Without Apology: A Defense of DiGiovanni

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Call me naive, but I believe a good and honest public servant was smeared this week.

The smear job was undertaken by the San Antonio Express-News. Its target was Deputy City Manager Pat DiGiovanni.  The Plaza de Armas news site piled on, too, never missing a chance to kick City Manager Cheryl Sculley and Mayor Julián Castro.

The Express-News published six stories and columns over the last eight days on its front page and Metro front (did I miss anything?), and held two editorial board meetings in which Sculley and DiGiovanni separately defended themselves, City staff and the bid review and contract-letting process. But there were mea culpas issued, too.

Mayor Julián Castro at City Council on Thursday acknowledged an appearance of a conflict of interest on DiGiovanni’s part while affirming the obvious: there was zero evidence of any real wrongdoing.  Sculley and DiGiovanni issued their own statements of regret to the Express-News. Contradictory? Well, yes, but a media-generated firestorm usually dissipates only when the same media get the opportunity to declare victory and move on. So take the mea culpas not as guilty pleas, rather as cries of “uncle.”

I wish Castro and Sculley had done something else: called a press conference, stood shoulder to shoulder with DiGiovanni, and stared down the newspaper. I wish they had looked into the television cameras and told the people of San Antonio that taxpayers were well served in this instance, and that an outstanding San Antonio company, Zachry Construction Corp. and its partner, Hunt Construction Group of Phoenix, had been selected on the merits by competent City staff to oversee the coming expansion of the Convention Center, a key element in the redevelopment of HemisFair Park.

The mayor and city manager might have added that if a previous mayor and city council had made its decision on the merits, Zachry would have been chosen to build the convention center hotel, and the Grand Hyatt would have been built on time, on budget, and without the complications of a business bankruptcy.

DiGiovanni

DiGiovanni

Everyone wants to avoid even the appearance of conflict, but it’s not always possible. DiGiovanni could have recused himself from the bid review process, and in hindsight, some say he should have done so. Just as strong an argument can be made that the City’s best guy should have stayed in the game. What really matters is whether any actual evidence of wrongdoing is found, or if there is a pattern of such appearances of conflict.  Neither is the case with DiGiovanni.

In the event you do not read the newspaper, here’s the background: The Express-News, in a Sept. 20 front page story by Metro Columnist Brian Chasnoff and City Hall Reporter Josh Baugh (two guys I respect and hired while editor there) reported that DiGiovanni was playing a key role in selecting Zachry for the convention center contract at the same time Zachry Construction President and CEO David Zachry was sitting on a selection committee interviewing DiGiovanni as a candidate to become CEO of Centro Partnership, a new private-public downtown development accelerator.

The indictment was clear: DiGiovanni ranked the Zachry bid at this top of his selection list and, in return, David Zachry used his influence to win DiGiovanni the new job. Quid pro quo. Later in the week, a Chasnoff column carried the headline, “Ethics violation orbits City Hall.” That, in my view, is a headline still awaiting a retraction. It’s not true. No ethics violation has been shown or determined. None is orbiting.

By week’s end, DiGiovanni had sent an eight-page letter to the City’s Ethics Review Board, requesting an “advisory opinion” on his conduct. The board is relatively inactive; its page on the City of San Antonio’s website indicates it has only issued 20 such opinions since its inception in 1999 and none since 2009.

Given a completely different cast of characters, something like what the newspaper alleges is at play here might very well have happened in the San Antonio of the 1980s and’ 90s. Back then, insider wheeling and dealing was rife at City Hall and some council members took kickbacks and extracted political favors for their votes, and certain influence peddlers and contractors gladly bought those votes. Three city council members were indicted and convicted of criminal wrongdoing during Mayor Ed Garza’s stint in office.

But not any more. A good government era was firmly established after Mayor Phil Hardberger took office and persuaded Sculley to leave Phoenix to become city manager here. DiGiovanni was city manager in Kalamazoo, Michigan, a job Sculley once held, when she recruited him to move here. DiGiovanni is a tough negotiator who has allowed Sculley to float above the fray and focus on the big picture. His tenure in the number two job coincided with the rebirth of the city’s central core and the arrival of Castro and his ambitious SA2020 agenda, which includes an idea first launched before Hardberger left office: the redevelopment of the underutilized HemisFair Park.

