A Katy ISD school board candidate has responded to questions regarding to his employer being sued by an area school district over fraud allegations following debris clean-up in the wake of Hurricane Ike.
Katy ISD trustee candidate Bryan Michalsky on Monday said the lawsuit filed by the Clear Creek ISD against his employer, Cotton Commercial USA, was the result of work done by a subcontractor – Cottonwood Debris Company – which was later acquired by Cotton two years after the incidents alleged in the litigation.
According to the lawsuit filed by Clear Creek ISD in Galveston County’s 405th District Court, Cotton Commercial USA created Cottonwood Debris as a “sham” subcontractor following the hurricane, and Cottonwood submitted fraudulent invoices to the district for work never done.
The litigation also contends Cottonwood invoiced the school district for bogus fuel bills and engaged in price gouging.
A recent news story about the lawsuit in a Galveston County newspaper caused a number of Katy area residents to question whether Michalsky should seek to serve on the Katy ISD school board while his company is being sued by a nearby school district.
Michalsky, who is the chief financial officer for Cotton, said he could not discuss details of the case because it remains in litigation, but said the litigation was not relevant to his candidacy school board candidacy.
“As this is pending litigation I cannot discuss the details of the case,” Michalsky said. “I would, however, like to issue a statement of facts related to the case:
- Cottonwood Debris Company was a subcontractor hired by Cotton to perform debris removal and other services.
- The work in question was performed in 2008 in the aftermath of Hurricane Ike. I was and am the CFO of Cotton and had no management responsibilities for Cottonwood in 2008.
- Cottonwood was acquired by Cotton in 2010 at which time this claim came under my responsibility.
- CCISD was satisfied with the work performed in 2008, and their schools re-opened 13 days after the hurricane, much sooner than many in the Houston area had even restored power.
- Cotton has a counterclaim in the amount of $705,123 for services unpaid by CCISD related to the work performed by Cottonwood.”
Michalsky also said news reports of the lawsuit carried in the Galveston Daily News were taken from Clear Creek ISD’s original court document and “one would have to look at subsequent filings by Cotton to get a better picture of what occurred.”
“The only relevance to my candidacy related to this case is the value that my professional experience in matters such as these would bring to our board of trustees,” Michalsky said.
According to the lawsuit filed by Clear Creek ISD, Cotton was hired to remove storm debris and perform restoration services for school district facilities following the hurricane.
The contract allowed Cotton to hire a subcontractor for any work it could not provide. Cotton would then bill the school district at the subcontractor’s cost plus 10 percent overhead and an additional 10 percent profit.
Both the school district and FEMA later questioned the legitimacy of the invoices submitted by Cottonwood for the debris cleanup. FEMA subsequently denied reimbursement of roughly $700,000 to the school district over the discrepancies, according to the lawsuit.
Court documents also noted the highest rate for debris removal allowed by FEMA was $55.62 per cubic yard. Cottonwood Debris charged the district at a rate of $170.73 per cubic yard.
Clear Creek ISD representatives would not discuss the matter due to the pending litigation.
Is this for real? How stupid do they think we are? The only candidate running against Terri Majors is involved in a scandal. Hmmmm, awfully convenient if you ask me. I’m not buying this at all. This is a Terri Majors smear campaign.
Stan:
Unlike the smear campaigns of the incumbents/vendor PAC’s of the past, this isn’t a smear of a candidate AT ALL. This is an honest-to-goodness ongoing court case involving a candidate in the KISD BOT election – who’s also a high-ranking executive of a company being sued for overcharging a school district.
Now go ahead and blame Terri all you want – but to my knowledge she’s not, nor was she, employed by Galveston ISD in 2008-2010 = so why would you even accuse her of “arranging” this two-year-old lawsuit? Vote for who’d you like – and so will I.
You’re right though – something about one of the candidates in that Majors-Michalsky stinks. I just don’t agree with the candidate you believe is causing the smell…
In a way you helped me proved my point. Why is a two year old lawsuit being talked about on Instant News Katy the week early voting starts? Some of us are just not as dumb as you’d like us to be.
You’re not dumb – but it absolutely brings to light potential issues for voters to consider that are NOT false – unlike rumors of the past that have been aimed at hurting challengers’ campaigns. Michalsky is a guy that pledges his business and financial savvy make him a better candidate; however, he had “nothing to do with” the independent-come-subsidiary that is the focus of the lawsuit. For fun, it’s a suit from a school district to boot. Lawsuits are a part of most medium and large-sized companies, but when a high-ranking executive is apparently in the dark of potentially fraudulent billing practices of a company that is now his subsidiary, then it’s simply something for people to consider if they choose.
