Inside Fresno Unified’s massive Nutrition Center
The district board approved Wednesday a $120,000 contract to the firm for an internal audit of bids related to the grant-funded Fresh Fruit and Vegetable Program, which allows the district to provide free fruit and vegetable snacks during recess.
In 2018, supplier David Miller of Fresno Produce claimed the district had paid a few cents more for each item than what was bid, totaling up to an overpayment of a million dollars or more over the years.
Miller said he first received an anonymous letter alerting him to a possible discrepancy, and subsequently requested four years worth of invoices from the district that he compared to the original bid amounts. He said he did so after losing portions of the FFVP contract to a rival supplier who offered lower prices, but then raised them after the contracts were awarded.
At one campus, invoices obtained by Miller showed the district overpaid by $1,304 in one month.
The district denied any claims of wrongdoing and said the snack program was flexible, allowing Fresno Unified to approve price adjustments in certain situations. Mike Kahaian of 1st Quality Produce, the winner of the contracts in question, said there were a number of possible reasons why a billed price might be more than a bid price, including inclement weather and substitutions for better-tasting or in-season produce.
Miller said Wednesday that the internal audit was a good step forward.
“Even if it’s a grant, it’s about watching the taxpayer’s money,” Miller said.
Miller said he’s not yet pursuing legal action, and didn’t plan to do so unless the district failed to take action on his claims. The district has since divided its contract for the Fresh Fruits and Vegetables program in two, so that price changes are reflected by both suppliers.
“It was frustrating to be asked to hurry up and get another bid in,” Miller said. “How can I bid when I know you’ve allowed someone else to go up?”
Trustee Carol Mills said she supported an audit to determine whether the district had overpaid and if so, to find what could be done to assure that it didn’t happen again.
She added that an overpayment would need to be looked into to determine how and why it occurred, whether it violated any state or federal laws and whether personnel consequences were necessary.
“These are taxpayer dollars and FUSD, and its personnel, need to be accountable for how the money is spent,” Mills said.