Superintendent Says Cash Exchange was for Campaign

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    NEWSLETTERS

    NBCSanDiego
    The superintendent of San Ysidro school district said in a June 20 deposition that he accepted $2,500 in cash from a contractor in 2010 in the parking lot of the Chula Vista Butcher Shop, a South Bay restaurant that has since been renamed the Steak House.

    The superintendent of San Ysidro schools said in a June 20 deposition that he accepted $2,500 in cash from a contractor in 2010 in the parking lot of the Chula Vista Butcher Shop, a South Bay restaurant that has since been renamed the Steak House.

    San Ysidro schools superintendent Manuel Paul said the money was for a campaign contribution for board member Yolanda Hernandez.

    “It was cash given to me by Mr. Loreto Romero,” Paul said. “He gave me cash for campaign posters for Mrs. Yolanda Hernandez.” Paul later added the amount was about $2,500.

    Hernandez did not respond to multiple requests for comment made over several weeks.

    Loreto Romero concurred with Paul’s description of the cash exchange, saying the money was a political donation. When pressed, Romero admitted he was hoping to compete for a construction management contract with the school district at the time the money was dropped off.

    A donation from Romero does not appear on any campaign finance forms available on the San Diego County Registrar’s website for Hernandez and the county campaign services supervisor confirmed Friday that no amendments have been made or filed recently.

    Even if the money was a political donation, San Diego State political science professor Brian Adams said exchanging that much cash breaches state campaign finance laws.

    “For cash, it’s $99 for what you can receive. Everything else has to be in a check,” said Adams, who has written a book on local and state campaign finance laws.

    Paul’s deposition was taken as part of a lawsuit brought by Chula Vista-based Manzana Energy, a solar panel company suing the district for breach of contract. The approximately $18 million services contract would have allowed the school district to purchase solar power from political consultant Art Castañares’ company, Manzana or EcoBusiness Alliance - another business name for Manzana.

    Under the deal, San Ysidro agreed to buy power generated by the panels from Manzana Energy over 25 years for a flat fee of $18.9 million. Manzana was to pay $16 million to buy and install the panels, which would have generated about 70 percent of the schools’ power needs. School district officials estimated at the time that the deal would save San Ysidro $10.5 million in energy costs over the 25 year life span of the contract.

    The equipment was supposed to be installed in early February 2008, but not one panel had been put into place when the contract was terminated in October 2011. Because no panels were installed, no district funds were ever spent on the endeavor.

    Castañares’ is building a case that his contract was terminated because he refused to “pay to play.”

    In the deposition, Paul said he took the cash from Romero to a business in Tijuana to make posters for Hernandez’s election campaign.

    “That’s completely illegal. And it’s very clearly illegal,” said SDSU professor Adams, who said that all campaign cash must be deposited into a campaign account and then expenditures made from that account to promote transparency.

    “You can of course amend your form and that does frequently happen with candidates who make mistakes, but the initial mistake is still there and they can still be fined for that. Also, what’s typical in these types of cases is the money has to be returned. Now, I don’t know if they’ve returned the money, but it is very likely they will be required to return the money to the contributor.”

    San Diego County District Attorney Bonnie Dumanis is prosecuting six current and former officials in the neighboring Sweetwater school district for their role in what she has described as a pervasive and systemic “pay to play” atmosphere. Dumanis said the Sweetwater officials traded their votes on key contracts in exchange for Lakers tickets, Halloween costumes, expensive meals and other entertainment.

    In an email statement in response to questions about the 2010 cash exchange, Paul wrote:
    “We are in the middle of litigation with EcoBusiness System I am not willing to discuss anything relative to pending litigation. Apparently your interest involves information you have learned from a deposition. I am surprised that you would have a deposition that has not been filed in court in your possession. That being said, I believe that there are ulterior motives by parties to this case which relate to an effort to pressure an improper resolution. That will not occur, and I will not allow my position to be used for such a purpose. I must respectfully decline your request to go camera. I believe that the issue you have discussed with others in my office has been completely obfuscated. I believe the proper reporting regarding campaign contributions have been made."

    NBC7 asked Paul why he was collecting campaign money on Hernandez’s behalf, as he is not listed as her campaign manager or treasurer in disclosure forms, but he has not yet responded to that question.

    During the Fall 2010 cash exchange in the parking lot, San Ysidro schools was accepting bids for construction on a new school, Vista Del Mar. According to Paul’s testimony in the deposition, companies who competed for the contract included: Echo Pacific, Barnhart Balfour Beatty, Erickson Hall, GI Construction Management, Seville Construction Management and HAR Construction Management, a company headed by Loreto Romero’s brother, Hector.

    Erickson Hall eventually won the contract.

    The San Ysidro school district consists of seven schools serving about 5,200 students in kindergarten through eighth-grade, along the U.S. border with Mexico.

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