and any employee of Agua SUD on or after April 27, 2017.

Attorney Frank Garza, who represents the utility district, said the board cooperated with the subpoenas.

“As has been publicized, the district attorney is conducting a review of Agua’s policies and procedures regarding employees and how they were affected by Senate Bill 814,” Garza said. “Due to the fact that the review, as we understand from the District Attorney’s Office, is still ongoing, we’re limited on what more we can respond on behalf of Agua SUD.”