Commissioners Court Replace Independent Auditing Firm Martinez Rosario & Company for New One Who Did Not Submit a Written Proposal
By: Jose G. Landa, Eagle Pass Business Journal, Inc. Copyright 2015
Maverick County Commissioners Court approved to replace former County Independent Auditing Firm of Martinez Rosario and Company, LLP, under the leadership of Ismael “Milo” Martinez of San Antonio, Texas for a new one, Beyer & Company, CPA, of Pleasanton, Texas recommended by new County Auditor Sandra Watkins and Legal Counsel Woody Wilson despite not submitting a Request for Proposal due to the auditing firm’s reservations concerning Maverick County’s bad reputation for corruption at their meeting held on Monday, June 29, 2015, dumping longtime Independent Auditor Milo Martinez, CPA.
County Judge David R. Saucedo called Agenda item No. 19 calling for discussion and possible action regarding the acceptance or rejection of an Independent Auditing proposal submitted by Martinez, Rosario and Company LLP as the County’s independent Auditor in response to the county’s request for proposals for its Fiscal year 2014 Audit. Only one firm submitted a proposal, Martinez Rosario and Company, LLP. No other auditing firms submitted a proposal.
Maverick County legal counsel Woody Wilson from the Law Office of Luis Vera of San Antonio, Texas advised Commissioners Court that under that proposal for auditing firms there had been only one response, the proposal by Martinez, Rosario and Company LLP on May 4, 2015, but that he was recommending to Commissioners Court to give another auditing firm, Beyer and Company, CPA, of Pleasanton, Texas, the opportunity to present a proposal for consideration as the new Independent Auditing Firm for Fiscal Year 2014 Audit.
“We need to make a determination and decision on whether to move forth with the intention of retention of Martinez , Rosario and Company LLP based on the proposal that was submitted,” said Wilson.
“The total cost as per the proposal that was submitted is going to be $142,500 that says that it applies to the county only. The other auditing that he was going to be providing would be an additional, roughly about $42,000, I believe. Your total auditing cost would be roughly almost $192,000″ under Martinez Rosario and Company, LLP, said Wilson.
Commissioner of Precinct 4 Roberto Ruiz questioned legal counsel Woody Wilson why was he recommending another auditing firm if they had not submitted a proposal in response to Maverick County’s Request for Proposals. Ruiz stated that only one auditing firm had submitted a timely Request for Proposal as Independent Auditor of the County’s Fiscal Year 2014, Martinez Rosario and Company LLP.
“Yes, that is correct. I do have someone here that I’m going to suggest, recommend as well,” replied legal counsel Woody Wilson to Commissioner Ruiz.
“But, they were not part of the bid?,” questioned Commissioner Ruiz.
“They did not submit a proposal, no.,” replied legal counsel Wilson.
“So, why would you recommend them?,” asked Commissioner Ruiz.
“Based on the pricing submitted by Martinez, Rosario and Company LLP,” answered legal counsel Wilson. “I understand that,” added Wilson.
“How can you bring it to us, if they didn’t even bother to submit a bid?,” questioned Commissioner Ruiz.
County Judge Saucedo intervened and addressed Commissioner Ruiz’s legal issue and asked Wilson to explain to Commissioners Court the issue concerning the County’s hiring of professional services such as Independent Auditor services.
Legal Counsel Wilson noted that due to the special circumstances that Maverick County was in concerning being late on the audit of Fiscal Year 2014 allowed Commissioners Court under state law to take certain special action as the one being proposed here, to approve an auditing firm although they did not submit a proposal.
“As long as you select someone who is competent, qualified and a reasonable fair price, you can select a CPA without going through the proposal process. And I am suggesting that now, due to the extenuating circumstances of having to get a loan to fund the County through the rest of the year, now you do have Martinez Rosario and Company LLP to make a determination on their submitted proposal of roughly about $192,000, but I have someone else here as well. I have spoken to other individuals in regards to auditing services and the person I have here tonight is most definitely qualified and competent and will be able to afford at a reasonable fair price,” said Wilson to Commissioners Court.
“You can make a determination of selection based upon Martinez Rosario and Company LLP as well. They’re on the agenda to do that, since they submitted a proposal. But I also have someone else here that you can hear from as well in regards to their services even if they did not submit a proposal. You’re granted that leeway within the statute,” added Wilson.
Newly appointed Maverick County Auditor Sandra Watkins jumped in and stated that it was legally permissible under an exemption of the state bidding process under professional services. Watkins concurred with Wilson’s legal opinion to Commissioners Court that state law for procurement of professional services such as Independent Auditor allows Maverick County to award the contract to a company even if they did not submit a proposal.
