Follow the Money

Don't let accusations of overtime fraud by low-level employees distract you. The real money disappears from the Dallas Independent School District through sleazy contracts awarded by top administrators.

The idea came from Robby Collins, special assistant to the DISD superintendent, after he saw a news story about how City of Dallas workers got price breaks on their car phones. Collins figured cheap cel phones would be a nice perk for DISD workers.

These days, if you call Collins' own voice mail, you will hear an unexpected announcement. "If you are calling concerning cellular phones," the taped announcement chimes, "please call..." and then recites another number.

Why is one of the district's top administrators hustling cel phone service? Collins started wearing a second hat as a sort of marketing manager for Southwestern Bell Mobile Systems, he says, because he was looking for a new benefit to give employees. Collins is not receiving any special consideration for his help running the program.

In years past, he says, the district rewarded its employees by selling them computers at discounted prices. But that program became obsolete, he says, when electronics wholesalers like Best Buy started selling computers so cheaply that the district's bulk purchase discounts couldn't beat the retailers. "We had kind of a void in our benefit package," Collins says.

Scrounging around for a replacement, the DISD administrator came up with the notion of cellular phone service. He asked telephone companies to offer competitive bids, and struck the deal with Southwestern Bell.

Under the terms of the contract, the telephone company is allowed to hold "phone fairs" twice a month in district buildings to sell DISD employees on the idea of discounted phone service. Typically, Collins says, the fairs are held at Skyline High School, which has a lunchroom large enough to accommodate the crowds.

The company sends DISD one master phone bill for all the employees who sign up for the plan. The district, in turn, gets the money back through payroll deductions. DISD goes further than just collecting the money. The school district also keeps track of each employee's phone use to make sure the employees aren't using more peak air time than the contract allows.

In return, Southwestern Bell charges DISD and its employees a flat rate of $35 a month--for 100 minutes of peak-time calls and unlimited calls on weekends. Should a subscriber want more time during the week, he or she can bump up to $69 a month for unlimited calls all the time.

The response to the plan has been overwhelming, Collins says. "I expected maybe one thousand," Collins says. Instead, there are 4,500 subscribers now, and more signing up every day.

Teachers love the service, Collins says. But the contract--not the only one of its kind in the state--has not pleased everyone. "It raises some issues," says Thomas Canby Jr., senior division chief of school financial audits at the Texas Education Agency.

One problem, Canby says, is that the school district could be left holding the bag if an employee's paychecks failed to cover telephone bills. The Texas constitution specifically bars the advancing of governmental funds--or credit--to individuals.

Collins adamantly insists the district will not wind up using tax money to pay personal cel phone bills. "We have no intention of paying the telephone bills of employees," he says.

The district is protected, he says, because teachers receive accrued salaries: Their pay is parceled out over the year to cover them during the summers when they aren't working but still need cash flow. When a teacher is terminated, the paychecks don't just stop. DISD still has time to deduct what it needs to cover any unpaid phone bills, Collins says.

Employees also aren't allowed to charge long-distance or toll calls to their accounts, he says; they must use their own credit cards or calling cards when dialing long distance.

But the contract language between DISD and Southwestern Bell is clear: "Guaranteed payment...through employee payroll deductions, of total DISD subscriber monthly charges."

While the deal is unquestionably popular among DISD employees, it raises questions about why DISD resources are being used to provide teachers cheap personal phone service. What do cellular phones really have to do with better educating the children? First-grade teacher Berk's idea of using the phone in the classroom seems a little farfetched. Berk says the phone also helps her contact her principal if she is caught in traffic on the way to work. But the cost of administering a cellular phone service for all DISD employees seems a high price for such a relatively limited benefit.

Still, DISD superintendent Gonzalez is no more concerned about the propriety of the phone contract than she is about the half-million-dollar contract with Voyager. "'I really don't see this as something that has dark implications," she says.


Compared to the gleaming glass, polished chrome, and wood found in the quarters of Dallas' more prestigious law firms, the offices of Schwartz & Eichelbaum can hardly be described as luxurious. In fact, they're downright dingy.

A small, shabby sign of etched plastic on an unassuming door timidly announces the firm's location. Inside, the secretary and attorneys work in cramped rooms with little light. The law library doubles as conference room.

But, as they say, appearances can be deceiving.
The firm of Schwartz & Eichelbaum is paid a lot of money--well over a half-million dollars a year--to handle legal matters for DISD. In the past 10 years, the firm's contract has been renewed and revised at least four times. Each time, Dennis Eichelbaum and Leonard Schwartz have managed to negotiate a richer deal for their firm. Under their current contract, the firm is paid $54,000 a month in taxpayer money.

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