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Recent Examples of Government Waste, Fraud and Mismanagement

Education

  • Your Proposition 98 Dollars at Work: San Jose Community College Chancellor Gets Huge Benefits as Class Offerings Shrink. As taxpayers know all too well, education funding doesn't always make it into the classroom. The San Jose Mercury News reports that Rosa Perez, the outgoing chancellor of the San Jose/Evergreen Community College District, has enjoyed a 48 percent pay hike in just four years, and currently receives $293,000 per year, plus a $147,000 bonus for staying on the job for four years.

    That's not all. The paper, citing documents uncovered by KGO-TV, reported: "She also has charged the district and its foundation for lavish perks that included overnight stays at San Jose's luxury Fairmont Hotel, a tour of El Salvador, and airfare to Scotland. Perez's partner, Bayinaah Jones, a district administrator hired two months after Perez, has seen her salary climb 35 percent to $122,688."

    The Mercury News noted that the chancellor's spending was "in contrast to the modest goals of the community college system." For about $800, a student can earn a certificate in cosmetology or dental hygiene. Ms. Perez, however, spent twice that much in district money at the Bombay Company to furnish an office in her Bernal Heights home in San Francisco. (Cal-Tax: Ms. Perez lives in San Francisco and oversees a college in San Jose – and she billed the taxpayers for overnight stays in San Jose? Seriously?)

    She also spent $3,700 in district funds for a painting – now hanging near the Evergreen Valley College student center – showing Latinos in a crowded boat, using the American flag as a knapsack.

    While the administrative spending was increasing, budget cuts forced the cancellation of 18 classes at Evergreen and 20 classes at San Jose City College. Funding was cut for programs for disabled students, low-income students and working parents.

    Ms. Perez recently announced that she will be retiring soon for health reasons. The community college district said it has hired an outside investigator to review Ms. Perez's spending. The district board's September response to a grand jury report on the questionable spending indicates that taxpayers shouldn't expect much action even after the investigation. In its rebuttal to the grand jury report, the board wrote: "The Board of Trustees has reviewed the employment agreement with its chancellor and sees no areas where reductions are appropriate." (Source: San Jose Mercury News, November 23.)

  • Pasadena School District Squanders $15,000 on Parcel Tax Blunder. After narrowly winning voter approval for a new parcel tax, the South Pasadena Unified School District immediately wasted some of the revenue by failing to fill out the necessary paperwork to have the tax included on the property tax bills sent out by the county tax collector. The blunder necessitated an extra mailing that will cost taxpayers $15,000.

    The Los Angeles Times reported: "The school district forgot to submit to the county assessor's office the paperwork for the voter-approved assessment and the new tax of up to $288 for homeowners. The mistake wasn't discovered until the county bills were mailed about a month ago."

    If the district had submitted its paperwork in time, the county would have charged $1,500 to collect the exaction via its annual property tax bills. Instead, the district is paying $15,000 from its general fund to hire a private company to send out a parcel tax bill.

    The district also will have to absorb the cost of staff time to collect the money. This could be a significant amount of time, as the parcel tax mailing is generating a number of phone calls from people who aren't accustomed to receiving multiple tax bills for their property, and who don't recognize the letterhead of the private firm that is sending out the supplemental bills. The district's error could have a major impact on tax compliance.

    School board President Elisabeth Eilers did not take responsibility for the mistake, but rather blamed it on turnover of key personnel. "This happened at a time when we were going through a lot of changes at the district," she told the Times.

    The tax is expected to cost property owners approximately $1.8 million per year. (Source: Los Angeles Times, November 27.)

  • Fresno School District Misspent $1.3 Million in Tobacco Tax Money. Schools in the Fresno Unified School District misspent $1.3 million in tobacco tax revenues intended to help young children under the First 5 Program, an auditor found. An auditing firm hired by First 5 Fresno County found major violations at five elementary schools. Money intended to help young children get ready for school instead was spent on cameras, computers and employee trips to Napa and Washington, D.C.

    Specific findings of the audit:

    • Greenberg Elementary didn't provide attendance records to justify its expenses, and used money for unapproved expenses including $1,700 for computer equipment and $650 for an office chair. All of the school's program expenses, totaling $532,525 were disallowed.

    • Addams Elementary had $377,168 in disallowed expenses, including $587 paid to Hungry Howie's Pizza and Party City for a "family fair" that was not supported by documentation of who attended.

    • Lowell Elementary had $266,639 in disallowed expenses, including $1,500 in travel costs for a part-time clerical worker and $5,235 for umbrellas and umbrella stands.

    • Mayfair Elementary had $58,579 in disallowed expenses, including $3,500 for travel costs for employees who were not eligible to have their travel expenses paid by First 5.

    • Homan Elementary had $51,843 in disallowed expenses, including $6,000 for equipment.

    First 5 Fresno County deducted the disputed expenses from contract payments to Fresno Unified this year. (Source: Fresno Bee, November 29.)

  • Auditor Says State Agency Lacks Controls to Prevent Misuse of Federal Funds. The title of the state auditor's latest report pretty much tells the entire story: "California Energy Resources Conservation and Development Commission: It Is Not Fully Prepared to Award and Monitor Millions in Recovery Act Funds and Lacks Controls to Prevent Their Misuse."

    The auditor examined how the state plans to use taxpayer dollars from the federal American Recovery and Reinvestment Act of 2009, enacted in February. The money is supposed to go toward purposes that include preserving and creating jobs, promoting economic recovery and assisting those most affected by the recession. "One general principle of the Recovery Act is that the funds be used to achieve its purposes as quickly as possible consistent with prudent management," the auditor noted.

    The Recovery Act designated $3.1 billion for the State Energy Program, and California was awarded $226 million of that total. This money was awarded to the California Energy Resources Conservation and Development Commission.

