A school foundation holding somewhere between $200 million and $250 million in assets — one of the largest of its kind at any public school district in the country — spent more than 11 hours under a legislative microscope on August 26 as Texas state lawmakers pressed Barbers Hill ISD leaders on where the money came from, where it went, and who benefited along the way.
The hearing, convened by the Texas House Select Committee on Governmental Oversight and chaired by Representative Cody Vasut, examined transparency and conflict-of-interest questions tied to school district education foundations statewide, according to The Texas Dispatch. As ABC13 Houston reported, lawmakers grilled witnesses about the Barbers Hill Education Foundation's spending and its relationship with the school district that created it. Mandy Drogin, a Texas Public Policy Foundation fellow, testified that roughly $97.1 million moved from Barbers Hill ISD to the foundation between January 2012 and June 2025, while the foundation returned only about $6.5 million to the district between June 2010 and October 2025.
How the Money Got There
That $97.1 million was generated primarily through supplemental payments tied to Texas's former Chapter 313 economic development program, which let school boards route corporate tax-break payments into private foundations instead of district revenue, according to reporting from Texas Scorecard. Drogin told the committee she still has questions about what happened to the money once it reached the foundation and who ultimately benefited from the arrangement, per ABC13's account of the hearing.
Superintendent Greg Poole, who also serves as the foundation's Executive Director, defended the arrangement to lawmakers, saying the foundation is following the law and that allegations against it lack evidence, according to ABC13. Poole reports working eight hours per week managing the nonprofit on its IRS Form 990 filings, separate from the $489,143 salary he draws as superintendent, Texas Scorecard reported. He framed the foundation's asset strategy as a deliberate move to build an alternative financial reserve — one that generated over $100 million in returns while keeping local property tax rates flat for 20 years, even as the district sent nearly $300 million to the state under recapture, according to The Texas Dispatch.
Land Deals and Overlapping Board Seats
Much of the scrutiny centers on how the foundation has deployed its capital locally. In 2023, the foundation entered a 50% joint venture worth more than $5.3 million with private developer Americus Holdings to build the Brickyard Apartments, a 336-unit luxury complex in Mont Belvieu, after purchasing $6.4 million in land from Americus in 2024, according to the Texas Public Policy Foundation.
The foundation's board includes Poole, three active Barbers Hill ISD trustees, the district's assistant superintendent of finance, and Nathan Watkins, a vice president at Americus Holdings, according to Texas Scorecard. That overlap — a public school district's leadership sitting alongside a private developer's executive on the same nonprofit board that does business with that developer — is what state lawmakers and policy researchers say raises conflict-of-interest concerns and undermines transparency expectations for public education funding.
A district representative told ABC13 that the foundation's transactions were legal and approved by the Comptroller of Texas, that the foundation uses the same audit firm as the school district, and that it has received clean audits every year of its existence.
An Active State Investigation and a Defamation Fight
The Texas Education Agency opened a formal investigation into Barbers Hill ISD in February 2026 to evaluate allegations of statutory noncompliance involving fiscal practices, governance oversight, public-funds management, and potential electioneering, Texas Scorecard reported. That inquiry remains active alongside the legislative committee's work.
The foundation also sued State Representative Terri Leo Wilson for defamation in February 2026 after she publicly criticized its real estate dealings with board member Nathan Watkins. Leo Wilson appealed to the Fourteenth Court of Appeals in June 2026 seeking attorney fee reimbursement under Texas's Anti-SLAPP law after the foundation attempted to nonsuit the case, per Texas Scorecard's reporting.
What Lawmakers Might Do Next
During the hearing, State Representative Mitch Little proposed that the Legislature consider statutory changes in its 2027 session to eliminate school districts' ability to redirect tax-break supplemental payments into private foundations altogether, according to Texas Scorecard. That proposal would directly target the Chapter 313 mechanism that built the Barbers Hill foundation's fortune in the first place.
Barbers Hill ISD and Superintendent Poole are no strangers to legal scrutiny; a hair-length policy case against the district also drew national attention in 2024. Whether the foundation's arrangement survives the current wave of state scrutiny may hinge on what lawmakers decide to do with Chapter 313's legacy when the Legislature reconvenes in 2027.
