San Mateo County Community College District sues five companies over role in ‘pay to play’ scandal

A lawsuit filed this week demands that contractors be barred from spending public money awarded by the San Mateo County Community College District after company leaders gave vacations, event tickets and family favors to corrupt district officials in exchange for construction deals.

The suit, filed Feb. 8 in San Mateo Superior Court on behalf of the district, alleges that companies gave ex-Chancellor Rob Galatolo and former Vice Chancellor Jose Nuñez gifts and benefits in return for securing contracts for contractors and architects to construction projects at the district’s three colleges.

Galatolo served the district for 20 years before he was fired in February 2021; he now faces criminal charges of tax fraud, conflict of interest, theft of public funds and perjury. Nuñez pleaded guilty to using school funds for political purposes.

The college district oversees three schools: Cañada College in Redwood City, College of San Mateo in San Mateo and Skyline College in San Bruno. The companies named in the lawsuit are Allana Buick & Bers, McCarthy Building Companies, Bunton, Clifford and Associates (now known as Studio W Architects), Robert A. Bothman Construction and Blach Construction Company.

“This case represents one of the worst instances of abuse and stealing of public funds designated for the education of our students, young and working adults,” the complaint reads. “It is a story about the blatant pay-to-play of bond money that was intended for buildings, equipment, and educational infrastructure to benefit our local community here in San Mateo County.”

The complaint alleges that Galatolo pursued quid pro quo relationships with executives using his influence over the district’s board. The improvement projects for the three college campuses were publicly funded through bond measures passed by San Mateo County voters in 2001, 2005 and 2014. The three bonds totaled more than $1 billion; the suit claims much of that money was rewarded to the named contractors as a result of gifts and benefits given to Galatolo.

One of those quid pro quo relationships was allegedly between Galatolo and Karim Allana, CEO of architectural firm Allana Buick & Bers. For three weeks in April 2017, the two men vacationed with others in five countries across the Middle East and Asia on what the suit called the “district’s dime.” Beginning in Dubai, United Arab Emirates and ending in Bali, Indonesia, a group of associates allegedly arranged tours, including a helicopter tour of Mount Everest in Nepal, met up with Allana’s brother and extended family in his native Pakistan and partied at hotel pools.

The complaint alleges Allana upgraded Galatolo’s seat to business class on their flight to Dubai. The cost of the upgrade “far exceeded” that year’s $470 limit for gifts to local officials from a single source, and Galatolo did not disclose the gift in his 2017 tax forms.

Just two days after returning to the Bay Area from the trip, the complaint says, the district board awarded a $1.5 million consulting contract to AB&B. The board members were unaware of the three-week trek taken by the two men. Galatolo was present at the meeting in which the contract was approved.

During that trip, the two men discussed Galatolo’s plans to add solar panels to his personal residence in Hawaii. Allana asked an AB&B architect to assist with the project, services that Galatolo ultimately was not charged for, the complaint says.

Around October 2018, the pair, along with two other principals from AB&B, later purchased an apartment together in Paris, France, and appeared to vacation there together according to emails included in the lawsuit. In 2019, AB&B secured more than $1.6 million in contracts from the community college district.

Allana wasn’t the only executive to have mutually beneficial relationships with Galatolo, the suit says. Richard Henry, the president of McCarthy Building’s Northern Pacific Division, as well as Vice President Frances Choun, treated Galatolo to benefits and tickets to sporting events before receiving lucrative contracts from the district.

In 2007, Henry gave Galatolo tickets to a baseball game and offered to bring him and his friends to play golf at his country club, according to the claim. In 2010, Choun gave Galatolo tickets to a sold-out World Series baseball game in San Francisco. Henry later offered lodging to Galatolo in McCarthy’s corporate condo in Park City, Utah. The gifts were never disclosed to the district board nor claimed on his tax forms.