    Auditors reviewed the commission's readiness to administer the Recovery Act funds, and reported back with these troubling findings:

    • The energy commission has made little progress in implementing its subprograms, and none of the Recovery Act funds are currently being used to provide benefits to Californians.

    • The energy commission has approved the use of $51 million for Energy Program services, and of this amount has entered into contracts totaling about $40 million; however, none of the $40 million has been spent.

    • Although it began applying for Recovery Act funds in March 2009, the energy commission has not yet implemented a system of internal controls adequate to ensure that those funds are used appropriately.

    • The state is at risk of either having the funds redirected by the U.S. Department of Energy or awarding them in a compressed period of time without first establishing an adequate system of internal controls, which increases the risk that Recovery Act funds will be misused. (Source: California State Auditor Report 2009-119.1, December 1.)

  • CSU Puts Out Misleading Figures on Effect of Federal Stimulus. California State University officials have been caught providing misleading numbers to the federal government on the effect of federal stimulus dollars on the sprawling multi-campus system.

    According to an investigation by The Sacramento Bee, up to one-fourth of the total 110,000 jobs reported saved by stimulus dollars in California never were in danger. CSU reported that the money saved 26,156 jobs – one-half of CSU's statewide work force, and more than the number of jobs saved in Texas and 44 other states.

    On November 5, CSU admitted that half of that total were not going to be laid off if the stimulus dollars hadn't arrived. CSU spokeswoman Clara Potes-Fellow said: "This is not really a real number of people. It's like a budget number."

    The University of California received $717 million in stimulus dollars – three times the amount of stimulus dollars received by CSU – but reported only about 8,400 jobs saved. (Source: The Sacramento Bee, November 6.)

  • Dead-Head Archivist Wanted for "Dead Central" at UC Santa Cruz Library. The University of California at Santa Cruz is listing a job opening for an associate librarian to be part of a "dynamic, collegial and highly motivated department" dedicated to the newly acquired Grateful Dead archives. The actual archive on the band's life and times will be housed at "Dead Central," a dedicated area in the newly renovated McHenry Library at UC Santa Cruz.

    The Grateful Dead archivist will be paid $52,860 to $68,892 per year, plus fringe benefits. Some of the proposed duties include: managing "Dead Central's open access hours" and Dead Central exhibitions, as well as "maintaining Grateful Dead Archive Blog and Facebook accounts." To qualify for the position, archivists must have expert knowledge in the history and influence of the Grateful Dead, as well as excellent analytical, organization, time management, oral, written and interpersonal communication skills. Also, an eligible archivist must have a master's degree from an accredited graduate archives management program.

    The archive includes stage backdrops, shirts, business records, flyers, posters, fan mail and other materials from the Grateful Dead's glory years. Guitarist Bob Weir will initiate a fundraising effort to help support the archive's costs. (Sources: Jon Stewart's Daily Show, November 11; UC Santa Cruz Archivist for Grateful Dead Archive, accessed November 12; UC Santa Cruz Press Release, April 24.)

  • Placer County Spends More Than $1 Million on Buyouts. Placer County has spent more than $1 million in the past four years on severance packages for local government and school officials.

    The severance deals started in 2005, with a $500,000 payout that the Sierra College board agreed to give departing President Kevin Ramirez, the Placer Herald reported. Recently, Roseville City Manager Craig Robinson was given $390,000 as his parting gift, while Auburn Recreation District Administrator Alain Grenier was given $118,000 on his way out the door in 2006. Colfax Elementary School District Superintendent John Ray received a severance package worth an estimated $73,000 this year. (Source: Placer Herald, November 10.)

  • San Diego State Athletic Director Accused of Charging Taxpayers for Personal Travel. San Diego State University officials have announced that they are investigating the travel expense records of Athletic Director Jeff Schemmel to determine whether there is any truth to allegations that he charged taxpayers for personal travel.

    Very personal travel, at that. The allegations were made by an Alabama man who is suing to get Mr. Schemmel's travel records as part of a divorce proceeding. The Alabama man said his wife was having an affair with Mr. Schemmel. His wife testified under oath in a deposition that she met Mr. Schemmel for several sexual trysts in Dallas-Fort Worth, and in Point Clear, Alabama, and that Mr. Schemmel had no other business in Alabama except to see her. Still, a hotel bill for $814 was paid with a credit card that lists Mr. Schemmel and San Diego State University as the cardholders, with the university's address as the billing address. (Source: San Diego Union-Tribune, November 7.)

  • UC Davis Has More Staff Than Students. The headline in The Sacramento Bee read, "Another UCD employee accused of public funds misuse," and the October 20 story discussed how three employees of the University of California at Davis have been accused of fiscal wrongdoing including embezzling $38,000, billing the taxpayers for $1,300 for meetings that were not attended, and misspending $175,000 in grants intended to help abused children.

    But the real story is found in a quote from Robert Loessberg-Zahl, the university's assistant executive vice chancellor, who said: "This is a campus of 30,000 employees and we're talking about three employees. … The vast majority of our employees do their jobs honestly and competently and serve the university and the people of California very well."

    If Mr. Loessberg-Zahl's figure is correct, UC Davis has more staff than registered students. A publication on the UC Davis website lists the student population for the spring 2009 quarter at 29,311. To be fair, the school also runs a hospital, which requires significant staffing. (Sources: The Sacramento Bee, October 20; "UC Davis Student Population Headcount," Spring 2009.)

  • Does Education Bureaucracy Grow on Trees? Parents who planted four semi-dwarf apple trees along the west wall of the Robert H. Down Elementary School in Pacific Grove on October 25 have been told by a district bureaucrat to dig up the trees.

    Assistant Superintendent Robin Blakley said the problem is that the trees were planted without going through proper channels. He said that the sooner the trees are removed, the better. He wants the trees removed before the next meeting of the Pacific Grove Unified School Board.

