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Daily Report: Money and Politics

Bullet train bidder has history of cost overruns

April 16, 2013, 10:24 AM | Christopher Cadelago, U-T San Diego

California High-Speed Rail Authority

SACRAMENTO – The lowest-bidding partnership for the first segment of California’s high-speed rail line includes a firm with a history of cost overruns and costly lawsuits.

The California High-Speed Rail Authority on Friday announced that the American joint venture of Tutor Perini/Zachry/Parsons was the “best apparent value” with a low bid of $985 million – below the $1.09 billion bid by the next-lowest bidder.

On construction projects in California, the lowest bidder has a strong advantage in the eventual selection process. Rob Wilcox, a spokesman for the authority, declined to comment on bidders as the matter is finding its way to the authority’s board of directors.

“Five world-class teams competed for this opportunity, and the process is ongoing,” Wilcox said.


The first segment of the estimated $68 billion system is proposed to run 28 miles from Madera to Fresno in the San Joaquin Valley.

According to an August report by The Bay Citizen, sister site of California Watch, 11 major projects in the San Francisco Bay Area completed by Tutor in the last dozen years cost local governments $765...

Winning bid to start high-speed rail far below estimates

April 15, 2013, 10:14 AM | Tim Sheehan, The Fresno Bee

High-Speed Rail Authority

A trio of American companies outbid four other teams of contractors vying for the contract to build the first segment of California's proposed high-speed train system in the San Joaquin Valley – and for several hundred million dollars less than state engineers estimated.

The consortium of Tutor Perini Corp. of Sylmar, Zachry Construction Corp. of Texas and Parsons Corp. of Pasadena offered the low bid of less than $1 billion. Five construction teams submitted bids in January to the California High-Speed Rail Authority for the first stretch of the rail line from east of Madera to the south end of Fresno.

Engineers for the rail authority – the state agency in charge of developing the statewide train system – had at one time estimated that the 28-mile portion would cost between $1.5 billion and $2 billion to design and build. More recent estimates suggested the bids would likely come in at $1.2 billion to $1.8 billion.


The Tutor Perini/Zachry/Parsons bid of $985,142,530 was deemed the "apparent best value" by the rail authority, based on a total score that considered both the price and the technical expertise of the competing companies. While Tutor/Perini/Parsons had the lowest technical score of the five bids – 20.55 out of 30 possible points – it also racked up 70 out of 70 points...

Some Calif. retirement trustees cancel Hawaii conference plans

March 8, 2013, 12:05 AM | Jennifer Gollan, California Watch

nemuneko.jc/Flickr.comThe Hilton Hawaiian Village Waikiki Beach Resort, site of this year's National Conference on Public Employee Retirement Systems, has five swimming pools.

At least three board members overseeing underfunded municipal retirement systems in California have scrapped plans to attend a conference in Hawaii even as conference organizers defended the gathering after a recent California Watch report revealed that some pension funds planned to send as many as five board members each at public expense.

Conference organizers also removed from their website a “2013 Attendance Justification Tool Kit,” which suggested that pension trustees rationalize their attendance at the conference as a way to network and boost their pension funds...

School discipline reform groups question plans for armed security

January 15, 2013, 8:03 AM | Susan Ferriss, Center for Public Integrity

Nick Ut/Associated Press Los Angeles police Sgt. Frank Preciado and Officer Wendy Reyes watch children arriving at Main Street Elementary School. 

As the White House considers proposals to allocate federal money for armed guards in schools, prominent school discipline reform groups have issued a report denouncing the idea as a misguided reaction to the school shooting in Newtown, Conn.

“Placing more police in schools has significant and harmful unintended consequences for young people that must be considered before agreeing to any proposal that would increase the presence of law enforcement in schools,” says an issue brief [PDF] released Friday by the Advancement Project, Dignity in Schools and other organizations.

The Advancement Project, founded in 1999, has offices in Washington, D.C., and California and has worked with school districts and states to adopt alternatives to suspensions and expulsions. Dignity in Schools also is devoted to working with districts and advocating fewer suspensions and less involvement of law enforcement in school...

