Jim Schutze at the Dallas Observer came across an interesting piece of video the other day. It was the deposition of former Dallas City Manager Mary Suhm in the on-going lawsuit between jilted gas driller Trinity East and the City.
In their cross-examination, lawyers for Trinity East are asking Suhm about a secret (at least to the Council and the public) 2008 Memorandum of Understanding between the two parties trading Special Use Permits for gas drilling and production sites the company wanted to access on City-owned flood plain and park land – despite prohibitions on drilling in those places at the time of the agreement – in return for $19 million in upfront leasing payments.
Trinity East's lawyers want Suhm to say the agreement "guaranteed" the permits, and when the Plan Commission subsequently voted to deny them, and the City Council lacked the super-majority to override that denial, the City, by way of its agent in this matter Mary Suhm, defaulted on the agreement.
City of Dallas lawyers want Suhm to say Trinity East executives knew the drilling sites were off-limits at the time they signed the memo and, despite paying the City of Dallas $19 million before they got their permits, the company knew it was not a sure thing. According to the City's lawyers, what Trinity got was precisely what Suhm promised in the agreement: her best efforts to maneuver the company's permits through City Hall bureaucracy.
The crux of this back and forth comes at about the 4:30 point of the five minute video when Trinity East's lawyer, on behalf of his client, asks, "What is it they get for their $19 million dollars?"
Suhm says Trinity East "got the right to apply" for SUP permits.
But those permits cost considerably less than $19 million. What was Trinity East really paying for with those leasing checks, and did they get their money's worth?
Allow us to defend Mary Suhm.
When Trinity East wrote those checks, Suhm was riding high as City Manager and her command over Council affairs was already legend, especially as she negotiated the city budget through very tight times. Trinity knew the signature of a mere elected official was not sufficient. Those come and go at City Hall with hardly anyone noticing. It wanted the boss's John Hancock on the document and the boss was Mary Suhm.
Besides a perfectly legal and hefty bribe when the City needed it during the Great Recession, Trinity was investing in the power of Mary Suhm and her relationships with the Powers-That-Be. The company had every confidence as the ring master of the downtown circus, Suhm could make things happen that otherwise wouldn't happen. She was in control.
Trinity East wasn't wrong – in 2008. Had they pursued their permit requests in the next one to three years, there's every likelihood Trinity East would have received them.
But the company waited until 2011.
What had happened in those intervening three years?
There was a drilling backlash beginning to reach full volume in the Barnett Shale, aided by a new national awareness of fracking as it spread to other parts of the country. Josh Fox's "Gasland" came out in 2010 and was nominated for an Academy Award in 2011. Burning tap water replaced a folksy Tommy Lee Jones as the face of gas drilling in North Texas. Citizen groups were sprouting in every city with drilling fighting for larger buffer zones and more pollution controls. There were stories in the media all the time. Because no health or environmental studies had been done on urban fracking, all kinds of new ones were launched or just being reported on for the first time.
In light of the new controversy, Councilwoman Angela Hunt helped drive the City to convene a gas drilling task force, giving residents a chance to organize around the issue before Trinity East even applied for their permits. Every concern – air, water, even earthquakes – that would later become ammunition for opponents showed up in this task force process first.
Scott Griggs ran for Dallas City Council from one of the districts targeted by new gas drilling permits and won on an anti-drilling platform against an incumbent. He joined Hunt as a fierce critic of Dallas urban drilling. Neighborhoods were showing new muscle.
And so the stage was set for more of an uphill fight than what Trinity probably would have confronted in 2010.
Mary Suhm must have taken note of some of this and sighed when Trinity finally put in for its permits. Now they show-up?
Still, let the record show she put on a stiff upper lip and gave 110% to the cause of getting Dallas City Hall to approve Trinity East's permits. She contorted bureaucracies. She muscled appointees and council members alike. She and her staff worked overtime to try to subvert every move of the growing opposition to Trinity East's permits. When the company lost, it wasn't because Mary Suhm didn't pull out all the stops, but despite the fact she did.
Now, we're pretty sure this is a defense the City of Dallas lawyers don't want to use, but we offer it up here in case they need to break the glass and begin building firebreaks in court to keep from paying back the $19 million.
These are only the most egregious examples residents know about.
2011 Gas Drilling Task Force
In retrospect, it's easy to see Suhm's manipulation behind the last-minute Task Force endorsements of park and flood plain drilling. And when we say last-minute, we mean it.
Task Force members had already voted to keep the prohibition against drilling in these areas at a previous business meeting. The last meeting of the Task Force was supposed to be a pro forma affair that would ratify all previous recommendations and send them along to Council. Task Force member attendance was therefore down. This is when Task Force Chairwoman and former city council member Lois Finkelman chose to spring new votes on these two issues – and these two issues only – and won a reversal on each. Not only of the Task Force positions – but of current city policy, which of course didn't allow drilling in either area then.
Many excuses were used to justify this re-examination and re-vote that day, but none of them were the truth. Finkelman and staff were doing Suhm's bidding, and she was looking out for Trinity East. While it's not clear if Finkelman knew about Suhm's secret agreement, you can be sure Suhm, or someone on her behalf, made it clear to Finkelman it was VERY important to get these exemptions. Finkelman had been a friend to the clean air movement and other environmental causes during her tenure on the Council in the 1990's, but caved because of her relationship with Suhm, a belief she was helping the City out of a jam, or some other reason. At the end of the day, she weakened proposed city policy in accordance with what Trinity East wanted.
