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Germany Saved Workers From Pandemic Unemployment — With Great Success At Low Cost

Reprinted with permission from ProPublica.

The global coronavirus pandemic threw Petra Hamann's job into peril faster than just about any other. She is a physical therapist, a profession that is all about close proximity to others, with a clientele that leans toward older people, exactly the population most vulnerable to the virus. In March, she and the rest of the 10-person therapy group that employed her lost virtually all of their clients, first as a result of clients' fears about coming in for appointments, then as a result of government stay-at-home orders.

But neither Hamann nor anyone else in her group lost their job. Instead, they were kept on and, even while having zero clients, received 60 percent of their normal pay. As about half her clients gradually started to return in recent weeks, she began making 80 percent of her usual pay (including compensation for the clients who had not come back). And she was able to do so without having to negotiate any paperwork or online bureaucracy; she and her co-workers simply signed a form from their employer.

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The Rent Is Still Due In Kushnerville

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It was the day after April rent was officially due — April 6 — and Kevin Maddox was officially late. The week before, he had lost both of his jobs within a few days of each other. Both were at food-service warehouses. “My job is to get the food to the restaurants, and if no one's going to the restaurants, then I'm out of a job," Maddox said. So he filed for unemployment and now stood outside his small rental row house just beyond the Baltimore city line watching his young daughter as she rode around in her plastic car.

His spirits were relatively high, all things considered. Both employers told him they'd take him back, as soon as things opened back up. That maybe helped explain why he still wore the cap from one of the warehouses: Maines Paper & Food Service Inc.

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Baltimore Judge Allows Class Action Suit Against Kushner Companies

Reprinted with permission from ProPublica.

 

 

Kushner Companies Loses a Key Motion in Class Action Filed by Baltimore Tenants

A Maryland judge is allowing a class action lawsuit against Jared Kushner’s family real estate company to proceed, in a ruling that denies most of the company’s arguments to dismiss the case over its treatment of tenants at large apartment complexes in the Baltimore area.

The lawsuit, filed last September in the Circuit Court for Baltimore City, alleges that the Kushner Companies’ real estate management arm, Westminster Management, has been improperly inflating payments owed by tenants by charging them late fees that are often baseless and in excess of state laws limiting them to 5 percent of rent. The suit also claims that Westminster was making some tenants pay so-called court fees that are not actually approved by any court. The suit alleges that the late fees and court fees set in motion a vicious churning cycle in which rent payments are partly put toward the fees instead of the actual rent owed, thus deeming the tenant once again “late” on his or her rent payment, leading to yet more late fees and court fees. Tenants are pressured to pay the snowballing bills with immediate threat of eviction, the suit alleges.

The lawsuit followed a May 2017 article co-published by ProPublica and The New York Times Magazine that described the highly aggressive legal tactics used by Kushner Companies to pursue tenants and former tenants at 15 apartment complexes in the Baltimore area.

The company’s motion to dismiss the lawsuit was heard on Wednesday by Barry Williams, the same judge who presided over the cases against the six police officers involved in the arrest and transport of Freddie Gray, the 25-year-old Baltimore man who suffered fatal injuries after being taken into custody in 2015. None of the six officers was convicted.

In his ruling, Williams denied the bulk of the company’s motion to dismiss the case, including its argument that too much time had passed since the events the suit described. Williams also rejected for now, deeming it premature, the company’s argument that each tenant’s situation is too unique for the group to constitute a single class.

Williams did grant a couple of points in the company’s motion. Most notably, he granted the company’s motion to dismiss the count of the lawsuit alleging that the company’s treatment of tenants represented a breach of contract.

Andrew Freeman, a lawyer representing the tenants, said dismissing the breach of contract count had little practical effect, given that this count provided no damages beyond what the tenants would recover under the separate claim that the company’s late fees exceeded state limits.

Freeman cheered the ruling overall. “We are very pleased that Judge Williams recognized that plaintiffs have a claim for a violation of Maryland’s laws that protect tenants from excessive late fees and forbid landlords from threatening tenants with eviction for those not paying those fees, and that he refused to dismiss our class action allegations,” he said. “We look forward to proceeding with the case on behalf of the many hundreds, if not thousands, of Westminster Management’s tenants who have been victimized by those illegal fees.”

