The Belmont Curse

Photo by Slobodan Dimitrov

ReadLA Weekly's Web-exclusive report for an authoritative look at the Belmont Learning Complex, the most troubled building project in the city school district’s history - with articles, photos, maps and commentaries.

Those who follow the news know at least this much: Construction of the Belmont Learning Complex, which stands abandoned and half-finished, unraveled because developers brazenly ignored safety hazards as they built the nation’s most expensive high school atop a dangerous oil field.

It’s a narrative right out of Erin Brockovich, but like many Hollywood screenplays, the Belmont saga is suffering a rewrite, this one courtesy of Pan Pacific Plumbing, Queen City Glass, Van Nuys Sheet Metal, et al. These are the 49 subcontractors who got snared in the Belmont mesh when the L.A. Unified School District halted construction in 1999 and also stopped paying its Belmont-related bills.

The developers and contractors took the school district to arbitration last year, and last week, L.A. Unified took a $20 million hit. Belmont sure didn’t sound like an outlaw project in the rendition of Philadelphia-based arbitrator Steven A. Arbittier. In his view, it was district representatives who donned the black hats, insisting, for example, that project materials be delivered to the Belmont site prior to a work slowdown, and then refusing to pay for these goods. “Indefensible,” concluded Arbittier.

The arbitration ruling also is a blow to the credibility of school-district Inspector General Don Mullinax, who dug up dirt and named names on Belmont, only to find that other arbiters have begged to differ.

Of course, this arbitration is hardly the last word on either Mullinax’s findings or Belmont itself. The ruling didn’t even address many major questions, a number of which are the subject of a criminal probe by the District Attorney’s Office. But the decision is a clear setback to the district’s “cost recovery” strategy, the idea that money spent on Belmont can be recaptured through legal proceedings and by selling the land.

Superintendent Roy Romer, who inherited this quagmire, thinks he’s got a better idea: Limit the losses, move on and finish that school: “I’m sorry this thing was screwed up, but let’s now find a practical solution.” In a school system that needs a dozen new high schools just about now — and which has neither the land nor the money to build them — the 3,500 gleaming Belmont seats look darn attractive. In January, Romer pushed a reluctant school board to let him invite bidders to submit plans for finishing the project. And this month’s city elections have shifted the school board slightly in Romer’s direction, with challenger Marlene Canter defeating incumbent Valerie Fields, who was virulently anti-Belmont. (A 5-2 tilt of board members against Belmont now looks more like 4-3.)

If anything, the arbitration outcome is likely to help Romer. Its ending should cut loose the project’s architectural drawings, making them available to potential contractors. Once they get the drawings, bidders have 90 days to submit proposals. It doesn’t hurt Romer’s cause that an arbitrator found nothing untoward in the construction process to date. From his perspective, that’s all the more justification for finishing the star-crossed campus.

Still, this partial resolution comes at significant cost. First, the arbitrator verified claims of $12.9 million from the developers and contractors. This milestone could have been achieved without litigation, said Mark Barnhill, a senior executive at the public-relations firm of Fleishman-Hillard, which represents Temple Beaudry Partners, a development team anchored by Kajima Urban Development, Turner Construction, and McLarand, Vasquez & Partners, the architect. “The fact of the matter is: Had the school district offered this result when it sought to abandon the project, the development team would have accepted that offer in a heartbeat.”

Now the district also is stuck with $1.7 million in interest and with paying attorney fees for both sides — about $5.4 million — and arbitration costs totaling about $300,000. In addition, the district’s cost for expert witnesses, consultants and accountants easily exceeded $1 million, judging by a cursory review of district accounting ledgers.

Nonetheless, LAUSD General Counsel Hal Kwalwasser told assembled reporters that the school district, through the arbitration, had saved money, reducing the arbitration demands by $8 million, or 40 percent. But his computation is fatuously selective. For one thing, Kwalwasser is ignoring the interest and attorney charges. And then, too, he is comparing the final award to an original claim from last year that was merely an estimate.

Moreover, the district was not merely trying to limit its payout; it was trying to get money back. District lawyers contended that L.A. Unified was owedmore than $80 million in damages, reimbursements and penalties. Of which it got not a penny.

In its pleadings, the district tried to put responsibility for the site’s oil-field-related environmental problems on the developers. But Arbittier would not hear it: “In sum, there were serious environmental concerns about the construction of the project and . . . LAUSD assumed the environmental risks.” And “representatives of LAUSD were kept fully apprised of the detailed progress of the work at the project.”

The arbitrator turned down only $1.9 million in claims, according to the text of the decision. What he disallowed were attempts to assert vague damage claims. But he sided with the contractors, almost without exception, when they simply claimed that payment was due for work performed.