Oakland school district mishandled federal money, state finds

December 21, 2012, 12:05 AM | Will Evans, California Watch

Michael Short/California Watch St. Andrew Missionary Baptist Church and private school in West Oakland 

The Oakland Unified School District failed to follow federal regulations in doling out taxpayer money to benefit local private schools and must pay some of it back, a state review has found.

The state Department of Education cited Oakland Unified for not meeting federal requirements in its distribution of federal Title I and Title II money to provide teacher training and tutoring for struggling students at private schools. Private schools are entitled to a share of federal money, but public school districts are responsible for maintaining control of the funds.

The state found that Oakland Unified paid instructors who were not independent of their private schools, shipped materials directly to the private schools without taking an inventory and let private schools design their own taxpayer-funded programs...

Emails reveal college officials knew they were overbilling state

December 18, 2012, 12:05 AM | Erica Perez, California Watch


Newly released emails and documents show which current and former senior administrators at the College of the Desert were aware that the district's enrollment figures were inaccurate and the college was overbilling the state – a deception that will cost the district $5.26 million in repayments.

A recent audit by the state Fiscal Crisis & Management Assistance Team characterized the overbilling as potential fraud, though it did not name names.

Beginning in 2003-04, officials at the Palm Desert college used an inaccurate formula for counting enrollment that assumed most classes met for the exact number of hours listed in the catalog. By that calculation, every three-unit class provided 54 hours of instruction per semester.

But in reality, many three-unit classes met for 52 or 53 hours per semester.

The seemingly small discrepancy was significant because college districts receive the bulk of their state funding based on the number of instructional hours served. Applied over thousands of classes per year, the overbilling added up to millions of dollars that should have gone to other districts...

Nonprofits seek influence with political giving

December 13, 2012, 12:05 AM | Amy Julia Harris, California Watch

UPDATE, Dec. 13, 2012: This story updates to add a comment from the executive director of the nonprofit San Francisco Food Bank.


As executive director of the Friends of the San Francisco Public Library, Scott Staub raises money to give to the city’s libraries. In his spare time, he raises money to give to politicians.

Staub heads a political action committee that is attempting to increase the political clout of the nonprofit sector in federal elections. Most of the committee’s members are affiliated with charitable organizations.

“We want to be a political player in a positive way,” said Staub, chairman of the Association of Fundraising Professionals PAC, an umbrella organization for charitable fundraisers. “There are lots of interest groups, and we decided we needed to have a greater voice for philanthropy.”

The PAC was formed about a decade ago and since then has contributed $68,000 to politicians who support pro-charity causes, especially maintaining the charitable tax deduction.

Charities are prohibited from donating to political campaigns as a condition of their...

Defense contractors fear fiscal cliff spending cuts will strike bone

December 12, 2012, 12:05 AM | G.W. Schulz, California Watch

The 621st Contingency Response Wing/Flickr

An estimated 1 in 4 jobs in San Diego County are tied to the military sector, and $32 billion in defense-related activities is linked to that area alone, more than the entire economic output of Panama.  

So what happens if tens of billions of dollars in defense spending is suddenly yanked? Defense contractors and other employers are worrying aloud about the answer as Congress and President Barack Obama quarrel over tax increases and budget cuts and the country edges closer to the so-called fiscal cliff.

The bureaucratic term for this doomsday scenario is sequestration, and while many have expected a smaller military, more profound downsizing has a lot of people nervous in California and elsewhere.

“The damage is already starting to happen,” said Chad Moutray, chief economist for the National Association of Manufacturers. “Many of our members are already seeing a slowdown in their sales, hiring and investment.”

Deep spending reductions were proposed last year as a way to force lawmakers and the president to address the federal government’s outsized budget deficit. If Congress and the White House take no action by Jan. 2, $500 billion in Defense Department cuts will automatically kick in over the next 10 years, with $55 billion of it expected in the...

Law bans gag clauses in settlements with licensed professionals

December 10, 2012, 12:05 AM | Christina Jewett, California Watch


Californians who sue licensed professionals, such as contractors or nurses, will no longer be subjected to legal settlements that ban them from talking to state officials investigating misconduct when a new law takes effect in January.

