Will Race Determine How Mike Hubbard Is Treated Over Apparent Violations of Alabama Bid Law?

Mike Hubbard

A violation of the Alabama Competitive Bid Law can be a crime--and recent history indicates it is treated that way when the alleged violators are from a predominantly black, Democratic county.

But what happens when an apparent violator is a white Republican, with powerful ties to former Governor Bob Riley and his political machine? More specifically, what happens when the apparent violator is Alabama House Speaker Mike Hubbard (R-Auburn)?

We might soon find out, in the wake of a report last week that Hubbard rigged the bid-law process to obtain a multimillion-dollar media contract with Auburn University. Buddy Mitchell, a former lobbyist for Auburn, says in a sworn statement that Hubbard received copies of competitors' proposals before winning a five-year multimedia contract for Auburn athletics in 2002. In fact, Mitchell states in an affidavit that he personally delivered competitors' proposals to Hubbard, and that allowed Hubbard to tailor his bid in order to win the contract. It's all in a report by Bill Britt of Alabama Political Reporter.

Mitchell was director of governmental affairs at Auburn from 1993 to 2004, and Hubbard worked in the university's sports-information department before joining Host Communications in 1990. Hubbard proceeded to wrestle the contract away from Host via a no-bid contract and formed the Auburn Network in 1994. By the early 2000s, Hubbard's company reportedly was struggling financially when he approached Mitchell for help after Auburn forced him to go through a competitive-bid process. Here is how Britt describes what happened next:

Mitchell said Hubbard first acknowledged to him that his company was on the verge of going bankrupt.

Initially, forced by Auburn to go through a competitive bid process for the first time, according to Mitchell’s statements, Hubbard was given access to all of his competitors'  proprietary proposals prior to making his winning offer for the contract.

For years, it was speculated that Hubbard was given an unfair advantage in obtaining the Auburn contract. Mitchell, who was executive director of the Office of Governmental Affairs at Auburn from 1993 to 2004, said in a sworn affidavit that he personally delivered the competitors’ proposals to Hubbard.

If Mitchell's allegations are proven to be true, it's hard to imagine a more grotesque violation of the Alabama Competitive Bid Law. Attorney General Luther Strange--like Hubbard, a devout member of Team Riley--has proven that he treats the bid law seriously. In May 2011, all five members of the Bullock County Commission were arrested on felony charges of bid-law violations.

We reported on the Bullock County story and noted the political and socioeconomic climate surrounding the case:

The inquiry into Bullock County's finances started under the Riley administration, with Strange following through now on arrests. Is this payback for some slight that Riley perceived coming from Bullock County during his administration? Could this be part of a larger GOP plan to continue terrorizing Democrats in the Deep South?

To arrive at possible answers to those questions, it helps to understand the demographics of Bullock County. The county is 74.9 percent black, with a median household income of $24,440, well below the state average of $40,489. In the 2008 presidential election, Bullock County gave 74.2 percent of its vote to Barack Obama, with 25.7 percent to John McCain.

Bullock belongs to a strip of counties that starts to the northwest of Montgomery and runs to the capital city's southeast, representing what passes for a Democratic stronghold in Alabama.

Was the public trust grossly violated in the Bullock County case? Well, the five commissioners, combined, were alleged to have paid $85,000 for food and supplies without following the state bid law. That means each commissioner was responsible for roughly $17,000 worth of bid-law violations, although it's unclear that any of the commissioners personally benefited. Even Luther Strange must have realized the case was weak because he announced in February 2012 that he was dropping all charges.

Let's compare that to the case of Mike Hubbard. Here is how Bill Britt describes it:

In accepting Hubbard’s five-year, $8.5 million deal in 2002, Auburn, in turn, rejected a competitor’s bid that offered $12.5 million over the same period. That meant Auburn received $4 million less under Hubbard’s proposal than under the bid more financially beneficial to Auburn.

Translation: Hubbard "won" an $8.5-million contract that he probably would not have received without being able to tailor his proposal, based on under-the-table information about competitors' bids. On top of that, a taxpayer-funded university wound up paying $4 million more than it should have paid. If our math is correct, that's about $12.5-million worth of graft and corruption, courtesy of a public official who went on to chair the Alabama Republican Party and then become speaker of the House.

Is Mike Hubbard likely to face criminal charges of the sort that were brought against Bullock County officials? We think it's doubtful, based on a number of political and legal considerations. For one, it's hard to imagine our Republican-dominated power structure treating one of Bob Riley's favored sons the way it treated the commissioners in Bullock County. Perhaps of more importance, the applicable statute of limitations on a 2002 transaction probably has expired, which would block a criminal case as untimely.

It's possible that Hubbard is not out of the criminal woods. The five-year deal with Auburn extended through 2007, so that might bring the applicable statute of limitations back into play. Could a crafty prosecutor make the case that Hubbard has engaged in ongoing criminal activity that grew out of the 2002 deal, extending the statute of limitations? Well, Hubbard sold the Auburn Network to International Sports Properties (ISP) in 2003, but he continued as president of ISP's Auburn sports project. IMG College purchased ISP in 2010, so the Auburn Sports Network now operates under the IMG College banner. The Auburn Sports Network still has its contract with the university, so one could argue that the firm continues to benefit from Hubbard's apparent fraud on the 2002 deal.

If Hubbard used the the U.S. mails or wires while rigging the bid process--and he almost certainly did--that might invoke federal jurisdiction. And Hubbard's actions appear to go well beyond bid-law violations to outright fraud.

All of this includes an ironic twist in the volatile world of sports media. Host Communications, which probably would have won the bid in 2002 without Hubbard's apparent fraud, also has been bought by IMG. Host Communications probably is just now finding out about the fraud-riddled bid process in 2002, so it likely would have a valid civil claim against Hubbard. But with Host and the Auburn Network now both under the IMG banner, would such a claim make sense? Could IMG/Host go after Hubbard individually in a lawsuit?

The answers to those questions are unclear, but we suspect Hubbard's biggest concern should be on the civil side, rather than criminal. Auburn University might have the strongest grounds for a lawsuit, and who knows what the wide-ranging discovery process in such a civil claim would reveal about Mike Hubbard's business and political practices?

Paul Davis, the late owner and president of The Tuskegee News, wrote an article in 2010 that outlined Hubbard's machinations on the Auburn contract from 2002. The Davis article references an "emissary" who delivered copies of competitors' proposals to Hubbard. Thanks to Bill Britt's reporting, we now know the emissary was Buddy Mitchell--and Mitchell has admitted to his role in a sworn statement.

Regardless of what happens to Hubbard in a court of law, Alabamians should consider the words in Buddy Mitchell's affidavit and ask this question: What kind of man is leading our House of Representatives--and what kind of tactics did he use to reach that position?