Digiovanni has run hard with the downtown ball ever since Sculley gave it to him. Like anyone in a leadership position, he has his detractors. He’s bruised some egos with his negotiating style, intimidated a few, and not given others exactly what they wanted, but he is widely respected as smart, hard-working, and honest. I served as emcee of this year’s Downtown Alliance Awards where DiGiovanni was selected as Downtowner of the Year. He was a popular choice.

Pat DiGiovanni accepting the Downtowner of the Year Torch. (Photo by Greg Harrison.)

Back to the convention center expansion contract and the supposed wrongdoing. As the City’s lead professional on downtown redevelopment, DiGiovanni served as the senior representative on the review panel that examined competing bids for the $300 million project.

Notice that I didn’t gratuitously add the word “lucrative” to that last sentence. Yes, $300 million is a lot of money, but the truth is companies will work for minimal profit just to win such a showcase project and keep their employee base intact during a recession or slow recovery like we are experiencing now. The very bidding process itself encourages construction managers to slice spending at every turn to remain competitive. I’ve been told of some public projects where the commercial brokers made more in commissions that the general contractor made building the project.

At the same time, DiGiovanni, it is no secret, has been a candidate for at least two big jobs locally: the vacant CEO position at Brooks City-Base and the newly created job as CEO of Centro Partnership, a recently created public-private partnership designed to foster core city development. It’s operated in its first year as part of the Downtown Alliance, but the intention is for Centro to stand alone.

DiGiovanni, were he willing to leave San Antonio, undoubtedly could ascend to a city manager position in a top 50 city. San Antonio enjoys a national reputation under Sculley and her team for fiscal discipline, strong management, and integrity and they work in one of the fastest growing metro areas in the country. But DiGiovanni is hooked on the city, soon to be remarried, and probably would find life and work almost anywhere else to be less interesting than here. His departure from City Hall for another opportunity in the city has been expected.

What surprised some is that he chose the Centro job. It’s a high risk move and a lateral one at that for a guy firmly established in his current job with a good salary and benefits package, including a city pension. Centro is a not-for-profit with an uncertain future. It has a little more than $500,000 in operating capital, and no chance of growing unless DiGiovanni can raise the millions it will take to build a real entity with muscle. In my view, DiGiovanni’s passion for downtown San Antonio and his desire to test himself as a leader have led him to take an admirable leap of faith.

That’s no quid pro quo.

Then there’s David Zachry and Zachry Corp. The Zachry family and its companies have built billions of dollars of projects around the world, but they generally fly below the radar. Bartell Zachry’s sons could probably walk into a lot of places in this city and not be recognized by anyone. I can’t think of a major international company that spends less time, energy and money on managing its image in the media. I also can’t think of a company with a more sterling reputation, one with decades of work on virtually every continent unsullied by any wrongdoing.

And that brings me to my concluding points here. Here at The Rivard Report, I openly advocate for the growth and progressive development of San Antonio, which by my definition means building a city that is more educated, innovative, prosperous and healthy, all in a built environment that makes San Antonio a place people don’t want to leave and others want to  make their home.

That can’t happen without enlightened and honest civic and business leadership. Right now this city has both in spades. But other media find it all but impossible to recognize good leadership. Too many reporters see their job as only focusing on what is wrong rather than what is right.

That’s why, for example, CPS Energy CEO Doyle Beneby  can make game-changing decisions that save hundreds of millions of dollars from being spent on the wrong project and be selected as one of the nation’s most innovative energy utility leaders, yet people here are fed sensational stories of how much money he spent on wine at a dinner. It’s easier to crucify someone for buying a $100 bottle of Cabernet than it is to acknowledge he is transforming CPS into a leading economic development force while building one of the most diversified energy portfolios in the nation.

Unfortunately, that gotcha approach to journalism undermines the public’s confidence in its leaders at a time when this city’s residents should be celebrating a good growth era. I know from my own many years in newsrooms that reporters write first and foremost for their peers. What others in the newsroom think of their work is paramount, and writing positively about someone or something risks snickers that you’re soft. Ironically, the same newsrooms that produce such bulldog reporters are also stocked with journalists who are incredibly thin-skinned when their own work or motives are challenged.

I’m sure to be reminded of that when the bullets start flying my way in response to this story. I don’t mind. I come under periodic snark attacks at Plaza de Armas already, and a little more from its Innuendo Desk won’t kill me. And long before I left the Express-News there were those in the building who thought I was too close to some of this city’s leaders. People can think what they want to think. I’ve been around long enough to know the good guys from the bad.

Pat DiGiovanni and David Zachry are two of the good guys.

Follow Robert Rivard on Twitter @rivardreport or on Facebook.

