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POLITICAL INTELLIGENCE Attack of the Clowns BETTER LATE THAN NEVER Citing an “organizational structure and corporate climate that created a lack of independence, integrity and objectivity,” the Texas State Board of Public Accountancy notified Arthur Andersen on May 23 that it would seek to revoke the firm’s license to operate in Texas. An Andersen spokesman called the announcement a “rush to judgement,” but it seems a little slow to us. Andersen is nearly dead anyway; the Board beat the buzzards to the body, but not by much. Most of the firm’s clients jumped ship in April, and Andersen has laid off hundreds of Texas employees and allowed hundreds more to shift to other outfits. The Governor’s office apparently knew months ago that Andersen’s number was up in Texas. In a February 6 memo to all state agency heads, Perry’s Budget, Planning and Policy Director Mike Morrissey without mentioning Andersen by namedirected each agency to “review their financial or consulting contracts to ensure that such contracts safeguard state interests in the event the contractor fails to meet professional standards or otherwise performs inadequately:’ In other words: If you haven’t fired Andersen yet, now would be a good time to do it. “I’d be very surprised if any agencies still have active contracts,” Accountancy Board Executive Director Bill Treacy told T.O. on May 24, referring to the Governor’s memo. In an uncharacteristic burst of regulatory energy, the Board also got around to sanctioning Andersen for two other, unrelated screw-ups involving audits conducted by the firm in 1989 and 1993 for World Cycle Corp. and Randall’s Food Markets, respectively. On May 23, the board assessed fines of $125,000 for each faulty audit \(no word on whether that will by 1989 favorite was the accompanying reprimand for a former Andersen partner. In the Board’s own words: “The Board also reprimanded former Arthur Andersen partner Wilbur J. Armatta of Houston for his role in one of the cases. As part of the reprimand, Armatta, who retired from the firm in 1991, agreed to remain retired from practicing public accounting?’ Remain retired! Armatta probably read the press release while sipping a highball on the 16th hole. We note that the Board is up for sunset review next session. How about some more enforcement staff? MONEY TALKS We reported on May 10 \(“Harris County Hijacking,” Houston-area industries calling themselves the Business Coalition for Clean Air was preparing a backdoor assault on the state’s cleanup plan for Harris County’s air pollution. The state environmental agency, the TNRCC, adopted the plan in 2000 in an effort to comply with the federal Clean Air Act. The Coalition immediately sued, citing inaccurate information in the plan. As Tyer reported, the group is currently in the process of conducting its own study, the results of which are expected to be much more favorable to the industries footing the bill for it. Word on the street now is that the TNRCC may be ready to cave in without a fight. After closed door meetings with industry in May, the agency is reportedly set to announce a “compromise” on pollution reduction levels. This probably shouldn’t come as a surprise: The agency’s commissioners serve at the pleasure of the governor, and this governor serves at the pleasure of industry. On May 29, Texans for Public Justice reported that Perry’s campaign has accepted $408,256 from members of the Coalition over the last four and a half years. EVIL-DOINGS IN SAN ANTONE There may be some evil-doers in Cuba, but the Cuban brand of evildo does not include germ warfare, according to Jimmy Carter, who, much to the chagrin of the U.S. State Department, recently toured the country and pronounced it germfree. San Antonio, on the other hand, could use a closer look. The Sunshine Project, a bio-weapons watchdog group based in Austin and Hamburg, Germany, recently obtained under the Freedom of Information Act a copy of a bioweapon proposal made by the Armstrong Laboratory at Brooks Air Force Base in San Antonio. The lab proposed to develop genetically engineered bacteria that destroy enemy materials, including plastic, 12 THE TEXAS OBSERVER 6/7/02