The law prohibits civil legal settlements that bar consumers from cooperating with authorities who probe negligence and other misconduct by state licensees, including accountants, veterinarians, pharmacists, behavioral therapists and physician assistants. Laws banning such gag clauses in settlements with physicians and lawyers already are on the books in California.

“They’re immoral,” said Julie D’Angelo Fellmeth, administrative director of the Center for Public Interest Law. Gag clauses "allow an unscrupulous person who is licensed by the state of California to hurt people, settle with them and then gag them so they are controlling the information that’s going to their own regulator.”

D’Angelo Fellmeth, who supported the bill, said court precedents already prohibit the gag clauses for a handful of professions. But the new law applies to thousands of licensees regulated under the state Department of Consumer Affairs.

Then-Assemblyman Jerry Hill, D-San Mateo, introduced the bill in February; he was elected to the state Senate last month. Two prior versions of the bill failed, including a 2004 bill vetoed by...

San Jose to keep strict rules on disclosing lobbyists' texts, emails

December 10, 2012, 12:05 AM | Jennifer Gollan, The Bay Citizen


Secret electronic communications between San Jose's elected officials and lobbyists during public meetings are now permanently banned.

In a nod to the ubiquity of handheld devices at public meetings, City Council members have imposed strict rules on themselves requiring that they disclose communications from lobbyists who email or text them during council meetings.

The policy, which the council approved unanimously Tuesday, cements San Jose’s role as a leader in requiring its elected officials to disclose their communication with lobbyists. The rules are effective immediately and make permanent the temporary requirements approved by the council in March 2010.

“There were some instances where lobbyists were communicating with council members on the dais,” Mayor Chuck Reed said in a phone interview. “We want to have sunshine so people are made aware of lobbyists’ interactions with elected officials.”


If a lobbyist contacts a council member by text, email or handwritten note during a public meeting, the member is required to announce the identity of the lobbyist and the subject of the communication before it comes to a vote...

Calif. courts face federal scrutiny over interpreter access

December 6, 2012, 12:05 AM | Bernice Yeung, California Watch


U.S. Department of Justice representatives will visit California this month as part of an ongoing investigation into whether the state's courts are violating federal laws for failing to provide interpreters in many civil and family law cases.

The investigation stems from a December 2010 complaint filed by the Legal Aid Foundation of Los Angeles on behalf of two litigants who were not provided with Korean interpreters for their court hearings. The complaint alleges that in failing to provide the interpreters, the courts violated Title VI of the federal Civil Rights Act of 1964, which prohibits national origin discrimination.

These cases “are just two examples of many LAFLA (Legal Aid Foundation of Los Angeles) clients who have been denied access to the courts based on their limited-English proficiency,” according to the complaint. 

One of the Southern California litigants described in the complaint is a then-72-year-old woman on a fixed income who filed for a restraining order against an apartment maintenance worker she said groped her and exposed himself to her. 


In October 2010, she went to the Los Angeles County Superior Court and filed a written request asking it to waive the fees for an interpreter but was denied because there "is no right to an interpreter provided at...

State steps up enforcement of digital privacy protections

November 30, 2012, 12:05 AM | Matt Drange, The Bay Citizen


A handful of mobile app makers that defied an order from state Attorney General Kamala Harris to post a written privacy policy can expect enforcement actions to be filed against them as early as next week.

Several companies might face sanctions after Harris sent warning letters in late October to 100 app makers that had not posted a written policy. The vast majority agreed to comply, said Travis LeBlanc, who oversees the attorney general’s new Privacy Enforcement and Protection Unit.

The companies that rejected her order maintain they aren’t required to have a policy because the personal data they collect is not subject to the California Online Privacy Protection Act, LeBlanc said. He declined to name the companies or say how many were violating the law.

The prevalence of mobile app downloads has exploded in recent years, while enforcement of privacy protections has struggled to keep up. Privacy advocates say having a policy in place is the minimum requirement for app makers and a necessary first step in educating consumers who increasingly rely on mobile devices to share and store sensitive information...

