BY ELAINE GOODMAN
Daily Post Correspondent
The San Mateo County Community College District appears headed toward settlement with at least three defendants it accused of participating in a “pay-to-play” scheme aimed at obtaining lucrative contracts for construction projects.
The suit revolves around allegations that the firms gave gifts to former chancellor Ron Galatolo in exchange for contracts to build additions to the district’s three campuses.
In a lawsuit filed in San Mateo County Superior Court, the district named five construction or architectural firms: Allana Buick & Bers; McCarthy Building Companies; Bunton, Clifford & Associates; Robert A. Bothman Inc.; and Blach Construction Company.
But now, lawyers for the college district have filed three separate notices of settlement regarding claims against Blach, McCarthy and Bunton. The notices were filed on Dec. 31, Feb. 10 and Feb. 26, respectively.
The notices say the college district “has agreed in principle” to settle its claims against the defendants. The notices don’t include details of the settlements.
SMCCCD agendas show the case was discussed in closed session during regular board meetings in January, February and March and during a Dec. 17 special meeting.
If the three settlements are finalized, that leaves two defendants — Allana Buick & Bers and Robert A. Bothman Inc. — to potentially continue on to a trial date, currently scheduled for May 4. Lawyers for the district and the defendants said they’d try to work things out through private mediation, according to minutes of a Feb. 9 case management conference.
The college district — which runs College of San Mateo, Canada College and Skyline College — filed its lawsuit in February 2023 and revised it in November 2023.
Wine, concert tickets, free construction work
The lawsuit alleges that former Chancellor Galatolo accepted gifts including wine, concert and sports tickets, and free construction work on his personal properties, “in return for awarding lucrative construction contracts to contractors and architects in connection with the district’s various capital improvement plans.”
The lawsuit called Jose Nunez, the district’s former vice chancellor of facilities, a “co-conspirator.”
“Defendants knew that the benefits and gifts they gave to Galatolo and other college employees were illegal but made them anyway in order to secure massive construction contracts,” the district alleged.
Galatolo faced criminal charges and on Jan. 20, a jury found him guilty of eight felonies, including four counts of tax evasion and four counts of perjury. The jury was deadlocked on the remaining 18 felony charges, which included misuse of public funds, perjury and conflicts of interest.
San Mateo County District Attorney Steve Wagstaffe decided not to retry Galatolo for the 18 felonies, saying it would cost too much. Galatolo’s sentencing is set for June 5.
Nunez took a plea bargain in 2022 after being charged with 15 felonies.
$1.06 billion in bond measures
The construction projects at issue in the lawsuit were funded by voter-approved bond measures. From 2001 to 2014, voters approved three bond measures to raise $1.06 billion for the college district.
The district argued in its lawsuit that contracts it entered into are invalid if either Galatolo or Nunez had a financial interest in the contract based on gifts they received or expected to receive. Money paid under those contracts should be returned, the district claimed, citing California law pertaining to conflicts of interest in government contracts.
In a Jan. 30 joint case management statement, defendants called the case “pure government overreach.”
“One of the district’s most extreme positions in this litigation is that a single gift to a public official before a contract is entered into is sufficient to void a $100M plus contract,” the defendants said.
Defendants denied bribes
They said that during Galatolo’s criminal trial, there was no finding of any misconduct related to any defendant in the district’s lawsuit.
“This case is not about bribery or kickbacks,” the defendants said. “The district admits there is no evidence any gift was given or accepted in exchange for any particular contract.”
In the settlement notice for Bunton, Clifford & Associates, attorneys for the college district said they’d file a request to dismiss the case by the first day of trial. A dismissal depends on “the satisfactory completion of specified payment terms,” the notice said.
The settlement notice for Blach Construction said attorneys will file a request to dismiss the case by Nov. 6.
The college district said it would provide further details on its settlement with McCarthy when the agreement is finalized.
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