Roger Berg Strikes Out With the FPPC (Fair Political Practices Commission)

Roger Berg, in his latest attempt to smear me, filed three separate complaints with the FPPC this month. All three of the complaints were addressed by me in public over the last few years. I had reached out to the FPPC for letters of advice on each issue when it was raised by Roger Berg. Even after falsifying the information he used in his complaints, he was unable to convince the FPPC that I had done anything wrong.

Below is my copy of the response Roger Berg recevied this morning:

October 23, 2018

Roger Berg Via email:

Re: Sworn Complaints Against Alfred Lloyd White (COM-10092018-02093, COM-10092018-

02094 & COM-10092018-02095)

Dear Mr. Berg:

This letter is in response to the sworn complaints you submitted to the Enforcement Division of the Fair Political Practices Commission regarding the above-named individual. We will not open an investigation into this matter.

The Commission enforces the provisions of the Political Reform Act (“Act”) found in Government Code Section 81000. Based on a review of the complaints and the documents submitted, the Enforcement Division found insufficient evidence of a conflict of interest violation of the Act, and will not pursue an enforcement action in this matter.

If you have any questions regarding this letter, please contact Chloe Hackert at

Sincerely, GWest Galena West Chief, Enforcement Division

GW:ch cc: Mr. Alfred Lloyd White


Roger Berg’s latest fake news

Following is a portion of a letter I sent to the Fair Political Practices Commission in repsonse to a complaint filed by Roger Berg concerning an easement that has been legally established, legally recorded and maintained by the City of Beaumont uninterrupted for 12 years. Below is a link to an email I sent to the FPPC in August 2017, more than a year before Mr. Berg filed his latest complaint.

Mr. Berg was soundly defeated 4 years ago, After the arrests of his friends he enabled to steal from the citizens of Beaumont to line their pockets for the 16 years he served the citizens of Beaumont, he was the first to offer testimony as a character witness. The following letter and the documents linked within should put this issue to rest for everyone but Roger Berg.

My Letter to the FPPC - 10/10/2018

I sent a request for advice from your office on August 18, 2017, when this issue was being raised by Mr. Berg. I have attached a copy of the email I sent. Please read the attached email for a complete accurate account of the entire story that spans more than 3 years.

The other documents I have attached to this response include our original grant deed where you will find at the bottom the following: “Excepting and Reserving to the Grantor herein, together with the right to convey to The City of Beaumont, a Municipal Corporation”, an easement for maintenance purposes over a portion of said above described property. The second to last paragraph of the attached email refers to a final resolution by the current administraion and also in the attached documents you will find a letter from 2017 from our County Recorders office with a copy of the first two pages of the filing of the easement by the original developer who had failed to file it when we bought our home in 2006. I can provide you a copy of the entire recording documents if you need them.

On February 7, 2006 Corman Leigh Communities executed a grant deed to grant to my wife and I the parcel our home sits on. In 2007 The City installed a water meter in the area that had been reserved as an easement for City use. The landscaping for the easement was maintained for approximately 8 years before I was a council member and has continued to be maintained by the City with no change in the status over 12 plus years in total. The City has been maintaining that easement area as was originally intended.

The irony of Roger Berg criticizing the City for maintaining the reserved easement area, and now filing a complaint against me for the maintenance of the easement, is that the original decision to maintain the property in the reserved easement area was made while Roger Berg was a council member and Joe  Aklufi was the city attorney.

So why was this all being raised by Mr. Berg in the summer of 2017, more than 2 years after it appeared to have been fixed? 

As most people in our community know, I ran for office in 2014 because the community I loved was being mismanaged and its true financial picture was being misrepresented to the citizens. Since then we have uncovered and corrected decades of mismanagement. Over the last three and a half years I, along with others, have been instrumental in uncovering, disclosing, and correcting past corrupt practices and removing bad actors from the City who had held positions of power for years.

At the time I wrote to your office for advice on this easement issue, the city had recently initiated civil actions against Urban Logic, its former owners and against former City attorneys Aklufi and Wysocki. The former principals of Urban Logic, Joe Aklufi, and others were also facing felony criminal charges to which they eventually plead guilty to felonies and have paid more than $12 million in restitution.

