After KPRC2 reports, Rep. Jim Murphy no longer listed as GM of Westchase District

House Ethics Committee asks for lobbying, employment opinion following reports

By Channel 2 Investigates

HOUSTON - Less than three months after Channel 2 Investigates uncovered State Representative Jim Murphy’s two taxpayer-funded positions and bonuses for securing funding as General Manager of the Westchase District, we’ve learned Murphy's role at Westchase may be changing.

He is no longer listed as General Manager.

On Feb. 7, KPRC2 Investigator Mario Diaz revealed Murphy’s yearly salary of more than $312,000 a year at Westchase, plus bonuses, including a 2017 contractual benchmark of $6,000 if Murphy was able to “Secure $1 million or more in new TXDOT funding for highway projects.”

In an on-camera interview, Murphy acknowledged the arrangement.

In March, the House Committee on General Investigating and Ethics discussed Murphy’s potential conflicts of interests and concerns raised in KPRC’s reporting that Murphy was acting as a lobbyist for Westchase, violating state ethics rules.

The Chair of the Committee, Rep. Sarah Davis, sent two letters to Texas Attorney General Ken Paxton this week, asking for a legal opinion on the questions raised by the KPRC2 reports. While the letters do not mention Murphy by name, they are seeking Paxton’s opinion regarding lobbying as well as a 2005 AG opinion allowing Murphy to serve an independent contractor for Westchase.

Davis writes: “When may a legislator receive payment from a unit of local government for lobbying activity with a state agency or unit of local government?"

Davis, who first told Channel 2 in February Murphy’s contracts seemed “pretty shocking,” makes it clear she wants clarity on state law governing a legislator’s prohibition on lobbying.

The second question in the letter specifically asks, “May a legislator receive payment for a task performed by the legislator for a unit of local government as an employee or independent contractor if the task is to secure either state funding or state licensing or permitting approval?”

Channel 2 Investigates reported in February that Murphy has received tens of thousands in contractually promised bonuses for successfully securing taxpayer money for Westchase projects.

Channel 2 Investigates did reach out to Murphy for comment regarding the developments surrounding his role at Westchase and the request by Rep. Davis for new legal opinions. In an emailed statement, Murphy wrote, “The district removed the title from the website in order to avoid any confusion about my role as a consultant. My company, District Management Services, LLC, continues to provide management, planning, oversight and other services to the Westchase District as we have for more than a decade.”

AG Opinion Request: Independent Contractor Status

Murphy added, “I heard about Rep. Davis’s OAG request just yesterday. In 2005, Attorney General Abbott determined that ‘the Texas Constitution does not prohibit a member of the Texas Legislature from also working for compensation as an independent contractor for a municipal management district.’ My work is consistent with Attorney General Abbott’s legal opinion.”

AG Opinion Request Lobbying

Channel 2 Investigates will continue to follow developments in this story.

Houston based employment Attorney Todd Slobin told Channel 2 Investigates he has issues with Murphy's claim that he's an independent contractor, and not an employee.

"I'm having a difficult time with this one, because usually independent contractors could be on a case-by-case basis or a project-by-project basis, this just looks like a salary," Slobin said.

How does the new deal stack up with Texas Workforce Commission rules?

Murphy's new contract appears to punch the box on several of the 20 factors used by the Texas Workforce Commission to determine if someone is an employee or a contractor. Those include continuous monthly payments, reimbursement for expenditures as well as the power to hire.

The contract states under Section G, “Consultant must receive the approval of the district before hiring any contractor, sub-contractor or consultant in connection with the services permitted required by this agreement."

Slobin’s reaction?

"In most cases where you have an independent contractor, if they have subcontractors for example they are completely in control of who they are going to work with," he said.

Slobin also said Murphy's new contract with Westchase is unique as it also outlining the services he's providing.

"You usually don't see the duties spelled out like this. If again, if you are hiring someone to put on the roof you are not telling them how or what they are supposed to do, they are already know it," he said.

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