Southwestern College to Take Contractors to Court

Following release of the college’s own external audit, the Governing Board announced Wednesday evening the college district will file lawsuits against fired contractors.

• By Albert Fulcher
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• 10:37 am

After a closed session meeting Wednesday evening, the Southwestern College Governing Board announced plans to file suit against Seville Construction Services, BCA Architects, Echo Pacific and employees throughout as defendants.

Governing Board President Norma Hernandez said the board gave direction to legal council to initiate litigation.

“The substance of the litigation will include challenge to the procurement of contracts related to the corner lot project and conduct related thereto,” she said. “The vote was unanimous.”

Investigators raided the homes of SWC former trustees Yolanda Salcido and Jorge Dominguez March 20. One week later, former vice-president of business and financial affairs Nicholas Alioto and Dana Grimes, defense attorney for BCA Architect Paul Bunton appeared before Judge Michael Smyth March 26.

Charged with two felonies, perjury and filing false instrument and one misdemeanor of wrongful influence, Alioto plead not guilty to all charges.

If convicted on all charges, Alioto faces a maximum of four years and two months in prison and a $10,000 fine. He was booked and released April 1 and is scheduled for status report on May 18.

Grimes submitted a written admission of guilty to one misdemeanor charge of aiding in the commission of a misdemeanor. Awarded a $55 million contract in April 2010 for architectural services for SWC’s corner lot project, Bunton faces a maximum of six months in jail and fines up to $1,000. The court set a sentencing date of June 19.

Henry Amigable, former Gilbane/SGI employee in the SUHSD investigation, plea bargained his case and similarly plead guilty to a misdemeanor count avoiding felony charges of offering a bribe and obtaining a thing of value to influence a member of a legislative body. Amigable is due in court for sentencing June 22 and faces up to six month in jail and $1,000 in fines.

Hired as program director by Seville Construction Services, Inc. in March 2009, Amigable was the firm’s program manager when awarded a five-year, $2.75 million contract for program management services for the college’s corner lot project in November 2009.

In addition to evidence collected by the DA’s investigation leading to search warrants and charges, SWC’s current Governing Board approved the hire of independent forensic auditor Scott Seo of Seo Consulting, Inc.

In April 2011, to perform a focused special review involving the award of contracts related to Prop R and the activities of the Southwestern College Foundation. Governing Hernandez said the board is fully cooperating with the DA’s office and released its own internal audit on March 14.

Seo reported documentation stating selection of firms awarded contracts was inadequate and the price negotiation processes “took place in a vacuum and lacked transparency.” He stated there was not enough documentation to verify Seville’s contract and that the governing board did not have sufficient information provided to recommend the highest bid out of three finalists for program management.

In investigating the $4 million corner lot project awarded to Echo Pacific, Seo reported that the construction company had an unfair advantage in its revised cost proposal and there was no mention of the lower cost proposal of Barnhart Balfour-Beatty, who was awarded the construction management at risk contract for the college’s Central Plan/Field House.

Chris Rowe of Echo obtained a trip to Napa Valley by bidding $15,000 at the Southwestern College Foundation Gala “Havana Nights” held in March 2010.

Donated by BCA and advertised as “a weekend of golf and wine tasting in the beautiful Napa Valley” with Vice President Nicholas Alioto, Seo reported Rowe, Bunton, Alioto and Amigable went the weekend of June 25, 2010. This trip came immediately after initial RFP deadline and prior to revised proposals on June 30, 2010 and Echo’s corner lot contract.

With a new plan in place, Superintendent Dr. Melinda Nish announced the governing board postponed all corner-lot construction for one year to redevelop the college’s infrastructure before sending out new RFPs. Part of the plan is to complete the corner lot parcel 10 years earlier than the original plan.

“This is part of our commitment to ensure the public’s money is used appropriately,” she said.

Bob Temple, interim vice president of business and finance said the approximate $8 million spent is largely work completed and moving the project completion date earlier will bring a significant savings to the college.

“I believe that to the extent that the projects are being completed sooner, any cost that have been spent to date will be recuperated with the dollars that will be saved by expediting the project,” he said. “Only the corner lot has been stopped. The work on the central plant and field house and other projects are still going forward.”

http://imperialbeach.patch.com/articles/southwestern-college-district-taking-proposition-r-contractors-to-court

Alioto Central Character In Foundation Investigation

Alioto Central Character In Foundation Investigation

By: Albert Fulcher, Senior Staff Writer

Published: Thursday, March 22nd, 2012 at 11:16 pm

An independent investigation of the Southwestern College Educational Foundation has lifted the curtains on two years of secretive operations by a former vice president, including a mysterious 2010 that mixed fund raising for scholarships with multimillion dollar construction contracts, extravagant gifts and campaign contributions while banning all news media and cameras.

 

Forensic auditor Scott Seo compiled a 33-page report released to the public by the governing board this week. Much of the carefully-worded report centers on the activities of Nicholas Alioto, SWC’s former vice president of business affairs. Alioto was cited for “inappropriate” activities during his involvement in the planning and management of the 2010 “Havana Nights” gala at the Loews Coronado Resort, including multiple instances of conflict of interest. Alioto solicited sizable donations from future Proposition R contractors and other construction firms who had made bids for contracts.

