Taxpayers Could End Up Paying $4 Million In Building Rent Debacle

February 15, 2012 12:13 AM

From On The Money

SACRAMENTO COUNTY (CBS13) – There are new developments Tuesday on a case that CBS13 first reported on two years ago. It’s a case that may end up costing taxpayers more than $4 million.

Security guard: I’m going to have to ask you to stop filming.

Photographer: Don’t touch the camera.

Guard: Then stop filming please, stop filming.

Photographer: I do not have to stop filming at all.

This confrontation from 2010 occurred when a security guard tried to prevent us from showing the empty office building costing California taxpayers 1.3 million a year in annual rent. The building at Mather Business Park was vacant for two years, costing taxpayers a total of $2.6 million.

The empty building was leased by Edfund, a now defunct contractor that previously ran the loan program for the Student Aid Commission, as we showed you two years ago.

“Please leave. And if you don’t, we will call the police and escort you off,” said an Edfund lawyer during our first story.

Edfund is now out of business, leaving behind a multi-year lease and a lawsuit filed by the building owners demanding $40 million in unpaid rent.

The California state senate has already approved a settlement worth $4.2 million to pay off the building owners. Paying ten cents on the dollar may be the cheapest way to get rid of an expensive lawsuit, but critics say it’s $4 million taxpayers will never see again.

“The bottom line is that’s money that could be going for essential programs. And they should be obeying the law and not wasting money,” said Jon Coupal at the Howard Jarvis Taxpayer Association.

Now it’s up to the state assembly to approve the settlement. And not just on this case, but on several other claims that amount to $12.9 million.

Taxpayers Could End Up Paying $4 Million In Building Rent Debacle

gna

got to love those rent a cops, at least the reporting agency can’t sue the tax payers for touching the camers
Robert Humphrey

In my opinion someone should find out who owns the property, not the management company, because more than likely they are connected to our government in some way and are the ones who are actually receiving the proceeds from this scam. Property owners lease properties to businesses. It is not the tax payers responsibility to pay rent for businesses set up to funnel money to the scam artists that run our government. Someone should dig deeper and find out where the money is actually going.
JamesTheFool

This property is owened by Barbra Boxer’s Husband’s Management Group. Need I say more. Thanks Dems for such great leaders in CA…

MAC49

Yea, And they just keep voting these losers back into office, and look what they do to the tax payers. And that isn’t even the tip of the ice berg. and only one of MANY, MANY, others Politicians should be ashamed of themselves, on so many levels. ALL OF THEM!

will

The state CAN’T manage money with beans!!! Way too much waste!!!! That’s why we are always in a budget predicament. No accountability. Sad!!!
Larry

As a former EdFund employee, I would like to point out a few facts CBS never followed up on. First, One building was never empty, it has been rented without gaps. The second (empty) building is now full. Both buildings are occupied. The management company was never at a loss. That 4.3 million will make a nice bonus for someone. EdFund was NOT a contractor for the state but instead was a quasi state agency that acually made money for the state, The California Student Aid Commision killed EdFund with the bickering. Now a non-california agency handles the multi-billion dollar portfolio that EdFund was doing, and doing well I might add (EdFund was the second largest agency in the USA after Fanny Mae).
nothingchanges

Once again the state of California using their citizens as golden parachutes for their failures.
Alejandro

JasonViens23 on January 31, 2011 that was horbirle lol hahahaha.. im so happy mine didnt go that bad.. a bit of advice to all future best men.. dont try to be a inevative hero.. look up some good speeches take some good points from a few of them then impliment your own touch on them.. its a stressfull moment there is nothing wrong with a little help
InTheKnow

The “Security Guard” was nothing more than an office clerk working in the Security Office. Besides doubling as a guard, he also is a volunteer fireman. Give him a break. He was the victim of a pathetic company run by greedy executives with an underqualified President who focused more on his wine collection than student loans. Yes, they all made out like bandits as EdFund was handed over to ECMC, an organization run by Executives who previously ran a student loan company into bankruptcy only to be bailed out by the Feds. Ask the Mather ECMC employees what occupies a good portion of their current building and you will find out that ECMC built a huge gymnasium in the facility. Golden handshakes, a state of the art gym, and many jobs going to ECMC in Minnesota…. sounds like our students are paying for more than their education. Sad indeed.