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Did Megataxers and Pasadena Unified Pass Their $516 Million Bond Illegally?

 

November 7, 2021

BY BRIAN HEWS AND THE IRISHMAN

HMG-CN’s exposé has outlined the malfeasance of the Megataxers and their school board allies in passing bonds.

We have outlined the corruption in Bassett Unified’s $50 million bond, with a cost to taxpayers of $96 million, possibly committing fraud in the process; Citrus College’s $298 million bond, with a cost of half billion; Tiny Duarte Unified’s $79 million bond, with a cost of $148 million; Inglewood Unified’s  $240 million bond, with a cost of nearly half billion.

All told, $670 million in bonds, over $1.3 billion in costs to taxpayers.

We have revealed school board members using illegal processes to approve bonds, rubber-stamped by their chosen law firms.

We have found violations of the State’s Education Code and Elections Code. Exposed District officials in a conflict of interest position, opening political committees acting as treasurers in charge of the cash with single check-signing authority.

Finally, we exposed blatant conflicts of interest between firms donating large sums of cash to the bond committees and then landing lucrative contracts for construction after the bond passes.

Now we look into Pasadena Unified, but first, some background.

Ever play checkers? In 2016, San Francisco Unified School District not only passed Proposition A for the authority to issue $744 million in public school bonds, at a cost of well over $1 Billion, the Board also placed Proposition N on the ballot to allow non-citizen voting in school board elections.

Proposition N allowed parents, legal guardians, and caretakers of children to vote in school board elections and bond elections.

Professor Keith Shirey provided profound insight, “Plato’s greatest of lessons is that virtue must be caught, it cannot be taught.” Confucius also advised, “If your plan is for one year, plant rice. If the plan is for ten years, plant trees. If the plan is for one hundred years, educate children.”

Pasadena Unified School District, Measure O

Knowledge is a good thing, but nothing compared to character. Stephen English, Esq., along with Molly Munger and Connie Rice, all deserve honorable mention for their exemplary work in Godinez v. Davis.

Godinez was a public interest lawsuit filed in Feb. 2000 on behalf of students and community organizations challenging the manner in which the State of California and its various agencies apportioned more than $2 billion in new school construction funds.

The lawsuit involved a new funding system for the construction and modernization of public schools, especially to relieve overcrowding in urban schools.

Much like Jeff Mardersosian, Esq., English, Munger, and Rice are formidable advocates for students.

However, just when the first tax measure appeared to be channeled through residents and students, the process took a turn.     

The Lawyers

During the June 25, 2020 PUSD regular board meeting, the Board approved agreements with Megataxer law firms including Atkinson, Andelson, Loya, Rudd and Romo; Dannis Woliver Kelley; Mundel, Odlum & Haws, LLP; the Shimmof Law Corporation, and Garcia Hernandez & Sawhney who included an exhibit for processing immigrant documentation.

Bonifacio Garcia’s contract expressly contained fees for processing the immigrant documentation.

The Resolution and Measure

After signing agreements with the Megataxer law firms, the PUSD Board held a “special meeting” at 8:00 pm that night. The agenda had three bond proposals: issue school bonds for $360 million, $516 million, and $688 million.

 

 

PUSD 8 p.m. agenda had one other item to discuss, the remainder was to hurriedly approve the bonds.

 

The official meeting minutes show the Board passed two: one for $360 million, Resolution 2574; and another for $516 million, Resolution 2575; according to the minutes, the $360 million bond passed 7-0; the second 5 to 2.

Education Code Section 15266 requires a two-thirds vote of the Board. But the documents show the Board processed the $516 million tax measure. The $360 million measure never made it.

The documents also show that municipal advisors Dale Scott & Co., and the law firm of Stradling Yocca Carlon & Rauth were present at the meeting.

The Text of the tax measures gave the Board the option of authorizing $360 million or $516 million in bonds “at legal rates.” The presumption is that “at legal rates” means “at legal interest rates.”

According to Government Code 53508(d), the interest rate must be stated.

The Text differed, allowing the Board to impose a tax of $30 per $100,000 of assessed value on real property or $45 per $100,000 of assessed value on real property. Based on those numbers, real property tax revenue would be raising revenue equivalent $19.5 million annually or $28.5 million annually.

The tax would last “as long as bonds are outstanding.” The duration of the tax is not disclosed, concealed by the use of the words “while bonds are outstanding.”  Two additional violations of Education Code 15122 and Election Code 13119.

Looking at the tax rate statement for the measure for $516 million, the duration of the tax is 2027-2049. Including principal and interest, the bond is expected to cost taxpayers $798 million.

PUSD has just over 17,000 students, SFUSD has close to 60,000 students.

Voter Information Guide is not the Ballot

The voter information pamphlet is not the actual ballot used at the time of voting. The Ballot Label did not comply with Education Code section 15122 (including the full statement required by law) and Elections Code section 13119 (rate and duration of tax). The ballot label did not even disclose the rate of interest.     

No matter to the PUSD elected officials and lawyers as they watched the establishment of a special bond committee in support of Measure O, with only one person in charge. Normally a committee has a treasurer, a controlling officeholder and/or a responsible officer to ensure there is transparency and accountability.

But the “2020 PUSD Bond Committee” documents showed Jonathan S. Fuhrman as the lone treasurer, and on one else.

 

Cover page of PUSD Measure O bond committee.

 

The second page of the PUSD Committee shows Fuhrman as the sole listed official.

 

The list of contributors, who gave nearly $130,000, included the following:

PJHM Architects, $20,000

Flewelling & Moody, $10,000

Joan Payden, Chief Financial Analyst, Catholic Investment Services, $9,000

Atkinson, Andelson, Loya, Romo & Rudd, $8,775 (signed on as bond counsel)

LCC3 Construction Services,

Rancho Cucamonga, $5,000

PBK, Inc., Architects, Ontario, California, $5,000

WLC, Architects $5,000

C.W Driver $5,000

Kitchell, Inc. $5,000

Element Consulting, Construction Management, $5,000

Wendy Munger threw in $5,000

Jane “Malcolm in the Middle” Kaczmarek coughed up $5,000

Jerry Kohl, Philanthropist, $5,000

PBWS Architects, $3,500

NIC Partners, Inc., $2,500

Moving Forward California, c/o Gould & Orellano, $2,500

United Teachers of Pasadena $2,500

Stephen English, Esq., $2,500

NAC Architecture $2,000.

There were a number of $1,000 donations to bring the total up to nearly 130,000.

HMG-CN was able to obtain the initial filing of the committee which occurred on Sept. 20, 2020. The first report showed over $17,000 in donations; all of the donations were made prior to the committee’s establishment.

The bond passed in November 2020, despite the multiple violations of Government Code (one), Education Code (twice) and Election Code (twice).

And the Megataxers made millions.

The Megataxers count so far: Bassett Unified, $50 million bond, cost to taxpayers, $96 million. Citrus College: $298 million, cost of half billion. Duarte Unified: $79 million, cost of $148 million. Inglewood Unified $240 million, with a cost of nearly half billion. Pasadena Unified, $516 million at a cost of nearly $800 million.

Passed using compromised board members, bogus ballots statements and non-existent tax measures.

All told, $1.185 billion in bonds, over $2.1 billion in costs to taxpayers.

Next up, Whitter Union High School District, and how a few people can tax the public to death.

Superintendents and especially Assistants need to be prudent and careful.  Nefarious forces are at play. Just ask Zimmerman.

 

 

 

 

 

 

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