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Your bond money at work, paying lawyers

In 2006, Oakland voters passed a $435 million tax levy that would allow the district to refurbish its crumbling schools. Did you know that more than $1 million of that money has gone to a two-partner law firm, even though OUSD has its own lawyers?

In 2006-07 alone, local attorneys Bryant & Brown took in $846,900 in bond money to handle construction contracts, litigation and facilities-use plans, according to school board documents (just type the firm’s name in the search box) — plus $200,000 from the district’s general fund that was apparently furnished by an East Coast developer that was trying to negotiate a deal on a prime piece of district property.

Well, they do call themselves a “boutique law firm.”

In any case, the Oakland school district’s general counsel is investigating Bryant & Brown’s contracts and invoices, and the district has asked the Alameda County District Attorney’s office to review them as well. If the firm was, in fact, overpaid (and it’s possible that the total payments to Bryant & Brown were much larger than $1 million), the probe will look into how it happened and who was responsible.

“This is an extremely serious matter that we should not take lightly,” Noel Gallo said. “We need a full, complete investigation from the top down.” He added: “All those involved need to be terminated.”

Troy Flint, the district’s spokesman, said no personnel actions have been taken, but that the initial inquiry found “irregularities” in the firm’s invoices. And any such problems were difficult to spot because the law firm had a special arrangement with the facilities department that bypassed OUSD’s legal office (the one that’s leading this investigation).

“Legal didn’t authorize these contracts in the same manner that they authorize other contracts,” Flint said. “They were authorized through the facilities department, which was an unconventional arrangement.”

Hmmm…

Here’s the statement the district put out tonight:

Oakland – Oct. 15, 2008 – In September 2008, OUSD’s Board of Education directed staff to conduct a comprehensive review of District operations beginning in the Facilities Department. The decision, part of a continuing effort to monitor and improve the quality of OUSD services, has revealed significant procedural deficiencies. While the review is not yet complete, our initial finding is that substantial operational and systemic problems exist in the Facilities Department.

The first phase of the assessment revealed several irregularities related to invoices submitted by a law firm performing work for the Facilities Department. The pattern of irregularities indicates the possibility of flawed protocol and insufficient vendor oversight in the Department. To ensure that the investigation into the law firm’s billing irregularities is fully transparent and that all public funds are properly accounted for, the Board directed the General Counsel’s Office to refer the matter to the Alameda County District Attorney for further investigation.

In addition, we have taken immediate steps to remedy the problems we have found thus far. These measures include closer monitoring and scrutiny of vendor invoices as well as changes to the protocol for processing vendor invoices. We are also continuing our review of protocol in the Facilities Department as concerns the processing and payment of invoices submitted by other vendors. Going forward, the District will, as per the direction of the Board, continue to examine all District operations and take corrective action as needed.

The formal investigation apparently began after a Sept. 10 board meeting, when another contract to Bryant & Brown appeared on the agenda. Gallo raised questions about it — as he did back in June 2007 — since Oakland Unified hired an in-house attorney last year just to deal with facilities issues. It was ultimately tabled, but not before board member Alice Spearman accused Gallo of racism (Bryant & Brown is a minority firm).

“We have a race problem here,” Spearman said at the meeting. “When black folks try to make some money, we have a problem with it.”

Spearman said today that she only learned about the questionable payments to Bryant & Brown after that meeting, and that she now supports a full inquiry into these contracts and others — in facilities and elsewhere in the district. “If it happened for one, they can find improprieties all kinds of ways if they look for it,” she said.

Does she take back the allegations of racism, in light of the new information? “No,” she said. “Personally, I believe nothing would have been questioned had it been another firm.”

Read the full story here.

Katy Murphy

Education reporter for the Oakland Tribune. Contact me at kmurphy@bayareanewsgroup.com.

  • Equois

    When will there be a comprehensive review of the waste of public funds by the District’s Legal Department in its pursuit of frivolous legal cases undertaken against faculty and staff. Can we get an analysis of how much money the Department is costing the District or the money it has cost the taxpayers in cases prosecuted and lost?

    The taxpaying public deserves accountability!

