Grandma goes electric

Rylander is already practicing hitting them up for money by soliciting their contributions to e-Texas itself. She hopes to raise about $400,000 that would go into a special agency account to pay for travel, meal, and lodging expenses for the approximately 150 task force members. Rylander sees asking businesses to help pay for e-Texas as a positive example of a public-private partnership and a way to save taxpayer money. But others see the commingling as a taint on its independence.

"Polls have shown that Texans don't think it's ever appropriate for politicians to take contributions from those who have business before their agencies, and we as a state do not allow legislators to take contributions during the session from lobbyists and others who are advocating positions," says Tom Smith, state executive director of Public Citizen, a government watchdog group. "So why are we allowing large business interests to contribute to fund a government study which will create policies that will benefit those same large business interests?"

The chairman of the e-Texas task force to focus specifically on outsourcing is Bill Hammond, a privatization fan and president-CEO of the Texas Association of Business and Chambers of Commerce.

"We're not in this to get business for our members," Hammond says. "We are in it to reduce the cost of government, if possible, and make government more customer-centric than it is now."

Hammond says the committee is eager to seek counsel from Bill Eggers, a top Rylander aide who wrote the 1995 book Revolution at the Roots, which offers glowing accounts of privatization efforts nationally and is a bible for outsourcing proponents. The committee is less eager to ask representatives of state employee unions, who have been the most vocal critics of privatization, to join.

"As far as getting input from them, we'll be happy to do that," Hammond says as a compromise.

Mark Sanders, Rylander's special assistant for communications, admits the e-Texas task forces will be stacked with people who conform to Rylander's philosophy that government is bloated and should be streamlined. "Is e-Texas going to come out and recommend a return to the Great Society? The answer is no."

Hammond says e-Texas will ask independent experts to analyze the costs and benefits of business doing certain government services. Those are complicated analyses, Hammond admits, but ones he thinks can be done free of bias.

Michael Granof, a University of Texas professor who wrote the textbook for the governmental accounting course he teaches, warns that assessing the benefits of outsourcing is a tricky endeavor.

"There are many ways to determine cost and benefit," Granof says. "Give me 10 minutes, and I can make an argument both for and against outsourcing the same service by making different assumptions. I can tilt the argument either way."

When social and political issues come into play, such as state employee job security, the outsourcing debate gets more difficult to assess objectively. Granof says that some government functions should be outsourced, but that the public should be skeptical of any recommendations because of the difficulty in doing an objective cost-benefit analysis.

"Should Carole Rylander do this kind of review on outsourcing? I offer a resounding yes," Granof says. "Should we privatize everything that comes under review? I would say probably no."

So how can the public fairly assess whether the e-Texas outsourcing recommendations are good for the state or merely good for the businesses that would get the work? Essentially it's a question of whether the public believes Rylander wants to do what is best for Texas or simply what is best for herself. It comes down to whether the public can trust her.

The Texas Democratic Party got a tip during the summer that Steve Koebele, Rylander's general counsel, had recorded phone conversations in his office without the comptroller's consent. Playing on a hunch and a hope, the party asked the comptroller's office in a formal open-records request for copies of the tapes.

The office responded that the tapes did not exist. Reporters began asking Sanders, Rylander's spokesman, what his boss knew, when she knew it, and what she was hiding. He again responded: "There are no tapes."

"The questions were answered honestly," Sanders still says.

There's a fine line between honesty and dishonesty, trust and mistrust. Sanders' statement was true, but only because Rylander allowed him to play an insulting game of semantics with the press and the public. There were no tapes because they already had been destroyed. Only when the Democrats and reporters got wise and asked if there ever had been any tapes did Rylander begin to come clean. She conceded that Koebele had taped four phone conversations without her knowledge or permission and said the tapes no longer existed.

Koebele, who had left the agency under the guise of a voluntary resignation, wrote a memo ultimately supplied to reporters that described each of the four recordings. According to his accounts, none of the tapes contained anything inflammatory that could be used against Rylander.

"No other audiotape was made. No other audiotape exists," his memo ends. Sanders says the agency was within its legal right to toss the tapes because they were the equivalent of written notes taken during meetings.