    Asked if fruit trees would teach something valuable, Mr. Blakley said, "Theoretically, that's a possibility." Parents are protesting Mr. Blakley's edict to the school and to members of the school board. After a meeting on October 30, all parties agreed to keep the trees in place until the school board can decide the issue on November 12. (Cal-Tax: Mr. Blakley's action will contribute to global warming, as trees remove carbon dioxide from the air. Perhaps CARB should investigate!) (Source: Monterey County Herald, October 28 and October 30.)

  • School Board Considers Hiring Spokesperson to Talk About Budget Problems. The Santa Monica-Malibu Unified School District is considering hiring a spokesperson to improve its ability to tell the public about its budget problems. The proposed "director of communication, accountability and community engagement" is needed to "communicate to our community the many issues we are facing," said Superintendent Tim Cuneo. He noted that the position was recommended by a consultant hired by the district to audit the district's communications practices.

    The superintendent also mentioned that a spokesperson also would be used to discuss a potential parcel tax that would fund the district. (Cal-Tax: We suspect that this type of taxpayer-funded campaign work might be the first thing put on the spokesperson's plate.)

    The position would be funded in part by money from bonds approved by voters to improve school facilities.

    Reaction to Mr. Cuneo's suggestion was mixed, and the board directed its president and vice president to meet with Mr. Cuneo to discuss the idea further before bringing it back to the full board. (Source: Santa Monica Mirror, October 22-28.)

  • School District Overspends by $16.6 Million in a Matter of Months. San Diego Unified School District leaders announced October 20 that the district already has run up $16.6 million in unplanned expenses for the school year that just began. The costs included hiring extra teachers ($3.2 million), hiring a consultant ($63,000) and adding funding for a position that was left out of the initial budget process ($120,000). (Source: VoiceofSanDiego.com, October 22.)

  • San Francisco School Board Leader Uses District Credit Card for Shoes, Travel and More. The San Francisco Chronicle revealed that a school leader has been using her taxpayer-funded credit card for a wide variety of personal uses.

    The newspaper reported: "As San Francisco schools have cut budgets to the bone, the city's school board president used her district-issued credit card to charge thousands of dollars for personal items and thousands more at city restaurants and cafes, according to a Chronicle analysis of financial records. Board President Kim-Shree Maufas charged $4,300 on the district's Diners Club card for a wide range of personal purchases. They included more than $2,000 for a cultural exchange trip to China, $196 for tickets to the Florida Epcot theme park, $40 for black Crocs, a $125 car battery and a $162 car windshield, $160 in U.S. passport processing fees, a $37 medical visit in Los Angeles and $3 for Apple iTunes."

    Additionally, Ms. Maufas charged $3,000 on the district's Diner's Club for food and beverages to conduct meetings across San Francisco, although the people with whom she met and specific district purposes typically were not divulged. "The records showed that she was often a big tipper with taxpayer funds," the paper reported. "In more than 40 instances, a taxi or restaurant tip exceeded 20 percent of the final bill."

    Ms. Maufas reimbursed the district in four payments over several months for the personal expenses, even as she continued to charge personal gas, food, parking and other items to the Diner's Club card. Her repayments did not include interest. (Source: San Francisco Chronicle, October 4.)

  • UC Davis Treatment Center Falsifies Progress, Mismanages $175,000. Internal audits of a University of California at Davis center responsible for treating abused and neglected children show that the center falsified program progress and mismanaged money, The Sacramento Bee reported.

    The audits were released in response to a whistleblower suit filed by Kristen Rogers, an assistant pediatrics professor. She originally filed complaints with UC officials, but said that rather than address her concerns, officials retaliated against her.

    Ms. Rogers' lawsuit states that Marilyn Peterson, a longtime director of the UC Davis Child and Adolescent Abuse Resource Evaluation Diagnostic and Treatment Center, obtained federal grants to develop courses teaching medical practitioners how to properly conduct child sexual abuse exams. Ms. Rogers discovered that the director's report on the progress of her program contained false information, and improperly charged $175,000.

    After the whistleblower lawsuit was filed, Ms. Peterson allegedly cut Ms. Rogers' pay and violated UC policy by identifying her as the whistleblower. (Source: The Sacramento Bee, October 8.)

  • Community College Employee Suspended For Whistle-Blowing. Peralta Community College District Trustees voted 6-1 Tuesday to suspend a district employee for providing the media with embarrassing information requested under the Public Records Act earlier this summer.

    The information provided the Bay Area News Group and the Contra Costa Times to investigate questionable district management decisions, which included accepting a no-bid contract to Mark Lindquist, a longtime business partner of the district's chancellor.

    Jennifer Lenahan, the employee suspended, was the executive assistant to Vice Chancellor Tom Smith. In addition to suspending Lenahan for two weeks without pay, the Trustees requested that Lenahan be moved to another position. Upon receiving the Public Records request, Lenahan compiled a list of payments that had been sent to Lindquist. She was ordered not to give the list to the media.

    In response, district officials noted: "We don't create documents for [reporters]. He did not ask for that. We only give him what he asks for."

    The Trustee's decision was the result of Lenahan providing the media with "sensitive and confidential" information, and that such a "decision to manufacture a document that would reflect negatively on the chancellor and the district is not acceptable," the Trustees wrote in their decision. (Source: The Contra Costa Times, September 28-30.)

  • UC Berkeley Spends $3 million to Learn how to Stop Spending. UC Berkeley will be spending $3 million plus expenses to have Bain & Co. tell the university how to reduce its spending. Earlier this year, the UC campus had to make $150 million in budget cuts, and hopes the Boston-based firm will suggest further cost-effective solutions.

    Senator Gloria Romero, chair of the Senate Education Committee, told the Contra Costa Times: "UC has hired managers at hundreds of thousands of dollars each. They should have the expertise on campus already."

    According to Senator Romero, the funds used to pay the high cost of hiring outside consultants could have been used to make up for state budget cuts, student fee increases, furloughs and layoffs.