Michael Blumenfeld, a lawyer representing the Kushner Companies, said the company was pleased that Williams had limited the lawsuit on a few points, and indicated that the company still plans to challenge the assertion that the tenants make up a single class. “Kushner Companies looks forward to presenting these issues to the court soon,” he said. The company declined to comment on the merits of the lawsuit at the time it was filed, but did respond to questions about its tactics for the May 2017 article, saying that its approach to pursuing tenants was in line with industry practices and that it had a fiduciary duty to its partners to collect all money owed by current and former tenants.

The lawsuit now moves to the discovery stage. A hearing on the tenants’ claim to class certification could happen as soon as September.

In November, Kushner Companies and related corporate entities named in the suit sought to have the case transferred from state court to federal court, which would spare the company from having to face a jury drawn only from Baltimore. To prevail on such grounds, the company had to show that none of its ownership partners were Maryland residents. The company requested that its list of partners be sealed from view, citing the “politically-motivated innuendo” that could result from the high degree of media interest in Jared Kushner, President Donald Trump’s son-in-law and senior White House adviser, who has recused himself from a role in the family companies.

The request to shield the partners’ identities was challenged by ProPublica, the Baltimore Sun, the Washington Post, the Associated Press, and Baltimore TV station WMAR-TV. In January, a federal judge ruled against the request to seal the partners’ identities. As a result, the company opted to keep the case in state court after all.

Kushner Companies is also facing a separate lawsuit filed this month by tenants in New York, alleging a whole other set of behaviors in that much different real estate market: that it used harassing tactics to drive them out of their apartments in order to charge higher rent. The company has called that suit “totally without merit.”

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Kushner Companies Will Fight Transparency In Court

Reprinted with permission from ProPublica.

 

Jared Kushner’s family real estate company has backtracked on its effort to have a lawsuit filed against it by tenants of its Baltimore-area apartment complexes moved to federal court, after a judge ruled that this transfer would require it to reveal the identities of its investment partners.

The tenants’ class-action lawsuit was filed in the Circuit Court for Baltimore City in September, four months after a ProPublica article co-published with the New York Times Magazine described the highly aggressive tactics used by Kushner Companies to pursue tenants and former tenants over allegedly unpaid rent or broken leases. The lawsuit alleged that Kushner Companies, which owns 15 large apartment complexes in the Baltimore area, was improperly piling late fees and court fees onto tenants’ bills, often in excess of state limits, and using the threat of immediate eviction to force payment.

In early November, the various Kushner affiliates named in the lawsuit filed a request to have the case moved from the state court, where it would be heard by a Baltimore City jury, to the federal courts, where it would be heard by a jury drawn from a broader geographic swath of Maryland. To get approval for this request, Kushner Companies had to show that none of the investors it has brought in as partners on the complexes are based in Maryland.

The Kushner affiliates also filed a motion in federal court seeking to have the list of the investment partners shielded from public view, citing the high degree of media interest in Jared Kushner, who as Kushner Companies CEO presided over the purchase of the complexes before moving into the White House to serve as senior advisor to President Donald Trump, his father-in-law. “Given the tenor of the media’s reporting of this case, including politically-motivated innuendo no doubt intended to disparage the First Family, there is foreseeable risk of prejudice to the privacy rights and reputations of innocent private investors,” the Kushner lawyers wrote.

ProPublica and four other news organizations challenged the motion to keep the list of partners secret. And on Jan. 26, U.S. District Court Judge James K. Bredar ruled against the Kushner request for shielding the partners’ identities.

In that ruling, Bredar set a Feb. 9 deadline for the Kushner affiliates to submit the partners’ names to the court. But instead of doing so, the affiliates filed a short motion in federal court today asking to have the case moved back to the Circuit Court for Baltimore City. The aborted transfer has effectively resulted in a three-month delay in the tenants’ claims being heard.

