ROMER REHIRES BUNGLER OUSTED OFFICIAL'S SECRET JOB FOUND OUT, ERASED.

Byline: Helen Gao Staff Writer

The Los Angeles Unified School District pulled the plug Wednesday on a secret $58,500 consulting contract that was awarded to a former top administrator who was dumped earlier over his bungling of the Belmont Learning Center.

School board President Caprice Young called the no-bid contract that Superintendent Roy Romer awarded to former district Chief Administrative Officer David Koch - and then terminated Wednesday - a ``huge mistake.''

``The moment I found out, I demanded that the superintendent withdraw the contract,'' she said. ``This is a board that is not willing to go back to the Belmont phase.''

Young - who was on the board in 1999, when Koch's employment contract was bought out for $100,100 - said she was ``completely shocked'' he had been retained as a consultant.

Romer and Koch did not return phone calls.

Koch's employment contract was bought out after LAUSD Inspector General Don Mullinax recommended that he be disciplined for failing to properly supervise the Belmont Learning Center, the $175 million, unfinished downtown high school that sits atop a shallow oil field seeping toxic and potentially explosive gases.

A copy of the consulting contract obtained by the Daily News showed that Koch was to be paid $58,500 for working from Sept. 30 to Jan. 15, improving procedures in accounts payable and receivable in the LAUSD's accounting and disbursement division.

Prior to hiring Koch, the district had also paid accounting giants KPMG and Arthur Andersen, as well as Deloitte Consulting and Tomkins Associates Inc. to audit and improve business operations.

The LAUSD Inspector General's Office also did a detailed audit of the district's accounting procedures in June 2001, and made recommendations.

LAUSD district spokeswoman Stephanie Brady said Koch might be paid the entire $58,500, although he had worked only a month. ``He may be paid the full amount. I don't know because he hasn't submitted any bills yet.''

Officials said the school board had not reviewed or approved Koch's contract in advance. Its policy is to delegate agreements under $250,000 to Romer, then ratify contracts of $25,000 to $250,000 en masse, a few months after they are signed.

The Koch contract had not yet gone before the board.

``Generally with contracts at (Koch's) level, there is no real detailed oversight,'' Young said.

Brady also said Romer did not seek bids from other consultants because the district allows no-bid contracts when they involve someone with unique expertise.

``The superintendent wanted to get a quick solution to a problem and he consulted with various staff who might be brought in and (be) familiar with systems and cut to the quick of the matter.

``David Koch was recommended. He met with him, was impressed with his professional approach and ability to identify problems and find solutions.''

Board member David Tokofsky said the Koch contract is part of a broader pattern of hiring highly paid consultants. In fiscal 2000-2001, the district spent $188.7 million on professional services contracts.

``I just think that while teachers are still counting pieces of chalk and Kleenex, downtown can spend $200,000 on consultants without blinking an eye,'' he said.

School board member Mike Lansing said he learned last week that Koch had been retained, and that he complained immediately to Romer.

``We, as a board and new leadership, had made some moves to let the public know that we are properly administering our fiduciary responsibilities in terms of who is working for the district and the job they are doing,'' he said.

``The perception is not good when we make a move to terminate some personnel and bring them back in another capacity.''

Board member Genethia Hudley Hayes said Romer perhaps should have consulted her and other trustees on the Koch contract because of its political implications.

``I would say politically we are all going to take heat that he is hired. Politics is one thing. A person's expertise is something different,'' she said.

``As I understand it, he was working for the district for a very finite amount of time to do a very specific task, that is to help the district to get a handle on accounts payable and receivable.

``The thought behind it was to get the person who has the most knowledge of the accounts, the business section of the district, in an effort to get all that stuff cleaned up.''

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(color) David Koch, former LAUSD chief administrative officer, had been recommended for disciplinary action for failing to properly supervise the Belmont Learning Center.

Tina Burch/Staff Photographer