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Show Me the Money!
by David Stanowski
06 August 2013

It may be called a “Human Capital Plan”, but the current uproar has nothing to do with human capital; it’s all about the cash.

A friend of mine recently corrected me when I was speaking about the “Local Advocates” by reminding me that it is more accurate to refer to such groups as the Local Poverty Industry, because they spend most of their time looking for ways to find new sources of income for their “industry”, and little time really “advocating” for the best interests of those in poverty.

Obviously, he was right. The terms had begun to change when the State started referring first to the “Austin Advocates” and then to the “Local Advocates”. The City Manager also often referred to the “Local Advocates” in City Council meetings, and the name stuck.

The GOGP recently shared our concerns that the City Manager was giving the Local Poverty Industry far too much power to shape public policy. Special “arrangements” are not good for the City and its residents whether it’s granting TIRZs to favored developers or giving special deals to the Poverty Industry. This is because the Poverty Industry has no more concern for the “general welfare” of the City than developers seeking sweetheart deals or promoters that want to filter sea water on Pelican Island.

The key take away is that there is really very little difference between groups seeking special deals from the City; we should be very wary of all of them. 


Now we are hearing that the local Poverty Industry is scrambling to get its hands on the money slated to be spent on “human capital”. GHA’s RFP seems to be very well drafted, so if a contractor is chosen using the criteria cited, there should be no problem, because it is written so that the GHA should select from only the most qualified applicants. However, the selectivity is THE problem. Many of the members of the Local Poverty Industry do NOT qualify to participate in the Human Capital Plan. They don’t have the proper credentials or experience.

According to a source who is intimately familiar with the operations of the Local Poverty Industry, some of them are hopping mad that they don’t qualify to bid on this RFP. Therefore, they are attempting to get organizations like the United Way to bid, and then subcontract to them. This source also reports other problems with the bidding process. 


Apparently, the situation has gotten to the point that the GHA has called a special meeting on Thursday to “Discuss and consider for action suspending procurement process related to the Human Capital Plan”!

Where is MBS in this process? As you may recall, they have their own non-profit arm called Urban Strategies which is used to cash in on these types of opportunities. However, our source tells us that they may not be a bidder in deference to the desires of the local Poverty Industry.

Is it possible that MBS and Urban Strategies would pass on a bid for a lucrative project in order to strengthen their support from the local Poverty Industry for the rebuilding of the isolated segregated reservations of poverty north of Broadway? Only time will tell.

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