Kushner Companies’ reluctance to disclose its partners in the complexes, which were purchased in 2012 and the years following, comes amidst new revelations about the company’s international investment ties. The New York Times reported last month that Kushner Companies last spring secured a $30 million equity investment in the Baltimore complexes and others of its holdings from Menora Mivtachim, a large Israeli insurer, just as Jared Kushner was about to make his first official trip to Israel as Trump’s designated broker of Israeli-Palestinian negotiations. Also last month, a New Yorker article described the Kushner Companies’ aggressive pursuit of Chinese investors in its real estate ventures. There has also been widespread scrutiny of a meeting in December 2016 between Jared Kushner and the head of a Russian state-owned bank, which may or may nothave involved the matter of Russian investment in the Kushner Companies’ debt-strapped trophy building in New York, 666 Fifth Avenue.

Asked to elaborate on the decision this afternoon, Kushner Companies spokeswoman Christine Taylor said simply, “Our counsel on this matter has determined that the case should be remanded to state court.”

 

Judge: Kushner Companies Must Reveal Identities Of Real Estate Partners In Maryland Lawsuit

A federal judge in Maryland ruled Friday that Jared Kushner’s family real estate company could not keep secret the identities of its partners in Baltimore-area apartment complexes that are the subject of a class-action lawsuit by tenants.

The class-action lawsuit was filed in September, following a May article co-published by ProPublica and The New York Times Magazine that described how Kushner Companies have used highly aggressive tactics in pursuing payments from tenants and former tenants of 15 large apartment complexes it owns and manages in the Baltimore area.

The lawsuit, filed in the Circuit Court for Baltimore City, alleges that the Kushner Companies’ real estate management arm and related corporate entities have been improperly inflating payments owned by tenants by charging them late fees that are often baseless and in excess of state limits and court fees that are not actually approved by any court. The suit alleges that the late fees and court fees set in motion a vicious cycle in which rent payments are partly put toward the fees instead of the actual rent owed, thus deeming the tenant once again “late” on his or her rent payment, leading to yet more late fees and court fees. Tenants are pressured to pay the snowballing bills with immediate threat of eviction, the suit alleges.

Kushner Companies and its co-defendants sought to have the case transferred from state court to federal court, which would spare it from having to face an all-Baltimore City jury. To have this transfer approved, the defendants needed to show that none of their ownership partners were residents of Maryland. The defendants requested that their submission of the list of partners be sealed from public view, citing the high degree of media interest in Jared Kushner, President Trump’s son-in-law and senior White House adviser.

“Given the tenor of the media’s reporting of this case, including politically-motivated innuendo no doubt intended to disparage the First Family, there is foreseeable risk of prejudice to the privacy rights and reputations of innocent private investors,” wrote Westminster Management, Kushner Companies’ real estate management arm, in a court filing in November.

This request to seal the partners’ identities was challenged several weeks later in a joint filing by ProPublica, the Baltimore Sun, the Washington Post, the Associated Press, and Baltimore TV station WMAR-TV. They argued that the press has a “presumptive right” to view court documents, and that the Kushner Companies had not identified the “compelling government interest” that is required to block public access.

In his ruling Friday, U.S. District Court Judge James K. Bredar stated that the high level of public interest in Kushner and his business associates if anything enhanced the case for maintaining access to the identities of the defendants in the case.

“The Defendants are no doubt correct that the presence of the Kushner (and therefore Trump) families in this case has raised its profile and attracted significant, though perhaps not ‘unprecedented,’ media attention,” Bedar wrote. “But increased public interest in a case does not, by itself, overcome the presumption of access. In fact, it would logically strengthen it, particularly when the interest is due to the presence of important public figures in the litigation. In such an instance, the public’s desire to evaluate the Court’s decision-making is likely augmented. And beyond this apparently inevitable media scrutiny, Defendants have largely relied on ‘vague superlatives’ and insinuations instead of demonstrating specific harms.”

