Future Forum: Guilt, Innocence, and the Death Penalty 
The Great Texas Prison Mess
During the gargantuan buildup of the Texas Prison System, everyone wanted in on the action—even Andy Collins, the boss himself. Here’s how greed, fear, and VitaPro produced the state’s costliest scandal.
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But none of the board members had anything on autocratic chairman Allan Polunsky, whose defiance of procedure Collins often witnessed firsthand. It was the chairman who directly ordered Wackenhut to spend thousands of dollars erecting a fence in front of its Kyle facility so that motorists on Interstate 35 wouldn’t see the facility’s inmates playing basketball outside. It was Polunsky who ordered that existing private-prison contracts be rebid without consulting the other board members. And it was Polunsky who used Collins and other TDCJ officials to clear a path so that Polunsky’s old college roommate could claim a share of the TDCJ’s grease trap—cleaning business. At Polunsky’s request, Andy Collins lunched with Sanitech president David Collins (no relation) and thereafter joined Polunsky in badgering prison staffers into giving the ex-roommate special treatment: canceling contracts with existing vendors, rewriting contract specifications in a way that favored Sanitech, and even letting David Collins pick up his checks at the state treasurer’s office in Austin rather than waiting for them to be sent out of Huntsville. By the time the Sanitech president sold his company to a rival in 1995, he had grossed more than half a million dollars doing business with the TDCJ.
If Polunsky and other board members didn’t care about ethics, why should Andy Collins? And why, therefore, should anyone rattle his sword at Pat Graham? Besides, Graham wasn’t going away. Despite his testimony during the N-Group lawsuit that “I would never build another jail again,” Graham was then conceiving a juvenile lock-up facility in Jena, Louisiana. Once again he had solicited some impressive backing: Louisiana governor Edwin Edwards had awarded the project to Graham, the investment group behind it was led by former Houston mayor Fred Hofheinz, and Graham’s development partner was none other than Collins’ old friend Charlie Terrell. These men saw Graham as a rainmaker. Leave it to the N-Group jury to pass judgment. There was still money to be made.
In June 1995—nine months after Collins’ friendly testimony in the N-Group lawsuit—Graham’s proposal for the Jena juvenile facility landed on the director’s desk. With the proposal came a job offer: Collins could form a company to operate the facility. Other potential private operators had passed on the deal, and Terrell himself had pulled out; but as Collins studied the numbers, he concluded that it was their loss. By his calculations, he stood to clear well in excess of $150,000 annually. Coupled with the $50,000 retirement package he would be receiving, Andy Collins didn’t see how he could say no. So he didn’t.
On July 12, 1995, without notifying the TDCJ board, Collins quietly formed a Louisiana corporation called Professional Care of America, naming himself, Hofheinz, and former N-Group treasurer James Brunson as the officers. (Four months later, Collins would also incorporate a Texas business he called Certified Technology Consultants and list as his registered agent Lori Lero—an attorney who happened to be Pat Graham’s daughter.) Collins’ explanation for not notifying the board is that he didn’t want to spook the New York—based bondholders who would be financing the construction of the Jena facility. But he must have known that the potential for a conflict of interest would have made it difficult for him to hold both jobs, if word got out. Inevitably, word did get out, and in early September Collins was informed by Governor Bush, through Polunsky, that he would have to choose between his two jobs—now.
Collins chose Jena. At the September board meeting, Collins announced his resignation from the Texas Department of Criminal Justice. Aside from briefing Polunsky and his other friend on the board, Gatesville’s John Ward, Collins declined to tell the other seven members what his specific plans were. He simply said he was going into private business—that he had faced a “reality check” when he recently paid tuition to send his eldest daughter off to Texas A&M.
A number of the board members didn’t know what to make of Collins’ announcement. The director was making $120,000, living rent-free, and driving a company car—and he still couldn’t afford to send his daughter to a state school? A reporter for the Austin American-Statesman met privately with Collins. “You’ve got to tell me who you’re going to work for,” Collins says the reporter demanded.
“No,” said Collins. “I really don’t have to.” And that was that. The veteran public servant was now going private all the way.
BUT ANDY COLLINS BEGAN GOING private at least six months too soon. For between the time he first read Graham’s Jena proposal last June and the time he left office on December 31, three prison vendors benefited from extraordinary contracts with the Texas Department of Criminal Justice—and all three vendors, Collins admitted to me without hesitation, were companies he in fact had hoped to do business with once he left office at the close of 1995. The evidence can be read to suggest that Collins viewed his last six months in office as a window of opportunity to ingratiate himself with potential employers by awarding them fat contracts that they perhaps did not deserve, with the hope that the favor would be returned.