It had been reported that Roger Berg, along with another former council member, were scheduled to testify as character witnesses on behalf of the defendants in the upcoming criminal trial which was avoided when the defendants plead guilty to felonies. Berg was working with others to manufacture issues against me in a desperate attempt to draw attention away from their longtime friends who were facing criminal charges and significant civil liability.

In their overzealous attempt to draw attention away from their longtime and now convicted felony friends,   Mr. Berg posted an aerial photo of my family home in a social media post about the easement and an accomplice went so far as to drive to my home and take photos depicting the location of my family's home and posted such a photo online. My wife and children were frightened when they learned that these men posted photos depicting our home's location online and that  one of them drove  to our home and took photos to post online while attempting to incite his small group of supporters against me. The individuals facing criminal charges at the time for their conduct while in control of the City had found mouthpieces in the form of Roger Berg and another who were aggressively attempting to draw attention away from their longtime friends by attacking me and others who were working to hold their longtime friends accountable.

I hope you will bring these latest complaints to resolution by finding there is no evidence of any wrong doing by me and therefore a waste of your resources to further investigate as, by Mr. Berg's own account ot you in his complaint, it is clear the County District Attorney must have . I am sure there will be more claims by Mr. Berg and I will contiue to defend my reputation and my actions.

I decided to serve my community as a council member because I was disturbed by the damage being done to this city while under the direction and control of Roger Berg, City Manager Alan Kapanicas and others. Despite the efforts by Mr. Berg, I won't be bullied into backing down from repairing the City and holding accountable those responsible for damaging it. Most people learn early in life that you can't back down from bullies and I will not back down from these guys. I will remain focused on finishing what I started, rebuilding our city.  

Email to The FPPC August 8, 2017

Grant Deed and notification of recorded easement

Libi Uremovic Lies Twice in One Headline

Libi Uremovic is telling lies again. In one of her latest posts on the Banning-Beaumont Patch titled “’Council Approves’ Million Dollar Contract to ULC”, she tells two lies in the title alone.

The first lie by Libi Uremovic is that the council approved a million-dollar contract. The actual value of the contract was $708,000. She knows this is a lie. She can be heard on the Council meeting podcast on YouTube telling the Council the value of the contract is $708,000.

The second lie is that the contract was to ULC, Urban Logic Consultants. The contract was extended with Utility Partners, not ULC. She knows the claim that the contract was approved “…to ULC” is also a lie. She can be seen in the council podcast trying to claim that an invoice from years ago which was issued by ULC to Utility Partners for their management of the sewer plant means that Utility Partners is ULC. Click here to view a video of the false claim.

 In the body of her post, Libi Uremovic continues to lie, this time through omission.

First, she doesn’t explain that I moved to award the contract only after I determined that by not renewing the contract it would expire at the beginning of March and we would be left with no management of the plant if we chose to issue a new RFP and go out to rebid the contract. The RFP process would likely take 2-3 months to award a new contract.

Then Libi Uremovic omits the fact that I asked if we voted to renew the existing contract and went out to bid would we have a cost to terminate the new contract with Utility Partners if they were not selected for the new contract. Once I knew we had the ability to cancel the new contract with a cost free 120-day notice, I then moved to renew the existing contract.

Finally, she omitted the part of my motion that the staff was directed to analyze the pros and cons of bringing the management of the plant in house and to also bring back an RFP for council to consider.

Libi Uremovic will never provide credible evidence to support her lies because she can’t. Just writing an email to the state and federal agencies with her fake claims is not evidence.

My Final Post to the Banning-Beaumont Patch Bulletin Board

Below is a letter I sent to the Banning-Beaumont Patch Editor about the hijacking of a valuable resource of the citizens of Beaumont by Elizabeth Uremovic, the Patch's Bulletin Board. I asked the editor to forward my concerns to Patch Corporate Management in New York.