30 thoughts on “Without Apology: A Defense of DiGiovanni

  1. I never thought he did anything deliberately but it would’ve been smart to disclose that. And true, its not always possible to avoid conflicts of interests. Sometimes it just slips your mind. But unfortunately appearances are everything in public management. Hopefully this will go away soon enough.

  2. This won’t go away as long as the reporter on the Alamo dome scandal is still digging new stuff up…funny how it’s all now creeping higher up the chain.

  3. Not pushing the “publish” button on a poor piece of journalism about HEB or anyone else is not killing anything. It’s saving a reporter and the paper from doing the wrong thing. And I wasn’t afraid to sign my name to what I did and had to say.

    • Isn’t it true that you read and initially expressed enthusiasm about Scott Stroud’s H-E-B column, and only decided to spike it AFTER Charles Butt called to complain about it? Remember, there are witnesses who know what happened.

  4. Bob makes some excellent points here.

    A few more points:

    Would the City be better off if business leaders like the Zachrys declined to serve on boards like Centro out of fear that they would be excluded from being able to bid on City work? No.

    Would Centro and the City be better off if DiGiovanni had declined to take on Centro, because his job as Dep City Mgr required him to negotiate with contractors and developers? No. In fact, that’s what made him the best candidate by far for the job.

    In retrospect the process could have been handled better, and the timing of these two events happening at the same time was unfortunate.

    In the end, I think the media served its role. On the one hand, it reminded staff and City Hall of the need to be absolutely above reproach on these types of issues. On the other, today’s piece helps readers keep it all in perspective.

    For those that know the people involved, it seems inconceivable that there would be an inappropriate quid pro quo. It is inconceivable that others on the Centro Board (who generally have impeccable reputations) would go along with a scheme to secretly overpaying DiGiovanni for his role, without throwing up a red flag. At the same time, the committee of City staff reviewing Convention Center bids would also have had to be complicit with a choice of contractors, also without any benefit.

    In this case, there was smoke but no fire.

    But if they all go to Fleming’s to celebrate, I’d recommend separate checks.

  5. Great Article Bob – Great points on Zachry and Pat D. but the best part of the story was on Doyle Beneby, it would be nice to see someone reporting on everything he’s doing for CPSE and then contrast that with the cost of a steak dinner and parties for long time CPSE employees, or the value that both of those expenses bring. There would be a huge difference!!

  6. Thanks for the reminder that we are fortunate to have such fantastic leadership in both the public and private sectors. I, for one, am very excited about the future of our city because of the countless talented individuals who are choosing to invest their time and passions in San Antonio. Thank you for sharing your opinion with such eloquence and conviction.

  7. Bob interesting defense of DiGiovanni. No one is degrading him for his performance or anything. But maybe if you would actually sit in the council meetings and listen to the discussion you would gain a better reality check on the matter.

    The process is improving and both the mayor and city manager both said the process needed to be improved. That demonstrates a little more insight on the matter than you seem to present. In fact, I’m really trying to understand your position, other than to attack some introspection from the media. I like DiGiovanni. I like Zachry and feel they will do a great job on the construction expansion. You might note that the team is actually an AZ construction firm combined with Zachry. The expertise on this project is coming from Hunt Construction, who has constructed 8 major convention centers or expansions to centers. Zachry could NEVER take this project on alone without Hunt, a point that seems to escape your analysis.

    I’ll just quote Councilman Reed Williams, the one council member who extensively examined the business case for this project, who summed this up nicely “If there are too many charges of this, then our business leaders are just going to say I’m not going to do any civic involvement.” Unless we are above board on the dealings, then we drop back into the old days of unethical process. We must do better.

    Apparently those facts seem to escape you. We improve as a city by being above board with our involvement.

    Fortunately DiGiovanni is doing the right thing by taking this to the Ethics Commission to examine and rule on the matter. I’m now concerned that if this is your attitude on the situation, it’s difficult to truly understand your interests on matters, including overall development of our city.

  8. I understand the point of this peice, I do.

    But this is the city we are talking about. It was Pat himself who asked that the alamodome story get squelched. Things get lost, paper accidentally gets shredded, proof suddenly disappears. He also wouldn’t go on camera and explain why those men still have their jobs and are being fired and arent having charges filed against them for grand theft, So Scully and Pat are covering all THAT up, than this comes out and conviently Pat is leaving. So is Mark Solis. He’s pulled the wool over Gordon Hartmans eyes for now…but there is and was A TON of proof there…What happened to that?…

    Guess what, it’s the city.

