By Miriam Raftery, Editor
East County Magazine
February 10, 2015 (San Diego’s East County) --The scandal over Grossmont Union High School District’s misuse of bond funds has now made national news. Recently a Superior Court Judge issued an injunction requiring the district to set aside money from a portion of bonds and state funds to build the long-promised Alpine High School, after a Grand Jury previously found that the District spent money from voter-approved bond measures on unauthorized projects, while failing to build the promised Alpine High School.
Now a Forbes magazine article titled Regulators Way to Easy on Muni Bond Investors is calling the District’s actions a “classic bait and switch scheme.” Author Marilyn Cohen, one of the nation’s top bond managers, asks, “Why aren’t the people involved sent to jail?”
Forbes add, “…once they had the money in their hot little hands they thought they could do whatever they wanted with it rather than what they promised the taxpayers who voted for the bond issue.” The District’s efforts to resolve its financial woes in court means that “only the lawyers win, not the taxpayers,” Forbes continues. “Consider the audacity of Grossmont in issuing another $60 million in bonds over the next few months.” Bond investors should not trust the word of districts like Grossmont that mislead voters, Forbes concludes.
East County Magazine has asked District Attorney Bonnie Dumanis if her office is investigating the Grossmont district, but thus far we have not received confirmation on whether or not any criminal investigation is underway. Dumanis previously launched a criminal probe against members of the Sweetwater Union School District’s Board that resulted in two convictions of trustees on corruption charges for accepting gifts over state limits.
Political analysts may note that the key difference between the two districts is that Dumanis, a Republican, was willing to prosecute Democrats on the Sweetwater board but has thus far seemed unwilling to investigate or prosecute Republicans on the Grossmont district board. Yet the offenses committed by Grossmont’s board majority have caused harm that is arguably far more serious than Sweetwater’s board members did.
Tens of millions of dollars in bond funds were misappropriated, leading a judge to issue an injunction to halt spending of the money. Prop H was passed as the “Safety and overcrowding” bond initiative. Yet Alpine students have been killed in accidents traveling long distances to schools far away, so clearly school overcrowding and the long distance Alpine students must travel, especially in winter weather, is a safety issue.
By the District’s own admission, safety issues at other schools have not been fixed yet the district spent bond funds on unauthorized and seemingly less necessary projects such as a performing arts center and an Olympic-sized swimming pool. The entire district is on the verge of being split up because of the board’s actions, since Alpine parents now seek to leave the district and join the Alpine Union School District instead. A petition to unify the Alpine district so it can accept high school students and build the high school has been launched. The County Board of Education has recommended that the State approve unification, also finding fault with the Grossmont board’s actions.
Grossmont’s board majority has insisted that enrollment triggers for the high school were not met, though that notion has been debunked by numerous credible experts. The board has failed to offer any credible explanation for why it built projects not listed in the bond while failing to build the Alpine high school listed as a top priority in Props H and U. Whether this was due to mere bungling, political retribution, or some as yet undisclosed profit motive, such as for a construction company with ties to a board member or outright corruption, remains unclear since no investigation has been conducted.
Bill Weaver, an Alpine parent and taxpayer, says the district’s actions are why a taxpayer’s waste lawsuit is in the works against the district, its superintendent Ralf Swenson and others.
Weaver wants to see the Grossmont district answerable to its actions of ignoring safety and overcrowding issues that put Alpine students at risk. He concludes, “Criminal Investigations are merited, as the “Forbes” expert author has made the legal case for fraud of bond investors, and deceit of intent to the taxpayers who authorized these bonds.”
While the District Attorney would be a logical choice to head up an investigation into potential local bond fraud, the state and federal government may also have jurisdiction under provisions of the Education Code in the case of the state and potentially, mail fraud under federal law if deceptive materials were mailed to voters before the board majority diverted taxpayer-approved bond funds to other uses.