On Oct. 18, 2010, Miki Jackson at the tabloid HollywoodHighlands.org blog she runs with John Walsh broke the story about the LA Community College District hiring as inspector general over its $5.7 billion construction program Christine Marez, an ambitious construction manager without auditing experience who had formed her firm just a few months earlier.
“Community College District Chooses the “Hotness,” AKA Christine Marez, for their new $701,680 inspector general post,” said the headline.
” ‘The Hotness’is now Marez describes herself, with photos of her clinging to a shinny stripper pole at the Playboy Mansion and in numerous sexy shots from Vegas,” the post began. “Having gone to her ‘myspace’ page and looked at her ‘revealing’ shots I would have to agree she is not guilty of false advertising … Marez lists her interests as ‘men’ on the page — we are sure the interest is returned. She has a Facebook page too — that ones a little tamer — but she asks everyone to wish her luck — as she tries to land the big LACCD fish. Seem like she didn’t really need luck — not when you’re ‘The Hotness.’ ”
A few days later, I followed up on Miki’s report — unlike the corporate media — and set up my article with the headline “Wanted: A Thousand Citizen Watchdogs.” I traced how our local government agencies — the MTA and LAUSD — had gutted inspector general positions that were created in the wake of scandals and predicted accurately that the momentum to create a Rate Payer Advocate to clean up the DWP would be weakened dramatically by the time it got on the ballot in March 2011 — a crime against good government that was the handiwork of wannabe Mayor Eric Garcetti.
Marez was not without some qualifications: ”USC-trained electrical engineer who says on her Linked In site that her experience includes 10 years as a “senior construction manager” at the DWP, eight years with an engineering company with the last three as a consultant on LAUSD’s construction program … For the past four years, she lists herself as “Director of Policies” on construction.”
A February 2009 LAUSD audit of the Facilities Division where Marez worked found a lot of problems: 1,277 contractors earning $186 million — 1.7 times the cost of full-time employees. It noted the lines of authority between staff and consultants were “blurry,” causing a “lack of accountability” with consultants like Marez being hired routinely as staff.
A consultant was indicted and the head of the Facilities Division eventually resigned but Marez — whose 2010 New Year’s resolution was to “double my income” — landed on her feet, formed the firm Policy Masters in May and got the lucrative IG contract in November, beating out Ernst & Young and Deloitte, giant firms with vast experience.
“My new firm is at the top of the list for an amazing contract!! Asking for your love and support,” she said on her Facebook page.
Just days after Marez got the IG job at LACCD, City Controller issued her audit on the school district’s construction program “giving a clean bill of health to the district — and presumably Marez, who shared responsibility for its policies and standards.
“While we found some potential conflicts of interest during an earlier era at the district, it appears that the LAUSD under its current leadership has made significant progress in reforming the process for awarding construction projects,” said City Controller Greuel. ”The district still has room for improvement, but they appear to be on the right path.”
A year later, in October 2011 with Marez on the job for 12 months, the LA Times tore apart the Community College construction program in a series entitled “Billions to Spend: Part 1 — Waste throws wrench into Los Angeles community colleges’ massive project.”
“Poor planning, frivolous spending and shoddy work dog the sprawling system’s bond-financed construction program” declared the secondary headline.
It wasn’t so much news at the time except for the details since State Controller John Chiang already disclosed two months earlierin August 2011 that the nation’s largest community college district “could not produce complete and timely records, spent funds outside voter-approved guidelines, ignored its own procurement rules, failed to plan effectively, and provided poor oversight of bond funding.”
“Local voters raised their property taxes for a major investment in workforce development and higher education,” said Chiang. “Shoddy fiscal management and sub-par oversight of a project of this magnitude will undermine the public’s trust and threaten billions of public dollars.”
Chiang did not stop there, his audit criticized the lack of citizen oversight and the appointment of Marez as inspector general.
The oversight committee, he said, “which is required to issue annual reports, failed to issue any report for seven years. The latest report was found to be virtually meaningless, noting only that the committee members had met and providing no evidence that they thoroughly scrutinized bond expenditures.”
The audit also examined the district’s creation of an Inspector General for bond funding. The Inspector General position was designed to be an independent entity guarding against waste, fraud, and abuse. But when establishing this position, the district ignored its own procurement rules and – at least in appearance – compromised the integrity of the new role. LACCD ultimately selected an outside consulting firm that was formed just before the district went out to bid on the contract, led by a principal with no audit or legal experience, and who was not qualified under the Principles and Standards of the Association of Inspectors General. The LACCD’s selection process also rated nine of the eleven respondents (companies) as more qualified for the work, but could not explain why they were removed from consideration. In addition, the chosen consulting firm’s proposal cost $250,000 more annually than an international auditing firm’s proposal.
And now today, July 18, 2012, our own City Controller and wannabe Mayor Wendy Greuel delivered her own judgment on the LACCD’s hiring of its Inspector General — the never named Marez – saying the “evaluation process for the selection was flawed.”
“Some of the District’s actions are very troubling,” said Greuel in her press release.
“Everyone needs to play by the rules and clearly deviations from the procedures hampered the competitive bidding process. Our community college system is a valuable asset to Los Angeles and an essential part of educating our city’s future workforce. LACCD must ensure that taxpayer funds are spent effectively and that proper procedures for contractor selection are adhered to.”
She acknowledged that “Policy Masters, Inc. was selected for the contract, despite not having experience in directing audits and investigations or a history of successful work elsewhere as a firm since it was newly established. ”
You can read the full audit of the leading candidate to rule this troubled city here but you really won’t learn anything that Miki Jackson didn’t tell you way back on Oct. 18, 2010.
But then who am I to argue with someone who ends her press release urging LACCD officials to “take a series of steps, including revising its policies and procedures, to help prevent the district from entering into another flawed RFP (request for proposal) processes” and boasting what she has achieved for taxpayers in the last three years when City Hall has consumed nearly $22 billion of their money.
“Controller Greuel has conducted more than 60 audits and uncovered nearly $130 million that the City has lost to wasteful spending, fraudulent activity and abuse of government resources over the last two years.”