Several recent news reports have given a hint of just how far-reaching the network of investors in the Maryland apartment complexes could be. The New York Times reported earlier this month that Kushner Companies last spring secured a $30 million equity investment in the Baltimore complexes and others of its holdings from Menora Mivtachim, one of Israel’s largest financial institutions, just as Jared Kushner was about to make his first official visit to Israel as President Trump’s designated broker of Israeli-Palestinian negotiations. More recently, a New Yorker article described the Kushner Companies’ aggressive pursuit of Chinese investors in its real estate ventures.

In his ruling, Bedar gave the defendants until Feb. 9 to provide the list of their ownership partners. The Kushner Companies could opt instead to return the case to the Circuit Court in Baltimore, if the firm decides the downsides of having to disclose the investment partners in the complexes outweigh the downsides of having the case heard by a Baltimore jury.

A request for comment from Kushner Companies’ spokesman was not immediately returned Friday afternoon. A lawyer for the plaintiff tenants, Andy Freeman, said he and his colleagues on the case had not yet gotten any indication of how Kushner Companies planned to proceed.

“We’re pleased with the ruling. We don’t think that parties to federal litigation should be able to conceal their identity,” Freeman said. He added: “This is just the first step in moving toward justice for the tenants.”

 

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Can The Democrats Be As Stubborn As Mitch McConnell?

Reprinted with permission from ProPublica. This story was co-published with The New York Times Sunday Review.

In laying the groundwork recently for President Trump’s nomination for the Supreme Court, Mitch McConnell, the Senate majority leader, had this to say: “What we hope would be that our Democratic friends will treat President Trump’s nominees in the same way that we treated Clinton and Obama.”

McConnell was referring to his party’s grudging acceptance, without resort to filibusters, of President Obama’s first-term nominees to the court, Sonia Sotomayor and Elena Kagan. What McConnell notably neglected to mention, of course, was the very different approach he himself had taken with the open seat Trump was now on the verge of filling: refusing even to hold a confirmation hearing last year for Obama’s nominee, Merrick B. Garland.

That McConnell could now blithely ask for a routine reception of a Trump nominee for the very seat that he managed to freeze unfilled for nearly a year galls Democrats to no end and demonstrates, more than ever, that it’s impossible to match McConnell for sheer chutzpah. But his comment also underscored the conundrum that the Democrats and their new leader, Chuck Schumer of New York, now confront in the Senate minority.

As McConnell showed in the first six years of President Obama’s tenure, the Senate’s rules and traditions allow a determined minority to block much of a president’s agenda — indeed, the Democrats’ 48 Senate seats are their only real leverage against President Trump. But McConnell’s unprecedented use of the filibuster — which forced Democrats to muster 60 votes to get anything done — and other obstructionist tactics drew loud rebukes from Democrats and traditionalists, who identified his intransigence as eroding longstanding norms and contributing greatly to voters’ anger over a dysfunctional Washington.

Can Democrats, who are more philosophically invested in showing that government can function, really bring themselves to replicate McConnell’s obstructionist methods? Would they really be willing to withhold cooperation even in areas where they and President Trump might find agreement, such as a major infrastructure package?

These questions are especially pressing for Senate Democrats because of the landscape they face next year, when 25 of their seats (including those of the two independents who caucus with them) are up for re-election, as opposed to only eight Republican ones. Those 25 include five states that Trump won handily: West Virginia, Missouri, Indiana, Montana, and North Dakota. Doesn’t unified opposition to the president mean risking those seats and further diminishing their minority status?

A closer look at McConnell’s opposition during the Obama years suggests that the choices confronting Schumer and the Democrats may not be as stark as they seem. For one thing, the McConnell approach does not preclude going through the motions of working with the president of the opposite party. Recall that in the summer of 2009 McConnell allowed three Republicans, led by Chuck Grassley of Iowa, to spend months meeting with three Democratic counterparts on health care reform. The negotiations came to naught, allowing McConnell to claim that his party’s eventual monolithic vote against the Affordable Care Act came only after the Democrats’ refusal to move off their “far left” proposal.