Judge Saucedo noted during the same type of process last year for Independent auditor services, they (Commissioners Court) had not gone out for Request for Qualifications RFQ’s and that Martinez, Rosario and Company LLP had been chosen and hired by Commissioners Court. “This is a decision for the Court to make, whether to continue with Martinez, Rosario and Company LLP at that amount [$192,000] or to go out and seek somebody else,” said Judge Saucedo.
“Yes, you could,” replied legal counsel Wilson.
Wilson stated Commissioners Court could go through another agenda item and hear out a presentation from the other auditing firm seeking the auditing contract to determine the county’s options.
Wilson stated he had consulted with County Auditor Sandra Watkins and it had been determined that the other auditing firm, Beyers and Associates, met the requirements of qualification and competence and could be considered if so desired by the Court.
Commissioners Court and Wilson discussed how state law requires that the determination for contracting professional services must be based on qualifications and not on pricing.
However, legal counsel Wilson again emphasized the importance of retaining an independent auditor due to the lateness of Maverick County’s Fiscal Year 2014 Audit.
“You’re late and we need to get an auditor on board quickly to get the audit done so the county can get the funding (loan) that is necessary to operate the rest of the year,” said Wilson.
Judge Saucedo noted under the agenda item the Court had a decision to make to continue with the services of Martinez, Rosario and Company LLP or if not then they also had another agenda item set in place to pursue another option.
“Whatever it is, we need to decide today, what we’re going to do. We don’t have time to go back and go out for RFQ’s or any of those things, because of where we are at.” Added Saucedo
Judge Saucedo advised Commissioners Court that the banks whom the County is talking to for obtaining a loan ($2 Million) to fund the shortage for the remaining 2014 fiscal year are requesting the County hire an Independent Auditor immediately to conduct the 2014 Fiscal Year Audit.
Commissioner Ruiz stated that he perceived the situation as the County attempting to go after a cheaper, less expensive auditing firm to be able to lure a financial institution into lending the funds needed by showing some type of financial responsibility and not basing the decision on what is required such as the qualifications of the auditing firm.
Commissioner Ruiz noted that the only firm who submitted a proposal was Martinez, Rosario & Company LLP and that they are a group who has done work for the County for at least three years and are professional and helped the County in trying times such as the case of ousting former County Auditor Fidencio Ortiz.
“But now, you say well lets go with this other firm so we can get a loan. So we have a better chance at getting a loan, so we get somebody that’s price is low. I don’t know if the Commissioners see it, but that’s how I see it,” said Ruiz.
Judge Saucedo disagreed with Commissioner Ruiz.
Commissioners Court decided to table Agenda Item No.19 to go into Agenda Item No.20 to determine what steps to possibly take.
Agenda item No.20 called for the granting of an order of exemption of professional services of independent auditor Beyer and Company CPA contract from the bidding and proposal process.
During discussion, representatives from Beyer and Company, CPA, presented Commissioners Court their qualifications and services they would provide the County including an estimate of their proposal’s cost for services, including $44,920 for the County 2014 Audit, another $25,00 for the County Landfill (Maverick County Solid Waste Authority), $12,500 for the Maverick County Public Facility Corporation (Detention Center), $10,000 for the Maverick County Public Facility Corporation Fund, totaling $92,420 or so.
Representatives of Beyer and Company stated they did not submit a proposal due to the corruption issues facing Maverick County during the past years.
“ I also want to say to be quite honest with you, we did receive your request for proposals from the County and I came in the following Monday morning into our office and my desk was filled with newspaper clippings from the internet of commissioners being indicted, commissioners being in association with cartels and we discussed it and they didn’t want to come over here, based on that. Later, we found out from the County Auditor that it has been cleared up. I guess from the indictments and whatever has been done. I take the word of the County Auditor that those things have been cleared up, with respects to those things,” said the Beyer and Company representative. “When I was told that, I kicked myself for not sending in a proposal,” added the Beyer representative.
After discussion, Commissioners Court voted to approve Beyer and Company, CPA, as Independent Auditors for the County’s 2014 Fiscal Year Audit on a split vote of 3-2 with Judge Saucedo, Rosales, and Morales in favor while Ruiz and Rosy Cantu against.
Due to Maverick County’s financial problems during recent years, Commissioners Court has established a practice of hiring professional services without regard to proposals submitted and the qualifications of professionals, possibly opening County taxpayers to potential lawsuits.
