Monday, April 11, 2011

Are You Going to the Governing Board Meeting? I Can Give You 22.5 Million Reasons To Go

This Wednesday, I’ll make another public appearance at the Southwestern College Governing Board meeting. Yes, I’ll be speaking, and yes, I’d like to invite any and all of you to come with me and make them hear what you have to say.

Why am I going? What on Earth could get me back in front of the board to ask just exactly what the hell is going on?

It appears that the SWC district might be expected to pay for more of Nick Alioto’s shenanigans again. To the tune of $22.5 million.

Alioto? Shure.
Alioto, as you know, is the former VP of Business and Financial Affairs at SWC and one of my personal targets. Given that he was heard referring to me as “an archenemy” – and yes, that’s in quotes, I am delighted with my role versus his Lex Luthorness.

So it should go as no surprise that I’m doing this as an activist, not a journalist.

The money is question arises from construction taking place at SWC. The plans and budgets were developed by Alioto, former superintendent Raj K. Chopra, Seville Construction’s former project manager Henry Amigable, and former SWC consultant John Wilson.

See a pattern?

The board will be discussing paying contracts to several different companies. Some of these contracts are appearing for the first time, but some are contracts that have grown larger since Alioto and Amigable signed them.

Apparently, Alioto – known as a financial wizard – didn’t realize that the construction contracts signed by he and Seville Construction didn’t include funding for the various subcontractors that Seville would be hiring, including the huge Echo Pacific Construction.

Now I’ll grant this is all back-of-the-envelope math, but it’s taken from the agenda of Wednesday’s coming board meeting. It appears that $4,338,077 in contracts needs to be replaced by $26,799,522 in contracts.

In other words, the district is being told that they need to pay an extra $22,461,445 to pay for the mistakes made by Alioto, Amigable, Wilson, and Chopra.

Nick Alioto

Yes, that’s nearly 22.5 million dollars paid out to the following companies: Echo Pacific Construction, Fordyce Construction, Arthur Gensler and Associates, NTD Architecture, Act Inc, Countrywide Mechanical Systems, Southern California Soils and Testing, Tel Tech Plus, The Casper Company, Rocky Coast Framers, RL Electric, Chambers Inc, Winzler and Kelly, Consulting and Inspection Services, Willock Contracting, GA Abell Inc, Barnhart Balfour Beatty, BCA Architects, BRG Consulting, Bytesolutions Inc, and Union Bank.

This would seem questionable at the best of times. But these aren’t the best of times. In early November, the voters threw Salcido off the governing board, leaving Chopra and Alioto unsupported. Late in November, Chopra resigned. That December, Wilson “retired” from his consultant position and Seville Construction fired Amigable. Alioto clung on until February, when he also resigned. With the possibly-guilty parties all scuttling away like cockroaches from a light bulb, it’s clear that these are the bad times. And during the bad times, one must question these facts even more diligently.

These decision-makers weren’t strangers. They were connected in many ways. Working together with Focuscom’s Dan Hom, who attempted to provide rah-rah spin about the project, the men were the architects of the college’s construction future.

It's a little like Caligula, but in English.

Wilson was the live-in boyfriend of Yolanda Salcido, the former GB president. Several other news outlets have already covered their conflicts of interest, so I won’t bother. Salcido hand-picked Chopra as her superintendent, and Chopra and Salcido hand-picked Alioto as his vice president.

In return, Chopra and Alioto hosted fundraisers for Salcido’s reelection campaign – which failed. But they coerced many, many contractors into donating, which included Seville and Echo Pacific.

Somehow these men “forgot” that the contracts they signed didn’t cover sub-contractors.

Though it’s not an exact parallel, it reminds me quite strongly of the story in the Los Angeles Times, which detailed the process of creating and using “body shops” in Los Angeles County.

With this process, the L.A. Community College District (we are also a CCD) used district bonds (which we are using) to hire numerous contractors (which we have) and select a project manager (we have Seville) to oversee the whole thing (which we are doing).

In return for this largesse, the contractors sub-contract the hiring of workers into smaller companies, and then everyone above them charges a cut for their pay. One contractor, Patricia Torres, earned $210 thousand, but the county was charged $563 thousand for her work.

URS Corp is allegedly the mastermind of all this. But also named several times for adding tax and pay markups – Seville Construction. In fact, URS Corp attempted to shuffle Torres from her position at URS to Seville, a common practice to move them away from their job, but keep them in the payroll mix.

With Alioto out at SWC and replaced by apparent straight-shooter Bob Temple, even in an intermittent role, Seville should be putting their best face forward.

They’re not.

In December, Seville removed Henry Amigable from his project manager position, later replacing him with Bob DeLiso. Amigable left Seville in February.

Bob DeLiso
 From 2006-2010, DeLiso worked at Harris & Associates, which was the “point company” for many of the construction projects paid for by the LA Community College District. The LA Times did not list them by name, but did say around “two dozen” other contractors were involved. I’d wager that Harris & Associates was one of them.

Before Harris & Associates, DeLiso worked for URS Corp for 32 years, from 1974 until 2006. This is the guy who is now the project manager for construction at SWC.

Amigable, who was fired from Seville, has also shuffled to a new position and is now working for Echo Pacific Construction, as their SWC project manager.

Remember that $22.5 million in question? Echo Pacific is the largest beneficiary of this “mistake.” With contracts of $4,024,977 outstanding, they are claiming they deserve $10,614,180.

That means they expect the governing board to vote to increase their coffers by $6,589,203.

And the guy in charge of it is Henry Amigable, who was part of this “mistake” happening in the first place.

Alioto, long believed to have hidden and spent down millions of dollars – and recently confirmed by the Southwestern College Sun, and written by Yours Truly -- somehow managed to sign these contracts and Amigable never said “boo.”

So, yeah, I’ll be at the governing board meeting on Wednesday. Unless DeLiso, Amigable, Seville, and Echo Pacific are strenuously investigated, the district must not pay for these decisions. At these times of brutal budget cuts and soaring property taxes, expecting the people of the district to cough up an additional $22.5 million is not just ludicrous.

It’s criminal.


  1. I will be there to support you. That being said, what can the Governing Board do? I'm not playing dumb here. I am, in fact, dumb when it comes to these sorts of things. Can they refuse to pay? What happens then? What kind of investigation are you thinking about? Did Alioto et al enter into a legal document that has to now be carried out?

  2. At the moment, I'm not sure if those agenda items are up for discussion, or if they're "action items" - which means they need to be voted on then.

    The first question the board should address publicly is: do we owe them this? Alioto, Amigable, and Wilson ALL know their jobs, and have been doing so for a long time. It seems inconceivable to me that they "accidentally" failed to include all sub-contractors in their lists.

    So without public discussion on spending another $22.5 million, I don't see how they can simply rubber-stamp it. Furthermore, this involves Prop R money. I was at the last Prop R Oversight Committee meeting, and this was NOT discussed. Without having input from the oversight committee about a $22.5 million error, I don't think they can go ahead.

    Furthermore, I see at least one huge conflict of interest: Amigable helping with the error, and then helping his new company win about $6.6 million because of it. I don't think ANY money should be spent until both companies and both project managers agree to an in-depth forensic accounting - much like the one that will be going on about SWC funds.

  3. Thank you for the follow-up. I appreciate your diligence. Seriously.

  4. Thank you for very good blog about Forensic Accountants. It's very nice.

  5. Ah ha! It's all unravelling now.