U.S. Attorney Ends Probe Into Fresno Unified Construction Projects

U.S. Department of Justice officers based in Sacramento say that federal research into construction contracts awarded with the aid of Fresno Unified School District is over, and no fees may be filed. The probe, which became released in August 2015, began with a federal grand jury subpoena of district statistics related to its use of lease-leaseback contracts to build and renovate schools. We believe that they came to the appropriate conclusion, and the district is thrilled that this chapter is closed,” stated legal professional Carl M. Faller of Fresno, a former assistant U.S.

An attorney who represented Fresno Unified in the criminal research. Faller said that he believed federal officials announced due to “the big amount of public discussion” approximately the investigation. “They rightfully determined to notify the general public while it was concluded, and we very a whole lot admire that,” Faller said. Fresno Unified officers have steadfastly maintained that the contracts have been the prison and that no district employees engaged in wrongdoing.

Civil Lawsuit Over Gaston Contract in July

Three months earlier than the federal inquiry commenced, the Fifth District Court of Appeal reversed a Fresno Superior Court decision in a lawsuit hard Fresno Unified’s award of a $37 million agreement to build Rutherford B. Gaston Middle School to Harris Construction. The enchantment court-based part of its reversal on finding that the agreement between Fresno Unified and Harris wasn’t an “authentic” rent because the contractor didn’t finance the task.


However, two different California appellate courts have considered that rent-leaseback is exempt from competitive bidding requirements. The law governing leaseback creation doesn’t require a real lease and contractor financing. Filed through Stephen Davis of Davis Moreno Construction Inc., that lawsuit is scheduled to be heard by way of a Fresno choice beginning in July.

Documents Sought in Federal Subpoena

The federal subpoena required Fresno Unified to provide economic files regarding its leaseback contracts. The district switched from aggressive bidding to the leaseback mechanism under then-Superintendent Michael Hanson following voter passage of the $280 million Measure Q bond in 2010.

In the leaseback arrangement, a district forgoes the traditional competitive bid procedure. Instead, it hires a firm to the front the price of a mission and pays off the contractor over the years. Fresno Unified repeatedly used the leaseback method following the passage of Measure Q, although it had the price range to pay for Gaston and renovate many colleges.

The federal investigation additionally examined the private emails and get in touch with statistics of district officers and sought statistics touching on financial dealings among contractors and officials, and the campaign contributions of Harris Construction and any other business enterprise, Bush Construction, in Fresno Unified school board races. In January 2017, Fresno Unified trustees fired Hanson on a 4-2 vote. The dismissal came eight months earlier than Hanson’s previously announced departure date from the district.

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