This article is from Cal-Tax Digest, published
by the California Taxpayers' Association.
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Spending Tax Dollars

(Editor's Note: Following are examples of how taxpayer dollars are spent, or misspent. Generally, these cases are based on newspaper reports. In an effort to provide balance, since the news media usually focuses on government waste, cases of government efficiency were solicited from and provided by the League of California Cities.)

Wasting School Bond Money. If this were a national contest for wasted tax dollars, the hands-down winner quite likely would be the Los Angeles Unified School District's Belmont Learning Center. At $200 million, it would be the most expensive high school ever built. It is being called a public works nightmare, garnering front-page headlines in national newspapers. The district's internal audit, issued September 14, found "rudderless" district policies to blame, along with incompetence and possible violations of law. Construction was well under way when toxic hazards (the 35-acre downtown Los Angeles site is a former oil and gas field) were reported. Investigators said nine district employees should be disciplined or fired. They called for legal action against five contractors. The probe was directed by the district's new chief investigator, Don Mullinax, a former U.S. Senate investigator. One troubling conclusion, he said, was that his team of former FBI agents was unable to determine precisely who to blame. "The people we interviewed (who) we thought maybe should have been in charge said they weren't. No one was ever held responsible or accountable for their actions." Coverage by The Daily News of Los Angeles: The "scandal is symptomatic of a pervasive culture of lying, finger-pointing, power games, disregard for the law and wholesale shirking of responsibility that permeates top management of the nation's second-largest school district." The Associated Press: "Incompetence and possible school board violations of law led to construction of ... the nation's costliest high school atop an oil field plagued by explosive methane gas, investigators said." The Los Angeles Times: The Mullinax report called for "a sweeping housecleaning" of the school district's senior business staff for "failure to supervise construction of the environmentally plagued" Belmont project.

More Belmont. Fingers also pointed toward Sacramento, with the Mullinax report alleging that state Department of Education officials violated state law by approving state school construction bond funds to acquire the site and for failing to set appropriate standards to protect public health and safety in choosing school sites. Disagreeing with some findings, Duwayne Brooks, director of facilities planning for the state department, said steps have been taken to "tighten up the process." He said Belmont was approved on a conditional basis calling for local district officials to submit environmental analyses to the State Department of Toxic Substances Control. "We do not believe we were remiss in our responsibilities," he said. "The problem is there was no state agency responsible for monitoring the district's actions and make sure they did what they were supposed to do." Legislation pending on the governor's desk would require rigorous and stringent state review of proposed school construction sites.

More Belmont Followup. As reported by The Daily News, the school district, to gain public support for the Belmont project, hid key costs from the "guaranteed price" of $85.8 million. That's the pricetag used by district officials in 1997 when the school board narrowly approved the cost of a mixed-use complex downtown featuring a high school with classrooms for 5,000 students, a minimall with shops, parkland and low-income housing. The housing project was dropped early and the district has found no retailers willing to be mall tenants. The eventual cost now appears to be more than double that guaranteed maximum cost, the newspaper reported. The project, now slightly more than half complete, has resulted in bills for construction alone that total at least $103 million. The final cost, should the district decide to complete the project, will likely surpass $200 million when environmental mitigation, construction delays and consultant fees are added. Where'd the money go? Mr. Mullinax and his district Internal Audit and Special Investigations Unit plan to review project finances over the next two months.

Still More Belmont. Mayor Richard Riordan, who supported a reform slate of school board members elected earlier this year, said, "This should be a wake-up call to those who would protect the status quo. The findings of this report symbolize the dysfunctional, Byzantine culture that exists at the school district." The Daily News has reported how an architect, Ernesto M. Vasquez, parlayed a $110,000 consultant's fee into a nearly $6 million deal for his firm to design the center. Conflict-of-interest questions were raised by the district's internal investigation, as Mr. Vasquez and his firm worked for the district and the eventual winning developer at the same time. School Board Member David Tokofsky: "I'd say the architect hit the jackpot. The architect kept drawing and since we were playing with this new concept of a joint-use high school and retail complex, no one was really paying attention." The school board, meanwhile, is waiting for a report from an advisory commission of eight members, led by former District Attorney Ira Reiner. This report is due in late October. There also have been calls for a county grand jury investigation.

Carlsbad's "Miracle" School. Pacific Rim Elementary School in Carlsbad is being called the "miracle school" by administrators, according to a September 16 article in the San Diego Union-Tribune. This school for more than 500 kids took only 11 months to build and somehow defied inflation. It cost $7.5 million, which is $2.7 million less than the last elementary school built in Carlsbad. That was nine years ago. It was also noted that the school has received donations from the business community that include a computerized weather station from Pacific Bell and developers Greystone and Lenar, student handbooks and homework planners from Shea Homes, money from Wal-Mart for a school garden, a savings account free of service charges, including $1 donated for every new account opened for every student, from the local branch of Washington Mutual Bank, and computers from Kids Are Worth a Million, Carlsbad's education foundation.

San Francisco's Poorly Designed Library. San Francisco's $137.5 million library, only three years old, has problems that could cost millions of dollars to fix, according to a $240,000 study commissioned by the city. Armed with a draft of the report, the San Francisco Chronicle reported August 27 that the building has run out of shelf space for more books. Also, the open-space design confuses many visitors who find it hard to understand that to go upstairs they have to first go downstairs. The report by a team of architects, engineers and librarians says that while the library has proven to be a popular site, with 5,700 daily visitors, many "are baffled as to how to proceed once they enter the building." The report concludes, "Our findings are that the library, while designed to be a grand public space, does not function as effectively as it should or as effectively as peer institutions do in several major aspects." It says "critical library functions are poorly arranged and do not function well." Library Commission President Ernest Llorente said he was saddened by the report and that solutions will cost millions of dollars.

To Fax a Thief. That's how the Escondido Police Department, through use of computer software and a multi-fax carrier, has been making this city in northern San Diego County less-lucrative environment for counterfeiters, short-change artists, and users of stolen checks and credit cards. The pilot program, begun in 1996, is called "Faxnet." Initially, businesses were charged a nominal fee to cover costs of the project. This year, Escondido is overhauling the system and providing free and improved service to a master fax list of nearly 5,000 businesses. Besides providing timely information about crimes and scams, the service eventually will include missing persons information and make the transition to e-mail for even more timely alerts to the business community. For more information, contact Police Sergeant Holly Merkel at (760) 839-4947.

Helping Protect Domestic Violence Victims. The San Carlos Police Department and Cellular One have teamed up to confront increased concern over domestic violence-related calls. Cellular phones and air time are provided at-risk citizens with preprogrammed emergency numbers that can be dialed with the push of a button. The "Domestic Violence Victim Cellular Telephone Loan Program" has been well-received by the community and the news media, as well as domestic violence support groups and the San Mateo County District Attorney's Office Domestic Violence Unit. Fiscally speaking, the program was developed in a manner that costs the department, and taxpayers, virtually nothing. Contact Police Sergeant Doug Eccles at (650) 802-4232.

Vallejo Sets Pace for On-line Business Development. Many cities have on-line economic development information, but Vallejo is doing much more with its geographic information system Internet program. It recently won a first-place Interactive Internet Application award from the Environmental Systems Research Institute. Vallejo uses technology to identify and pursue unmet retail business opportunities for apparel, footwear, sporting goods, coffee shops and home electronics. Business-minded users can identify potential building sites, view interactive maps, create demographic reports for any location in the city, and analyze businesses by geographic location. Contact: Anatalio Ubalde, project manager, at (707) 648-4444.