I have stopped posting to the Bulletin Board because I believe there is no positive value left in what was once a valuable resource for the Pass. It was a place where members of the community could come together to carry on constructive dialogue about the issues facing the Pass. Without a daily news publication in the Pass, the Patch filled a valuable need. I still think the Patch is a valuable resource for local news, I don't believe the Bulletin Board provides any relevant purpose anymore.

I will not be responding on the Bulletin Board to any of the comments to this, my final Patch post, or any other posts on the Bulletin Board going forward. I will continue to work to expose the fake news and counter it with the truth on my website and in letters to the editor. As always, I am available for a face to face public discussion with anyone who is interested in a constructive discussion about the issue and where I stand on those issues.

You can always reach me through my city email - You can also follow me on twitter @OurFocusOurKids or Lloyd White - Councilman.

Also, beginning last month, I have been contributing to a radio show on the only local station in the Pass Area, KMET 1490. The show's producer, Glenn Stull, and the host, Douglas Gibbs, invited me to provide insights to local issues on their program, The Conservative Voice. I am only involved every other week on the local segment of the show, I leave the rest of the world of politics to Glenn, Doug and the rest of their team. I appreciate the opportunity they are providing me to keep the citizens of Beaumont informed.

The show airs on Saturday beginning at 8 AM. They have been kind enough to provide me with clips of the local segments in which I participate. I have linked to these segments on my website and I will send out a Tweet whenever a new one becomes available.

Here is my letter to the Patch:


Once again Elizabeth Libi Uremovic is on the Patch’s Bulletin Board posting lies and libeling good people. Over her last few posts, she has made claims as facts that she knows are lies. In her latest post, she refers to people associated with the city as “crooks”, “Band of thugs”, and “dirty” with no evidence to support her claims. I believe this is a violation of your policy against personal attacks or insults.

On May 2, 2011, I was invited to be the Banning-Beaumont Patch’s first contributor, before there even was a Bulletin Board. The Patch was a great place to discuss local issues and carry on civil discourse. Even in the early days, Libi Uremovic’s posts were somewhat civil. Since then I know the editors of the Patch have done what you can to minimize the exposure of what the Bulletin Board has become, Libi Uremovic’s personal blog.  

Moving the posts and comments from the front page to the Bulletin Board page and now moving the Bulletin Board under the Neighbor Posts has made it harder to find the attacks and false claims. Our community thanks you for that. However, there are also positive and useful announcements for the community on the Bulletin Board but they get buried among Libi Uremovic’s hate filled rants. I feel this is a disservice to the members of the community who are posting community announcements. More importantly, this a disservice to all the residents of Banning and Beaumont. The Bulletin Board used to be a useful tool for announcing community events.

19 of the last 20 posts on the Bulletin Board have been by Libi Uremovic or about Libi Uremovic. The one lone community post was by the Beaumont Library director about a tropical bird show coming to our library. The Banning-Beaumont Patch brand is becoming Libi’s personal attack site. It is time for her to pay for and manage her own site and return the community bulletin board to the community.

If she is allowed to continue to use the Patch to spread false accusations and lies, I feel a need to respond with the truth. Specifically, there are two latest claims by Libi Uremovic I need to address.

First, she continues to make a claim which I already proved was false. She claims Alan Kapanicas, was paid $100,000 more than the negotiated settlement of $214,000. She knows this is a lie but keeps posting it. She also refuses to acknowledge the $214,000 was for employee benefits (vacation and sick pay) earned and that the city is required by law to pay. Here is a link to my post, ALAN KAPANICAS IS STILL RECEIVING A SALARY , in the fake news section of my blog If Libi Uremovic is going to continue with this lie, she needs to post her proof of the city paying Kapanicas more than the $214,000. She doesn’t because she can’t.

The other of Libi Uremovic’s many false claims she has posted in the last couple of weeks that needs my attention involves the contract extension for the City’s Transit Director. She claims the new contract makes Beaumont’s transit director the 2nd highest paid transit director in the state. At last week’s city council meeting Libi Uremovic was aware that the staff would be presenting proof that the new contract was in line with the transit directors in our region, more than half of the other directors were higher paid. I am sure she knew I would be asking her to provide proof of her lie but she conveniently left the meeting before the item was addressed.

