Fresno Unified will pay an extra $160,000 for renovations to Fresno High School due to concerns about school board president Brooke Ashjian’s conflict of interest with a local construction firm.
But the cost to the district could be even greater: Lewis C. Nelson and Sons – the Selma-based firm that was the lowest bidder for the project but was not awarded the job – can likely no longer work with Fresno Unified as long as Ashjian is on the board, and has filed a lawsuit against the district because of it.
At a special meeting on Monday, the school board unanimously voted to reject a bid by Nelson and Sons for renovations to Fresno High’s auditorium, despite its offer of $1.64 million being the lowest. That’s because Fresno Unified’s legal counsel – and an outside attorney – say Ashjian’s work with Nelson and Sons through his paving company prior to being elected a school board member creates an “indirect, non-remote financial interest.”
While state law considers business relationships among elected officials at least five years prior to assuming office to be remote, Fresno Unified attorneys say Ashjian first did official business with Nelson and Sons in 2013 when his company, Seal Rite Paving, was awarded a bid as a subcontractor.
$160,000The price difference between the lowest bid and second-lowest bid
But Michael Schoenfeld, a Sacramento-based attorney representing Nelson and Sons, contends that because Seal Rite Paving unsuccessfully bid for work with Nelson and Sons as far back as 2007, the relationship fulfills the five-year requirement.
Schoenfeld said Monday that the school board’s decision is not only harmful to Nelson and Sons – which has received 60 percent of Fresno Unified’s construction project money in the past 15 years – but also to taxpayers.
“The entity that’s done the most work for Fresno Unified School District is prevented from doing work in the future as long as (Ashjian) is a school board member,” he said. “It’s not right, it’s not fair, and it will remove from competition a significant player in the industry, which therefore means prices are going to substantially increase … So everybody gets harmed.”
Schoenfeld said he had electronically filed a lawsuit against Fresno Unified on Monday morning, but did not release further details.
Everybody gets harmed.
School board members said their hands are tied, though. Gary Schons, an expert on government policy and public integrity at the San Diego-based law firm, Best, Best and Krieger, acted as a hearing officer regarding the matter earlier this month, and ruled that Ashjian’s financial interest in Nelson and Sons does not qualify as a remote one that is lawful.
Trustees Christopher De La Cerda and Valerie Davis made it clear Monday that they feel the blame is on Ashjian – pointing out his original Statement of Economic Interest did not include several of the construction firms the district is concerned about.
“This sends a clear message to the public that we take conflict of interest issues seriously – very seriously. It sends everyone a reminder of our duty and our obligations as we sit here, for us to provide full and timely disclosure,” De La Cerda said. “I don’t take this decision lightly because of so many unintended consequences. Clearly it limits a very good, strong local company from doing business with us and also results in a higher cost to our taxpayers.”
Fresno Unified Trustee Claudia Cazares defended Ashjian, saying the law is unclear regarding this issue, and that financial interest forms are complicated.
It’s a lamentable situation to be in.
FUSD Trustee Elizabeth Jonasson Rosas
“They are difficult to fill out. I’m not saying you shouldn’t get advice when you need it, but I had to amend mine last year and I’ve been filling them out for 17 years,” she said. “I don’t think there was any negative purpose of having it amended, and I think we should refrain from making judgments on this on the dais.”
Davis said the incident could have been avoided had Ashjian been “forthcoming.”
Ashjian was not present for Monday’s meeting and did not comment.
Monday’s meeting comes amid an investigation by the California Fair Political Practices Commission of similar allegations regarding Ashjian’s conflicts of interest with Seal Rite Paving. Last year, the school board re-bid a $9 million construction project in which Nelson and Sons was the lowest bidder, citing the same concerns. For the past several months, Ashjian has abstained from voting on construction projects that the district claims he has an indirect financial interest in.
The district is recommending that the Fresno High project be awarded to the second-lowest bidder, Davis Moreno Construction, for $1.8 million. That firm is suing the school district over its bidding process regarding a different construction project that has led to a federal investigation of its no-bid deals.