A majority of the school board also approved the use of bond underwriter Stifel, Nicolaus & Co. for an upcoming Mello-Roos bond sale, and allowed financial adviser Dolinka Group to advise on the deal. The district’s use of both consultant firms was voted down in September for the firms’ work on the district’s $100 million capital appreciation bond sale in 2011 that will cost taxpayers $1 billion to repay over 40 years.
State law lets cities, counties or school districts create Mello-Roos Community Facility Districts to raise money through a special tax with voter approval. It’s often used in newer housing developments and the money goes to pay for public works projects or public services.
The district is still waiting for a legal opinion about whether Dolinka’s various roles advising and profiting from the Mello-Roos program constitute an illegal conflict of interest. The opinion has cost the district $15,689 so far.
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