By Jim Schutze
By Rachel Watts
By Lauren Drewes Daniels
By Anna Merlan
By Lee Escobedo
By Eric Nicholson
Steve Hatchell answered the telephone in his hotel room last Thursday evening full of good cheer.
And, hey, why not?
The 49-year-old commissioner of the new Big 12 athletic conference was in New York City for an extended weekend. He was staying at the Marriott Marquis, a big, glitzy hotel located in the heart of the Broadway theatre district. He was up from Dallas for the NCAA Final Four basketball championship, one of the biggest events in college sports.
Hatchell had been to the event many times before, but this year's appearance was especially sweet.
Because this year he is a big deal--the newly appointed commissioner of the new powerhouse conference, made up of the Big Eight and the four best athletic schools from the soon-to-be-defunct Southwest Conference. He is making $200,000 a year--a figure destined to quickly escalate when the Big 12 becomes operational in July. He owns a $600,000 home in University Park, where he had moved three years ago to take a job as commissioner of the Southwest Conference. And, best of all, his new bosses in the Big 12 had just picked Dallas as the headquarters of the Big 12, bypassing Kansas City, where the Big Eight had been based for 89 years.
It had been a heck of a battle between the two cities--vying to land an operation that would boast a mere 20 employees--but Dallas had emerged the victor.
For one simple reason. At the 11th hour--two months after the two cities' bids had been submitted and four days before the decision was scheduled to be announced--Dallas City Manager John Ware had pulled the city's wallet out of his hat and offered a stunning $1.25 million in taxpayer money as a no-strings-attached-spend-it-as-you-will-Missouri-you'll-never-top-this gift.
It was an astonishing move that The Dallas Morning News tried its darnedest not to cover. Its initial report on the decision ran in the sports section and never bothered to mention the public's cash, instead explaining what happened this way: "Dallas officials suggested the vote went in their favor because of the superior airline connections out of D/FW International Airport and Love Field, and Dallas' image as 'the cultural and economic center of the region.'"
In the News' hands, the story--and the money--was destined to become teeny-tiny sports trivia. But on the day of the Big 12 announcement, Councilwoman Donna Blumer got a phone call tipping her off to Ware's offer, with which she immediately confronted Ware. Blumer's tipster also called the news department at Channel 5, which immediately ran a story, forcing the News to pursue the story--five days later.
Incredibly, only Bob Stimson, Donna Blumer, and Paul Fielding--the three most alert, most fiscally responsible members of the council--cried foul. What these councilmembers wanted to know, of course, was how Ware could be so brazen--or so stupid--as to haul off and do something of this magnitude without getting the OK from the council, which, of course, has to approve such an expenditure. "He did it not only without council authorization, but without council knowledge," Councilwoman Donna Blumer was quoted saying in the paper.
To which Ware humbly replied, referring to his bosses: "What I probably should have done was to at least call them up, and advise them of what was going down."
The story, though, never took on any steam--in part because Mayor Ron Kirk was quick to strongly defend Ware. Kirk had first heard about Ware's offer the week before, while on his much-publicized trade junket to South Africa, he told the News. But he applauded the manager's move. "I think this is much ado about nothing," Kirk said upon his return. "Dallas ought to be thrilled that we're bringing the Big 12 to Dallas. There is no question that John Ware has acted properly...I back him 100 percent."
Much more than we knew.
Because it seems there was more than one person with his finger on the trigger, offering $1.25 million of the public's cash to snag a tiny number of employees.
Just ask Steve Hatchell. He knows where his money came from.
"It came from the city manager, with the mayor's backing," he told me matter-of-factly, during a pleasant, open conversation we had while he was in New York. "You know, it's a rarity when you can really get someone to not only get interested, but to really understand the big picture. Ron's incredibly well-liked and well-respected, so when he wants to get something to work, he can get the ingredients put together. We didn't have to wind him up at all."
How interesting. And how positively revealing.
And people thought Bartlett was bad.
True, Steve Bartlett would look you in the eye and promise you the moon, then run for cover--like a cat caught with a bird in its mouth--the minute opposition mounted. True, Bartlett would get all mayoral and magnanimous and offer Norm Green a sports arena and Ray Hunt a racetrack. (Lucky for the taxpayers, it would all blow up in his face when Bartlett's buds woke up and saw their emperor standing there, earnest but naked, clutching only one vote, incapable of capturing the rest.)
True, Bartlett lied.
But even Bartlett wasn't this shameless.
Last Sunday at 9:15 p.m., Kirk returned this reporter's call from the Mayoral Car on his way home from a Mayoral Function. His disdain for the subject matter at hand--and the unboosterish way this newspaper wanted to pursue it (unlike the Dallas daily)--was all too obvious.
