The City College shell game - Page 2

How city college plays fast and loose with $130 million in bond money

But in board meetings he and his staff have insisted that the transfers were perfectly legal.

The school's lawyers say reallocations are acceptable under Proposition 39, a state ballot measure passed by voters in 2000 that lowered the threshold in California for passing school and community college bonds.

Other districts have also relied on reallocations as the cost of construction materials has increased globally in recent years due to Hurricane Katrina and the ongoing expansion of China's economy.

But the San Francisco school has argued the logical extreme — that it can transform voter-approved projects in virtually any way it deems necessary.

"What obligation do we have in our reallocation considerations about making sure that those things get delivered — all of those projects we listed in both [the 2001 and 2005] bond measures?" former trustee Johnnie Carter asked during a meeting Jan. 12, 2006.

"You have no obligation to complete any of those projects," Mona Patel, a bond advisor for the school, responded. "You can complete one of those projects. You can complete all of those projects or anything in between.... It's solely within the board's discretion."

Despite that explanation, City College's woefully short budget projections mean the school might have to return to voters a fourth time to secure funding for two projects already promised the last time City College went to the ballot, in November 2005.

One of those planned facilities was supposed to house a stem-cell-technology training program lauded by Mayor Gavin Newsom in 2005 as a way to help locals compete for jobs in the Bay Area's growing biotech and life-sciences research industries. The school stripped $25 million authorized by voters from that project and directed it mostly to two other projects running a combined $105 million over budget.

Marks and new board member John Rizzo have urged an expansive performance audit of the bond money, which they say is required under Prop. 39 but had never been completed.

Rizzo and Marks both told us that if unforeseen construction costs, a low number of project bidders, and the lethargy of state regulators are all problems contributing to unpredicted costs, school administrators need to come up with a plan to fix the situation. But the performance audit proposed by Rizzo and Marks would first identify which problems are most severe. Not having it, Rizzo said, "is like flying blindly. We're just writing checks."

Peter Goldstein, vice chancellor for finance and administration, insisted to us that state law, as interpreted by the school, doesn't require the type of audit called for by Rizzo and Marks. It simply requires that the school prove it isn't spending money on projects not presented first to voters. He added that the reallocations weren't simple but said he couldn't answer from memory specific questions about the 2005 bond election, including why the school chose to pursue tens of millions of dollars in reallocations so soon afterward, in January 2006.

"They've been very difficult decisions for both the administration and the board," Goldstein said. "[This has] not been some kind of snap judgment. We've really had to search and try to make sure there wasn't some way to contain costs otherwise."

The trustees often seem just as confused as the voters may be about the cost overruns. The trail is laid out in thousands of pages of bond proposals and ever-changing explanatory documents, all complete with glossy schematics and computer-generated students looking gleeful as they head off to class at one or another of the new facilities.

The section of City College's Web site dedicated to its bond projects is difficult to follow.

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