Texas Tech’s #RegentGate: The Board Chairman, a Dental School and Downtown El Paso

TWO EL PASOANS — Beto O’Rourke and Rick Francis — are currently in the biggest political fights of their lives.

O’Rourke is on the blue side of a November election against U.S. Senator Ted Cruz in red Texas.

Francis, the chairman of the Texas Tech University System Board of Regents, who is seeking reappointment in January, is still reeling in a public relations twister of unanswered questions after last month’s ouster of Chancellor Robert Duncan.

Their fights are different. But when it comes to downtown El Paso, they have a mutual liability. And a new political attack ad launched by Cruz’s allies targeting O’Rourke could prove fatal for Francis.

The ad brings up a question Francis would prefer to avoid: What role did Francis’ interests play in the proposed dental school in ousting Duncan? 

“El Paso’s rich and powerful stay that way by controlling politicians like Beto O’Rourke,” the narrator says. “As a councilman, Beto carried water for his wealthy father-in-law, the developer behind a downtown redevelopment scheme, pushing the city to bulldoze an historic Hispanic neighborhood using eminent domain.”

That father-in-law is Bill Sanders, an El Paso banking and real estate mogul. Sanders has longstanding ties with Francis, chairman and CEO of El Paso-based WestStar Bank.

The scrutinized downtown plan was introduced in early 2006 by the Paso Del Norte Group, a private organization made up of some the region’s most prominent businesspeople, led by Sanders. Francis is a past co-chairman and current board member of the same organization.

Controversy surrounding the group’s “scheme” grew throughout 2006. A then, in January 2007, a new group, a new group with many of the same old players, was registered with the Texas Secretary of State.

[Note: We’re getting back around to Francis and the dental school, just stick with me.]

The group was first called Borderplex Community Trust, but today it operates as Borderplex Realty Trust. [Note: See charts below for details on the evolution of Borderplex as a foundation, nonprofit and real estate investment trust.]

For nearly a decade, very little was known about Borderplex Realty Trust’s operations and finances. However, a 2016 lawsuit required the trust opened its books for the first time.

The El Paso Times found the trust to be a major downtown property owner. Possessing $65 million in real estate holdings, “the trust’s main assets are still in downtown El Paso: The 21-story Wells Fargo building, 18-story Chase Tower, 13 retail properties.” At the time of the story, the trust owed $10 million on the (former) Chase building, which had appraised at $12.5 million; it also owed $11.8 million on the Wells Fargo building, which had appraised at $11.3 million.

Site of proposed Tech dental school in downtown El Paso, via TTUHSC

Amongst the trust’s roughly 200 shareholders, a few of the largest were, according to The Times, Western Refining founder and CEO Paul Foster, land developer Scott Schwartz, and Bill Sanders. Schwartz first incorporated the trust, Sanders helped found it.

Borderplex Realty Trust appears to work closely with Borderplex Alliance, an economic and industrial advocacy group with which Francis, Sanders, Foster, and corporate giant Woody Hunt have all sat on boards or executive committees. And Borderplex Alliance works closely with Borderplex Bi-National Economic Alliance Foundation, a nonprofit with a stated goal of “providing funding to” Borderplex Alliance. One could logically deduce that both the alliance and foundation effectively facilitate the agenda for the trust. So, for simplicity’s sake, let’s just refer to the whole situation as #Borderplex from here on out.

Back to chairman of the Tech Board of Regents and the proposed downtown dental school.

Francis’ WestStar Board of Directors includes several members involved with Borderplex Realty Trust and Borderplex Alliance, including Foster, Sanders, businessman Meyer Marcus, Scott Schwartz’s sister-in-law Emma Schwartz. Hunt is an advisory director to the board. And while I’m at it: Francis sits on the board of Foster’s Western Refining and owns at least 10,000 shares of the company as well.

Is fair to presume at this point that a dental school in downtown El Paso is about a little bit more than dentist shortages in the border region?

After all, Richard Lange, president of the the Texas Tech University Health Sciences Center El Paso, has said a dental school can contribute $60-$109 million annually to a local economy.

If you’re involved in something like #Borderplex, wouldn’t it be an optimal return-on-investment (of time, effort, resources or otherwise) to have a business partner who happens to be a long-time regent of a major public university to help bring the school along? Would the proposed dental school’s namesake, Woody Hunt. have put up $25 million without Francis?

And if you’re said regent, how alarmed would you have been when your board was given an ultimatum of dental school in El Paso or veterinarian school in Amarillo by Gov. Greg Abbott’s chief of staff in late 2016.

When Tech walked away from the 2017 legislative session with a $4 million appropriation for a proposed vet school that was supposedly “on pause,” wouldn’t you have been concerned that whatever forces provoked the governor to threaten your dental school might return again?

Seen through #Borderplex, one can make sense as to why, as we’ve previously reported, Francis went on a war path demanding flat budgets over the next two years, beginning shortly after the 2017 session.

Even if, as we’ve reported, flat budgets required absorbing the costs of big expenses coming online, like operations of a new System building or component campuses. The point seems to have been to squeeze Duncan and, therefore, any threat to the dental school.

Even if it meant forcing Duncan to retire one year early, with a severance a true budget hawk frown upon, in order to keep him out of the legislative session beginning in January 2019.

And even if, ultimately, it required overseeing a no-confidence vote in executive session.

But back to the ad.

Whatever water Beto O’Rourke carried over a decade ago for a “downtown redevelopment scheme,” at whatever cost of his constituents, is a question O’Rourke has answered. 

But whatever water Rick Francis may have carried recently, perhaps for similar purposes, at great cost to Texas Tech, is a question Francis needs to answer. #Borderplex

 


For more on our #RegentGate coverage, see our previous articles: here and here.

 

Jay Leeson is the founder of Other Side of Texas. You can hear the radio program by the same name each weekday 5-6pm CST on AM 580 Lubbock, streaming OtherSideofTexas.com. Each episode is posted as a podcast, subscribe at Apple podcasts.

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