October 24, 2012 
Interview of Lockyer on High-Interest School Bond Loans  
State Treasurer: Fire Poway Bond Staff 

Oct. 17, 2012 | By Will Carless | www.voiceofsandiego.org   

EXCERPT: State Treasurer Bill Lockyer used a keynote speech at a conference in San Francisco on Wednesday to blast the practice of school districts taking out high-interest, long-term loans called capital appreciation bonds.

     He didn't stop there. In a post-speech interview with Voice of San Diego, he called out the Poway Unified school district, whose bond program we investigated earlier this year. Lockyer said the staff members who put together that deal should be fired and the school board should be voted out. He also said the deal would eventually be investigated because it probably wasn't legal..   

     ... On Poway's billion-dollar deal, Lockyer harkened back to his early political career, when he served on a school board: 

     "I would fire staff that made a deal like this. And if I were a voter, I'd pick a different school board. But that's just how I react to how egregious I think this deal is. " ...

  ... Finally, I asked Lockyer whether the state has any recourse to try and unravel Poway's deal.
     "No. But we've got a database [at the state]. We know who underwrote these deals, who the financial advisors were, who the bond firms were that said they were all fine. I want [those firms] to know that when future state business is being considered, that track record hurts you.
So you can make a choice: If you don't want to keep doing business with the state, then fine, keep making these deals. "...

Sweetwater UHSD - Conflict of Interest  

Sweetwater board Takes Heat at Meeting
Oct. 12, 2012 | Susan Luzzaro
EXCERPT: ... Brand (Superintendent) sought board approval for a conflict-of-interest bylaw change. His proffered analysis was: "This bylaw is being revised to include language regarding gifts, as recommend by Eric Hall & Associates in the Proposition O Audit."
     Community advocate Maty Adato brought it to the board's attention that the Eric Hall audit said, "The District should work with its legal counsel and develop a policy for board consideration restricting all gifts and donations from consultants [and] contractors."
     District trustee Bertha Lopez asked if any board members would be willing to include donations in the language. Trustee Pearl Quiñones said she was uncomfortable voting on it and wanted more time to review it. Brand urged the board to pass the resolution because it was "time sensitive." Lopez voted against it. Board members Quiñones and Arlie Ricasa - both under indictment for allegedly failing to report gifts - abstained. The resolution failed.
     Later, Proposition O bond oversight committee chair Nick Marinovich gave his committee's report. He shared with the board the committee's concern regarding the manner that Brand imposed the new requirement of conflict-of-interest forms subsequent to the oversight board's vote of no confidence in the superintendent. ...
     ... Board members were also served with subpoenas by Kevin Carlin of the Carlin Law Group. The subpoenas are seeking, among other things, information about board members' relationships with contractors in the past.
     The subpoenas stem from a lawsuit filed by Sweetwater parent Stewart Payne and Davis Moreno Construction, Inc. It is in regard to a $17.3 million construction contract the district entered into with Balfour Beatty Construction to build Montgomery Middle School's library, cafeteria, and other buildings.
     The agreement uses the lease-leaseback method, which allows the company to lease district property for $1.00 a year while constructing the building; it also allows the district to circumvent the bidding process.
     The state allocation board has concerns that "significant numbers of projects and significant sums of public funding are not being subjected to the checks and balances of the competitive bid process." 
     To read the complete article please visit: 
In This Issue
State Treasurer on High Interest School Bond Loans
Sweetwater Conflict of Interest
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