Finally, she continues to make false claims and misrepresentation of the facts concerning the SEC’s (Security and Exchange Commission) investigation. I have also addressed this claim on my website in the post titled THE SEC ORDER.

I implore the Patch to stop allowing Libi Uremovic to use your organization to libel and insult everyone associated with the City of Beaumont. Your Bulletin Board is losing credibility and most likely readers. The rest of your site is still a valuable resource and I hope it is around for a long time to come.

Thank you,

Lloyd White

The Potrero Gap -

Elizabeth "Libi" Uremovic from Rancho Cordova published a new post on the Banning-Beaumont Patch in which she tries to spin more fake news to make Beaumont's Council and Staff look corrupt and to promote her skills as a Government Watchdog for Hire.

Don't bother reading the post. In her usual ranting and rambling style she spins the reader in so many directions that by the time you have reached the end, all you remember are her bullet points in bold. In the middle of her claims of dirty, stupid council members and corrupt staff, one gem stands out.

$8 Million minus $14 Million equals a $6 Million Deficit.

I know where she got the $8m and the $14m but where she came up with the $6 million deficit is either a boldface lie she is knowingly telling, or her analysis is bordering on incompetent. 

Here are the details she accurately reported:

At the January 2nd Meeting Beaumont City Councilman Lloyd White asked Public Works Director Amer Jakher if the Developers had 'come up with the gap'.

Jakher proceeded to claim that 'the gap' was what the Developers were paying, not the difference between the cost of the Project and what the Developers are paying.

Libi Uremovic's analysis:

No. Incorrect. The 'gap' is the difference between the cost of the Project and what the Developers were willing to pay, which is $6 Million just to cover the one Construction Contract. 

Here are the facts:

  • The facts show the funding needed to complete Phase 1 and 1a is $21.6 million. Libi claims the cost of the project is 14 million.  I wish!
  •  The grant funds available are $13.4 million.
  • This leaves an $8.1 million gap to complete the infrastructure to support the property owners' projects that will benefit from Potrero.

The Council decided tax payers had already been overcharged enough by the previous councils and convicted felons. If the property owners didn't commit to fund the gap, the project would be scrapped, even if it meant the State and Federal Grant Funds were to be  rededicated elsewhere. As Ms. Libi Uremovic correctly reported, the property owners have deposited $8.1 million in a dedicated bank account for the Potrero project. There now is no gap. Libi claims that the gap is $6 million. 


Is this incompetence? I don't think so. It is more plausible that Libi Uremovic is knowingly lying to the public because she doesn't believe anyone will check her facts. Every new post she makes, reveals to her potential clients what they can expect if they hire her. If you visit her business web site, you will see how much she is taking credit for bringing Beaumont down. I'm not sure I understand why she believes it is so important to keep Beaumont from recovering. Who would want to bring her into their town?

Better to remain silent and be thought a fool than to speak and to remove all doubt.
-Credited to Abraham Lincoln or Mark Twain

If Her Lips are Moving or her Keyboard is Clicking...

When Libi (Elizabeth) Uremovic claimed;

The 'plan' ... is to continue to steal money out of the Pensions and run up the Pension Debt, then throw the Pension Debt into a Bankruptcy.

I responded with:

There has been no plan to enter into Bankruptcy.  The City of Beaumont has begun the financial recovery process, thus avoiding even the consideration of bankruptcy. 

When she exhibited her lack of an understanding of California's municipal accounting, I helped her education with this response:

Government Accounting Standards Board (GASB)  Statement No. 68, commonly referred to as GASB 68, set an amended standard for accounting and financial reporting for pensions, which became effective with Beaumont’s fiscal year ending June 30, 2015.  Also included in this standard is the disclosure of assumptions, explanations of annual changes, summary of information including ratio, plan resources, contribution rates, discount rates, and the recognition of deferred inflow and outflow of resources.

From these two responses, she writes a post on the Patch, her personal bulleting board, with the headline "Lloyd White Defends Pension Debt Increase". The title alone is clearly fake news, no reason to even read her post.

