Saturday, August 21, 2010

H.B. Zachry Jr. Bankrolls Sheila McNeil's Campaign

Report shows McNeil-Zachry ties


Greg Jefferson
San Antonio Express-News
Copyright 2010

Judging from Sheila McNeil's latest campaign finance report, it turns out there really was no sunlight between her and Zachry Construction Corp., just as many East Siders had come to believe during her four years on the City Council.

But while they're close, they're not cozy these days. There's discord over McNeil's methods as she lined up financing for her long-shot — and losing — campaign against County Commissioner Tommy Adkisson in the Democratic primary.

Filed last month, the report shows $25,000 in contributions from H.B. Zachry Jr. after the March 2 contest. The magnate signed off on two checks to help clean up some of McNeil's campaign debt, which reportedly reached about $60,000 and included a handful of loans. Her lenders certainly were close at hand.

Some of the money went to repay loans from McNeil's boss at the George Gervin Youth Center, Barbara Hawkins ($3,500); McNeil's longtime adviser Leon Thomas ($3,500); and McNeil herself ($1,500). According to her report — covering Feb. 22 to June 31 — $7,500 in loans remain outstanding.

Zachry's money makes up 93 percent of the contributions reported. (Before the election, Zachry officials gave a combined $1,250.)

Now here's the discord.

Zachry spokeswoman Vicky Waddy said she heard from “multiple sources” that McNeil had asked them for loans and indicated Zachry would repay the debts if she lost — which McNeil disputes.

If that were the case, Zachry, no fan of Adkisson, would have essentially underwritten her campaign. But Waddy said that wasn't the case.

As she geared up to run Zachry had offered to help repay her debt if she failed, an offer he'd made to many candidates over the years, according to Waddy. (Though maybe not often to the tune of $25,000.) But she said he never guaranteed the debts.

“I was upset there was a sense that people were going to lose money expecting that I had agreed to pay,” Zachry said in a written statement. “I made a decision not to get into details (about her campaign debt), but let her resolve the final matter as best she could with an additional check. I could afford it better than those who trusted her and came up short.”

McNeil, for her part, said she never floated his name as a guarantor — at least as someone who would “completely” cover the loans.

“No, no, no. Any fundraising, any loans, any money that came into my campaign solely was to win the election,” she said. “It was not based on any one contributor because I had other people who helped me.”

Despite the disagreement, however, the contributions make clear that this was an extraordinary relationship. She has said the company is one of the few investing in the East Side, but questions loom in the community about the economic impact of its efforts.

McNeil certainly took care of the company at City Hall. Their relationship got rolling within weeks of her taking office in 2005. The company wanted a subsidy for a planned hotel, but community activists were still outraged by an e-mail from a Zachry subsidiary executive that referred to the East Side as “the ghetto.”

McNeil cut a deal in which Zachry would pay $750,000 over three years to revamp the East Side's economic development agency, and the councilwoman would support the company's bid.

It looked like a shakedown, but, hey, Zachry got the incentive it wanted.

Later she championed incentives for the Vidorra condominium project, a principal of which was a Zachry son-in-law. Zachry's development arm was an investor.

She then pushed for a nearby quiet zone, angering residents in the area. And just before leaving office last year, she helped secure another break for the project.
As chairwoman of the Metropolitan Planning Organization, McNeil was anathema to the anti-toll crowd. Waddy said she didn't recall Zachry officials discussing MPO issues with McNeil, but — as road builders and supporters of the toll option — they couldn't have been unhappy with her.

Adkisson, who clumsily tried to take tolls off the table last year, is a different matter. There's a lot of sunlight between him and the folks at Zachry.

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