"I'm just not in an Observer mood right now," Kirk said, explaining why he wasn't willing to have a conversation about exactly how he helped get the Big 12 to come to Dallas.
But, Mr. Mayor, is it true--as the News reported--that you only learned about Ware's $1.25-million offer while you were in South Africa?
Pause. "I think so."
OK, then, exactly who was it who gave you this news over in South Africa?
"Well, if you recall, I'm still just kind of in my..." he said, searching for words. "I don't know. I've got nothing to talk to the Observer about right now."
Well, OK, but Steve Hatchell says you authorized the money.
"That ain't the case," he said. "I was involved with the courtship of the Big 12--I supported it. But the concern about the offer came while we were gone."
True--the concern about the offer came while Kirk was gone. But the decision to make the offer came before Kirk left--at least according to Rick Douglas, president of the Greater Dallas Chamber of Commerce. He's the one who asked City Hall for the money to begin with.
"I talked to John on Wednesday of that week--we left on Friday," says Douglas, who accompanied Kirk and a host of Dallas business leaders on the South Africa trip. "We had to get a written proposal completed. John said he'd give me a letter."
And Kirk--did Rick Douglas talk to Kirk?
"The guy I was talking to was John Ware," Douglas said carefully. "When we work a thing at the chamber that involves a commitment, I try to always talk to the administrative staff. John and I talked about it. I asked him for the commitment. I asked him for the letter, and I got it. Who he was talking to, I don't know."
Like Kirk, Douglas is not happy about this conversation and where it's leading. "But if you're trying to do a hatchet deal on this thing..." Douglas said. "This is a big deal for the community. We're now working on at least two different deals that are sports-related--well, three--that have come out of the networking we've gotten from this deal."
That's fine. That's terrific. In fact, let's ignore that big-time professional sports--never mind the college level--generated a mere 10th of one percent of all payroll dollars in Dallas County in 1991, the last year stats were available on this from the U.S. Department of Commerce. Never mind that. No, let's all agree that giving 20 employees $1.25 million in tax money--which, by the way, is enough to buy each Big 12 staffer a brand-new Jaguar, with money left to spare--is exactly what's needed to jump-start the economy in the entire Dallas region.
Fine. It still doesn't give the mayor and the city manager the right to make a major financial decision in a vacuum--not when we supposedly (according to that stupid thing called the city charter) have a council-manager form of government by which 15 elected officials decide how we're going to run the show.
Kirk, of course, is playing real dumb on this one. "Big 12 Commissioner Steve Hatchell said he had thought the city money was a sure thing, but councilmembers said they must approve the grant," the News wrote on February 7, when it finally reported that a bunch of public money had been offered without proper authorization. "No date has been set for the vote, but Mayor Ron Kirk said he was hopeful that the council would approve."
Hopeful? While Kirk was telling the poor, pothole-suffering populace that he was "hopeful" that the democratic process would deliver him a good outcome, he was telling Steve Hatchell that it was a done deal. No problem whatsoever.
"I think they know the city council is going to vote," Hatchell said of his bosses at the Big 12. "But I think the perspective is that of the 15 on the council, there are always dissenters who don't have the vision the mayor and Ware do, but there are enough votes there. That's the belief."
Because the mayor has told them so, Hatchell says.
Which is enough to make a good, idealistic public servant like Bob Stimson want to bend paper clips or something. Stimson's a mild-mannered accountant who rarely flashes anger. But on this deal, he's close.
"Whoa," Stimson told me last Thursday, when I called him to tell him of the mayor's involvement in the $1.25-million offer. "Kind of leaves me a little speechless. Whew. Well, I'm not going to say anything off the record--but, off the record, holy moly."
Stimson, more than anyone else on the council, has the right to be absolutely crazed about what Kirk did.
Each Monday since Kirk was elected mayor, Stimson, as chairman of the city's business and commerce committee, has attended a 4 p.m. meeting in the mayor's conference room to discuss strategy to lure businesses to Big D. Stimson; Kirk; Mike Marcotte, the director of the city's economic development department; and one or two representatives from the chamber of commerce attend the sessions.
"I've been talking about the Big 12 ever since I've been going to these meetings," Stimson says. "This was something the Greater Dallas Chamber had been taking a lead on, and for the most part, they did a super job.
"One of the most interesting things about this is that, through this entire period of time we talked about this, one of the best parts of the deal was they weren't asking the city of Dallas to do a doggone thing," Stimson says. "The chamber's package did not call for any city inducements. And I liked that."
For all those months, Stimson remembers Kirk encouraging the chamber people to be aggressive in their attempts to pursue the Big 12. But never for a minute did Stimson think that Kirk was directly involved in a back-room chamber scheme to do so.
