EDITORIAL LAUSD BLIND SPOT OVERSIGHT COMMITTEE HAS CEASED TO BE THE WATCHDOG OVER BOND-ISSUE BILLIONS.

THE citizens committee charged with providing oversight of $15 billion in money to build hundreds of new schools in Los Angeles and to rebuild many others has done a poor job for a long time and has lost credibility.

That has become evident over the years, and the failure has now become starkly visible. That's because of the appearance of a possible conflict of interest involving the Taylor Yard property in Glassell Park that a wealthy developer and Los Angeles Unified are fighting over.

Here are the basic facts: The LAUSD wanted the 23-acre property along the banks of the Los Angeles River for a new high school in the Eastside neighborhood. But the district was edged out by prominent downtown L.A. developer Richard Meruelo, the No. 1 contributor to Mayor Antonio Villaraigosa's political campaign.

Meruelo came out of nowhere to scoop up the property rights when school officials say they were getting ready to buy it. Now the LAUSD is looking at seizing the land through eminent domain, paying a fair-market value.

On the other hand, Meruelo is trying to get the school board to partner with him to develop a $600 million, mixed-use project along the river that would include a campus. The twist in the plot comes from the role of Robert Garcia, who resigned as the bond oversight chairman last July at the time word was surfacing that his nonprofit group, the Center for Law in the Public Interest, was possibly going to get a $1 million gift from Meruelo.

The highlight of Garcia's five years on the oversight committee was how he harassed and finally got the resignation of LAUSD Inspector General Don Mullinax, the only person really overseeing the bond billions and all the other money passing through the nation's second-largest school district.

On Tuesday, when the LAUSD board voted to go ahead with its plan for the property, new information came out that added another twist to the story.

Prior to the vote, board members were given a letter from the Center for Law in the Public Interest urging them to consider every alternative to condemning the property, which would, of course, include Meruelo's plan. Nudge, nudge. Wink, wink.

That led to disclosure that one of the board members of Garcia's organization is none other than Tom Rubin, the bond oversight committee's highly paid consultant.

In the end, the LAUSD decided to ignore Meruelo and the request from Garcia's group. But the entire affair was enough to cast serious doubt on the credibility of the bond oversight committee and whether it's really watching out for the public interest.

After a strong start in its watchdog role, the oversight committee long ago ceased to function as it was intended. The same can be said of the Inspector General's Office without Mullinax.

So who's looking after all those billions of taxpayer dollars?

City Controller Laura Chick has asked repeatedly for permission from the LAUSD to do just that, but has yet to be given the green light. Perhaps the state Board of Education or even the District Attorney's Office needs to step in while there's still bond money left to protect.