Not even her sole supporter, the one person who lobbied harder than anyone else in the City to save Alan Kapanicas, Gabe Ewing, could spin my responses into a defense of pension debt increases. Well, maybe Gabe could.

If her lips are moving or her keyboard is clicking, Elizabeth "Libi" Uremovic is spewing fake news.

Budgets and Employee Pensions

In a recent post on The Patch by Rancho Cordova's Elizabeth "Libi" Uremovic, she exhibits a lack of understanding of municipal budgets and employee pensions. She desperately tries to find continuing corruption in Beaumont for the promotion of private services her business offers to prospective clients in other jurisdictions. I doubt she truly believes her claims and is making such histrionic statements purely for the shock factor. 

All those of us who have become Ms. Uremovic's regular targets have become used to her tactics, but once in a while, she stoops lower than usual, even for her. I don't think she realizes, or more likely doesn't care how many Beaumont citizens, employees, and friends and family members of our employees she offends when she writes the following:

I'm sure the majority of Beaumont Citizens reading this don't have much pity for City Employees losing their Pensions. In many respects; it couldn't happen to a more deserving group of people.

Fake News vs Truth - Here we go

I am going to ignore the venomous libel and personal attacks and try to find the excerpts from her post where she is trying to make a coherent argument. It won't be easy but I am up for the challenge. 

Since Parton's arrival in Beaumont he's purchased a lot of 'bling'. Beaumont Staff and Council are spending money on new vehicles, office furniture, computers, trips, and of course the parties.

The FY2018 budget included a line item “Capital Expenses” for various funds and departments.  That budget line item was developed for replacement of long overdue fleet vehicles and information technology equipment, as well as some furniture and fixtures.  The travel expenses were also budgeted, including costs for attendance at the annual League of California Cities conference.  The City of Beaumont has had no “parties”.  There has been an employee benefits fair held in December, and a service recognition lunch will be served this week.  Both in City hall, only at lunch time, and are not extravagant by any stretch.

The 'plan' ... is to continue to steal money out of the Pensions and run up the Pension Debt, then throw the Pension Debt into a Bankruptcy.

There has been no plan to enter into Bankruptcy.  The City of Beaumont has begun the financial recovery process, thus avoiding even the consideration of bankruptcy. 

But what people in the private sector might not realize is that Beaumont City Employees don't pay in any Social Security Insurance - SSI. They are dependent on a pension from the City.
Some government agencies in California offered marvelous pension packets to their employees; so marvelous that the agency could opt-out of paying in SSI. The problem is that they never paid the Pensions into the System.

CalPers pension and Social Security are two different retirement plans, and there has been confusion in the past about one versus the other or both.  I have linked to an article from CalPers that addresses some of the concerns, and provides phone numbers if anyone has additional questions. 

The employees pay in their portion of CalPers through a withholding of their pay.  The City then has an obligation of a matching contribution.  Those contributions are added together and made by the City on a regular basis to CalPers. 

As Melana Taylor discussed with the Finance Committee at length, the liability recognized on the audited financial statements relates to the actuarially determined future liability of the plan.  CalPers does not require payment based on that calculation.  However, CalPers is developing a methodology whereby payments towards the future actuarial calculations can be made.  There are many factors that drive the actuarial determination which includes years of service, participant age, mortality tables, and compensation rates.  Additional considerations include service by multiple participating municipal agencies. 

Government Accounting Standards Board (GASB)  Statement No. 68, commonly referred to as GASB 68, set an amended standard for accounting and financial reporting for pensions, which became effective with Beaumont’s fiscal year ending June 30, 2015.  Also included in this standard is the disclosure of assumptions, explanations of annual changes, summary of information including ratio, plan resources, contribution rates, discount rates, and the recognition of deferred inflow and outflow of resources.  Here's a link to "A summary of GASB 68"

Finally, this last quote shows that Libi Uremovic knows she is lying or, just doesn't do her research and makes up statements for shock factor:

- they don't even 'believe' in pensions in Texas

According to Texas State Comptroller's website:

Texas’ state and local government pension funds have more than 2 million members in 93 different plans. The Employees Retirement System (ERS) manages three funds for different groups of public employees: ERS for most state employees; the Law Enforcement and Custodial Officers Supplemental Retirement Fund (LECOS); and the Judicial Retirement System Plan Two (JRS II). The main ERS fund includes most state employees and all LECOS members, serving more than 185,000 active participants in all

Libi Uremovic claims

(Todd) Parton was not qualified to be Beaumont's City Manager because he didn't know California State Laws and he had no experience managing a city the size of Beaumont.

