FINAL REPORT - San Bernardino Superior Court

Section 4: SCLA Hangar Development
If the City or SCLAA had instituted controls or oversight there would have likely been a much
clearer accounting of the project’s costs. Specifically, if at least one staff member was assigned
to oversee the project or if the City had instituted financial controls, it is unlikely that the
accounting of the project’s costs would be so murky.
Hogdon Group Could Not Account for $12.9 Million of Project Funds
The Hogdon Group report’s most alarming finding is the unknown use of $12,899,664 of funds
provided to CBS Aviation Development by SCLAA. The inability to document the use of these
funds is the direct result of City management’s heavy reliance on outside contractors and its
failure to institute sufficient financial controls over public funds.
City Management Will Not Pursue Collection from CBS Aviation
City management has asserted that the unaccounted funds may have been for project assets, such
as building materials, which were not entered into the accounting record. However, there has
been no attempt to reconcile this accounting. Without a thorough accounting of such costs, which
City management years ago determined was unnecessary, the City and its residents will never
have a full understanding of the use of public funds for the hangar development project. City
management made a determination in 2008, after the project concluded, not to pursue the matter
further. Rather, management determined that these funds would simply be aggregated into the
total costs of the project.
Total Costs for Hangar Construction Project May Have Exceeded $100 Million
As previously noted, City management has no official or definitive accounting of the funds spent
on the hangar development project. Therefore, it is not possible to accurately state how much the
hangar development project cost the taxpayers of the City and other VVEDA jurisdictions.
However, based on City documents we have estimated the total costs. This estimate of total costs
for the hangar development project is shown in Table 4.4 below.
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Harvey M. Rose Associates, LLC