The meetings also dragged out debate around the bill, helping sour the public on the legislation. As Robert F. Bennett, then a Utah senator and close McConnell ally, who died last year, told me of McConnell in early 2014: “He said, ‘Our strategy is to delay this sucker as long as we possibly can, and the longer we delay it the worse the president looks: Why can’t he get it done?’” He remembered the party leader’s promise to “delay it, delay it, delay it as long as we can.” The main lesson: “Every time something would come up, he would find a way to delay it.” Another lesson for Schumer and the Democrats might be that they could enter into negotiations over an infrastructure package, but insist on doing it mostly on their terms.

The record of Republican intransigence in the Obama years also suggests that voters pay far less attention to the legislative process than Washington insiders would like to believe. What McConnell recognized was that a president’s party is rewarded in midterm elections if he’s popular and getting things done, and punished if he’s not. Grassley, for instance, might’ve been tempted to help President Obama create a bipartisan health care bill since he hailed from a state, Iowa, that had embraced Obama in 2008. Instead, by withholding support, and even endorsing the “death panel” rhetoric around the bill, Grassley fueled the resistance to the “overreaching” president in 2010 and easily won re-election that year.

Similarly, Senate Democrats’ 2018 prospects in states that Trump won will depend more on whether he’s seen as succeeding — on how energized or demoralized the ends of the polarized electorate are — than on whether a given senator found an issue or two of common ground with him.

All of this still leaves the basic question of whether Democrats really have it in them to slow government to a crawl as much as McConnell did. Their willingness, goaded on by an inflamed Democratic base, to force postponements of committee votes on Trump nominees suggests they just might. The biggest test still awaits: whether, in protest of the treatment of Garland, to filibuster the confirmation of Trump’s Supreme Court nominee, Neil M. Gorsuch, which could lead to Republicans’ eliminating the filibuster for court confirmations once and for all.

The two sides of the debate facing the Democrats have been articulated by a veteran arbiter of Washington mores, Norman Ornstein of the American Enterprise Institute. Shortly after the election, he urged Schumer not to mimic the obstructionist methods of McConnell. He wrote: Democrats “will be tempted to adopt the Republican playbook from 2009, when Democrats controlled Washington: Vote in unison against everything, filibuster everything, even those things you like, to obstruct action and make it look ugly, allow damage to the country in the short term to reap political rewards in the next election.” He thought that would be a mistake, because it would limit the ability of Democrats to do anything positive.

But Ornstein told me that he is changing his thinking on this, after witnessing initial Trump moves such as the ban on travel from seven majority-Muslim countries and witnessing how reluctant Republicans have been to provide a check on him. He now recommends that Democrats stall President Trump’s agenda by repeatedly denying unanimous consent on the Senate floor.

This sounds similar to McConnell’s brand of obstruction, but Ornstein argues it’s not, because the opponent is different. “We don’t have a conventional president,” he said. “We’re seeing behavior that could lead us right down the path to martial law or authoritarian rule. These are dangerous times, and you have to think through your strategy in that context.” For Democrats, using “leverage to pull us back from the brink of something that shatters our fundamental system is now in order.”

Of course, McConnell had framed the context for his own obstructionism in dire terms, too, saying it was necessary to withhold bipartisan cooperation from Obama so that voters would realize just how radical his agenda really was. Now, with Trump in the White House and Republicans in control of Congress, McConnell is calling for a new era of comity. “The first thing we have to do is move beyond this us-and-them mentality that has so often characterized the last eight years,” he said on the Senate floor late last month. “We’re all in this together. We rise and fall as one.”

IMAGE: The mascots of the Democratic and Republican parties, a donkey for the Democrats and an elephant for the GOP, are seen on a video screen at Democratic U.S. presidential candidate Hillary Clinton’s campaign rally in Cleveland, Ohio March 8, 2016. REUTERS/Carlos Barria

Crony Cabinet Watch: Rick Perry’s Texas Giveaways

Reprinted with permission from ProPublica.

Donald Trump’s selection of Rick Perry to lead the Department of Energy has prompted many Democrats to question Perry’s qualifications for the position. While he governed a state rich in fossil fuels and wind energy, Perry has far less experience than President Obama’s two energy secretaries, both physicists, in the department’s primary work, such as tending the nuclear-weapons stockpile, handling nuclear waste and carrying out advanced scientific research. That’s not to mention, of course, that Perry four years ago called for doing away with the entire department.

