Morning Report: Report Finds Evidence of Fraud in Sweetwater Budget Mess - Voice of San Diego

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Morning Report: Report Finds Evidence of Fraud in Sweetwater Budget Mess

Sweetwater Union High School faculty rally against the district’s proposal to lay off more than 200 employees and shut down learning centers dedicated to struggling students. / Photo by Adriana Heldiz

A damning and highly anticipated audit was released Monday that says there is “sufficient evidence” to suggest officials at Sweetwater Union High School District committed fraud by covering up their budget problems. The next stop for the audit will be the district attorney’s desk, reports VOSD’s Will Huntsberry.  

The audit comes after a series of stories by Voice of San Diego revealed mismanagement and deceptive practices within the district. The district unexpectedly came up $30 million short in September 2018. Reporting showed that the district approved across-the-board raises even though some administrators knew doing so could lead the district to go bust. High-level administrators also knew the budget was much worse off than public documents actually showed

The most serious allegation in the report suggests district administrators deceived a credit rating agency before issuing millions of dollars of bonds in 2018. 

The U.S. Securities and Exchange Commission is investigating Sweetwater and has previously fined and helped prosecute government officials for similar bond-related schemes. San Diego’s district attorney could also choose to press charges that might be related to safeguarding public funds or perjury. 

The newly released audit by the state’s Fiscal Crisis and Management Assistance Team points to the district’s current superintendent, a former chief financial officer and director of financial services, as well as an external financial adviser as those who might be criminally liable. 

Where ‘Defund the Police’ Goes From Here

Cuts to the police budget weren’t part of city budget discussions as recently as several months ago. That changed quickly after protesters outraged over the death of George Floyd in Minneapolis pleaded with city leaders to cut $100 million from SDPD’s budget.

Now, the conversation is changing rapidly again. Though the Council didn’t cut any funding for SDPD (and in fact increased its budget by millions) reformers seem confident that major changes are on the table for next year and beyond, Andrew Keatts reports in a new story.

Councilwoman Monica Montgomery asked the independent budget analyst for a comprehensive review of 2021 police spending. She indicated that the review would be a step before “serious consideration” is given to reallocating SDPD funds.

“You only experience these times every 60 or 70 years,” she said. “We are in that time. When the generations that come after us, our charge is that we will be enough, and be visionary enough, for them to be proud of what we’ve done. It is a very legitimate concern, and we have to reimagine how we look at what keeps us safe.”

The Pandemic Has Disrupted the Drug Trade, Too

It’s not just legal businesses that have been hit hard by the coronavirus pandemic. The cross-border drug trade has taken a major hit over the last several months, Maya Srikrishnan explains in the latest Border Report.

“Since many drug supply chains, especially for synthetic drugs like methamphetamine, are spread out geographically, the disruptions in these markets began before Mexico and the United States put limits on the border,” Srikrishnan writes.

In San Diego drug seizures fell dramatically between January and March, though they’re beginning to tick back up.

One UC San Diego professor has been given a green light to study how COVID-19 is impacting drug users in the San Diego-Tijuana region.

“There are also unique challenges that drug users face during the pandemic — social distancing is hard when you need to feed that addiction,” Srikrishnan writes. “That could result in more COVID-19 cases among drug users and higher citations for not following rules put in place by municipalities and states during the pandemic.”

In Other News

The Morning Report was written by Sara Libby and Will Huntsberry, and edited by Scott Lewis.

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