An audit of hiring practices in the Los Angeles Unified School District’s $20 billion construction program has revealed nearly 230 possible conflicts of interest, including four cases of possible financial misconduct, the city controller says.
The district describes its 8-year-old school building program as the largest school construction project in U.S. history. It has involved the hiring of more than 1,000 contractors.
The violations uncovered by the audit largely occurred before 2006, when controls were especially lax in the program, Controller Wendy Greuel said last week, adding that since then, the district has tightened hiring oversight.
The four more-serious cases involved hiring decisionmakers who stood to benefit financially from the company selected because they had investments in it, Ms. Greuel said. She declined to reveal details, saying only that she has referred the cases to the school district for review over the next 30 days. The district could turn the cases over to the prosecutor’s office if it deems a criminal investigation is warranted.
The audit also found 225 instances in which contractors serving on the district’s hiring panels hired others from their own firms, and 80 instances in which contractors were hired without going through a requisite three-member hiring panel.
Schools Superintendent Ramon Cortines requested the audit after a former contracted construction manager was indicted on charges of receiving kickbacks from employees he had hired. Ms. Greuel described the request as unusual and rare and noted the audit marked the first time the city controller had examined the school district. She said she hoped to be able to conduct more probes into school district issues, such as textbook purchasing.