    Calling someone a good man…just doesn’t quite make him a good man.

  9. I appreciate your points of view. Upon first review of this sitution, I said to myself, how could this not have been viewed by those in charge as, at a minimum, a perception of impropriety or ethics violation. Until proven otherwise, I believe all was done in good faith. Unfortunately, I believe the situation has tarnished the city manager’s and the mayor’s reputations regarding oversight of city operations.

  10. Bob, thank you. Well written, well explained. FINALLY, some truth is published… Too bad it’s not on the front fold. Really makes you question the media.

    In my job, I’ve closed many a deal with the help of a $175 bottle of Darioush!

  11. I remember when I was an intern in 1997, and I had turned in my first investigative piece at the E-N. It was about a San Antonio public housing official who wasn’t taking care of her own rental properties, and she owed thousands of dollars in property taxes. You and the other editors came out of the budget meeting, and Dino Chiecchi told me, “Bob said your story was an ass kicker.” The story ran on the front page. The Bob Rivard who said that was a good guy and a good journalist. I miss him.

  12. John, when have you or any of your colleagues ever accepted criticism of your work or conclusions? Many in that newsroom are closed to it. I read, post and relish investigative reporting on this page from all kinds of journalistic sources. But I’m amazed how defensive the local culture is, how closed it is to being questioned. Challenge a story or column as work not measuring up and reporters immediately resort to cries of censorship. Would love to see some of the same reporters in the newsroom of the WSJ, the Newsweek I once worked at, or other national media orgs. The tough editing culture would leave them bleeding.

  13. Interesting. There’s a reason I seldom read the E-N anymore, and it’s that the writing and much of the reporting are pretty bad, and getting worse. From grammar howlers to burying the lede, to flat out leaving out answers to the questions I want answered, it’s just sad much of the time.

  14. Good article. The local news is completely bent on finding any “i” un-dotted or any “t” uncrossed. I am sick of hearing about Doyle Beneby staying in nice hotels and running a tab. The truth is that he runs a multi-million dollar company and is doing a great job. Evidently, the old saying of “no news is good news” doesn’t run true in San Antonio. Every friend I know references mysa.com as a gossip rag and it’s absolutely true. We live in a city where there is very little news and the reporters evidently want an easy way to sell advertisements. These reporters focus on the sensational and look for conspiracies where there are none. Just like there was huge progress in city government from the ’90s to today, hopefully we will see that same progression in San Antonio journalism, although I doubt it.

    I hope the trouble shooters don’t come after me.

  15. The same ethical rules should apply whether you consider the person a good guy or not. It takes an amazing amount of hubris to think otherwise.

    • Mike

      You can call it hubris. My take on the facts is that Pat is a guilty of a first offense technical mistake and is being asked to stand before a grand jury. He deserves a ticket, nothing harsher.

  16. Write three columns a week about S.A. politics. Politics is the meat-and-potatoes of all the major blogs. Your defense is great stuff regardless of one’s opinion on the issue. And since space is infinite on the internet, there is still plenty of room to promote S.A. as the next Shangri-La. As to the mainstream media, they become very sensitive when they realize that they no longer monopolize opinion. Stick it to them!

  17. Bob,

    I get your point. We do have a gotcha system in place now. However, the best thing to do is for Giovanni to have realized the potential conflict of interest.

    I dont presume guilt on him. But are we to always presume someone is doing the right thing when hey are in conflicts of interest scenarios…..Truly we cant. Because there will always be the 1 percent that abuse it…

    Best thing for him to have done was to realize this conflict ahead of time…Put in a different process that would have almost always yielded the same result.

    EN did a hatchet job. I am not siding with them. Or , really anyone. I am saying that leaders must know these lines they tow and be cognizant of them, if only to avoid these hatchet jobs.

  18. What an excellent blog! Someone finally has the courage to say what this is: a sensationalized non-story. The fact that the team wins with our without DiGiovanni seems to be left out of every story implying that the process was flawed. Good for you, Bob. Great journalism.

  19. i can see nowhere in the Express-News coverage where “a good guy” (subjective term) was persecuted or the subject of “a hatchet job.” It seems clear that on-the-books process was not followed. Does that mean DiGiovanni and Zachry were scheming? Not at all. And I don’t think Express-News has said or implied that. The whole point of open government is to have processes so that people in these positions can’t scheme.

    DiGiovanni may indeed have made an innocent mistake. But the city should take full responsibility for failure to keep the process open.

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