San Marcos - Buda - Kyle Edition | March 2020

A LOOK BACK

CITY GOVERNMENT Texas Rangers arrest former San Marcos staer on charges of theft

Below is the timeline of the San Marcos investigation.

20 19 MARCH

Community Impact Newspaper receives thousands of documents from the city of San Marcos in response to a public records request submitted in February. The records included contracts, change orders and bids awarded to or submitted by The Fence Lady Inc. from 2013 to February 2019, protests submitted by other contractors on those projects and emails mentioning The Fence Lady Inc. or its owner Rebecca Dean. The city of San Marcos places its former construction project manager Jason Pence on paid administrative leave to look into allegations that he had engaged in improper purchasing practices related to city construction. Community Impact Newspaper publishes a special report that shows, based on the review of thousands of pages of documents, while Pence was the city’s construction manager, the city bypassed the legally required competitive bidding process through the use of change orders. The city of San Marcos res Pence. In a letter to Texas Attorney General Ken Paxton’s oce, the city also conrmed that Pence was under criminal investigation by the Texas Rangers. The letter was in regard to a public records request from Community Impact Newspaper.

BY ANNA HEROD

A review of documentation provided by Ramirez and city nance records showed that Pence used taxpayer dollars to purchase material for this project, Evans stated. Pence used city funds for another construction project he was personally compensated for on a New Braunfels property, according to the adavit. Evans found that Pence purchased several items for this project with city money, the adavit stated. Evans stated that he observed text messages between the property owner and Pence from Aug. 3, in which Pence states that he picked up “the rest of the cedar beams” for the construction of a carport and roof for the property owner. On the same day Pence sent that text message, he purchased cedar beams of the same measurements for $2,426.52 with the city’s account, according to the adavit. San Marcos Director of Public Safety Chase Stapp provided Evans with multiple invoices associated with heavy-gauge copper wire Pence purchased with city funds, according to the adavit. Stapp told him several of the copper wire purchases did not appear to be linked to any city projects. Records show, the adavit stated, that on at least two projects Pence claimed to have purchased the wire for, the projects were actually com- pleted with a dierent wire gauge. Texas Department of Public Safety records show that Pence sold about 4,500 pounds of copper wire between July 2018 and February 2019, Evans stated. Evans reviewed records associated with nine electrical jobs the city of San Marcos hired Johnny Homann of CT Electric to perform. City records and receipts show that Pence purchased $28,919 worth of copper wire and associated the purchases with the jobs the city hired Homann for, the adavit stated. Homann told Evans that none of the wire was necessary or used for any of the nine jobs he was hired for, according to the adavit. “It should be noted additional examination is being conducted into

The Texas Rangers arrested former San Marcos Construction Manager Jason Pence after the agency found that he used thousands of public dollars for noncity construction proj- ects he was personally compensated for, records show. An ongoing criminal investigation by the Texas Rangers also found that as the city’s construction manager, Pence directed his subordinates on multiple occasions to complete work on noncity construction—that Pence was personally paid for—while they were on the clock for the city. Pence, who was red by the city Jan. 27 following allegations that he had engaged in improper practices as construction manager, was arrested Feb. 11 on charges of theft by a public servant of more than $30,000 but less than $150,000, according to his arrest warrant. Pence has since been released on a $10,000 surety bond and could not be reached for comment. Pence’s arrest warrant was led based on information gathered by the Texas Rangers during the agency’s criminal investigation into Pence’s conduct as the city’s construction manager. Texas Ranger Joseph Evans stated in the arrest warrant that interviews, text messages and city nancial records show that as the city’s construction manager, Pence—on multiple occasions—directed his subordinates to do construction work on noncity projects that Pence was personally compensated for. A temporary employee with the city of San Marcos, Matthew Ramirez, told Evans that he and two other temporary city employees were instructed by Pence in October 2019 to manufacture re pits for a New Braunfels business, according to the adavit. Ramirez and the other city employees were on the clock for the city when the work was performed, Evans stated in the adavit. Based on city records and inter- views with the business owner, this was not a city project, and Pence was personally compensated for it, the adavit stated.

DEC. 13

2020 DEC. 14 JAN. 27

FEB. 11

The Texas Rangers arrest Pence on charges of theft by a public servant of more than $30,000 but less than $150,000.

The city of San Marcos states in a news release that multiple city employees came forward about “potential improprieties” by Pence after a December news article was published . The city stated this led to the Texas Rangers criminal investigation as well as the city’s own investigation, which is being conducted by Deloitte & Touche LLP.

FEB. 12

SOURCES:CITYOFSANMARCOS,TEXASRANGERS/COMMUNITY IMPACTNEWSPAPER

multiple wire purchases and McCoy’s purchases made by Pence utilizing City of San Marcos funds and asso- ciated with materials believed to be unrelated to any City of San Marcos projects,” Evans stated. The city of San Marcos stated in a Feb. 12 news release that in addition to the ongoing criminal investigation by the Texas Rangers, the city has hired Deloitte & Touche LLP to examine any construction contracts Pence has overseen since 2015, the release stated. The company will also evaluate the city’s internal procure- ment process controls. “A December news article detailed concerns and prompted other individuals to come forward with information about potential impro- prieties,” the release stated. Community Impact Newspaper published a special report in Decem- ber that showed, based on the review of thousands of documents, while Pence was the city’s construction manager, the city bypassed the

legally required competitive bidding process through the use of change orders. San Marcos ocials declined to comment for this story. That report was based on a review of 120 contracts awarded between January 2013 and February 2019 to Boerne-based construction company The Fence Lady Inc., which is owned by contractor Rebecca Dean. The city of San Marcos awarded The Fence Lady with $3.2 million in contracts during this time, records show. But through change orders approved by the city, The Fence Lady’s earnings increased by $922,309—or 28.85%. During this time, Pence was charged with managing the city’s construction projects, approving change orders, and monitoring and authorizing related expenditures. “I’ve committed to our City Council and to this community to fully investigate this situation,” San Marcos City Manager Bert Lumbreras stated in the news release.

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SAN MARCOS  BUDA  KYLE EDITION • MARCH 2020

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