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    The San Ysidro School District’s dark days were even darker than previously known and compromised the school bond program, according to a new County Grand Jury report.

    Former district officials misspent school bond funds, double paid vendors, spent $45 million on an ill-advised land purchase and fulfilled few promises made to voters who approved a $250 million bond measure in 1997, according to the report released Tuesday. About $376,900 removed from the bond fund may still be unaccounted for.

    “Prior SYSD boards did not perform due diligence and disregarded their fiduciary duty, approving expenditures from bond proceeds for purposes other than those listed in the ballot measure,” the Grand Jury wrote. “The district has amassed hundreds of millions of dollars in long-term debt with little to show for it.”

    San Ysidro’s superintendent Manuel Paul and board member Yolanda Hernandez were among 18 people convicted in a wide-reaching corruption probe by the San Diego County district attorney that concluded in 2014. Hernandez was one of five public officials forced from office in the South Bay, and Paul spent time in prison for a separate federal corruption charge.

    While the criminal charges focused on gifts from contractors, the Grand Jury report highlights lapses in San Ysidro’s bond spending and record-keeping.

    The 19-person citizen jury recommended an independent forensic audit.


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    District officials say one is already under way, and concurred with the thrust of the report, acknowledging former administration members destroyed records and mismanaged district finances and bond funds.

    “There was poor fiscal management by former district leadership,” San Ysidro School District Superintendent Julio Fonseca said in a statement. He said the current administration “is working to become truly transparent” and “is wholeheartedly committed to not only correcting the errors of the past, but building a strong financial infrastructure for the future, while also building trust within our community and providing the highest quality educational opportunities for students.”

    Fonseca said the employees who wrongfully destroyed records are no longer employed by the district.

    The Grand Jury’s findings – made with the help of county auditors – take aim at former administrators, like longtime business chief Dena Whittington, saying she approved contract amendments and change orders without board approval. Whittington, who resigned in August 2015, did not immediately respond to a request for comment.

    In addition to San Ysidro officials, the Grand Jury lobbed criticism at County Office of Education staff brought in to oversee the beleaguered border district after it earned a negative budget rating in 2012. The jury concluded officials – like fiscal adviser Lora Duzyk – “did not take an aggressive enough role in correcting problems” while fending off a state takeover. Duzyk declined to comment

    “We strongly disagree with the characterization of our fiscal oversight as anything other than rigorous and active,” the County Office of Education said in a statement. “We are always looking to improve our operations, including the public’s understanding of the role of the County Office of Education, and will carefully consider the Grand Jury’s recommendations.”

    San Ysidro passed a $250 million bond measure in 1997 known as Proposition C, and has sold at least $142 million of those bonds to date. While Vista Del Mar Elementary School was built for more than $23.7 million and opened in 2012, Beyer Elementary – demolished in 2012-13 – remains an empty lot.

    District officials issued $45 million in debt to buy 20 acres of land and pay for the construction of Ocean View Hills School, but a portion of the property was environmentally protected, saddling the district with mitigation costs.

    “The decision to purchase this property is suspect and should be further investigated,” the jury report says.

    Officials took on another $97.5 million in debt in recent years to pay off earlier debt, some on Duzyk’s watch, which she should have advised against, according to the Grand Jury.

    District officials also borrowed $18 million from the bond fund to pay for payroll and other needs.

    The district was also chided for paying financial advising firm Dolinka Group to both advise on and execute bond sales, a practice that “may create a conflict of interest.”

    The jury also confirmed what’s been known for a while: That former district employees destroyed district records. The school board ordered an internal investigation into the matter, but no records show any investigation occurred.

    The jury claims the school board at one point approved the destruction of 215 boxes of documents, “but there is no record of what was destroyed.”

    Many records that do exist, the jury claims, are sloppy and filled with errors.

    The jury offered a few words of praise amid the litany of complaints.

    On the upside, the district recently hired a consultant to create a new financial reporting system that will eventually allow the district to track all major revenue and expenses for state grants, bonds and other debt.

    The district may create its first citizens bond oversight committee to look after the remaining $108 million.

      This article relates to: Education, Must Reads, School Bonds

      Written by Ashly McGlone

      Ashly is an investigative reporter for Voice of San Diego. She can be reached at ashly.mcglone@voiceofsandiego.org or 619.550.5669.

      7 comments
      Don Wood
      Don Wood subscriber

      This is just one reason voters should reject future school bond initiatives, including any on their June or November ballots.

      If you want to see how school bonds work, just follow the money. The building industry association and school construction

      contractors contribute the majority of the money school board candidates collect, and also provide most of the funding

      for school bond initiative political campaigns. In return, the school board members they funded and now own, find ways

      both legal and illegal to funnel new school bond money to those contractors, in many cases failing to do the work promised

      in the initiative campaigns and other promises to the voters.  Before any voters looks at their ballots, they should look

      at their last property tax bill and see how much of their taxes are already going to help pay off previous school bonds.

      Then vote no on any new ones.

