RICHMOND -- Dennis Clay was
understandably stressed before he exposed alleged financial mismanagement in
the West Contra Costa school district's bond construction program. But now the
whistleblower says he feels a sense of relief.
"Most of my personal
turmoil happened between January and April," he said, explaining that he
spent weeks compiling documents to demonstrate budgets that don't reconcile,
overspending on projects and a lack of fiscal controls.
He sent the documents to the
school board, which released them to the district's independent citizen's bond
oversight committee. He also delivered them to the Contra Costa County Civil
grand jury.
Clay's efforts paid off. In a
special April 29 meeting, school trustees voted to pursue a forensic audit -- a
more detailed examination of the records than a regular audit entails -- but
have not yet hired a firm to begin that work. The Securities and Exchange
Commission has also launched an investigation into his allegations, and the
Contra Costa grand jury excoriated the district's management of the bond
program in its latest report.
"Once it got past that
first special meeting, I felt much lighter," Clay said, during an
interview Wednesday. "It was a little bit of an obsession there for four
months."
Clay says he alerted Sheri
Gamba, the district's associate superintendent for business services, in 2011
about millions of dollars in discrepancies between internal and external
reports, that now amount to $60 million unaccounted for in reports to the
district's independent Citizen's Bond Oversight Committee.
"The budgets were changed
to match what was actually spent," he said. "The spending was never
controlled by the budgets. It was pretty much the reverse. And that's still
true. There is no budget process in place to control spending."
Clay said he decided to go
public after he alerting the recently hired bond program finance manager and
the bond program engineer, who was moved to that position last year, about the
problems. Also playing into his decision to go public was his feeling that an
outside auditor he told of the problems didn't adequately investigate his
complaints.
The district's process for
managing $1.6 billion in voter-approved construction bonds, he said, results in
staff who believe they should " ... never have to say 'no' to the board or
board requests for projects."
"Once you understand that
need," he said, "a lot of things make sense."
Employees who have questioned
this process are no longer around, Clay added.
"Frequently, there will be
an official budget and for planning purposes, and a different amount that they
actually expect the project to end up at," he said. "The official
budget does not keep them from spending over it."
Ivette Ricco, chairwoman of the
bond oversight committee, said she doesn't know Clay, but she appreciates his
willingness to speak out about his concerns.
"I think this is a real
testament to his character that he feels that this is so important that he just
has to step up and say something," she said. "When you put your job
on the line like that and you know you're going to work with everybody and it's
going to be uncomfortable, that takes a certain amount of courage."
In response to Clay's
allegations and a recent civil grand jury report that criticized the district's
bond oversight, the district issued a statement Wednesday confirming that the
SEC is already investigating similar claims made last year.
"Because of the SEC's
inquiry," the statement said, "the district will not discuss these
claims in detail."
The district said its most
recent audit found no shortcomings or inefficiencies in the bond program, but
that it would take action in response to any findings or recommendations that
may come out of the forthcoming forensic audit. The district also said it has
taken steps to rebuild public confidence in the bond program by appointing new
leadership to manage it, authorizing an independent attorney to advise the bond
oversight committee, and directing staff to develop a facilities master plan,
expected to be completed next year.
Clay said things have changed
since former Trustee Charles Ramsey, the bond program's biggest booster who
previously chaired a facilities subcommittee that made most
construction-related decisions, left office last December, but there is still
much more to be done.
He questions the district's
practice of hiring architects to begin conceptual plans for schools that will
not be built for years or even decades, saying an official in the SGI
construction management firm that oversees the district's bond program once
referred to it as "the architect full employment program."
"I was astounded that he
would say that, even though it's obviously true," Clay said. "I would
have restated it as 'the SGI and architect full employment program.'"
Although Clay said he cares
about district students having well-built facilities and taxpayers getting
their money's worth, one of his main motivations for going public was to bring
integrity to the district so he and his fellow employees can take pride in what
they do.
"I'd
like to work for a well-run, upright, honest organization," he said,
becoming slightly teary-eyed. "We're going to run out of money before
these schools are done and people are going to feel like they've been lied to.
It's not going to be a happy place or time."
July 2, 2015
Contra
Costa Times
By Theresa
Harrington
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