SFO to return $2.1 million in misspent stimulus funds

November 27, 2012, 12:05 AM | Zusha Elinson, California Watch

UPDATE, Nov. 27, 2012: This story updates the inspector general's estimate of improper payments made by the Department of Transportation.

kla4067/Flickr San Francisco International Airport 

The Federal Aviation Administration will take back $2.1 million in stimulus funds that it gave to San Francisco International Airport because the money was used improperly, according to the Department of Transportation’s inspector general.

The airport received $14.5 million in stimulus funds to improve runways and taxiways, which was completed in 2010. But the inspector general said in a report earlier this month that $2.1 million was used for unauthorized construction. It is unclear what specifically the money was spent on.

It is the second time in two years that the San Francisco airport has been found to be misusing federal stimulus money.

The airport disclosed to bondholders in January that it was conducting an internal review of how it spends grant funds and is “working to improve its internal controls and procedures to ensure compliance with its Federal grant agreements.”

SFO spokesman Doug Yakel said the airport is still awaiting the completion of a final audit of the federal grants. But he said the “$2.1 million recovery described in...

State lawmaker brothers accused of money laundering

November 21, 2012, 12:05 AM | Lance Williams, California Watch

Tom Berryhill photo State Sen. Tom Berryhill 

Two San Joaquin Valley lawmakers have been accused of laundering $40,000 in a scheme to dodge California’s tough limits on political contributions.

In an accusation filed Oct. 22, the state Fair Political Practices Commission said state Sen. Tom Berryhill, a Modesto Republican, and Assemblyman Bill Berryhill, a Stockton Republican, repeatedly had violated campaign finance laws during the 2008 election.

The lawmakers deny wrongdoing and are contesting the charges, said Charles Bell, a lawyer for Tom Berryhill.

The Berryhills are brothers, and in 2008, they were running for the Assembly in adjacent districts.

The commission said that less than a week before the election, Tom Berryhill gave his brother’s campaign $40,000 – more than 11 times the $3,600 donation limit set by state law – to pay for television advertising.

To mask the true source of the funds, the commission contended that Tom Berryhill steered the money through Republican central committees in Stanislaus and San Joaquin counties, which by law could accept as much as $30,200 per donor...

Pastors challenge IRS rule with partisan talk

November 21, 2012, 12:05 AM | Amy Julia Harris, California Watch

J. Helgason/Shutterstock

Larry Ihrig, the longtime pastor of Celebration Christian Center in Livermore, began a recent Sunday sermon with the issue on everyone’s mind: the outcome of the presidential election.

“Now, some of you may glory in the result, but I know some of you are disappointed,” Ihrig told the 100 members of his evangelical Bay Area church after Election Day.

In the lead-up to the Nov. 6 presidential election, he was one of about 1,600 religious leaders around the country who talked politics from the pulpit, challenging a 1954 law that bans churches from supporting candidates during worship services. 

The movement, called Pulpit Freedom Sunday and organized by the Arizona-based Christian legal group Alliance Defending Freedom, encourages pastors to “preach a biblically based sermon regarding candidates and the election without fearing that the IRS will investigate or punish the church,” according to the group’s website.

Pastors across the country have posted videos on the Internet of their direct or thinly veiled political endorsements and sent letters to the...

Study questions success of border enforcement

November 20, 2012, 12:05 AM | G.W. Schulz, California Watch

Brian Auer/Flickr

When the Department of Homeland Security trudged up to Capitol Hill this year and asked lawmakers for another 365 days worth of funding, as every federal agency does each year, officials ticked off a list of accomplishments they presented as evidence of the agency’s ongoing success.

The department pointed to a marked decrease in the number of immigration apprehensions by the Border Patrol. Apprehensions, they said, are “a key indicator of illegal immigration,” according to its annual budget request totaling $39.5 billion for the 2013 fiscal year.

Such apprehensions are down more than 50 percent since 2008, and total just one-fifth of what they were in 2000, the request claims.

But a downward trend in total apprehensions may not prove the department’s border enforcement strategies are working, because they don’t reflect the number of people who elude capture or who are discouraged from attempting to cross again after being caught once...

Border agency looks to expand drone fleet

November 19, 2012, 12:05 AM | Andrew Becker, California Watch

U.S. Customs and Border Protection A U.S. Customs and Border Protection unmanned aircraft, or drone. 

