A taxpayer said her investigation of a government district has uncovered questionable spending, a conflict of interest, and a lack of records showing the district is in compliance with the payroll tax. She’s fighting the district to release its financials to the public, while the district claims it’s being transparent.
With similar districts sprawled across Texas, this could be happening in anyone’s backyard.
Located 25 miles north of Houston, Water Control and Improvement District #92 is a municipal utility district charged with supplying water and sewage services to residents. It also runs a recreational area. On January 9, the board president, Donald Roberts, resigned. That was roughly a month after Attorney Eric Grimm sent Michael Bacon, attorney for the district, a letter about multiple overdue and non-compliant responses to Public Information Act requests from his client, Barbara Rivera.
Her years-long investigation of the district uncovered multiple items that concerned her, including a $3,800 September 2019 payment to Dewatering Solutions, a company owned by district board member Charles Randall Hart.
Bacon addressed that conflict of interest in a statement to Texas Scorecard.
They were used for an emergency repair during Hurricane Harvey to save a District owned building from flooding. Mr. Hart disclosed the potential conflict of interest to the Board of Directors of the District and the event was later ratified by the Board as a necessary emergency action. Mr. Hart abstained from any vote on that matter. There is no ongoing work or relationship between the District and Dewatering Solutions.
Rivera also reported she couldn’t find records of the district withholding taxes from bonus payments to then-district General Manager Robert Cowart and maintenance worker Jose Almader.
In 2025, Rivera requested more financial records, including payroll tax compliance documents. She said the district resisted her, so she escalated the matter to the Office of the Attorney General, though she received no response. Then, after Bacon allegedly yelled at her in a meeting last fall and refused to provide the documents she requested, Rivera lawyered up.
The district provided multiple files in response to Grimm’s letter, but Rivera said it only provided some of what she asked for, while everything else it delivered was records readily available elsewhere.
Grimm sent a follow-up letter on January 15. “It appears that the MUD has overlooked or disregarded its income reporting obligations to the Internal Revenue Service, and its obligation to pay payroll taxes on all income that current or former employees received from the MUD,” he wrote. “Further records review indicates tax-related irregularities for additional workers and/or contractors in relation to the MUD and/or its ‘recreation’ enterprise. I need complete documentation to ascertain or refute whether the MUD is actually fulfilling its income and payroll tax obligations.”
He reminded Bacon of state law mandates for district transparency. For multiple overdue items, Grimm warned that “complete responses are necessary, and the next step is to escalate either to a governmental enforcement mechanism, or court, or both.”
Barbara’s Story
In 1988, Rivera moved to Lexington Woods, within WCID 92 service area. She didn’t take an interest in the district until about 12 years ago, when she became community manager after serving on the board of her homeowners association.
“I started noticing some of the residents started asking more questions about different services … the trash, which is included, of course, in our water bill, security, the constable contract, and recreation,” she told Texas Scorecard.
The recreation facilities, which she said the district took over in 1985, included a cabana club, a basketball court, a pool, and a large private clubhouse. Rivera said ratepayers in the 1,500 homes within the district fund these items to the tune of $217,000 a year. Despite that, she found the cabana club in poor shape, with bathrooms that were “disgusting,” and “air dryers [that] were rusted practically off the walls.”
It didn’t make sense. She tried to ask Roberts about the situation, but found his response to be a “political answer” that explained nothing. She then hunted through the district website and found its 2022 audit. She was shocked to notice “the amount of money being spent, and there’s nothing to show for it.”
Fellow ratepayers Mihai Mosculu and Chris Arredondo also asked questions and helped Rivera investigate. They taught her how to send Texas Public Information Act requests. Armed with that knowledge, Rivera requested the district disclose receipts and expenses from 2022.
WCID 92 responded with a nearly $600 bill and required her to pay more than $200 up front. Rivera paid in full, though she said the district only deposited the first check. The district delivered the records. “We started seeing some very concerning receipts,” she said.