    The full $3 million plus expenses will be paid out over a two-year period, and was taken from the campus infrastructure fund.

    Vice Chancellor Frank Yeary, who left Citigroup to return to his alma mater said: "Self-diagnosis is not always the most beneficial method. And the intensity of the effort does not lend itself to asking our faculty to go offline for six months to help us."

    Administrators expect that the study will improve services. (Source: Contra Costa Times, October 2)

  • UC Davis Official Misrepresented Sex Crimes in Federal Report. In filing reports required by federal law, Jennifer Beeman, who retired as the UC Davis Campus Violence Prevention Program director in June, grossly inflated the number of sex crimes on the campus in the last three years. Reporting violations can result in a $25,000 fine per incident.

    Ms. Beeman reported 45 forcible sexual offenses in 2005 (actual 21), 68 in 2006 (actual 23) and 69 in 2007 (actual 33). Whether the misreported statistics had played a role in a nearly $1 million crime-fighting award grant awarded to the UC in 2007 could not be immediately determined, according to the Sacramento Bee.

    University officials said Ms. Beeman was placed on administrative leave in December 2008 amid separate allegations that she improperly charged travel expenses to federal violence prevention grants. (Source: Sacramento Bee, October 2.)

  • CSU Backs Out of Lease Deal, Causing Tax Dollars to Be Squandered. Board of Equalization Member Bill Leonard reported in his September 21 newsletter that California State University officials have backed out of a lease arrangement with the BOE, resulting in a massive waste of time and money for the tax agency.

    Mr. Leonard wrote: "I have learned so much since moving from the Legislative Branch to the Executive Branch. One lesson is that faceless huge bureaucracies can be as unethical and duplicitous as any individual. Our Board of Equalization has grown tremendously over the last 20 years with not only the growth of the economy but the dozens of new 'fee' programs assigned to us by the Legislature. So we set out to find additional space to house these people.

    "After jumping all the hurdles to get permissions we advertised for new space in Sacramento. We found a few worthy prospects and spent time reviewing them. In the end we decided that a building owned by California State University, Sacramento fit our needs. We told the other bidders the bad news and focused on the CSU property. We have spent thousands of hours in space planning, building logistics of the move, and details of the lease. It has now been two months of negotiations since we chose this property and sent the others away.

    "After leading us along for all this time, some CSUS decision makers have now told us the property is no longer for lease. It is unethical behavior of saying one thing and then doing another that gives government bureaucracies such a bad name. And now another government agency is the victim. It is a good lesson for the folks at the Board of Equalization to know that government lies."

    The property in question reportedly is on Hornet Drive, south of the CSUS football field. (Source: Leonard Letter, September 21.)

  • University of California Lays Off Teaching Staff, Hires Lobbyist. The University of California system has so many budget problems that it has laid off thousands of employees, furloughed faculty, cut class offerings, reduced library hours and increased student fees. Still, UC President Mark Yudof has found $121,000 to hire a new lobbyist, The Sacramento Bee reports. Vince Stewart, formerly the governor's deputy secretary of higher education and workforce development, started September 1. His annual salary of $121,000 currently equates to take-home pay of $111,000 because of furloughs. He also will receive generous fringe benefits.

    The Bee noted that two weeks ago, Mr. Yudof told students: "We are going to Sacramento, but when you contact our political leaders, they flat out don't have the money." The paper asked, "So why spend scarce funds to lobby legislators who have no money?" A UC spokesman said lobbying is needed to stave off reductions to the university's current budget. (Source: The Sacramento Bee, September 24.)

  • Despite Budget Problems, State Universities Approve Paid Sabbaticals for Professors. In a statement on the California State University's website, the CSU Board of Trustees say they have raised fees and ordered furloughs in response to "one of the greatest fiscal emergencies in the history of California." Still, CSU campuses are adding to the cost of educating students by continuing to allow faculty to take paid sabbaticals – including sabbaticals dedicated to writing books on the afterlife, illustrating children's books, writing operas and painting.

    A Cal-Tax staff review of just a handful of the 23 CSU campuses found:

    • CSU Sacramento approved 51 sabbaticals.

    • CSU Fullerton approved 43 sabbaticals, including one for an art professor who will "spend the semester updating his skills set by developing a story pitch, character description and illustrations to propose a 32-page children's book."

    • CSU Bakersfield approved 14 sabbaticals, including one for L. Stafford Betty, who will use the time to work on the book, "Mapping the Afterlife."

    • CSU Los Angeles approved 31 sabbaticals.

    A memo from the CSU Long Beach Office of Academic Affairs notes that sabbatical leaves are subject to furlough rules. "The salary the employee receives during the sabbatical leave will be reduced by 9.23 percent," the memo says. (Cal-Tax: Wouldn't it make more sense for the CSU leaders to simply cancel all sabbaticals when the economic conditions are such that furloughs are necessary?)

  • Illegal Fiscal Practices Found by East San Jose Group Running Charter Schools. A 45-year-old non-profit agency running two East San Jose charter schools is being accused of "illegal fiscal practices" and "misappropriations of funds" by the California Fiscal Management and Crisis Team. Investigators found that $400,000 in employee retirement funds were diverted to operate El Portal and Academia Calmecac charter schools. The agency promised to restore the retirement funds as soon as possible. (Source: San Jose Mercury News, September 2.)

  • Some Teachers Get Pay Raises While Colleagues Get Laid Off. The Sacramento Bee reports that some teachers in Sacramento are getting pay raises, even as other teachers are being laid off due to funding problems. The paper explains: "Most teachers in the Sacramento area will receive raises when they return to school. These increases are automatic 'step' increments, and many teachers don't consider them raises. … Those raises will cost school districts millions as education budgets continue to shrink." Sacramento City Unified laid off 281 teachers in May and is discussing furloughs and salary freezes for the 2010-11 school year. Still, step increases costing $2.5 million already have been approved. Elk Grove Unified laid off seven teachers in May, and will issue $5.2 million in raises to teachers and counselors for the upcoming year. (Source: The Sacramento Bee, August 10.)

