August 24, 2022 515 PM
PRESIDIO — At their last meeting on August 15, Presidio City Council members raised concerns about the operations of the Presidio International Port Authority (PIPA). In the thick of budget season, both the city and county are expected to pitch in between $14,000 and $16,000 in annual dues to the organization — a figure that has some city officials questioning where that money goes.
The issue was first raised at a city council meeting back in March, when Councilmember Nancy Arevalo asked for clarification on PIPA’s mission. Jeran Stephens, executive director for the Presidio Municipal Development District (PMDD) had similar questions. “I’m curious, because in December I was asked for a very large check [for PIPA] from PMDD,” Stephens said. “I declined until I got something in writing, showing me what you’re doing. Where does this money go?”
The issue has come up cyclically since that meeting as the city has faced internal strife over a proposed hazmat ordinance that would set a safety framework for expanding trade in the border city. Adding fuel to the fire, the city has been working hard to rectify past problems with bookkeeping and financial accountability — city officials are tracking every dollar and making sure they count. “We’re looking for return on investment,” said Councilmember Joe Andy Mendoza. “The mission [of PIPA] is great, but we’re looking for that bottom dollar.”
To quell some of these concerns, Mayor John Ferguson invited Jake Giesbrecht, PIPA executive director and the organization’s only paid employee, to last Monday’s meeting. In addition to the work Giesbrecht does for PIPA, he runs Bullet Transport Services, a cross-border shipping company in Texas and Chihuahua. PIPA dues from entities like the city and county of Presidio go into a pot of money used to reimburse Giesbrecht for expenses and expertise as a 1099 contractor. But it remains unclear exactly how much money goes to those ends, and what else is funded by the dues. Giesbrecht declined to comment on the matter during the meeting and did not return a request for further comment.
PIPA’s history dates back to 2015, when regional economic boosters were hoping to build and operate a toll bridge between Presidio and Ojinaga. TxDOT ultimately shot down the toll bridge plans when the current bridge expansion project was granted a presidential permit in 2017. “PIPA’s mission, first and foremost, was to raise funds for the city and the county of Presidio with the bridge, then to build the bridge and to operate the bridge,” Giesbrecht explained.
Giesbrecht’s primary role is as a liaison between various local entities — he regularly interfaces with TxDOT, officials in the state of Chihuahua, and county officials to promote the bridge. “It’s really an agreement between the county and the city, and the mission was very clear: economic development,” he said.
He pointed to the U.S.-67 corridor study that secured $60 million dollars for construction on the highway as a major win for PIPA. The organization also contributes to what’s called a 559 program with Customs and Border Protection that allows for an easier flow of donations that board members think will benefit operations on the bridge. The organization attributes that cash flow to substantially shorter wait times in customs over the past year.
According to the organization’s bylaws, PIPA was created as a local government corporation (LGC). Local government corporations allow local governments to create separate entities that combine advantages of a nonprofit corporation with a transportation corporation — big city examples include the Harris County Sports and Convention Corporation and the Dallas Area Rapid Transit (DART) Bus Service.
Forming a local government corporation helps separate the business side of a transportation project from the city or county undertaking it — local government corporations face fewer restrictions in buying and selling real estate than cities and counties do. The LGC is considered a separate entity from its host locale, so the acts of the corporation are legally separate from that of the city or county it’s located in.
According to the Texas Secretary of State’s online database, PIPA has been in “forfeited existence” since January 2018. A corporation in forfeited existence has failed to file tax returns or pay taxes — even nonprofits have to file quarterly or annual returns with the state.
Frequent city council attendee Joaquin Rodriguez asked both Giesbrecht and Mayor John Ferguson — an ex officio member of PIPA — about the organization’s tax status. “That’s the thing that’s of greatest concern,” Rodriguez said. “What that suggests to me is that the organization has not paid taxes, though they’re not dissolved.”
Giesbrecht declined to answer questions without legal representation, but Ferguson, who has attended PIPA meetings since its inception, tried to respond as best he could. “I really have no idea what you’re referring to, I wish I did. And I don’t mean that flippantly,” Ferguson said. “The subject of taxes has never come up over the years.”
County Attorney Rod Ponton — who clarified he was representing the county and not PIPA, which has never officially appointed legal counsel — said that he didn’t think PIPA needed to file tax returns because of the nature of the organization. “It’s really not a legal entity and doesn’t need to be one — it was an interlocal agreement between the City of Presidio and the county to pay for [Giesbrecht] to interface with TxDOT at some of these border trade meeting and push the project of border trade in Presidio further forward.”
For all their legal and financial benefits, local government corporations also have a number of responsibilities: they must abide by the Open Meetings Act and Public Information Act. PIPA meeting agendas are posted physically at the Presidio County Courthouse and Annex, as well as Presidio City Hall, but they are not online or broadcasted remotely. “They’re obligated to be very transparent in their business,” Rodriguez said.
The organization’s only real online presence is on the defunct blog of County Commissioner Precinct 4 candidate David Beebe, who documented each meeting in PIPA’s early days. “I used to go to meetings and take notes on them because I thought there was a potential that all of a sudden there would be real money,” he said, giving the example of an idea that’s been tossed around of setting up a produce distribution terminal with the USDA. “All of a sudden, there’s millions of dollars coming through [the bridge]. Who’s gonna be standing around to get it?”
Ponton disagreed that PIPA hadn’t acted with transparency. “None of this is secret. The amount of money spent on [dues] is in each entity’s annual budget,” he said. “It’s nothing nefarious, Presidio has been a crossroads for trade for 12,000 years and will continue to be. It helps Presidio to have an entity that helps speed that forward and improve.”
PIPA President and County Judge Cinderela Guevara was receptive to the idea of making the meetings more accessible, but hadn’t had the opportunity in 2022 to put those principles into practice. “This year, I’ve tried to set up three meetings but haven’t been able to get a quorum,” she said. “We may be looking at disbanding. I believe PIPA has completed its purpose.”
Ponton felt PIPA still had a function to serve: helping smooth relations between the state and the city regarding business on the state’s only bridge. Most of the other international bridges in Texas are owned by private corporations or the city or county that the bridge is located in. “[PIPA] is almost a creature of TxDOT — it makes TxDOT more relaxed when they have to spend money down here.”
Despite all of the confusion about the organization’s past and future, both Beebe and Ponton spoke in support of Giesbrecht’s work on behalf of the county and City of Presidio. “In my estimation, Jake [Giesbrecht] has been a big plus,” Beebe said. “He’s the only one getting any work done [for the bridge]. He’s a great guy, very knowledgeable, but ultimately he’s only one guy.”