      Steve Sarviel
      Steve Sarviel

      Thank you VOSD and Ashly McGlone for keeping the public informed on this terrible waste of taxpayer money through deceit , mismanagement and what may very well be corruption and fraud.


      Readers should be reminded this same Dolinka Group responsible for pushing these bonds (at a nice profit for them and who knows what kickbacks or quid pro quo) and the attorney Dan Shinoff who represented SYSD are both active and what appear to be favored contractors of the Superintendent John Collins led Poway Unified School District as well.  The now illegal and infamous "billion dollar bond" PUSD thrust on unsuspecting taxpayers at the behest of John Collins with the aid of the Dolinka Group and counsel of Dan Shinoff has very similar yet larger scale characteristics of what is reported here about SYSD.


      One is forced to wonder why PUSD continues to allow Dolinka Group to have ANY dealings with PUSD putting taxpayers in further jeopardy of additional questionable or bad deals.  Similarly, one must wonder why PUSD continues to employ attorney Dan Shinoff who has been discredited and penalized for his (bad or lack of) service to SYSD and most recently was responsible for a massive data breech of private student data for over 30,000 students, in direct violation of federal privacy laws.  Could there be some quid pro quo relationship between John Collins and the Dolinka Group or Dan Shinoff?  Could there be some back room ties between these entities and any of the three PUSD Board members who support their continuing to be funded by PUSD?  These board members are TJ Zane, Michelle Occonner Ratcliff and Andy Patapaw.   Should there perhaps be a grand jury investigation into the dealings of the Dolinka Group, Dan Shinoff,  John Collins and these three board members?  Many of your readers and taxpayers who cannot fathom why the board would support such discredited entities think so.


      Given the close ties board member TJ Zane has to the Republican of San Diego County (a paid employee), should there be an investigation into any Dolinka Group or Shinoff donations to the Party?  Could there be a pay to play situation going on?   Honest people certainly hope not.  Given the record of Dolinka Group and Shinoff, it is probably worth investigating however.


      Thank you again VOSD for your good and timely reporting.

      sosocal
      sosocal subscriber

      I do recall that it was reported that Mr. Paul was burning documents on school property AFTER he was no longer superintendent.  So that is probably where at least some of the missing documents went.  This proves yet again how important it is to have a Bond Oversight Committee that has real power.  There is too much temptation apparently in bond monies.

      Steve Sarviel
      Steve Sarviel

      @sosocal Taxpayers should resoundingly vote NO on each and every bond put before them unless it has been fully vetted by an INDEPENDENT committee of citizens and TAXPAYERS with no financial or other interest involved should the bond pass.  A statement of the findings of this group should be required to be included in the ballot proposition.  This alone would help ensure the profiteers like Dolinka Group have a much more difficult time defrauding taxpayers with the assistance of school district administrators and/or board members.


      anniejc j
      anniejc j

      There is a storm brewing -  


      When one runs for office it should be a humble attempt to SERVE, not an arrogant attempt to USE.


      it is unfathomable to imagine that those who sat on the previous San Ysidro Board including Mr. Paul would choose to use their position for personal, political or special interest gain - but that is exactly what happened.


      One thing for sure breaking news today, reported by the Voice of San Diego will most certainly deter any rational voter from voting for another Bond any time soon.


      THIS IS WHY BOND OVERSIGHT COMMITTEES LIKE SWEETWATER UNION HIGH SCHOOL DISTRICTS ARE SO IMPORTANT - too bad their value is marginalized with allegations such as 'they are overstepping'.  PERHAPS WHAT MAY BE NEEDED IS A LEGAL REVIEW OF ALL EXISTING BOC'S.


      San Diego County Office of Ed 'in this situation' has failed, and failed miserably.  i believe i recall reading where there were allegations from a Financial person working in the San Ysidro District office that they were being told to inflate the debt of the District, by a County employee,  at a time when employees were on strike in an attempt to 'cry poor, we can't afford to pay you more'.


      There is a storm brewing - and I believe it will be a revolt of NO MORE TAXES!!!!!! - because we have no trust. 

      Steve Sarviel
      Steve Sarviel

      @anniejc j You are so correct.  There seems to be this irresistible lure for elected (so called) "representatives" and their appointees to feel free to use other peoples money for their personal or political gain.  As far as citizen oversight goes, there can be no such thing as "overstepping".  What has happened in SYSD is but a small pebble in a massive quarry of misuse of taxpayer dollars due to a lack of "overstepping" oversight.


      Taxpayers need to understand this simple formula:  Bond = INCREASED TAXES.  The profiteers will always set it up with scare tactics about how some service will severely suffer if this TAX INCREASE doesn't happen to further enrich those who are in the business of siphoning off tax dollars.

      anniejc j
      anniejc j

      @Steve Sarviel @anniejc j Perhaps SIR you might want to take time out to attend a Sweetwater Board meeting and send your message home 'there can be no such thing as 'overstepping' - as the majority of our Board seems to react as you would to a mosquito on

      a warm summer evening.


      We taxpayers must accept some responsibility for what has/is happening - far too many believed those they voted in 'would take care of business' alas, nothing could be further from the truth.