After reading this latest piece of Ms. Uremovic's, one has to wonder what, if any qualifications, she has to comment on municipal accounting and pensions in any city or state. Maybe she'll share her resume with us. 

The SEC Order

Ms. Uremovic's (Libi) claims about the investigation by the Securities and Exchange Commission (SEC) has been one of her most often published fake news stories and it can be found in many of her posts on several different social media platforms. The following quotes were pulled from Uremovic's Patch article regarding what the City of Beaumont had accomplished in 2017 and are examples of some of the claims she makes regularly.

  1. "the City was locked out of the Bond Market"
  2. "The S.E.C. has given the City until February 22, 2017 to re-submit Financial Statements and Bond Certificates of completion that are NOT forged."

The first claim, "The City was locked out of the Bond Market" is one she makes often. To properly debunk this false claim would require the city to disprove something that didn't happen, prove a negative. A statement would be required from the SEC that "Beaumont is not locked out of the bond market and has never been locked out of the market." I have not seen any statement from the SEC that would specifically dispute Uremovic's claim. At the same time, there is no statement or document supporting the claim that  "The City was locked out of the Bond Market" The burden of proof of this one has to be on Ms. Uremovic. If there is any truth to her claim, she should be able to point to documentation or a statement from the SEC stating "The City of Beaumont is locked out of the bond market." 

For the second claim, I'll only need to present a summary of the actual SEC order, using only the details from the order, and then let the reader decide. Any reasonable person should come to the conclusion that these claims are a distorition of the facts, fake news or outright lies. 

The SEC issued an order on August 23, 2017 "Insituting Cease and Desist Proceedings" against the Beaumont Financing Authority. 

On page 2 of the order the Beaumont Financiang Authority's violations are summarized:

1. This matter involves material misstatements and omissions by the BFA in the sale of municipal securities. Between 2003 and 2013, the BFA issued approximately $260 million in municipal bonds in 24 separate offerings. In connection with each of those offerings, a community facilities district established by the City of Beaumont, California (“the District”), in its capacity as an obligated person with respect to the bonds, entered into a continuing disclosure agreement (“CDA”) for the benefit of investors in the BFA’s municipal securities, including annual reports containing financial information and operating data relating to the bonds being offered. From the period of at least 2004 through April 2013, the District regularly failed to comply with its CDAs.
2. In 2012 and 2013, the BFA issued approximately $32.26 million of revenue bonds in five separate offerings. In each of those offerings, the BFA falsely stated in its official statements that, except in one instance several years earlier, the District had complied with its CDAs.
3. As a result of the conduct described herein, the BFA violated Sections 17(a)(2) and (a)(3) of the Securities Act.

On page 5 of the order is the legal description of the issues addressed in the SEC's order:

17. Section 17(a)(2) of the Securities Act makes it unlawful “in the offer or sale of any securities … directly or indirectly … to obtain money or property by means of any untrue statement of a material fact or any omission to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading.” 15 U.S.C. § 77q(a)(2). Section 17(a)(3) of the Securities Act makes it unlawful “in the offer or sale of any securities … directly or indirectly … to engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon the purchaser.” 15 U.S.C. § 77q(a)(3). Negligence is sufficient to establish violations of Sections 17(a)(2) and 17(a)(3) of the Securities Act. See Aaron v. SEC, 446 U.S. 680, 696-97 (1980). A misrepresentation or omission is material if there is a substantial likelihood that a reasonable investor would consider it important in making an investment decision. See Basic Inc. v. Levinson, 485 U.S. 224, 231-32 (1988).