  • John

    I recall a school site ‘slip and fall’ incident that required my cooperation with the district legal office in 2001. Both of the OUSD staff lawyers I had dealings with at that time were Afro Americans. I’m not aware of people having a “problem” with the “black folk” lawyers making money as employees of the district legal office. Perhaps Spearman has a special interest in some black folk over at Brown & Brown making money from the OUSD that needs to be investigated? Probably not.

    By the way, I wonder how things are going with the conflict of interest and nepotism investigation in the wake of Mayor Dellum’s firing of Oakland City Manager Deborah Edgerly. (Now I wonder what suddenly popped that thought into my head? Oh well.)

    I remember during the mid 1990′s assisting with writing a proposal for the formation of the board approved Latino Educational Task Force (LET). As I recall the Afro American Task Force enjoyed access to district funds and other resources never available to the Latino Educational Task Force. The LET was established around the time Noel Gallo was first elected to the school board.

    Perhaps Mr. Gallo should give Ms. Spearman a history lesson on OUSD actions favoring the interests of the Afro American community over those of the Latino community. But then, as we all know, Afro Americans are incapable of racial bias and discrimination, are they NOT?

  • Sue

    Getting back to the legal issues of the district, I hope the next department investigated is Programs for Exceptional Children. They have a mess on their hands.

    I know one family that has their child in a private school with the district refusing to pay the tuition this year. If the family has to file another suit, the district will be paying the family’s attorney costs as well as the tuition.

    Sacramento has already reviewed the family’s case and concluded that the student’s IEP requires attendance at the private school at district expense.

    But the current director apparently *still* doesn’t get it – her department has to honor the settlement the previous director worked out with the family. Instead of paying just the tuition, she’s going to fight it, lose, pay a bunch of legal fees, and then pay the tuition anyway.

    This can’t be the only example of expensive legal problems in that department, even though it’s the only one I’m personally aware of.

  • turner

    Spearman is just another divisive old school politician. She screams racism first then looks to see what the incident is.

    Construction bonds were given to the district to modernize the schools. The language of the bonds is very clear. The OUSD legal department can handle the processing of contracts. That department spends more than $2 million a year for just that.

    Payments to B&B were unnecessary and, possibly, not allowed by the bond language. (Hopefully, someone can clarify this).

    It would serve the district well if Spearman listened to the facts first before she assumed racism was invcolved. Whther they would be questioned if they were not black is irrelevant. The point is the schools, parents and students of Oakland have just been robbed. Shouldn’t the perpetrators be made to pay…even if they are black?

    Let’s enforce the law.

    Turner

  • Nextset

    If there are billing irregularities they should be referred to the DA (who can use a grand jury) for a possible False Government Claim prosecution. Bickering about all this in public meetings is a silly waste of time. A District Civil suit to recover overpayments could follow and that doesn’t need to be discussed in public either.

    Lawyers cost money. If you design your affairs so that you have liklihood of litigation, expect to pay dearly. Try to establish a budget for it.

    Lawyers are required in serious and complicated finance deals. You budget for that also. As far as the selection of the firm, that’s a product of the sound or unsound judgment of the hiring authority. If they had the right lawyers they would not be having problems. And If you can’t trust their honest billings you shouldn’t be using the firm in question at all.

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  • Chauncey

    Its the typical Oakland, and other big city political story. Blacks yelling racism when clear disregard for the law is before us. Being black myself allows me to be critical of my own race.

    Moreover , its OK plitically for blacks to criticize white or other races, but when another race even looks crossly at a black person, out flies the racist attack.

    And we wonder why the schools and this city is in the shape its in? This system of racial patronage is very entrenched in this country and if we continue to accept and excuse this type of attitude in America, we will be doomed.
    Two types of racist exist, those that attack based on color and those that attack to defend based on color.

    Spearman should be ashamed, and you as a taxpayer, pissed off.

  • John

    The ‘OUSD Ebonics Resolution’ of the mid 1990’s was drafted by an attorney in the OUSD legal office. Perhaps Bryant & Brown should have been retained to sue its author for defamation of OUSD character and embarrassing school board member, now city council person, Jean Quan, for reportedly voting for it before reading it.

    My 2001 experiences with the district legal office did nothing to dispel rumors of its lack luster performance. But far be it from little old white me to criticize and cause a “race problem” by drawing unwanted attention to some “black folks trying to make some money,” as was alleged by Afro board member Spearman about Latino board member Gallo in response to his concerns about possible fiscal waste and duplication of services associated with bypassing the district legal office for outside (Bryant & Brown) African American legal services.

