Construction fraud impacts Peralta

The Peralta Community Colleges District has been drawn into the corruption scandal involving Oakland-based NBC General Contractors, whose owner Monica Ung is currently facing felony criminal charges for labor exploitation and insurance fraud.

NBC was awarded contracts by Peralta to perform work on the James Oliver Writing Center at Laney College, the Laney Bistro, and the Building A Renovation and Sidewalk Rehabilitation projects at the College of Alameda (CoA).

Since its completion, the writing center has had numerous problems with water leakages, malfunctioning a/c units and faulty wiring. The opening of the bistro, intended to be a student-run culinary facility, has been delayed several times and remains closed.

The projects at CoA were completed last month. At this moment, no problems have been reported.

Ung and her two associates, Joey Ruan and Tin Wai "Winnie" Wu, were arrested in May 2009, after having stolen an estimated $3.6 million from workers in unpaid wages and $1.5 million from California taxpayers in insurance fraud. They have since posted bail and have yet to go to trial.

Investigative reporter Robert Gammon of the East Bay Express detailed in the Aug. 26 feature story, "Monica's Victims," how Ung had been exploiting her workers for years and how she was eventually exposed.

The article states that NBC had performed work for various public agencies, including the Peralta District, as well as suggesting the possibility of legal action against these institutions for failure to enforce labor compliance laws upon NBC.

At the time of the article's publication, labor attorney Ellyn Moscowitz, representing the NBC workers, had already filed a class-action lawsuit against Ung and her associates. Moscowitz stated via e-mail that a civil court hearing will be held Nov. 13.

She also said that her firm has filed liens against Peralta in order to compensate NBC workers for unpaid wages, though she did not give the amount of the liens.

When asked about the legal action taken by Moscowitz's firm, Peralta General Counsel Thuy Nguyen deferred her response to district spokesperson Jeff Heyman, who said, "We're unable to comment on pending cases, but let me just say that we are cooperating with the parties involved."

Peralta first employed NBC in February 2006 to complete the James Oliver Writing Center, awarding the bid in the amount of $328,000. The project was scheduled to finish in September 2006, but was not opened to students until March 2007 as work was still being done, according to writing center technician Terrence Fisher. The final cost was $361,936.

Following the storm on Oct. 13 last month, the center had to be closed for several days in order to fix leakage problems.

"The room was a mess after the storm," said Fisher. "We had to arrange buckets under the leaks, mop the floors, and soak up water on the tables. Luckily, we had tarps covering the computers where we knew the leaks were, otherwise they would have been ,rreparably damaged.

"Since we took possession of the room," he continued, "we've had problems with leaks in the roof, the air-conditioning, and flickering lights."

The a/c equipment requires consistent maintenance in order to properly regulate the room temperature. Robert Beckwith, Peralta director of facilities and operations, said he was unaware of these problems.

NBC was awarded a second bid of $5.7 million for the Laney Bistro in September 2007. The project carried on into March of this year with a final price tag of $7.1 million. The $1.4 million discrepancy was due to seven change orders, which repeatedly pushed back projected dates of completion.

The third bid for the renovation of CoA's administrative building (Building A) and sidewalk repairs in the amount of $9 million was awarded in March 2008.

NBC completed its contract with Peralta after finishing work on Building A in October. The final amount for the CoA projects was $9.4 million. The $400,000 discrepancy was due to change orders to the projects.

Peralta Vice Chancellor of General Services Sadiq Ikharo, who oversees the capital projects and facilities operations departments, was unavailable for comment on any of the three projects.

NBC's ties with Peralta go beyond contracting; in October 2008, the company made a $10,000 donation to the Peralta Colleges Foundation (PCF), an independent non-profit organization established to raise funds for Peralta students.

When asked about whether the donation should be returned in light of the charges brought against NBC, Foundation Executive Director Alton Jelks stated that the organization "does not get involved with the affairs of its donors."

Local developer Mark Lindquist, who was awarded a $940,000 no-bid contract by the Peralta District and is a known business partner of Peralta Chancellor Elihu Harris as reported by Matt Krupnick and Thomas Peele of the Bay Area News Group in September, served as president of the foundation in 2008 and currently serves as its treasurer.

Chancellor Harris currently serves as its executive secretary, while Director Jelks also serves at the Peralta District as special assistant to the chancellor. Requests for comment on Peralta's involvement with NBC have not been answered by Harris, or Peralta Trustee President Bill Withrow.