  • Community Colleges Hand Out Millions in Raises While Eliminating Classes. The Sacramento Bee reports that the California Community College system has been handing out pay raises even as it has been "cutting thousands of classes, reducing hours for part-time teachers and forcing students to wait longer to get courses they need to graduate, transfer or get jobs." The Los Rios Community College District, in Sacramento, is cutting 630 class sections this year, but still plans to spend more than $3 million to give employees their annual pay raises of 2 percent to 4 percent based on time on the job. Community colleges in Rocklin, Woodland, Marysville, Los Angeles, Orange County and San Diego also are handing out pay raises. (Source: The Sacramento Bee, July 30.)

  • Modesto School Administrator Paid $190,000 to Resign. On August 3, Modesto City Schools trustees publicly released the details of a settlement with the district's former second-in-command, showing that she will be paid $190,000 to resign.

    As part of the settlement, Debbe Bailey, who served as deputy superintendent of business services for eight years before she was placed on paid leave in April, agreed not to sue the district.

    The administrator's problems with the district began after school officials uncovered e-mails between Ms. Bailey and teachers' union officials. Some of the e-mails were critical of one of the school superintendents, who called the conduct disloyal.

    Ms. Bailey's last day was July 31, but she will remain on unpaid leave through July 2010 or until she can settle her retirement credits. The district will pay for the settlement through funds in its self-insurance pool for liability claims, officials said. (Source: The Modesto Bee, August 4.)

  • Confessions of a College Trustee Shopaholic. Since January 2008, Peralta College District Trustee Marcie Hodge has charged more than $4,000 in personal charges to her public credit card.

    Ms. Hodge put the following purchases on her publicly funded card:

    • $355 at Marshall Rousso, a dress shop at the Venetian Las Vegas Hotel and Casino.

    • $278 at Privilege, another dress shop at the Venetian.

    • $1,763.32 spent on clothing at four New York Look stores in Manhattan.

    • $650 paid to Alpha Kappa Alpha sorority.

    Other charges included purchases at Best Buy, gift stores in Georgia and Washington, and Coach Leather of Napa.

    After an account of these expenses was released, Ms. Hodge said the charges shouldn’t be a problem for the district, because she paid the bills. She said she didn't use a personal credit card because, "I didn't know this was going to be an issue." She added: "I ran for the Peralta board to stop waste. I didn't run to live off the taxpayers."

    On July 28, the Peralta College District Trustees approved a ban on the use of public credit cards for personal purchases. The ban will be added to the district's ethics policies. (Source: Oakland Tribune, July 23.)

  • UC Riverside Pays $355,000 to PR Firm While Keeping Communications Employees on Payroll. The Riverside Press-Enterprise reports that the University of California at Riverside is spending big bucks on a no-bid contract with a public relations firm, even though the university has in-house staff who are paid to perform many of the same functions.

    The paper reports: "UCR contracted with Riverside-based O'Reilly Public Relations in April last year to help win Board of Regents approval for the creation of (a) medical school. Regents approved the school last July, but UCR continued to pay the O'Reilly firm $20,000 a month through June, the end of the $280,000 contract."

    The university also paid the PR firm $75,000 in a subcontracting arrangement to procure the lobbying services of a former state lawmaker, who was more effective than the UC's government relations staff at securing state funding for the medical school, a school official said. (Source: Riverside Press-Enterprise, July 6.)

  • Peralta Community College Chancellor Sticks Taxpayers With a Big Travel Bill. Former Assemblyman Elihu Harris, now chancellor of Peralta Community College in Oakland, has been travelling well at taxpayers' expense. According to the San Francisco Chronicle, there have been lavish trips where Mr. Harris and his wife were lodged at five-star hotels, including a three-night stay at a posh New York hotel at a cost of nearly $1,500. In January, Mr. Harris and his wife spent nearly $5,000 on one trip alone. The expenses included a stay at a $400-a-night hotel and $1,000 in unspecified expenditures. (Source: San Francisco Chronicle, July 17.)

  • UC Merced Spends $1 Million for Michelle Obama to Speak at Graduation. The tab for the University of California at Merced for first lady Michelle Obama to speak at the campus graduation May 16 was $1 million, considerably more than the $100,000 originally budgeted for the event. UC said the cost was absorbed by $500,000 from endowment fund interest and other non-state dollars. (Cal-Tax: While we are pleased that Michelle Obama was able to be present to give this UC campus some needed publicity, it seems to us that: the federal government should pay for the costs associated with the first lady's visits; at a time of severe budget problems, having a general fund agency spending big bucks is unseemly; and the UC needs to abandon the charade of funds coming from other sources. The public knows that money is fungible, and the "non-state funds" spent on this event could have been used to backfill some of the cuts made in the university's budget that affect the educational program.)

  • State University Chancellor Hires Lobbyists Without Competitive Bids. The San Francisco Chronicle reports: "California State University Chancellor Charles Reed has retained high-priced lobbyists without competitive bidding, even though CSU has a Sacramento office where it runs a $1.1 million-a-year, in-house lobbying unit whose state employees monitor CSU-related bills and follow state budget hearings. In the last decade, the university system has paid more than $2 million in public funds to two Sacramento lobbying firms … to influence the policies and budget decisions of the governor and state lawmakers. At a time of state budget cuts, student tuition hikes, canceled classes, faculty hiring freezes and layoffs, CSU's lobbyists have been paid to defeat bills designed to shed more light on CSU executive salaries and perks as well as public records."

    The paper noted that the outside lobbyists were paid not just to work on CSU-related bills, but also "to monitor nearly a dozen bills that had little or no direct connection to the university, including legislation on affordable housing for Iraq veterans, money laundering, terrorism, sex offenders and sacred Indian grounds."