This is no “Firethorne Voters PAC” or repeated Wolfe Elementary-style rumors right before voting. This is an ongoing case involving (possibly) a board candidate and his professional company – in an election where again, his executive and financial savvy is a major selling point for him.
Legitimate question involving a candidate, which he answered appropriately. Geez, do you have any extra tin foil hats?
Stan give a break.
If this guy had some questionable business dealing we as the tax payers need to know that information.
These two have already created a fake controversy about the Katy High School attendance zone.
He is and was the CFO at the time so he should know what was going on, unless that is how he handles his business. I am just saying.
Ok, so then…
Who owned Cotton at the time that the work was performed?
The lawsuit alleges Cotton set up Cottonwood as a sham subcontractor. Cotton bought Cottonwood (anyone else notice a name similarity here?) in 2010. So, who owned Cotton in 2008? Who created Cotton?
Did the owners of Cotton also create/own Cottonwood, seperate from Cotton? And then just effect a merger in 2010?
It may well be true that 1) the charges are completely false or 2) The charges are true but the gentleman running for office truly had nothing to do with it (he says he had no management responsibility for Cottonwood at the time).
But if… and this is a big if… but if Cottonwood and Cotton had similar ownership, considering the position he holds in Cotton… he may need to further explain himself.
I hope that none of this is true… I would hate for a Katy school board race to be decided based on something happening with someone’s employer and another school district… but if he holds a high enough position in the company, it surely would not look good if there was a problem.
for me it goes to the ethics and character of the person…..if Bryan was involved in any shady dealings I think that is most pertinent to his fitness to hold a position on a school board……especially when it involves a school district…..make what you want of it, but unless he does some explaining he wont get my vote….
He can’t/won’t because it’s ongoing litigation and his lawyers would be negligent to let him do so. There’s incredibly large amounts of missing data/info in his “statement” – large enough that it SHOULD make people pause when considering their votes in this BOT election. If it doesn’t, then God help us all!
Great. So now we have a questionable litigation candidate versus a candidate that threatened and bullied parents while she was principal (and yes WSBill I have knowledge of this). Can we have a write-in candidate? I say it’s time for a return of Ross Raymond.
I will second that vote for Ross Raymond!
Fans
The facts are, the principals of Cotton started Cottonwood in 2008. They did in fact merge Cottonwood into Cotton Commercial in 2010. If it was a purchase as stated it was certainly an arms length transaction. Contrary to Mr Michalsky’s statement he must of had some interest, or at the very least some knowledge of company business in Cottonwood as he signed the merger document as the manager of Cottonwood! This is public information as provided by the Texas Secretary of State.
Another satisfied Cotton customer.
http://www.witn.com/home/headlines/Sheraton_Atlantic_Beach_Facing_13_Million_Lawsuit_148954625.html
More Cotton legal woes.
http://dockets.justia.com/docket/texas/txsdce/3:2011cv00188/881744/
Ouch! Here is another one. Will this be part of the new business model for the BOT?
http://dockets.justia.com/docket/louisiana/laedce/2:2006cv09931/109974/
I have asked Michalsky, via his website, to explain his connection and fundraising efforts for Bobby Jindal, but as of yet I have received no response. Jindal is trying to privatize schools and de-certify teachers in Louisiana. I am worried that vouchers and for profit charter schools are on Michalsky’s agenda. Two information requests to Michalsky’s website and neither one answered. So much for open dialog.
Rick Archer
Rick,
I hear you. As a taxpayer I am beyond ticked off with the cozy contracts, PACs funded by architects, engineers and other groups who profit from these enormous bond projects……with the support of the superintendent and BOT. I am of the opinion that Mr Michalsky knows very well how that game is played, obviously he does it in his business. A vote for him is a vote to have the fox guard the hen house.
Stan the man you arguement is diving deeper that a submarine.
The guy has the morals of a alley cat. Got more illegitmate kids than you can count.
This proves he thinks he is above us all. He thinks he can buy off whomever and whatever he wants.
His on and off again fiance is proof he can not and does not want to committ to anything or anyone.
And these fools want him on the board.
I feel sorry for the kids.
Cottonwood is a shell company set up to bypass rules and regulations.
This is all typical of how he operates.
Blackman/Majors. Democratic PAC funded mailers. AFLCIO Funded mailers.
And the politics of personal destruction that is the hallmark of Democratic operatives. The picture is becoming very clear.
Now that’s what I call “Transparency”.
Babytigersays: Who is Katy’s Peddler of Dirt?
http://babytigersays.blogspot.com/2012/05/who-is-katys-peddler-of-dirt.html
BT, I would say at this point you are a hypocrite.