HIDALGO — The City Council hired law firm Linebarger Goggan Blair and Sampson on Tuesday night to collect Hidalgo’s delinquent property taxes.
The unanimous decision to hire Linebarger — a major player in the lucrative and highly political delinquent tax collection business — came after controversy over Mayor John David Franz’s connection to rival firm Perdue Brandon Fielder Collins and Mott, which collected the city’s delinquent taxes last year.
Mayor Franz did not attend the meeting.
While the mayor’s eponymous law firm has a joint venture agreement with Perdue Brandon, that agreement doesn’t cover the city contract. Nevertheless, the mayor’s uncle, longtime Hidalgo power broker Rudy Franz, had raised questions about whether Mayor Franz would use his allies on the City Council — including his mother, Siglinde Franz — to ensure Perdue Brandon kept the contract.
The furor reached a fever pitch on Jan. 10, when Linebarger attorneys arrived at City Hall for the regularly scheduled meeting, only to find out elected officials had canceled it for lack of quorum. Attorneys from Perdue Brandon, apparently aware the meeting had been called off, didn’t show up.
Asked for an interview, Perdue Brandon released a statement.
“While Perdue Brandon has a joint venture agreement with the Law Office of John David Franz in the delinquent tax area, it is for the representation of other taxing entities, not the City of Hidalgo. That has always been the case and will remain that way,” reads the statement. “Therefore, Perdue Brandon does not have a conflict of interest representing the City of Hidalgo.”
Both Linebarger and Perdue Brandon offered to collect Hidalgo’s delinquent taxes in exchange for a 15 percent cut of tax, penalties and interest actually collected.
Perdue Brandon touted its nearly 44 percent collection rate during the past year, and told Hidalgo Finance Director Xavier Moron in a letter that the firm “knows the City of Hidalgo and your taxpayers.” Perdue Brandon warned that the Hidalgo Independent School District had experienced a lower year-to-date collection rate for delinquent taxes after picking another firm.
The Hidalgo school district is controlled by Mayor Franz’s rivals, and the decision to switch delinquent tax collection firms was widely seen as a political move.
Linebarger also submitted a letter detailing its experience and work with local taxing entities, including McAllen and the Pharr-San Juan-Alamo school district.
Dave Hendricks covers McAllen and general assignments for The Monitor. He can be reached at email@example.com and (956) 683-4452.