City Attorney’s Email Sparks Controversy
City Attorney alleges fraud, stating that council members knew about the allegations but still approved the $2 million hotel incentive. The message, sent September 19 to the mayor and city officials, was shared with the media by at-large Councilman Roland Barrera. As City Attorney alleges fraud in the approval process, questions continue to rise about how the decision moved forward despite the warning signs.
Altered FEMA Screenshot at Center of Allegation
According to the email from Miles Risley, the city attorney, the developer for the Homewood Suites by Hilton allegedly manipulated a screenshot of a FEMA webpage and then presented that altered version to the Type B Corporation board. “On April 16, 2024, in executive session, with the entire City Council present, the City Manager and I showed … that documents in the developer’s application appeared to be altered,” Risley wrote.
Furthermore, Risley contends that the applicant altered the document to conceal prior knowledge of upcoming FEMA floodplain changes. Specifically, the developer’s screenshot omitted the date and release number from a FEMA news release that had announced the finalized maps on April 13, 2022. In contrast, the authentic version—cited in Risley’s attached presentation—clearly displayed the official release details, highlighting the discrepancy between the two.
Legal Fight Erupts Over Knowledge and Intent
Those allegations lie at the core of a lawsuit filed by a competing developer, Ajit David, who argues that the City Council approved the incentive even after being informed of intentional alterations. Consequently, a jury will hear the case on January 20, 2026.
Meanwhile, in July 2025, Elevate QOF LLC—the hotel developer—firmly denied any wrongdoing. Furthermore, their legal representatives claim the lawsuit is a deliberate and strategic attempt to derail the project and undermine its progress.
Timeline: Meetings, Votes, and Changes
- April 13, 2022: FEMA finalizes new flood maps for Nueces County.
- February 2023: Developers meet city staff and redesign plans to comply with FEMA.
- September 27, 2023: Elevate QOF LLC submits tax incentive application to Type B Corp.
- December 11, 2023: Type B board approves the incentive request.
- February 20, 2024: City Council votes 7-1 (one abstention) on first reading.
- February 27, 2024: City officials delayed the second reading amid internal concern.
- April 16, 2024: City Manager and attorney present alleged alterations in executive session.
- April 23, 2024: Council approves the incentive on second reading (5-3 vote), removing references to FEMA requirements.
- Aug. 2024: Auditor’s office initiates an investigation.
- August 2025: The auditor recommends an independent external review.
- August 27, 2025: Elevate files a petition to intervene, defending the council’s ordinance.
- September 9, 2025: Council refers the matter to outside counsel; key council members abstain.
- September 23, 2025: City approves $444,000 for legal defense in the lawsuit.
Council Members React Differently
The email provoked a stir among council members, many of whom pressed for clarity on who knew what—and when. Some critics argue that city officials never fully informed the councilors. In his defense, Mayor Paulette Guajardo maintained that no expert had confirmed in litigation that fraud occurred.
Barrera, who supported the incentive, said he repeatedly asked city officials whether they had broken any laws, and they assured him they had not. He insists he would have acted differently had he known of any misconduct.
Other councilors—such as Gil Hernandez, Sylvia Campos, and Eric Cantu—now advocate for an outside investigation, citing potential misconduct. Hernandez, who voted for the project in its first reading but abstained later, supported bringing in a third party to assess civil or criminal fraud independently.
Yet at-large Councilman Mark Scott objected to hiring outside counsel. He preferred that local police first evaluate the allegations. Scott said the city attorney’s email clarified events to keep both new and former council members informed.
Looking Ahead
As depositions continue in the civil suit, calls for transparency will only intensify. The public deserves to know whether municipal leaders fully understood potential irregularities—or ignored clear warnings. With the jury trial just months away, this controversy could reshape how city incentives are vetted in Corpus Christi and beyond.