Council directs staff to hire outside counsel to investigate Homewood Suites allegations after charter language revised

Corpus Christi City Council approved a request that city staff identify and contract with an outside attorney to investigate allegations tied to the Homewood Suites matter referenced in the lawsuit Ajit David v. City of Corpus Christi, et al. The vote followed a lengthy legal and procedural discussion in which the city attorney said the original three‑signature memo on the agenda, as written, would probably violate the city charter.

What the council approved: Council adopted revised language directing staff to "execute a contract within the city manager's authority, subject to available appropriated funding, to contract with an attorney to investigate fraud allegations pursuant to the Homewood Suites transaction referenced in the lawsuit Ajit David v. City of Corpus Christi, et al., selected from the following list of attorneys." Councilmembers provided a short list of potential candidates to be vetted by the city attorney and city manager.

Why the language changed: City Attorney Myles Risley told council that, as drafted, the item "does not comply with the city charter" because the charter prohibits hiring private counsel except "upon the request in writing of the city attorney stating the necessity therefore and with the consent of the city manager." Risley and the city manager said an alternate motion that asks staff to vet and execute a contract under the city manager's authority would comply with the charter while accomplishing council’s expressed intent to obtain independent legal review.

Who was involved and what they said: Several council members pressed for an independent investigation after months of dispute over the Homewood Suites transaction and related depositions. Councilwoman Sylvia Campos proposed the revised language; Councilman Eric Cantu seconded. City Manager Peter Zanoni, City Attorney Risley and outside counsel already engaged to represent the city in existing litigation (Hyde Kelly LLP / George Hyde) described how vetting would work and why, in the current litigation posture, outside counsel representing the city must be independent of any conflicts.

Key procedural points clarified by staff: - The charter requires a written statement from the city attorney and the consent of the city manager for city contracts with private counsel; the revised motion routes the request through staff and the city manager so the city can comply with the charter. - Staff (city attorney and city manager) will vet proposed firms for conflicts, competency and cost and negotiate a contract if within the city manager’s procurement authority. - The city attorney estimated it would take roughly one to two weeks to bring back a vetting memo, recommended attorney and draft contract language for execution; staff said it will include the necessity memo required by the charter.

Attorney names proposed by council for vetting included: Daniel Ray (Scott, Ray, Pemberton & Goll PLLC), Justice Patricia Alvarez, an O'Hanlon/Demerth/Castillo firm reference, and Carlos Valdez. The council also discussed the already‑retained Hyde Kelly LLP; that firm is representing the city in ongoing litigation and can subpoena and depose witnesses in the active case. Council members and staff debated whether the same outside lawyer could both investigate and, later, defend the city in litigation. Risley said an attorney who sees a conflict during vetting must notify the client and recuse if necessary; he also explained that a vetting memo would document conflicts and capability.

Costs and funding: Staff said retaining outside litigation counsel to represent the city in the pending lawsuit had been estimated in the $300,000+ range; council discussion noted separate estimates for a narrower investigative engagement could be much lower but would depend on scope. City staff said the contract would be executed subject to available, appropriated funding and under the city manager’s contracting authority for the amount involved.

Public comment: The item drew extended public comment; speakers alternately urged an independent investigation and defended the mayor and existing staff. Several members of the public said the city should not use taxpayer funds for politically motivated actions; others said outside investigation was necessary to restore public trust.

Council action and next steps: Councilwoman Sylvia Campos moved the revised language to request staff to execute a contract under the city manager's authority and to vet a short list of attorneys; Councilman Eric Cantu seconded. The motion carried after roll call; Councilman Everett Roy recorded an abstention. Staff will return with a written necessity memorandum, the results of vetting for conflicts and a recommended contract/attorney for execution under the city manager’s authority, with a target of one to two weeks for completion.

Quotes from the meeting: - "As written, it is a probable violation of the charter," City Attorney Myles Risley said about the original three‑signature memo language. - "If council wishes, the city manager and city attorney can vet candidates and execute within the city manager’s authority," City Manager Peter Zanoni said.

Context: Council previously requested outside counsel after internal questions about the Homewood Suites matter and related depositions raised concerns that would make the city attorney’s office a witness in the litigation. The revised motion seeks to provide the independent review council members requested while preserving compliance with charter procurement rules and avoiding direct council hiring that the charter forbids.