    I recall the district legal office as largely staffed by African Americans. Perhaps this is no longer true making it necessary to bypass that office in search of ‘outside’ African American lawyers? Or perhaps the facilities office bypassed OPS legal services for the same reason parents are increasingly bypassing the OPS for outside (private, charter, & elsewhere) school services – TO GET BETTER RESULTS!

    But let’s keep it ‘Oakland simple!’ As long as OUSD doesn’t’ hire a white non-minority law firm and is giving ‘filthy rich Oakland home owner property tax money’ back to the (Afro American) minority community it shouldn’t be a problem, unless you’re “racist” or a cold hearted uncaring fiscal pragmatist.

  • Jim Mordecai

    John:

    Sometimes I feel like you are channeling Steve Allen’s Tonight Show bit when he read the letters to the editor in an angry tone. Difference in style is Steve Allen would pick things that most people wouldn’t be upset about (source of ha, has) and you are dealing with sensitive and difficult issues.

    Katy: question I have is how is the in-District attorney that is covering the same issues as Bryant and Brown law firm being paid? Is it also out of Measure B bond money?

    One of the duties that B & B law firm was paid Measure B was working with the Citizens Oversight Committee and if you read the education code that committee is suppose to get district resources without tapping construction bond money.

    Seems the legislature was concern with the practice of districts creatively diverting bond money intended for construction costs.

    If the District’s attorney dedicated to facilities bond issues is being paid to work with the citizens oversight committee out of bond funding, both cases are a violation of the education code.

    Possibly it is a violation of the education code in listing Measure B Committee as part of the justification for $150,000 and previous monies the B & B law firm received.

    Jim Mordecai

  • Turner

    Jim,
    I can answer that questiuon for Katy and she can verify it. The district’s attorney is paid out of the District’s General Fund. A few years ago, Dr Ward had to answer a question about the Legal Department. I think he said the annual Legal budget was close to $3 million annually.

    The Legal department can’t be paid out of bond funds because the language did not specify that salaries could be paid for with those monies.

    Turner

  • http://groups.yahoo.com/group/oaklandpublicschoolparents/ Christopher Waters

    As usual, OUSD’s trumpeting of its moral convictions belies the real facts. This is a witch hunt. Assistant Superintendent of Facilities, Tim White, is being targeted by Deb Cooksey, OUSD’s Interim General Counsel, and the “Strategy Group” — the team of five executives under the State Administrator and Superintendent whose chief role is to toe the party line about the failed, Machiavellian, conservative corporate foundation-sponsored “Expect Success!” initiative, now being rebranded as just “Oakland SUCCESS.” Tim White is one of the only honorable people left at OUSD, and he has never been a part of the “inner sanctum” of power-hungry, upward-looking executives who have drunk the Kool-Aid being passed around by Jack O’Connell and his pals Eli Broad, Bill Gates, and Michael Dell, who have turned Oakland into a playground for their conservative education theories, and a consolidating field for their nationwide public school privatization and charterization campaigns. Tim White has refused to even pretend to buy into those political games — he has just remained hunkered down, nose to the grindstone, delivering the virtually impossible time and time again for a district that refuses to back its own capital projects with adequate resources.

    When Randy Ward was still the State Administrator and Roy Coombs was his General Counsel, Mr. Combs personally assigned Meredith Brown, from the independent legal firm of Bryant and Brown, to work directly under the supervision of Tim White on Facilities department legal matters, rather than under his own (Combs’) supervision. Meredith Brown had been working with OUSD since long before Tim White ever came to OUSD from Compton. When Combs, with whom Tim White often disagreed, allowed Tim White to supervise his own department attorneys, Tim took it as a sign of Combs’ professional respect for White’s always-respectful, apolitical approach and ability to get in and get the impossible done. It now appears that this was a setup, designed to eliminate the paper trail to those truly responsible for the underhanded dealings regarding the proposed sale of OUSD’s downtown headquarters and adjacent properties to developers, who were planning a massive waterfront condo development. Those who were actually running the program regarding the sale of the property? State Superintendent Jack O’Connell and his staff: Gavin Payne, Susan Ronnback, and Kathleen Moore; State Administrator Randy Ward and his Chief Academic Officer Kimberly Statham, who became Ward’s first successor; and the erstwhile Javetta Robinson, who was fired by Statham a little over a year ago. Javetta Robinson, like Tim White, resisted the crooked dealings of the State in this scandal, and when the blowback from Statham’s dismissal of Robinson led to Statham’s subsequent departure from the State Administrator job, those left behind to consolidate their power knew that they needed to handle Tim White’s refusal to play ball much more delicately — so they left it alone for a time.