On pages 6-7 the order lists the undertakings the City has agreed to. For simplification, I've filtered out the legal references.

Respondent undertakes to:
21. Within 180 days of this Order, establish appropriate and comprehensive written policies and procedures and periodic training regarding all aspects of the BFA’s municipal securities disclosures, including formal policies and procedures to be followed for the preparation, review and approval of official statements and continuing disclosures, and the designation of an individual officer of Respondent responsible for ensuring compliance by Respondent with such policies and procedures and responsible for implementing and maintaining a record (including attendance) of such training.
22. Within 180 days of this Order, establish appropriate and comprehensive written policies and procedures and periodic training regarding the accounting of bond proceeds and recordkeeping, and the designation of an individual officer of Respondent responsible for ensuring compliance by Respondent with such policies and procedures and responsible for implementing and maintaining a record (including attendance) of such training.
23. Within 180 days of this Order, ensure that the District complies with all existing continuing disclosure undertakings, including updating past delinquent filings if the District is not currently in compliance with its CDAs.
24. Retain an independent consultant (the “Independent Consultant”), not unacceptable to the Commission staff, to conduct a review of BFA’s policies and procedures as they relate to all aspects of the BFA’s municipal securities disclosures, the accounting of bond proceeds and recordkeeping. The Independent Consultant shall not have provided consulting, legal, auditing or other professional services to, nor had any affiliation with, the BFA during the two years prior to the institution of these proceedings.
25. Require the Independent Consultant to enter into an agreement that provides that for the period of engagement and for a period of two years from completion of the engagement, the Independent Consultant shall not enter into any employment, consultant, attorney-client, auditing or other professional relationship with the BFA, or any of its present or former affiliates, directors, officers, employees, or agents acting in their capacity. The agreement will also provide that the Independent Consultant will require that any firm with which he/she is affiliated or of which he/she is a member, and any person engaged to assist the Independent Consultant in performance of his/her duties under this Order shall not, without prior written consent of the Division of Enforcement, enter into any employment, consultant, attorney-client, auditing or other professional relationship with the BFA, or any of its present or former affiliates, directors, officers, employees, or agents acting in their capacity as such for the period of the engagement and for a period of two years after the engagement. The agreement will also provide that, within 180 days of the institution of these proceedings, the Independent Consultant shall submit a written report of its findings to the BFA, which shall include the Independent Consultant’s recommendations for changes in or improvements to the BFA’s policies and procedures. 7
26. Adopt all recommendations contained in the Independent Consultant’s report within 90 days of the date of that report, provided, however, that within 30 days of the report, the BFA shall advise in writing the Independent Consultant and the Commission staff of any recommendations that the BFA considers to be unduly burdensome, impractical or inappropriate. With respect to any such recommendation, the BFA need not adopt that recommendation at that time but shall propose in writing an alternative policy, procedures or system designed to achieve the same objective or purpose. As to any recommendation on which the BFA and the Independent Consultant do not agree, the BFA and the Independent Consultant shall attempt in good faith to reach an agreement within 60 days after the date of the Report. Within 15 days after the conclusion of the discussion and evaluation by the BFA and the Independent Consultant, the BFA shall require the Independent Consultant inform the BFA and the Commission staff in writing of the Independent Consultant’s final determination concerning any recommendation that the BFA considers to be unduly burdensome, impractical, or inappropriate. Within 10 days of this written communication from the Independent Consultant, the BFA may seek approval from the Commission staff to not adopt recommendations that the BFA can demonstrate to be unduly burdensome, impractical, or inappropriate. Should the Commission staff agree that any proposed recommendations are unduly burdensome, impractical, or inappropriate, the BFA shall not be required to abide by, adopt, or implement those recommendations.
27. Disclose in a clear and conspicuous fashion the terms of this settlement in any final official statement for an offering by Respondent within five years of the institution of these proceedings.
28. Certify, in writing, compliance with the undertakings set forth above in paragraphs 21-27. The certification shall identify the undertakings, provide written evidence of compliance in the form of a narrative, and be supported by exhibits sufficient to demonstrate compliance. The Commission staff may make reasonable requests for further evidence of compliance, and the BFA agrees to provide such evidence. The certification and supporting material shall be submitted to LeeAnn G. Gaunt, Chief, Public Finance Abuse Unit, with a copy to the Office of Chief Counsel of the Division of Enforcement, no later than sixty (60) days from the date of the completion of the undertakings.