However, there’s one realm in which Perry will have plenty of preparation: doling out taxpayer money in the form of government grants to the energy industry.

What often gets lost in all the talk of the Texas job boom under Perry is how much economic development strategy was driven by direct subsidies to employers who promised to relocate to the state or create jobs there. Of course, many states have for years engaged in the game of luring companies with tax incentives. But by the count of a 2012 New York Times investigation, Texas under Perry vaulted to the top, giving out $19 billion in incentives per year, more than any other state.

Perry’s economic development largesse came in many forms, but among the most high-profile were two big pots of money that he created while in office. In 2003, he founded the Texas Enterprise Fund, which he pitched as a way to help him close the deal in bidding wars for large employers thinking of moving to the state. Over the course of Perry’s tenure, which ended in early 2015, the fund gave out more than $500 million. In 2005, Perry created the Emerging Technology Fund, which was intended for start-ups. It gave out $400 million before being shuttered last year by his Republican successor, Greg Abbott.

Disbursements from both funds were controlled by Perry, the lieutenant governor and the speaker of the House. The technology fund had a 17-member advisory board, all appointed by Perry. With such scant oversight, it did not take long for political favoritism and cronyism to creep into the programs. In 2010, the Texas Observer reported that 20 of the 55 Enterprise Fund grant recipients up to that point had contributed directly to Perry’s campaign or the Republican Governor’s Association, of which he became chairman in 2010. Also in 2010, the The Dallas Morning News reported that some $16 million from the Emerging Technology Fund had gone to firms backed by major donors to Perry. For instance, after Joe Sanderson received a $500,000 Enterprise Fund grant to build a poultry plant in Waco in 2006, he gave Perry $25,000. And the Emerging Technology Fund gave $4.75 million to two firms backed by James Leininger, a hospital-bed manufacturer and school-voucher proponent who had helped arrange a last-minute $1.1 million loan to Perry in his successful 1998 run for lieutenant governor and contributed $239,000 to his campaigns over the ensuing decade.

In theory, companies receiving Enterprise Fund grants were accountable for their job-creation pledges and had to make refunds when they fell short. In practice, the numbers proved hard to quantify and few companies had to make refunds. The watchdog group Texans for Public Justice determined that by the end of 2010, companies had created barely more than a third of the jobs promised, even with Perry’s administration having lowered the standard for counting jobs. And in 2014, the state auditor found that $222 million had been given out to companies that hadn’t even formally applied for funds or made concrete promises for job creation. “The final word on the funds is that they were first and foremost political, to allow [Perry] to stand in front of a podium and say that he was bringing jobs back to Texas,” said Craig McDonald, the director of Texans for Public Justice. “From the very start those funds lacked transparency and accountability.”

This being Texas, it was not surprising that many of the leading beneficiaries of the taxpayer funds were in the energy industry. Citgo got $5 million from the Enterprise Fund when it moved to the state from Tulsa in 2004, even though it made clear that it had strategic reasons to move there regardless of the incentive. Chevron got $12 million in 2013 after agreeing to build a 50-story office tower in downtown Houston — a building that three years later remained unbuilt.

Most revealing of the problems associated with the Perry model of taxpayer-funded economic development, though, may have been a $30 million grant in 2004 to a lesser-known outfit called the Texas Energy Center. The center was created in 2003 to be a public-private consortium for research and innovation in so-called clean-coal technology, deep-sea drilling, and other areas. Not coincidentally, it was located in the suburban Houston district of Rep. Tom DeLay, the powerful House Republican, who, it was envisioned, would steer billions in federal funding to the center, with the help of Washington lobbyists hired by the Perry administration, including DeLay’s former chief of staff, Drew Maloney.

But the federal windfall didn’t come through, and the Enterprise Fund grant was cut to $3.6 million, which was to be used as incentives for energy firms in the area. Perry made the award official with a 2004 visit to the Sugar Land office of the Greater Fort Bend Economic Development Council, one of the consortium’s members, housed inside the glass tower of the Fluor Corporation. In 2013, when I visited Sugar Land for an article on Perry’s economic development approach, his administration still listed the Texas Energy Center as a going concern that had nearly reached its target of 1,500 jobs and resulted in $20 million in capital investment.

