Council ratifies outside ethics counsel (Hyde Kelly LLP) after heated debate over 'power of 3' and process

The City Council voted on Aug. 4 to ratify a limited engagement with Hyde Kelly LLP to provide independent legal ethics counsel to the city, with a not‑to‑exceed fee cap of $50,000.

Council debate focused less on Hyde Kelly’s qualifications than on process. Councilwoman Lupe Gonzalez (speaker 2), who had asked to move the item from consent, said she requested the public discussion to ensure transparency. Other councilmembers criticized the use of a so‑called “power of 3” to move items and expressed concern that the city should have used an RFQ or otherwise documented the selection process. Councilwoman Villafranca (speaker 4) and others called the process a “shadow government.”

City Manager (speaker 10) explained staff identified three firms for limited engagement — Knight, Sheets & Crossfield, and Hyde Kelly — and selected Hyde Kelly based on municipal ethics and independent‑investigation experience; he described $50,000 as an administrative cap to limit exposure rather than an estimated total cost. George Hyde, a partner with Hyde Kelly LLP, addressed council about his municipal and ethics experience and said the firm would provide objective recommendations. “I’m here to provide you with specific, non‑biased, non‑connected legal advice,” Hyde said.

A motion to table the contract to a future study session failed. Councilman Reid (speaker 7) moved to approve Resolution 2026‑107; a council member seconded and the motion passed on the record. The approved resolution ratifies the engagement, limits the city’s financial exposure to $50,000, and directs staff to work with the firm under the defined scope. Council then voted to recess to executive session to receive legal advice under Texas Government Code §551.071.