    Nearly $400,000 was paid to the two lobbying firms as retainer fees during months of the year when they performed no services for the CSU system regarding administrative or legislative actions.

    "There is no need for these lobbyists," Senator Gloria Romero said. "There is no need for us to spend this money." (Source: San Francisco Chronicle, July 6.)

  • Are School Tax Dollars Wasted in Chaotic Classrooms? Voters assume their tax dollars that go to schools are being spent to educate students. That is not always the case. In Contra Costa County, a Clayton High School math class is a good example.

    The school suspended a girl for videotaping in the class, despite the fact that she was videotaping in order to prove that the classroom was out of control, and was not a suitable learning environment – a complaint she previously made multiple times to school officials, who did nothing to address the problem.

    In the third-period algebra class, the teacher couldn't control students, who were throwing things and making a ruckus every day. Students told the Contra Costa Times that shortly after Christmas, someone put Play-Doh in the microwave, causing the substance to explode. This resulted in a smoke-filled classroom that the teacher refused to air out. In other classes taught by the same teacher, students reportedly lit trash can fires and smoked cigarettes and marijuana in the classroom.

    Having been told about this state of affairs by her daughter, Allison Moore alerted the school administration to the problem. By May 15, with less than a month left in the school year, the classroom atmosphere had not improved, Ms. Moore said. That morning, when students flicked the lights on and off and began a paper-ball fight with no intervention by the teacher, Ms. Moore's daughter caught the chaos on video with her cell phone.

    When the video footage was sent to the acting principal, Dick Nicoll, by a friend of Ms. Moore, the acting principal suspended the daughter for two days. The suspension notice said she "had participated in major paper throwing," which her parent said is a false allegation.

    Five other students throwing paper were suspended, but three shown in the video doing the same were not, Ms. Moore said. School officials initially upheld Ms. Moore's daughter's suspension, but changed their mind after the incident was widely reported in the media.

    (Cal-Tax: We suspect this is not an isolated incident. The Legislature should look into how to improve the learning environment in classrooms.) (Source: Contra Costa Times, June 23.)

  • To Address School Officials' Error, District Asks Kids to Come Back to Class for 34 Days. Summer vacation may be delayed more than a month for many students in Southern California.

    The Associated Press reported that students at Dickson Elementary in Chino and Rolling Ridge Elementary in Chino Hills were supposed to be done with school this week, but are being asked to spend another 34 days in the classroom so the school district will not lose $7 million in state funds.

    The problem is that the schools shortened school days by 5 minutes to 10 minutes on 34 occasions to give teachers more time to prepare for upcoming classes. Under state law, a day that is a few minutes too short doesn't count at all toward the required number of school days. So in order for the district to receive state funding for the shortened days, district officials said all 34 days must be made up, even though the time missed could be made up in one or two school days. The extra instructional days will cost roughly $200,000 total, and will be packed with art, music, experiments and other activities that students tend to enjoy more than solving quadratic equations or conjugating verbs.

    The school officials' blunder affects approximately 500 students in the fourth through eighth grades. However, media reports indicate that many parents are planning to let their children take planned summer vacations, and are not going to force their kids into hot classrooms for more than a month to make up for the timing mistake, which has been admitted by an associate superintendent who is retiring this year.

    Assemblyman Curt Hagman has introduced legislation (AB X3 35) that would allow the district to receive full state funding if it makes up the time with two extra school days. (Source: Associated Press, June 16.)

  • Vallejo Superintendent and Spokesman on Paid Leave. Vallejo's school board voted to place district Superintendent Mary Bull and district spokesman Jason Hodge on paid leave pending the results of an investigation for unconfirmed claims of a hostile work environment.

    Neither school employee would comment on their recent absences, and Vallejo City Unified School District Board President Cris Villanueva would not comment on the specifics of the board's action or the source for the investigation.

    Ms. Bull was hired in September 2007, and is paid $200,000 per year. Mr. Hodge is paid $100,000 per year. Both will continue to collect pay despite their leave.

    Vallejo schools are still under partial state control after the district needed a $60 million bailout in 2004 due to its fiscal collapse.

    Before coming on board with the Vallejo school district, Ms. Bull was employed as curriculum director of Carmel Unified School District, where she faced a number of verbal abuse lawsuits. (Source: Contra Costa Times, June 16.)

  • San Diego School Officials Junket on Federal Funds. While San Diego Unified School District's schools were attempting to survive a $106 million deficit, school administrators spent more than $2,000 in federal funding for disadvantaged students to send Superintendent Terry Grier to a conference in Washington, D.C., possibly violating federal regulations that prohibit such funds from being used for lobbying.

    Several district staff and trustees who accompanied Mr. Grier enjoyed more than $550 in meals, which included a hefty tab at a posh Georgetown restaurant.

    Previously, Mr. Grier's contract limited him to a $25 meal limit. However, his contract was amended last year to allow for "reasonable out-of-pocket costs," with no specific limit. In regards to the change, Mr. Grier commented, "Have you ever tried to eat on $25?"

    The superintendent said the trip may save their district millions of dollars through their lobbying efforts to sway Governor Schwarzenegger to send stimulus money to schools. District Spokesman Bernie Rhinerson said district officials were able to build valuable relationships with legislators and their staff while in D.C., and that focusing on meal expenses was "losing the point."

    School board members Richard Barrera and John Lee Evans also have lobbied on behalf of the district, but when they traveled to Sacramento, they paid for their own meals. Mr. Barrera called the district's expenses while in D.C. "just not appropriate."

    Deputy Superintendent Chuck Morris told the Voice of San Diego: "I screwed it up. I should've have done that." Mr. Morris said he originally approved the spending thinking that the conference was related to federal funding for disadvantaged students. He said he will bill the superintendent's office to correct the error. (Source: Voice of San Diego, June 9.)