On page 8 of the order the Cease and Desist is explained as follows:

A. Pursuant to Section 8A of the Securities Act, Respondent BFA cease and desist from committing or causing any violations and any future violations of Sections 17(a)(2) and 17(a)(3) of the Securities Act.

In conclusion:

  • The cease and desist order issues make no reference which a rational person could use to claim it applies to locking the city out of the bond market.
  • The undertakings make no reference or inference to " re-submit Financial Statements and Bond Certificates of completion"


For the full text of the SEC's order Click here.
Click Here for a link to the SEC's Press release

$400 mil missing - $350 mil embezzled From CFD Bonds -

In the December 29th letters to the Editor section of the Record Gazette, Elizabeth (Libi) Uremovic claimed that  "four hundred million is missing from the city of Beaumont, $350 million of which was embezzled from the Mello-Roos community facilities district bonds".

Here are the facts:

City Council received a report on June 7, 2016 from Urban Futures, Inc. regarding the reconciliation of Mello-Roos bond funds.

  • 34 bond issuances from 1993 to 2015 Face value = $367,240,000

  • $109,320,000 was issued as refunding bonds

  • $257,920,000 was issued as new money bonds

  • Bond expenditures in the amount of $258,099,800 were reported (Excludes bond proceeds used to refund bonds)

  • Reported that approximately $41 million of the proceeds were directed to the businesses of the criminals


       As described above, the funds have been reconciled and $350 million has been accounted for. Reconciliation of these funds show that capital projects were completed.

  • Construction Funds

    • Design, Planning, Engineering and Management = $50.6 million

    • Payments to 3rd party public agencies = $41.0 million

    • Payments to 3rd parties = $36.6 million

    • Reimbursements to developers = $24.6 million

    • Transfers to city = $53.1 million

  • Funds held by trustee = $29.7 million

  • Cost of issuance = $12.0 million

  • Administrative costs = $3.6 million

  • BFA bond expense = $6.9 million

  • Infrastructure needed to serve development is installed and functional

    • Streets

    • Drainage

    • Parks

    • Wastewater

Alan Kapanicas is still receiving a salary

In the December 29th letters to the Editor section of the Record Gazette, Elizabeth (Libi) Uremovic claimed Alan Kapanicas was still receiving a salary from the City of Beaumont;

Here are the facts:

A separation and settlement agreement was signed by Kapanicas and the City effective October 17, 2015. The City agreed to pay him for an accrued balance of 1,885.5 hours of leave time (sick leave, holiday, vacation leave), no future salary. Total monetary value of $213,702.  

Kapanicas was granted terminal leave starting on November 16, 2015. While on terminal leave, the City agreed to pay him at a rate of 40 hours per week for 24 pay periods (each payment totaling $8,904.27) until the total monetary value above was satisfied. City agreed to continue to contribute toward CalPERS but no other benefits were extended. Agreement specifically states that Kapanicas was considered terminated and no longer an employee as of November 15, 2016. 

CalPERS found that Kapanicas’ last day as a Beaumont employee was May 29, 2015 and determined that he no longer qualified for CalPERS contributions. City stopped making CalPERS contributions for Kapanicas on Oct. 29, 2015. City reversed any CalPERS payroll contributions for him that occurred after May 29, 2015. He did not have enough tenure in CalPERS to become vested. 

After Kapanicas was arrested, terminal leave payments were suspended in May 2016. Beaumont’s City attorney confirmed with the DA’s office that the Kapanicas bank account had been frozen as part of the criminal case. City staff directed that no more payments be made because it would violate a court order. City was later directed by court to submit check in the amount of $101,269.29 to the receiver in the Kapanicas criminal case for the balance of the accrued earnings established in the settlement agreement.