Collins’ first beneficiary was a Houston-based construction company, 3D/International. The TDCJ’s records show that on June 27, Collins and a few of his lieutenants met with 3D/I officials in Houston and agreed to award the company a $932,000 contract to design a high-security prototype prison unit without subjecting 3D/I to a qualifications process. Less than seven months later, in January 1996, the just-retired Collins would fly to Oregon with 3D/I officials on a trial run as the company’s consultant.
The prototype contract was icing on the cake for 3D/I, which had benefited greatly from the prison-building scheme utilized by the TDCJ’s deputy director of construction J. B. Cole (who retired last February). Using “construction managers” like 3D/I to oversee all the general contractors and subcontractors would, according to Cole, result in quicker, less expensive prison building. But an analysis of TDCJ figures suggests otherwise: The 12,000 warehouselike “emergency beds” built using 3D/I as a construction manager turned out to be more expensive per square foot than the average maximum-security facility, and later construction-manager projects cost the state at least $17.2 million more than what it cost to build comparable facilities without construction managers. A main reason for the scheme’s excessive cost was the hefty up-front fee paid to “managers” like 3D/I (which pocketed $1.7 million for the emergency-bed program). As a construction manager, 3D/I was never required to prove that it was the best-qualified company. Its hundreds of thousands of dollars’ worth of reimbursable expenses were never audited. And in August 1994, 3D/I was even paid $80,000 to write a TDCJ construction-procedures manual, even though the agency already had an updated manual. (Twenty months later, 3D/I had yet to complete the manual.)
Another beneficiary of Collins’ largesse was Safeguard Technology, a Hackensack, New Jersey, company that designed fences for the Israeli government. On August 29, 1995, Collins circulated an interoffice memo ordering the purchase of high-security motion-detector fences on an emergency basis. “The immediate purchase of the improved security system is a life/safety issue,” Collins wrote. “Due to the recent change in demographic population, we have been required to place inmates in a less secure environment than absolutely required. The installation of these systems is required to be accomplished within the next ninety days.”
TDCJ staffers couldn’t believe what they were reading. After all, it had not been much more than a year ago that Collins had been heard scoffing at state comptroller John Sharp’s recommendation that the TDCJ replace its guard towers, or pickets, with motion-detector fences. “Sharp doesn’t know what the hell he’s talking about,” Collins said to staffers more than once. “No fence is going to see better than a good pair of eyes.” Now Collins was a fence convert, and in short order a $9.2 million contract was awarded to Safeguard without competitive bidding. It turned out that about $6 million of the contract involved the “less secure environment” used to justify the emergency purchase. The rest of the money went to buy fences for five new higher-security units—units that in fact are set on large compounds that are completely secure, hardly requiring the taut-wire intrusion-detection fences being manufactured by Safeguard. In the case of the “less secure” units, those fences were not installed “within the next ninety days”; in fact, three of the ten fences weren’t scheduled for completion until December of this year. What this means, of course, is that there was plenty of time to submit the project to a nonemergency competitive-bidding process. The fences for the high-security units have yet to be erected; they currently reside in a TDCJ warehouse.
So just what was the emergency? Perhaps that Andy Collins was looking for business clients. Four months after awarding the contract, Collins flew to New York and dropped by the Safeguard offices while he was in the neighborhood. Though he admitted to me that he and Safeguard president Moshe Levy had been discussing Collins’ doing work for Safeguard on a commission basis, Collins said they didn’t sign any deals during his visit: “Actually, I went up there for the Jena deal, because I wanted them to look at the plans of doing something for that particular facility.”
In other words, Collins, while still serving as the TDCJ’s executive director, was negotiating with a TDCJ vendor to do business with Collins’ own private enterprise—a textbook case of conflicted interests.
Collins saved his best act of generosity for VitaPro. In February 1994, well before Collins decided to leave the TDCJ, he was visited in his Huntsville office by former board chairman Charlie Terrell and a Montreal entrepreneur named Yank Barry, who was the president of VitaPro. Terrell and Barry wanted to know if the prison system might have a use for VitaPro—not only for its own inmates, but as a commodity it could sell to other markets throughout the U.S., much as the TDCJ does with the cattle it raises.
A year later, on January 30, 1995, a TDCJ press release trumpeted “an innovative agreement with VitaPro to nationally market, package, and distribute the new soy-based chicken and beef supplement.” The release neglected to mention that the $6.7 million contract was awarded without competitive bidding and that Terrell would be paid a commission to help market the product. Terrell was in fact so taken with VitaPro that he became a worldwide broker for the company, services for which Yank Barry paid him more than $40,000 in 1995. One of the markets Terrell advised Barry to target was Louisiana, and in February, at the Ritz-Carlton Hotel in Houston, the former prison board chairman introduced Barry to a stand-up guy who knew the Louisiana market inside out: Pat Graham.
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