“It was inappropriate for the Vice President of Business and Financial Affairs to serve in such a direct fundraising capacity for the 2010 Gala, especially considering his responsibilities in the Proposition R contractor selection process,” wrote Seo. “Some of the maximum sponsorships and significant auction prizes were awarded by Proposition R contractors who were already or would eventually be awarded contracts.”

Seo’s investigation had a long list of “concerns” and “inappropriate” behaviors related to Alioto. Among them: nearly $15,000 in uncollected pledges, poor accounting practices, appearances of possible influence peddling, conflicts of interest, lax internal controls, inappropriate involvement of companies bidding for construction and architectural contracts, overpayment of vendors and use of Proposition R funds to pay for Foundation activities.

“It is not unreasonable to suggest that a potential donor could have been compelled to make a donation based on a solicitation from Mr. Alioto if his/her firm was currently or could potentially be considered for a contract that was under control of Mr. Alioto and his responsibility as the Vice President of Business and Financial Affairs,” read the report.

Alioto was able to insinuate his way into Foundation affairs follow a spring 2008 reorganization of the college by former superintendent Raj K. Chopra and approved by a previous governing board. Chopra fired or transferred Foundation staff, including its director, and transferred control of the Foundation to his office. Gutted, the Foundation lay dormant for nearly two years. Chopra cancelled two of the organization’s annual galas and conducted little visible fund raising.

In 2010, with Proposition R contracts out to bid and a contentious governing board election looming in November, Chopra ordered the gala resurrected. The March event at the Loews Coronado was attended by several contractors involved in the San Diego Country District Attorney investigation, including Seville Construction, Echo Pacific and BCA Architects. Other contractors also bidding for Proposition R funds were solicited for contributions by Alioto. Echo Pacific was the winning bidder for a weekend of wine tasting and golf with Alioto at a Napa resort hotel. Representatives of Echo Pacific joined Alioto on the getaway and three weeks later were awarded a $4 million contract from Alioto which was approved by the board. Incumbent board members Terry Valladolid and Yolanda Salcido later received large campaign contributions from Echo Pacific. Valladolid and Salcido were staunch supporters of Chopra and Alioto.

Alioto’s home was raided by the San Diego County District Attorney in December along with those of Echo Pacific’s Henry Amigable, former SWC director of facilities John Wilson, and four Sweetwater Union High School District trustees. Amigable and three of the trustees have been charged with multiple felonies for bribery and influence peddling. Alioto and Wilson have yet to be charged. Investigators reported they were unable to find Chopra, who may have fled the country. The U.S. State Department has a mutual legal assistance agreement in place with India, Chopra’s native country. San Diego County District Attorney spokespersons were asked if Chopra could face extradition if charged with felonies, but they did not reply before deadline.

Seo, in his report, said he examined several aspects of Alioto’s involvement with the Foundation, including:

Uncollected pledges in excess of $15,000. When an independent auditor requested documents in an attempt to reconcile the discrepancy, Alioto was uncooperative and took nearly four months to respond. Seo wrote that there were also $3,000 in uncollected sponsorships and a $1,047 overpayment to one unidentified vendor.

Fellow Circle sponsorships. Seo wrote that “many of the firms who were awarded Proposition R contracts also contributed…maximum sponsorships” of $15,000. In total, Seo reported, more than $190,000 was pledged for these sponsorships. “To the extent that contributions were made in response to aggressive solicitations made by SWC officials who were in positions of awarding Proposition R contracts would have been inappropriate,” Seo concluded.

Alioto’s involvement. Seo said that Alioto’s active participation in the gala “could have the appearance of a potential conflict.” Seville Construction also participated in the planning of the gala and the 2010 Foundation golf tournament “with the full knowledge and possible direction of Alioto,” Seo concluded. “To the extent that Seville was compensated for these activities from Proposition R funds under their contract with SWC would be inappropriate,” wrote Seo.

Insufficient internal control. Seo agreed with the Foundations auditor that internal controls were lax following Chopra’s dismissal and reassignment of Foundation staff. Governing board member Dr. Jean Roesch, a staunch Chopra supporter, was the board’s liaison to the Foundation in 2010.

Angela Amigable. Seo expressed concern that Alioto hired Henry Amigable’s wife, Angela, to work on the gala and paid her $3,000 without a contract or agreement between her and the Foundation.

Seo concluded that Foundation operations improved substantially for the 2011 gala. Chopra resigned following the November 2010 election. The new board majority of Norma Hernandez, Tim Nader and Nick Aguilar directed Interim Superintendent Denise Whittaker to restore Foundation staff and remove Alioto from Foundation affairs. Alioto resigned in February 2011. Hernandez became the board’s Foundation liaison. Seo said the 2011 gala corrected the problems and was “well-organized and well-managed.”

http://www.theswcsun.com/2012/03/22/alioto-central-character-in-foundation-investigation/