    Now that Deb Cooksey, who is working without a contract as the Interim General Counsel, has risen to prominence, she has decided that she resents not having direct authority over Tim White’s department legal matters. With the support of the “Strategy Group” — who saw their opportunity to bring down Tim White and eliminate the last threat to their gang’s dirty little secrets — Ms. Cooksey launched an investigation. In a deeply disappointing move, our elected school board — rather than asking Tim White for his side of the story — descended into a petty squabble over race and, when they moved beyond that, began making demands for an investigation. Where was the demand for an investigation two years ago when the state and its cronies were trying to co-opt our school property for a sweetheart deal with private developers? Where was the demand for answers when, as FCMAT evaluator for the past five years, Roberta Mayor — whom the school board has now inexplicably throned into authority as OUSD’s new Superintendent, and who is now presiding over this “comprehensive review” of district operations — gave Tim White and his Facilities department only the highest evaluation marks?

    As head of Facilities, $50 million to $100 million of capital projects expenditures come across Tim White’s desk from clerks for signature every year. I am highly suspicious about Ms. Brown’s billing errors — reportedly approximately $50,000 worth of “accidental” item duplications buried within reams of legal invoices. But whether these irregularities are accidental or just another kickback for her part in a nasty episode involving East Coast developers — it’s not Tim White we should be looking to for blame. It’s the seething criminality of the State Superintendent, the State Administration, and its many adherents within OUSD. Tim White is perhaps the only innocent left among the lot of them. I am appalled at yet another example of willing submission by our elected board, and by the absence of a resounding chorus of public support for Tim White. It is telling that Tim feels he will get a fairer result from an impartial investigation by the Alameda County District Attorney than he would get from his own peers at OUSD. It will be a travesty if we let them get away with scapegoating him in the phony name of “Oakland SUCCESS.” The proper name is Oakland SHAME. Please raise your voices, defend Tim White against this witch hunt, and call the hunters to justice.

    Christopher Waters
    OUSD parent and Oakland activist

  • Turner

    Christopher,

    I don’t know enough to say it’s not a witch hunt. More power to you for knowing your facts.

    The reality is this: bond monies for construction should never be used for reasons other than what the voters approved.

    You’re right about Tim White being an honorable person. He’s a stand-up guy. But, whatever the politics behind the scene, he should always be aware of what the bond spending criteria is, especially what the monies shouldn’t pay for.

    Legal costs are considered administrative in nature. They are to be covered by the General Fund. The work that B&B has done should therefore be paid for by the General Fund. If the bond monies paid, then the bond fund needs to be reimbursed.

    Turner

  • Sue

    Yeah, I don’t know all the facts, either. But among the people Waters has named, his characterizations of the ones I’ve met match with my impressions of them. That lends a lot of weight to his words about the people and things I don’t know.

  • Equois

    While investigating this story the media also ought to look into the expenditures of the Oakland Unified School District’s Legal Dept. Especially exploring decisions by the Dept that are continuing to cost the District and taxpayers unnecessary expense in frivilous litigation. In one particular case the District wrongfully accused a teacher of immoral conduct based upon slanderous and libelous accusations, initially dropping the charges that were based upon a sham of an investigation that was incomplete and inconclusive, only to reinstate those same charges a year later.
    The teacher refused to be bullied into resigning and successfully challenged the wrongful suspension and attempted termination by the District. The District has had to pay the salary of this teacher while the teacher was placed on admin leave and suspension since March 2006 until March 2008 (approx $147K plus benefits) plus the attorney fees of the teacher over $100K. The District continues to accrue legal expense and liability because it has refused to pay the teacher’s back salary and legal fees pursuant to state Ed Code Sec 44944 and 44946! This needs to be investigated!

  • John

    Jim: Steve Allen & I also both play(ed) the piano:

    http://www.youtube.com/watch?v=QPwRo0YTTe4

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