This is certainly something Trinity East got for its $19 million.
2012 Xmas Plan Commission Hearing on Trinity East Permits
Scheduled on December 20th, 2012, this was the first time gas drilling permits had been voted on for Dallas in three years, or pre-national outrage. It occurred before the Task Force recommendations had been considered and adopted into policy. In other words, after a call to reform its outdated drilling ordinance, and after a special Task Force had already been convened and issued its recommendations, Dallas was now about to grant three new permits, including one for a compressor station and refinery, under the old ordinance it was trying to replace. What was the rush? Why not wait and approve new permits until after the Task Force recommendations are written into a new ordinance? Because that would cause further public debate. More debate would highlight the problems of drilling in sensitive areas like park land and flood plains – still off limits in Dallas at the time.
In a transparent attempt to limit public awareness and participation even more, the City decided to hold this important hearing only five days before Christmas. Again, in retrospect, this has Mary Suhm's fingerprints all over it. And it almost worked. But just enough citizens showed up, representing enough well known groups and neighborhood organizations, and citing just enough new facts that had changed the situation since 2008 to win the climatic vote, 7 to 5 at 7:30 pm that evening. It was uncertain which way the decision would go right up until the very end.
Showing-up expecting to lose, instead citizens were elated. Overturning the denial would take a super majority of 12 votes on the Council – something that even then seemed unlikely. Citizens thought they had won. Mary Suhm had tried her best to rig the system, but the rigging failed. She tried again.
January- February 2013 Plan Commission "Reconsideration Vote" on Previous Permit Denial
Because she'd lost the December Plan Commission vote and knew she might not be able to get the 12 votes on the Council to overturn, Suhm had to do something creative. Viola! The Plan Commission would have a vote to "reconsider" their denial of Trinity East's permits only 21 days earlier. Nobody could remember the last time the Plan Commission even took such a vote. It was unprecedented. It was also Mary Suhm's handiwork.
That do-over decision came at a "special meeting" of the Plan Commission on January 10th, with a 6 to 5 vote to indeed take another vote on Trinity East's permits. This outcome, done under heavy police presence and with no public participation allowed, spurred one of the most iconic moments at Dallas City Hall in recent years – a 3 to five minute spontaneous standing crowd chant of "Shame."
You can see the speed at which Suhm is moving behind the scenes to engineer a better outcome after her unexpected defeat before Christmas. She's doing exactly what she promised Trinity East she would do. She's working the levers. Making things happen that would never otherwise happen. But now, it's costing her more to do so. The contortions of the system necessary to get the permits through are getting more twisted and harder to pull off gracefully. She's gone from talks with friends behind closed doors to forcing awkward "do-over" votes. It was obvious to the public there was something special about these Trinity East permits. Company officials had been dropping hints about some sort of an agreement with the City. Mayor Rawlings said permitting these sites "were a done deal" – although he didn't say why. It was getting messy.
Finally, on February 7th, the day the Plan Commission had scheduled the "do-over" vote, the Dallas Observer broke the story on the Suhm-Trinity East agreement. It was now clear what was driving the favoritism behind the treatment of the Trinity East permits by City Hall – going all the way back to the last-minute reversal of the Task Force, to the Christmas time hearing, to the pending "reconsider vote."
The timing could not have been worse for Suhm. We'll never know what the vote to reconsider might have been were there no headlines pointing to a City Hall cover-up. She may have thought she had the votes to keep the Trinity East permits alive. But with the story breaking that very day, the spotlight was too bright on the Plan Commission to take a new vote. Citizens won a reprieve and eventually a victory as the Commission requested the City Council deal with changing the current prohibitions against parkland and floodplain drilling before asking them to violate current ordinances again. That never happened. Instead, the three Trinity East permits were again denied by the Plan Commission in March 2013, albeit by razor-thin 8 to 7 and 9 to 6 margins.
And that was that. Suhm was gone in four months. Officially it wasn't because of the cover-up of the Trinity East agreement, but of course everyone knew it was because the whole thing was headed to court one way or the other.
Although the Mayor tried to rally 12 votes on the Council to overturn, he couldn't do it. The prospect of the kind of rolicking citizen protests keeping the Plan Commission on the 6 o'clock news showing up at a Council Meetings could not have helped his cause at this point.
Urban fracking opponent Philip Kingston had replaced Hunt on the Council, Griggs was still there, and they were joined by enough other council members (Sandy Greyson, Monica Alonzo, Carolyn Davis, and Adam Medrano) to insure the Plan Commission vote would prevail.
At the end of the day, Trinity East walked away empty-handed. but make no mistake about it. Mary Suhm did all she could to subvert the system for Trinity East.
Had the Dallas Observer not revealed the secret agreement, she might have even won the day for the company and still be City Manager. Was it $19 million worth of subversion? At today's inflated rates, who knows? But other than funding a small army and declaring herself dictator of the Drilling Republic of Dallas, she did all she could.
If you're Trinity East you can complain about the outcome, but you can't complain about her effort. There were too many variables out of her control for once. Not the least of which was a vigorous, rowdy, neighborhood-based movement against urban fracking in Dallas that was taking the fight to the public square…and winning. Sometimes, even the most powerful City Manager is on the wrong side of history.