Deep Dive
From the records she obtained, Rivera provided Texas Scorecard with copies of two checks that former General Manager Cowart wrote himself from the district bank account: one in April 2022 for $2,274.56, and one in August 2022 for $3,932.46. She could find no justification given for these checks. Rivera said bank statements showed Cowart was spending $5,000 a month on a district credit card.
In a statement, the district broadly denied wrongdoing and suggested that audits have not uncovered any wrongdoing.
Cowart retired in May 2025, but Rivera said the district contracted him as a consultant through December 2025 at $2,500 a month.
She also found other questionable district spending, such as receipts for large soda purchases, even though district doesn’t have a soda machine, and over-the-counter pharmaceutical purchases. Rivera found monthly payments of roughly $700 for pool supplies. She said this was curious because WCID 92 already pays a yearly fee to a pool management company.
Additionally, the $700 in pool supplies was not delivered to the district but to a home address Rivera said is Almader’s, the district maintenance man. She believes the supplies weren’t meant for the district or even for Almader, but for Cowart’s son, who she said has an Olympic-size swimming pool.
There’s more. Rivera said she found $80 gas receipts for reimbursements three to four days in a row, roughly every week, from Almader. By her estimates, this resulted in “over $4,600” in gas for 2022, which she found excessive. Rivera said a friend of hers works at one of the gas stations Almader goes to, so she asked about it. “She goes, ‘oh, well, he comes in, he’ll put down $80 and then maybe pump two or three [gallons] and come back and get the rest cash,’” Rivera said. “But he’s turning in the whole $80 receipt.”
Rivera said expenses by Cowart and Almader totaled roughly $7 million for about 30 years.
Grimm reviewed Rivera’s records and said that “this is not just smoke.”
“That’s just astonishing to me the gas station scheme appears to have some basis in documentary reality. I haven’t completely run it to ground yet, but it seems like a very plausible allegation,” he told Texas Scorecard. “She’s given me some documentation on various things that are pretty obviously personal expenditures by personnel who are employed by the MUD that mysteriously have been reimbursed and are reflected in their documents.”
He compared these issues to his experience as an elected public official in Roosevelt Park, Michigan. “We had a lot of political shenanigans going on, including somebody who circumvented the board of that municipality to purchase a dozen semi-automatic firearms that we didn’t have an operational need for in our police force and then essentially created a loan to each of the members of the police department that they were to pay back over time.”
Fighting Records Requests
In June 2025, Rivera sent another PIA request for district financials. This time, the district had a new attorney: Michael Bacon from Coats Rose, a law firm focused on real estate and special purpose district development that provides legal counsel to “governmental entities” and others in Texas and eight other states. Rivera said ever since Bacon arrived, the district became more resistant to her records requests. That led to her hiring Grimm.
Rivera said the only items Bacon actually delivered in response to Grimm’s December 5 letter were statements for Cowart’s Bank of America card. These showed more than $4,000 in payments for pool supplies from December 2023 to January 2025, as well as what she called unjustified payments to Kroger and Texas Roadhouse. Everything else he provided—audits, bookkeeping reports, and board meeting minutes—were records she hadn’t requested and are already available.
Bacon responded on behalf of WCID 92 to questions about the allegations. “The District complies with the Texas Open Meetings Act and Public Information Act, has provided numerous financial records to Ms. Rivera, and continues to do so. The statement that Ms. Rivera was denied documents is patently false. We have provided responsive documents as recently as this month,” he wrote on January 22.
Attorney Grimm disagreed. “Selectively delivering a subset of the documents requested, sometimes interspersed among documents that were not requested, is hardly the same thing as responding in full, and timely, to the document requests as written,” he stated. “Indeed, the email I received today from Mr. Bacon’s office appears to admit that they still have not turned over everything required.”
Grimm was referring to a January 22 response to his own January 15 follow-up in which he identified seven items the district had yet to deliver: documents identifying the accounting software the district uses, operations documents for a device used at the sewer plant, copies of payments to Almader and Cowart, reverse sides of checks written, records to confirm or refute payroll tax compliance, and the district’s records retention policy which Texas Local Government Code § 203.026 requires local governments to have.
