Clueless

For city Councilman Al Lipscomb, taking handouts from power brokers has become a way of life. Is there a problem?

But, then, Lipscomb wasn't thanking anybody, either--and, truth be told, he needed to. Because if anybody's been taking a free ride in this town, it's Albert Louis Lipscomb.

Ever since the bankruptcy petition was filed on March 27, Lipscomb has been out preaching the victim thing. And people believe it: poor Al. Al was duped by his partner. Al was taken advantage of. Al was robbed blind.

Al may be clueless when it comes to some things--integrity and ethics are good examples--but what happened with Lipscomb Industries cannot be explained in a throwaway line in the back of a courtroom. The truth is far more complex and far more insidious.

The Observer has been examining Lipscomb Industries since shortly after it was created in June 1993, about the time when Lipscomb was leaving Dallas City Hall after serving on the council for nine years--the maximum he was allowed under the city charter's term-limitation provision.

Through numerous interviews in late 1993 with Lipscomb and his partner, Roger Hoffman--at their office, at Lipscomb's home, at the job sites of their customers--it became clear that Lipscomb Industries was not what it seemed.

It was purported to be a disadvantaged, minority-owned business--a designation bestowed upon it by the North Central Texas Regional Certification Agency, which is the Good Housekeeping seal of approval for 3,000 businesses that want an opportunity to participate in various corporate and government minority-goals programs.

In truth, Lipscomb Industries was far from disadvantaged--after all, not only had a group of Dallas corporate captains agreed to put up the money to start Lipscomb Industries, they had also promised to keep it afloat by supplying it with more business than any two men without a nickel of sense between them could possibly have dreamed. It may come as a shock to Lipscomb's backers that his business partner, Roger Hoffman, was indicted last week on federal charges in connection with a kickback scheme--unrelated to his involvement in Lipscomb Industries.

What should be far more disturbing to the public, though, is that this generosity from the city's power brokers was nothing new: Lipscomb had been privately taking money from these people throughout his public service career, though no one would ever suspect that, considering that he built his early political career on insulting and antagonizing the Anglo power structure. The empty rhetoric has been a grand fireworks display, capturing headlines for years--a show that served to camouflage the staunchly pro-business, pro-status-quo voting record Lipscomb had established at the same time he was mollifying the minority community he was supposed to be fighting for downtown.

For years now, one of Lipscomb's well-publicized beefs has been with the reluctance of local government and corporate Dallas to give contract work to "real" minority firms--firms that have bona fide black or Hispanic owners who have invested their money, sweat, and tears to set up shop and hire real, live employees who manufacture a product or provide a service. These are the basic components a company must have in order to gain a berth in a minority-goals program.

Too bad Al's own Lipscomb Industries was not one of those companies.
Lipscomb Industries was nothing more than a black guy, a white guy, and an address book filled with the names of every big-shot businessman Lipscomb had ever serviced during nearly a decade on the city council. It was Lipscomb's job to call in his chits with these people and get them to buy chemicals, mainly cleaning supplies, from Lipscomb Industries. It was Hoffman's job--once the orders were placed--to go out and find a chemical supplier, then to hire someone to deliver the products. None of these other businesses, of course, had to meet any minority-goals standards, and while Lipscomb Industries did use some black-owned delivery companies, the chemical suppliers--the biggest players in the deal--were all owned by Anglos.

The plan, though, had two flaws--both of which made Lipscomb Industries more pathetic than newsworthy.

First of all, the chemical manufacturer was supposed to be NCH--a giant, Dallas-based Fortune 500 company. NCH had agreed to make Lipscomb Industries an official manufacturers' rep--an unprecedented arrangement for a company with its own international sales force of 17,000 and a customer list filled with companies just like the ones Lipscomb and Hoffman were targeting. In fact, there was only one reason the company had agreed to do this--a sense of loyalty to Hoffman's father Hal, who was an NCH executive vice president with 35 years' experience at the company.

NCH's affiliation gave little Lipscomb Industries enormous credibility. But shortly after Lipscomb and Hoffman placed their first order, NCH abruptly pulled out of the deal. Not only was its local sales staff up in arms about having to compete with Lipscomb Industries for business--a problem that NCH alluded to in its November 18, 1993, termination letter--but the low-profile company, according to Hoffman, cringed at the publicity that business with Lipscomb brought.

The "straw that broke the camel's back" with NCH, as Hoffman put it, was a vicious, very public campaign the partners mounted to strip one of its competitors, a Native American-owned cleaning supply company, of its minority-owned certification--a move that had prompted the Morning News to run an editorial critical of Lipscomb's efforts.

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