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Click here for the full text of this decision FACTS:Rodolfo Rangel was the deputy executive director for financial services at the Housing Authority for the City of El Paso (HACEP). He had worked in public housing programs for 30 years, and for HACEP for six. In early 2001, Rangel informed the federal Housing and Urban Development regional office in Fort Worth of improper activity by two HACEP commissioners. Gerardo Licon, he said, had a conflict of interest with contracts awarded by HACEP; he was affiliated with a subcontractor hired on a building contract, and he allowed HACEP staff and vehicles to perform work on the project. Lourdes Lozano, Rangel said had falsified information to move out of public housing into a Section 8 home, an action that could be considered welfare fraud. Rangel met with officials at HUD a month later and continued to have phone conversations afterward. On Feb. 18, 2001, Rangel and two other HACEP deputy executive directors, filed a letter with HUD official reporting the misconduct; however, Rangel did not sign his name, for fear of retaliation. Rangel was fired on Feb. 23, 2001. Because he had never received a poor performance review in the 36 years he had worked with public housing, he believed he was fired for reporting the misconduct. He filed suit against HACEP under the Whistleblower Act. The city filed a plea to the jurisdiction, which the trial court denied. HOLDING:Affirmed. The Whistleblower Act prohibits a state or local governmental entity from suspending or terminating a public employee who in good faith reports a violation of law by the employing governmental entity or another public employee to an appropriate law enforcement authority. To prevail on his claim, Rangel must show: 1. he is a public employee; 2. he acted in good faith; 3. his report involved a violation of law; 4. the violation of law was by the employing governmental agency or another public employee; 5. he made his report to the appropriate law enforcement authority; and 6. he suffered retaliation as a result of making his report. HACEP specifically challenges the fourth and fifth elements. In determining whether the alleged violation of law was by the employing governmental agency or another public employee, the court first considers whether the two commissioners were public employees. The Whistleblower Act refers to public employees as being “paid,” and the commissioners were not paid for their service as commissioners. Consequently, the commissioners were not public employees. Nonetheless, the actions of the commissioners can be construed to be acts of the employing governmental entity if the actions were taken pursuant to their duties and authorized by state law. The court finds that if a commissioner controls a direct or indirect interest in a HACEP project for pecuniary gain, the commissioner must disclose his interest. Licon’s failure to do so constitutes misconduct of office. Consequently, his conduct clearly constitutes misfeasance in his official duties. Lozano engaged in misconduct because she attempted to procure additional benefits that were within her official duties as a tenant commissioner. Further, “Lozano’s actions in misstating her income were detrimental to society in general and would be the type of conduct the public would be concerned about if committed by an appointed commissioner of HACEP.” Turning next to whether Rangel reported the misconduct to an appropriate law enforcement authority, the court refers to City of Crystal City v. Lopez, 955 S.W.2d 152 (Tex.App. � Austin 1997, no pet.), for support. There, too, a local housing authority employee was fired after making complaints to HUD. The court found the employee acted in good faith when he made the report since HUD oversaw and subsidized the local housing authority. The court rejects HACEP’s attempts to distance itself from HUD by saying that though HUD funds HACEP, it has no investigatory powers. The court points out that the office is authorized to forward on complaints, which was done here, to conduct follow-up investigations. The investigator in this case conducted an on-site visit and forwarded that information to HUD’s legal department. OPINION:McClure, J.; Larsen, McClure and Chew, JJ.

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