There was just one problem: There was no Texas Energy Center to be found. Here, from the 2013 article in The New Republic, is what I discovered:

The address listed on its tax forms is the address of the Fort Bend Economic Development Council, inside the Fluor tower. I arrived there late one Friday morning and asked for the Texas Energy Center. The secretary said: “Oh, it’s not here. It’s across the street. But there’s nothing there now. Jeff handles it here.” Jeff Wiley, the council’s president, would be out playing golf the rest of the day, she said. I went to the building across the street and asked for directions from an aide in the office of DeLay’s successor, which happened to be in the same building. She had not heard of the Texas Energy Center. But then I found its former haunt, a small vacant office space upstairs with a sign on an interior wall — the only mark of the center’s brief existence.

Later, I got Wiley on the phone. There has never been any $20 million investment, he said. The center survives only on paper, sustained by Wiley, who, for a cut of the $3.6 million, has filed the center’s tax forms and kept a tally of the jobs that have been “created” by the state’s money at local energy companies. I asked him how this worked — how, for instance, was the Texas Energy Center responsible for the 600 jobs attributed to EMS Pipeline Services, a company spun off from the rubble of Enron? Wiley said he would have to check the paperwork to see what had been reported to the state. He called back and said that the man who helped launch EMS had been one of the few people originally on staff at the Texas Energy Center, which Wiley said justified claiming the 600 jobs for the barely existing center.

In at least one instance, this charade went too far: In 2006, a Sugar Land city official protested to Wiley that, while it was one thing to quietly claim the job totals from a Bechtel venture in town, it was not “appropriate or honest” to assert in a press release that the Texas Energy Center had played a role. “There is a clear difference between qualifying jobs to meet the [Energy Center’s] contractual requirement with the state and actively seeking to create a perception of [it] as an active, successful, going concern,” wrote the official, according to Fort Bend Now, a local news website. In this case, reality prevailed, and Wiley declined to count the Bechtel jobs.

Today, the $20 million in capital investment from the Texas Energy Center has vanished from the state’s official accounting of Enterprise Fund impact, but the 1,500 jobs remain, part of the nearly 70,000 jobs that the state claims the fund has generated.

Drew Maloney, the former DeLay chief of staff who lobbied for federal funds for the Texas Energy Center, is now the vice president of government and external affairs at the energy giant Hess Corporation.

And Perry is on the verge of being put in charge of vastly larger sums of taxpayer dollars to disburse across the energy industry. (Requests for comment from the Trump transition team went unanswered, as did a request to Jeff Miller, an unofficial Perry spokesman who now works for Ryan, a Dallas-based tax consultancy that helps clients, including ExxonMobil, get tax incentives from Texas and other states.) The Department of Energy has a budget of around $30 billion, oversees a $4.5 billion loan guarantee program for energy companies, and distributes more than $5 billion in discretionary funds for clean-energy research and development. (The loan guarantee program was the source of the $535 million loan that solar-panel maker Solyndra defaulted on in 2011, but it has had plenty of successes as well.) Many of the department’s programs have well-established standards for disbursement, but as secretary, Perry would have a say over at least some of the flow of dollars.

Trump himself, in announcing his nomination of Perry, said he hoped Perry would bring his Texas strategies on energy and economic development to Washington. “As the Governor of Texas, Rick Perry created a business climate that produced millions of new jobs and lower energy prices in his state,” Trump said, “and he will bring that same approach to our entire country as secretary of energy.”

Related stories: Read about how Trump’s Commerce pick has a big conflict of interest,check out the deregulation philosophy of his Labor choice, and learn about the family business links of his Transportation secretary.

IMAGE: Former Texas Gov. Rick Perry discusses his economic plan at a National Press Club luncheon speech in Washington in this file photo taken on July 2, 2015. REUTERS/Yuri Gripas/File photo