Grimm noted that for multiple items, the district was more than ten days overdue in responding. In the case of Cowart’s payment records, reverse sides of checks, and payroll tax compliance records, Grimm noted the district was “more than a month overdue.”
According to a presentation from the Texas Attorney General’s Office, state law requires that governmental bodies must notify requestors if providing records will take longer than ten business days. If they intend to appeal the request to the Texas Attorney General’s Office, they must do so within ten business days.
In 2025, Gov. Greg Abbott signed a law intended to address governmental bodies not responding to PIA requests. However, much work remains to be done. “The Texas Public Information Act needs a complete and total overhaul. The current iteration is wholly inadequate to ensuring that government remains the servant and not the master of the people,” stated James Quintero of the Texas Public Policy Foundation.
Grimm warned Bacon that “just producing a subset of the same items…over and over again” that Rivera already has—despite the district’s prior replies failing to fulfill her records request—“does literally nothing to deliver timely, complete, and informative responses.”
The January 22 response to his January 15 letter, which Grimm shared with Texas Scorecard, from Nicholas Karolys, associate attorney at Coats Rose, included a 2015 resolution adopting a “records management schedules and policy,” and a file that listed August to December 2025 health insurance reimbursements for Almader. The reimbursement document did not include multiple items Grimm’s January 15 letter listed, including the name of the insurance company and his insurance invoice.
For the payroll tax compliance records, Cowart’s payment records, and records regarding the sewer plant device, Karolys wrote that the district had requested those documents “and are working on processing this request.”
Regarding the accounting software, Karolys wrote that “many of the records you have requested from the District do not exist.” He added that the Texas Public Information Act doesn’t require governmental bodies to create new information, notify requesters of future data, or fulfill ongoing periodic requests, and exempts from answering questions or performing legal research.
In light of Karolys’ response, and the entire history of dealing with the district, Grimm wrote that “with appropriate respect to … Mr. Bacon, and to your readers, we simply cannot agree with Mr. Bacon’s characterization of the situation.”
Grimm told Texas Scorecard he wants to work with Bacon. He intends to offer WCID 92 multiple opportunities to be transparent. But if the district continues to block transparency, Grimm and Rivera will decide on the next steps, and giving up is not one of them. “Ms. Rivera will continue running these reasonable information requests to ground,” Grimm wrote. Rivera said she believes “they are willfully trying to cause me to exhaust my funds, hoping I’ll quit.”
Getting state lawmakers involved has crossed Grimm’s mind. “It might be possible to get in communication with the legislature to put additional safeguards in place than currently exist for [municipal utility districts] to make clearer the standards in order to have proper financial controls in place, and make sure that the audit process works better,” he said.
Rivera said her previous conversations with State Rep. Valerie Swanson (R–Spring) and now-former State Sen. Brandon Creighton’s chief of staff went nowhere. Creighton has since left office and is now Chancellor of the Texas Tech University System. Gov. Greg Abbott has set a May 2 special election to fill his vacant Senate seat.
Swanson’s office did not respond to a request for comment before publication.
In his statement, Bacon wrote that “we take all accusations of fraud and misconduct seriously, and the District has controls to prevent the abuse or misuse of public funds. These controls include a third-party professional bookkeeping company, an annual audit conducted by a separate auditing firm, and this law firm. If any fraud or misuse of public funds is ever identified, it will be dealt with promptly and severely.”
Rivera updated that Karolys replied again on January 30 with more documents that Rivera called “more of the same stuff … They are really stalling and refusing to turn over my requests!”
Dewatering Solutions didn’t respond to a request for comment before publication. Grimm copied the Office of Harris County Attorney Jonathan Fombonne on both of his letters to Bacon. His office did not respond to a request for comment before publication.
The district accepted applications for the board position vacated by Donald Roberts through January 31.
WCID 92 is a municipal utility district, one of more than 1,200 active ones across Texas as of 2021. These types of governments typically fly under the radar, unnoticed by citizens. Rivera and Grimm’s experience with one raises questions about what Texans may find if they look into the ones in their own backyard.
If you are a citizen concerned with local corruption and would like to partner with us to promote transparency, please email scorecardtips@protonmail.com.