  • School Spent Funds for Race-Based Rallies. The Elk Grove Unified School District in southern Sacramento County has been segregating students based on race for rallies prior to taking state exams. The rallies, held in April, separated African-American, Pacific Islander, Asian, Latino and white students. After receiving a cease-and-desist letter from the Pacific Legal Foundation, the district said it will abandon the practice. "It's surprising that in this day and age a school district would make a distinction of students based on race," Ralph Kasarda, an attorney for the legal foundation, told The Sacramento Bee.

    Superintendent Steven Ladd said he is recommending that district trustees amend board policy to ban the separation of students by race "for educational opportunities or activities." The board is expected to take up the issue this summer. (Source: The Sacramento Bee, June 11.)

  • Sacramento Grand Jury Critical of School District Land Purchase. In a report filed May 27, a Sacramento grand jury is highly critical of the Natomas Unified School District for purchasing 41 acres of farmland for $13.4 million. The grand jury said the property was worth $2 million.

    The grand jury pointed out that the land was not incorporated, had a number of environmental issues, is part of a state flood plain and is partially protected under the Endangered Species Act and the Williamson Act.

    According to the grand jury, school officials told the appraiser to use certain assumptions that greatly inflated the appraisal. Also, the superintendent was soliciting funds for a school foundation and had approached a partner with the sellers of the land.

  • Los Angeles Unified Policy to Dictate What Students Eat Is a Failure. It comes as no surprise that an effort by Los Angeles Unified School District to tell students what they should eat is a failure. An audit released May 5 by the district's inspector general found that a school policy to restrict student access to certain foods was a dud, as "most schools were not in compliance with the LAUSD's (2002) Motions to Promote Healthy Beverage Sales and Obesity Prevention." The audit team visited 70 schools sites to gather data. (Source: Los Angeles Unified School District, Office of the Inspector General.)

  • Los Angeles School District Pays Teachers Not to Teach. In an excellent investigative piece published May 6, the Los Angeles Times reported that the Los Angeles Unified School District is paying approximately 160 teachers and other school staff not to teach, giving them their full pay while allegations of misconduct – including alleged sexual contact with students, harassment, theft and drug possession – are resolved. "All told, they collect about $10 million in salaries per year – even as the district is contemplating widespread layoffs of teachers because of a financial shortfall," the Times reported.

    The school district refers to these employees as being "housed," and typically places them in district offices where they are required to show up during regular school hours, but are not given any responsibilities. They have the same schedules as teachers, with 30-minute lunch breaks and school holidays off, but perform no work.

    This situation was created by an agreement between the district and the teachers' union. Under the agreement, the "housed" teachers cannot be assigned tasks such as making photocopies, stuffing envelopes or mowing a school's baseball field.

    One of the teachers interviewed by the Times complained that he has been "housed" for more than two months, but has not been informed why he was removed from his ninth-grade teaching duties.

    In a case highlighted by the paper, teacher Matthew Kim has been "housed" with pay and benefits for seven years. The Times noted that the 41-year-old, who suffers from cerebral palsy, "has been accused of inappropriate behavior with two aides and six students, including groping them with his left arm, the one limb over which he has limited control." As suits, countersuits and appeals have been winding through the district's bureaucracy and the courts, the district has spent more than $2 million in salary and legal costs in this case alone. Two weeks ago, the school district decided that Mr. Kim would be allowed to stay home – rather than report to a district office – and still will be paid. (Source: Los Angeles Times, May 6.)

  • Kudos to Two California Schools. Bravo for tax dollars being well spent. Two California schools won the National Science Bowl competitions May 4 in Washington, D.C.

    Mira Loma High School, a school in the San Juan Unified School District in suburban Sacramento, won the high school division, defeating Lexington High School of Massachusetts. In the intermediate school division, Hopkins Junior High School, in the Fremont Unified School District in Southern Alameda County, came home with top honors. (Source: The Sacramento Bee, May 5.)

  • School District Paid $720,000 for Pizza Machine, Then Took Pizza Off School Menu. The San Jose Unified School District paid $720,000 in 2006 for a machine that was supposed to churn out 800 pizzas a day to sell on various campuses in the district. But the San Jose Mercury News reports that the machine has made only 2,000 or so pizzas in the two years it has been in place. (Cal-Tax: At a cost that works out to $360 per pizza, let's hope the kids got extra cheese and generous toppings.)

    One reason for the low output is that the machine breaks down frequently. In the words of a district spokeswoman, it is "sensitive."

    Another problem, apparently unforeseen by the officials who approved the purchase: the district doesn't have enough trucks to deliver hot pizza to different campuses in time for lunch, and late deliveries aren't feasible since students have a strictly enforced time period for lunch.

    Lastly, the district made an interesting management decision and took pizza off the daily menu shortly after it purchased the costly pizza machine.

    Now, the machine is used on a very limited basis – one day a week, for Friday "pizza parties" that rotate among the district's 26 elementary schools. (Source: San Jose Mercury News, April 26.)

  • Schools Spent $3.7 Million on Superintendent "Buyouts." School districts throughout the state have spent $3.7 million in recent years to pay superintendents to leave, according to data compiled by Assemblyman Tony Mendoza. The Democratic assemblyman has introduced legislation, AB 164, to eliminate "buyout" provisions from superintendents' contracts. He cited 13 buyouts that have been approved recently, in just about every region of the state. So far, the bill has received very little support from the legislator's colleagues, and it appears to be dead for the year.

  • Los Angeles Schools Using Costly Outside Consultants. The Los Angeles Daily News reports: "An audit detailing Los Angeles Unified's reliance on costly outside consultants to build schools has raised such concern for Superintendent Ramon Cortines that he called in a former bank executive to review the findings."