U.S. Customs and Border Protection last month received its latest unmanned aircraft, but it’s a new sole-source contract that could approach a half-billion dollars that offers the latest insight into the agency’s vision for its controversial eyes-in-the-sky drone program.

The border agency has locked in a five-year deal with a San Diego-area aeronautical company estimated to be worth as much as $443 million, according to a document posted Nov. 1 on the federal government contracting opportunities website. An estimated $237 million of that would buy up to 14 drones and related equipment. Whether Customs and Border Protection will actually get the money to spend is another question.

Congress hasn’t appropriated funding beyond the 10th drone the agency just received, which will fly from Cape Canaveral, Fla., and the agency hasn’t asked for any more for the 2013 fiscal year...

Win for environmental law is loss for Wal-Mart

November 16, 2012, 12:05 AM | Will Evans, California Watch

Courtesy of Wal-Mart

A state appellate court has dealt a blow to Wal-Mart’s strategy of using petition drives to push through approval of new superstores while avoiding California’s environmental law.

In a cookie-cutter pattern documented by California Watch, the mega-retailer bankrolled local signature-gathering efforts to build superstores or repeal restrictions on big-box stores in five California cities last year. Once 15 percent of local voters signed the petitions, city councils had to either approve the projects or hold a special election, which can be costly. Wal-Mart then urged cities to approve the petition rather than send it to voters, angering some officials who felt bullied.

Wal-Mart has said the strategy is necessary to avoid politically motivated lawsuits under the California Environmental Quality Act.

Voter-approved ballot measures that stem from petitions are exempt from environmental review and protected from CEQA lawsuits. Wal-Mart argued that when a city approves one of its petitions without an election, the project would be protected, too.

But in a strongly worded opinion, a three-judge appellate panel ruled late last month that the landmark environmental law still applies...

Some DMV voter registrations fall through cracks, registrars say

November 12, 2012, 12:05 AM | Will Evans, California Watch


Jonathan Eldridge wanted to vote for president.

The Santa Rosa resident had registered to vote – or so he thought – at a Department of Motor Vehicles office several months ago. But when he called the Sonoma County registrar last week to find out why he hadn’t received any ballot information, Eldridge was told there was no record of his registration.

Eldridge's only option was to come to the registrar's office, apply for a last-minute court order allowing him to vote and hope that a judge would approve it. 

"I was appalled," said Eldridge, 44, who works for a computer forensics company. "I was like, 'How can someone deny me the right to vote?' I couldn’t believe it."

County registrars are all too familiar with the problem. They say every year, they hear from a smattering of frustrated citizens who tried to register at the DMV, only to find themselves ineligible to vote. Sonoma County had 25 applications for court orders to vote this year. Santa Cruz County had about 60, mostly from people who tried to register at DMV offices.


There have been problems since the federal "motor voter" law took effect in 1995, requiring the DMV and other agencies to offer applications, said Gail Pellerin, Santa Cruz County's clerk and registrar.

Pellerin's motto, she said, is: "You...

Facebook gives cash to N. Calif. town over traffic concerns

November 8, 2012, 12:05 AM | Matt Drange, The Bay Citizen

Noah Berger/For The Bay Citizen Facebook headquarters in Menlo Park 

Facebook’s move to Menlo Park late last year has created a small windfall for one of the richest communities on the Peninsula.

The town of Atherton, a wealthy enclave near the new Facebook campus, received $350,000 from the social media giant last month to allay its concerns over increased traffic.

Now the question for the town of 7,000 people is what to do with the cash.

“We’re not in a big hurry to spend the money,” said Atherton Mayor Bill Widmer. “We have a number of issues we’re looking at.”

The payment is the smallest Facebook has made to appease its new hometown and neighboring communities.


East Palo Alto, one of the poorest cities in the region, received $650,000 from Facebook to compensate for increased congestion on its streets.

Menlo Park, meanwhile, received $1.1 million to finance street improvements and other projects to handle the thousands of employees working at the new location.

Facebook also will pay Menlo Park at least $8.5 million over the next 10 years to offset the loss of local sales taxes formerly generated by Sun Microsystems, the computer software company that used to occupy the space Facebook now calls home. Menlo Park does not levy a sales tax on...

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