LAUSD: COPS Fund 765 Million in Debt

Flap reported yesterday on Superintendent Roy Romer’s Secret Slush fund in this piece.

Now, Mayor Sam via Full Disclosure has this piece, Secret LAUSD Bond Operation.

Full Disclosure Network will be issuing a report that claims that the Los Angeles Unified School District maintains “a secret public financing operation whereby they quietly issue non-voter approved, tax-exempt bonds, mounting billions in public debt, and which is passed on to unsuspecting taxpayers for undefined projects.”

Anthony Patchett, special district attorney and head of the LA County D.A.’s Belmont investigation, describes the LAUSD financing operation as a “pyramid scheme to defraud the voters” and LAUSD Chief Facilities Executive Jim Mc Connell confirms the existence of a secret public benefit corporation saying the LAUSD Land Bank is funded by Certificates of Participation (COP) bonds.

Full Disclosure has a video report online featuring interviews with Patchett, LAUSD Inspector General Don Mulllinax, former US Attorney General Ed Meese who describes the secret bond financing process as a “gimmick” to fool the taxpayers. To view the report and interviews, click here.

Actually, Certificates of Participation are not secret nor illegal.

However, do they avoid the intent of voter adopted Proposition 13? Do they increase debt with little public scrutiny? Do Bond underwriters make commissions?

You betcha!

Superintendent Romer has alot of explaining to do…… eventually before the Los Angeles County Grand Jury.