    The story continued: "According to district sources, the audit found that $186 million was paid to 1,277 outside consultants in 2006-07, averaging $145,653 per person that year. The audit's findings mirrored an earlier analysis by the Daily News that found the district spent $182 million on 849 consultants – about $215,000 each – in the 2007-08 year."

    "For almost 10 years, we've been telling the district that it's a waste of money to use contractors and not district employees," said Connie Moreno, a representative for the California School Employees Association. "We've seen Facilities Division management take work away from district employees and give it to their contractors." (Cal-Tax: While the union is concerned primarily about union jobs, taxpayers should be concerned that there doesn't appear to be enough scrutiny of the spending. If contractors are being used to replace more expensive government workers, thereby saving money for taxpayers, that would be laudable. If they are simply adding to the cost of government, taking on duties that public employees still are being paid to perform, then something needs to change.) (Source: Los Angeles Daily News, March 26.)

  • Follow-Up: Alum Rock School District Repeals Superintendent's Buyout. Last year, the Alum Rock School District gave former Superintendent Norma Martinez a $500,000 buyout, approved at an illegal December board meeting (see Cal-Taxletter of December 5, 2008). This created a public outrage, and as a result, new members of the school board have declared the agreement non-existent because it was adopted illegally (before the December meeting where the buyout was approved, the contract was not listed on the agenda). (Source: San Jose Mercury News, February 8.) (Cal-Tax: Publicity about outrageous government spending sometimes gets results.)

  • Fresno's Accounting Errors Led to $34 Million in Overpayments to Schools. An accounting error by the Fresno County Auditor's Office led to the county overpaying schools $34 million in property tax revenue over four years, the Fresno Bee reports.

    "The county will be sending a letter to the school districts in the next few days telling them how much they have to pay back," the newspaper reported. "Although the Auditor's Office first notified the Fresno County Office of Education about the possibility of repayment last April, the county needed to figure out how much was owed before contacting the school districts."

    Ultimately, the state will repay the schools. The Bee explained: "Whenever property tax revenues come in lower than budgeted, the state is required to make up the difference to school districts. Because the county overpaid property tax revenues to local districts, the state didn't have to kick in any money during the past four years. Now that the overpayment has been uncovered, the state is obligated to reimburse the districts." (Source: Fresno Bee, February 3.)

  • Kern County Taxpayers Paying Part of Teachers' Union President's Salary. Taxpayers in the 37,000-student Kern Union High School District are paying 60 percent of local teachers' union President Mitch Olsen's salary. Mr. Olsen is working for the union full-time and does not teach any classes.

    School board member Ken Mettler is suggesting that the union, which he says receives $1.6 million in dues, pick up the full tab. Mr. Olsen said he would not respond to comments by one board member, but would deal with the board as a whole.

    (Cal-Tax: We do not believe this situation is unique to Kern High School District. At a time when schools are making cuts in instructional services to students, it is outrageous that taxpayers are funding the operations of a flush teachers' union. In fact, it is inappropriate at any time.) (Source: Bakersfield Californian, January 27.)

  • Community College Chancellor May Get 18 Percent Raise, Retroactive to July. Budget problems? What budget problems? The Contra Costa Community College District is scheduled to vote January 28 on whether to give the district's chancellor an 18 percent raise, increasing her current $209,000 salary to $247,000. The raise would be retroactive to July 1 of last year. The chancellor, Helen Benjamin, also receives generous fringe benefits as compensation for overseeing the three-college district. The district's board members said the raise is intended to keep Ms. Benjamin from leaving for a higher-paying job, and they said her salary is lower than nearly every other Bay Area chancellor's pay. (Source: Contra Costa Times, January 20.) (Cal-Tax: The district's logic makes no sense. If the pay is intended to keep the chancellor there, why is the raise retroactive to a period of several months that she already worked? It also is troubling when taxpayer-funded agencies get into bidding wars, real or imagined, because the taxpayers will lose that battle every time.)

  • UC Davis Turns Private-Sector Food Servers Into Government Employees. The University of California at Davis has chosen to make a transition that has turned hundreds of private-sector workers into UC employees, adding to the university's spending for salaries and fringe benefits. On January 2, nearly 200 food-service workers and 400 student employees received their first paychecks from UC Davis, having transitioned from working for Sodexo Inc., which continues to have a four-year contract to manage the campus' general food service program. The contract calls for the company to be paid approximately $23 million a year.

    In 2006, some workers and the American Federation of State, County and Municipal Employees complained about a lack of union representation for the workers, and said the employees deserved better pay and health care benefits. The next year, UC Davis and Sodexo agreed to provide higher pay and fringe benefits, thereby increasing the cost to taxpayers at a time when the state budget is far out of balance.

    On January 14, the UC Board of Regents announced a plan to reduce enrollment of new California resident freshmen by 2,300 students systemwide for the 2009-10 academic year in order to "cope with insufficient state funding." (Sources: The Sacramento Bee, January 17; University of California Board of Regents, January 14.)

  • Ventura County Schools Pay $396,000 for Lobbyists, Get Little in Return. The Ventura County Board of Education voted unanimously January 9 to terminate its contracts with two lobbying firms, acknowledging that the $396,000 spent over the past 18 months has yielded no benefit for students. One of the only accomplishments reported by the lobbyists was setting up a meeting last month among county staff, school trustees and a Wal-Mart representative to discuss possible funding opportunities, none of which have yet been realized.

    It takes three months to cancel the contracts, so the total cost will grow to approximately $443,000. The money comes from a $1 million pot of funds that originally was intended to pay for technology upgrades in the schools, including upgrades that would benefit students in vocational education programs. (Cal-Tax: We wonder how many other school districts are spending thousands of dollars on lobbyists who aren't producing any revenue that the schools wouldn't receive even without the lobbying. We also congratulate the Ventura board for doing the right thing, even if it took a major budget problem and 18 months of overspending to come to the proper conclusion.) (Source: Ventura County Star, January 10.)

 

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