Former Amarillo Mayor, Fairly Group CEO file lawsuit against Amarillo ISD

AMARILLO, Texas (KVII) — Former Amarillo Mayor Jerry Hodge and CEO of the Fairly Group Alex Fairly have filed a lawsuit against the Amarillo Independent School District claiming the district violated the Texas Education Code when selecting medical benefits providers.

According to court documents, Amarillo ISD evaluated vendors for employees’ medical and pharmacy benefits during the fall of 2019 to begin June 1, 2020.

However, Hodge and Fairly says the district violated Texas Education Code 44.031, which states “Except as provided by this subchapter, all school district contracts for the purchase of goods and services, except contracts for the purchase of produce or vehicle fuel, valued at $50,000 or more in the aggregate for each 12-month period shall be made by the method, of the following methods, that provides the best value for the district:

  1. competitive bidding for services other than construction services;
  2. competitive sealed proposals for services other than construction services;
  3. a request for proposals, for services other than construction services;
  4. an interlocal contract;
  5. a method provided by Chapter 2269, Government Code, for construction services;
  6. the reverse auction procedure as defined by Section 2155.062(d), Government Code; or
  7. the formation of a political subdivision corporation under Section 304.001, Local Government Code.

The Amarillo ISD Board of Trustees chose a contract from Blue Cross Blue Shield to provide medical service benefits and a contract from Express Scripts, Inc. to provide PBM services.

However, a statement from Fairly provided to ABC 7 News says a bid submitted by the Fairly Group would have saved the district and taxpayers $10-$15 million while providing equal or better coverage and was not received by the Trustees.

Fairly’s full statement can be read here:

Today, solely in my interest as an Amarillo taxpayer, I filed a lawsuit in Potter County District Court seeking an injunction preventing Amarillo Independent School District from performing a contract that is not in the best interests of the District or its taxpayers.

AISD recently awarded the contract for medical insurance, which was the culmination of a Request for Proposal (RFP) to which Fairly Group responded. Our response contained options which we believe were of equal/higher quality and were $10 – $15 Million less expensive over the three-year term than the option AISD Trustees selected. Additionally, these options would have been substantially less expensive for our teachers.

Unfortunately, Trustees were not made aware of any of the options we presented at the meeting in which they voted to select a vendor. In our proposal, we did not ask to be compensated; we offered our resources, expertise, and time at no charge to the District.

I constructively raised my concerns, which were supported by certain Trustees but not, in my opinion, taken seriously by AISD Administration. Our aim in bringing this suit is to bring accountability and change to AISD’s RFP practices and protocols which enable AISD to make decisions which cost Amarillo taxpayers unnecessarily, and which ignore less-expensive options for our teachers.

This suit does not seek to recover monetary damages from AISD. I am simply ‘raising my hand’ to shed light on a process I believe is flawed and unfair to Amarillo’s teachers and taxpayers.

Hodge also issued a similar statement, which can also be read here:

Today, I filed a lawsuit in Potter County District Court seeking an injunction preventing Amarillo Independent School District from performing a contract that is not in the best interests of the District or its taxpayers.

AISD provides pharmacy benefits to our teachers and other AISD employees, which are substantially funded by Amarillo taxpayers. In their process of evaluating pharmacy benefits vendors, AISD is required to consider certain factors which are set forth in the Texas Education Code. These factors are designed to ensure that selected vendors provide the best value to the District.

I have been privy to certain details regarding AISD’s recent Request for Proposal (RFP) process regarding the District’s employees’ pharmacy coverage and, as an Amarillo taxpayer, am gravely concerned that AISD’s RFP process failed to consider all the factors mandated by Texas law. The result is they may have approved contracts which not only cost taxpayers millions of dollars unnecessarily, but also increase pharmacy costs for all AISD employees, including our Amarillo teachers.

After repeated attempts to address my concerns privately and directly, it has become clear that AISD’s Administration is not willing to engage in a good-faith conversation about my concerns. To be clear, this suit seeks no monetary compensation from AISD; its purpose is to bring accountability to AISD’s RFP processes, pull back the curtain to determine whether taxpayer money has been wasted, and ensure our teachers have the very best options available to them.