According to Steve Hatchell, the team that put together the Big 12 bid consisted of Kirk, Ware, Rick Douglas, Dallas Stars owner Tom Hicks--a member of the University of Texas board of regents--and UT booster Bob Utley, who is CEO of First Southwest, the city's financial consulting firm.
"Rick Douglas at the chamber was terrific," says Hatchell. "I worked more with Rick than with the mayor. But I think they met a lot. In between Rick Douglas and the mayor, they got a lot done in a hurry."
That's not to say that Hatchell didn't meet with Kirk. "Oh, sure," he says. "He's one of the ones when you call and say, 'We have to meet.' He says, 'My calendar is full, but I'll see you at 5:45'--and you go. It's great. He's at the top of the list."
Hatchell says Kirk, whom Hatchell knew before Kirk became mayor, jumped into the Big 12 fray almost as soon as he was sworn in last May. "There was enough to keep them in the hunt from the beginning," says Hatchell. "We had major bids from other cities, but the big push came after December 1. And Ron was right there to say Dallas needs to be counted in."
Which was fine until December 1, when Kansas City's bid was $1 million better than Dallas' offer. For Kansas City, winning the Big 12 headquarters was serious business--a matter of civic identity. Buildings had been lit up to impress Big 12 officials; the governor had flown in to lobby; citizens had worn buttons of support. More important, 23 corporations had ponied up $2.5 million in cash to give the Big 12, no strings attached.
Dallas, by contrast, had only the promise to raise $500,000 from the private sector to cover the costs of finishing-out office space for the Big 12 offices. The rest of our package consisted of free or discounted goodies, such as office space, telephone equipment, computers, accounting and legal services, airfare, cars, and office furniture.
So, in the 11th hour, with the Dallas business community unwilling to put cash on the table, the chamber turned to the taxpayers. And unbeknownst to them, Kirk and Ware agreed to hand over $1.25 million--$250,000 a year for five years--that they would take out of a fund the council was setting up to spur economic development south of the Trinity. The fund does not even exist yet--and never mind that the Big 12 has absolutely no intention of locating south of the river.
And what would the Big 12 use the taxpayers' money for? With most of its overhead being covered by local companies, it would seem unlikely to actually need much. "We'll use it for operational expenses to stage the [sports] events," Hatchell told me. "These are huge enterprises."
All of which is hugely upsetting to the man Kirk appointed to chair the business and commerce committee--the man who dutifully sat there, in front of the stoic mayor, carefully examining the chamber's weekly handout on the so-called private-sector progress of the Big 12 wooing.
After almost a year of those meetings, Stimson was incredulous when reporters began calling him last month about the whopping public subsidy. "I said, 'No, this isn't right--you all need to get your story right. We're not putting any money in this,'" he says. "Well, as it turned out, I needed to get the story right."
Stimson is a good councilman--in fact, if you look at his entire body of work over three years, he's often the best of the entire bunch. He does all his homework, takes all the city's complicated issues apart like a jigsaw puzzle, is always ready to jump in with a battery of detailed questions that the more cerebrally limited staffers often can't answer. He's the only CPA on the council, which has been a tremendous asset for the citizens. What's more, he's a reasonable guy who, despite shenanigans like this, manages to keep a Dudley Do Right view of public service.
Stimson knows what it's like to be bamboozled. Eighteen months ago, in a public briefing on the sports arena, John Ware told Stimson and his fellow councilmembers that the proposed site for the new arena--a site that had just been announced with much fanfare, with the help of a $500,000 consulting study--was going to be changed immediately because the council, led by Stimson, had made some wise criticisms of the property that was picked.
Stimson preened in the meeting--as he should have after spending weeks collecting facts and trying to change Ware's mind. In truth, though--as the Observer found out later by sifting through internal City Hall memos--Ware changed the site because oilman Ray Hunt ordered him to do so. Hunt, who owned the proposed arena site, had decided that he much preferred the arena on a different piece of his land that allowed him better development opportunities in the future.
Stimson didn't like being lied to then--and he doesn't like it now any better. "This really is inexcusable," says Stimson, who was supposedly on the new mayor's "team" of people who were going to work with the mayor to take Dallas to new heights of commerce and peacefulness.
But Stimson is starting to see what other councilmembers, such as Donna Blumer, have been seeing for some time. "Kirk is running the whole show on his own," Blumer told me last Sunday, in the middle of an unprecedented two-week spring recess that Kirk has implemented. "Kirk keeps us out of City Hall while he stays in and does all these things. We have fewer meetings, and the meetings we do have are very short. You barely read about what we're doing in the media any more, because, in truth, we're not doing anything. He's doing it all behind the scenes."
And Steve Hatchell can sit in his house in University Park and breathe a sigh of relief for it. He's just tickled about the mayor's handiwork on this one. Says Hatchell, sizing things up: "He's a two-fisted guy about a lot of things."
So we're finding out.
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