Delta pays $533,000 to consultant

College's expenditures toward acquiring land getting mixed reactions

San Joaquin Delta College has paid nearly $533,000 to a Pasadena-based consultant to help the college acquire land for future satellite campuses in Lodi, Galt and the foothills.

More than $423,000 alone has been paid to David Rodriguez and his firm, Public Private Ventures, Inc., for work securing the Victor Road site just east of Lodi, according to documents obtained by the News-Sentinel.

The size and terms of Rodriguez' contracts with Delta — including a $19,500 expense account for his work in Lodi — have caused some to question whether the college overpaid for the consultant's services.

"I don't think we're getting a heck of a lot of bang for our buck," said Delta Trustee Ted Simas, who represents Manteca and has been outspoken about the college's handling of its $250 million bond.

Those funds were approved in March 2004 by voters in the San Joaquin district.

Critics have questioned the performance of PPV, wondering whether the firm got the best price for the Lodi campus site.

Some have asked whether Delta could have paid less for a local firm, one that was more familiar with the valley and its real estate market.

Others, however, have defended the college and its consultant. They maintain that acquiring land for a future campus is a complex process — one that demands the hiring of outside experts, no matter the cost.

Rodriguez and Lodi's land deal

David Rodriguez has served as lead consultant for Delta's land deals for the past two years. His firm was hired in July 2005.

Rodriguez holds a master of business administration degree in real estate finance and is one of several principals at PPV — which is currently working to gain land for 10 new community college campuses throughout the state.

His contracts with Delta show he could earn a up to $605,000 for his work in Lodi, Galt and the foothills. He's also eligible to collect up to $30,250 in travel, printing and postage expenses.

Rodriguez did not respond to several calls for comment on this story over the past week.

He has, however, been the key figure in acquiring a controversial 119-acre parcel for Lodi's future campus, off Victor Road.

As recently as last summer, Rodriguez told the Delta board of trustees that the college would need only $1 million to acquire the Lodi site, according to Simas.

Under such a deal, a private developer would cover all additional purchase costs, plus pay for the needed road, water and sewer improvements.

A developer never emerged, and the college now expects to pay approximately $15 million to buy the land and build the off-site improvements.

"That's one reason I'm not real thrilled," said Simas, who has strongly opposed building a campus at the Victor Road site from the beginning.

Simas is not the only one disappointed in Delta's recent land deals and PPV's assistance.

Given that Delta has yet to build a single new classroom with its bond money, many have begun to question the college and the performance of its consultants.

Delta plans to bring a set of portable classrooms to the Lodi site by 2010.

"The college has spent a lot of money on consultants. I think it's been a big concern," said Karen Munro, who lives near the proposed Lodi campus and ran unsuccessfully for a seat on Delta's board of trustees last fall.

"People in Stockton and Lodi have commented about how much they paid for the (Victor Road) land and why would someone from Los Angeles be asked to come up and give advice on where and how much they should spend on land."

Numerous residents who live near the Victor Road site have opposed Delta's plans, citing concerns that a college will draw further development and pave over the area's rich farmland.

Opposition from one property owner in particular — Jerry Ferdun — has prevented the college from securing a 4-acre property right in the middle of the campus site.

For several months, Delta President Raul Rodriguez, who is not related to David Rodriguez, maintained the college had an option to buy the Ferdun property through a third party.

David Rodriguez even wrote the college a memo stating the third party had "secured" the option.

But this spring Ferdun vehemently denied that he's ever agreed to sell his land to the college or any other party. As it stands now, the college does not have any right to the 4-acre parcel — essentially an island in the middle of the campus — despite an earlier $1.4 million offer to buy it.

Defending expensive expertise

Despite the criticisms, Delta College administrators have defended their decision to hire David Rodriguez and PPV.

The firm has secured a purchase agreement for the Lodi land, as well as for sites in Galt and Valley Springs — though the latter may be dropped due to cost overruns at Delta's Mountain House campus, where Rodriguez has not worked.

Construction estimates at Mountain House, northwest of Tracy, have skyrocketed to $95 million, more than $30 million higher than initially thought.

Without hesitation, Andy Dunn, Delta's vice president of business services, said PPV has done a good job.

"I'm pleased with their performance," Dunn said.

Not having the 4-acre Ferdun property at the Lodi site is "not a consequential difference," he said, noting the college will plan the campus around Ferdun's land.

Dunn said the cost of the Lodi campus site may have been higher than some nearby. But that's because it's been earmarked by the city of Lodi for annexation, he said.

Such land is more valuable because it will receive city services like police and fire and water and sewer.

Dunn said the college scrutinized the purchase agreement for the Lodi land and, in the end, decided "it was in the best interest of the college to go ahead."

He said the college considered very closely the fact that PPV is not a local company, and realized the firm would need to make contacts and learn the area.

"But, this firm has worked — and successfully, I might add — with a number of community college districts around the state," Dunn said. "They came well recommended."

A Southern California critic

Listed on PPV's Web site is David Rodriguez' experience with Palomar Community College District, along with several other groups, though not Delta College.

Nancy Chadwick, a Palomar College trustee, said Rodriguez' work at her college is incomplete, at best.

The consultant has secured land for one of Palomar's two future campuses. But Chadwick said Rodriguez still hasn't come up with a suitable site for the other — in Poway, a San Diego suburb — despite several years of work.

"I've been very disappointed," she said. "They haven't come up with anything. We've had so many false starts. We keep reducing our requirements (for the Poway site)."

Chadwick said Rodriguez has suggested sites that were later found to be too close to or include conservation districts or wetlands or simply weren't suitable.

"I thought we had been given less than all the information (about the land)," she said.

Michele Nelson, another Palomar trustee, confirmed the college has contracted with Rodriguez for several years and had trouble securing the Poway site. She declined, however, to comment about his performance.

More than just surveying land

Lodi Mayor Bob Johnson, a strong supporter of the Lodi campus plans, said hiring an expert like Rodriguez to work for the college was a good move.

He and others noted that such work includes more than just surveying the local real estate market. Negotiating with property owners, drawing up contracts, and working with a bevy of state and local government agencies to make sure the site meets environmental clearances are also part of the job.

"There are people who specialize in different types of (land) acquisitions," Johnson said. "I don't know that you would necessarily call up 'Sally Jones' who sells single family houses and ask her to (acquire the Delta campus site)."

Johnson said he couldn't comment about whether Rodriguez' contract was a fair one or not.

"I'm going to assume that the Delta board of trustees thought that the price was reasonable," he said.

If David Rodriguez was simply locating sites for the college but nothing else, then his compensation might be a bit high, said one area assistant real estate professor.

"He's doing the work of a real estate developer," said Thomas Davidoff, who teaches at the Haas School of Business at the University of California at Berkeley. "Maybe they could have done better. But (PPV's compensation) doesn't rub me terribly wrong."

"I would think someone local could have done it. But I've heard of worse graft on a deal than someone in Southern California getting $400,000," Davidoff added.

Spending hundreds of thousands of dollars on a consultant made Laura Perry take notice. The trustee for the Gavilan Joint Community College District in Gilroy — which also employs Rodriguez — said she initially was skeptical of the move.

She noted, however, she doesn't think the college could have secured its Coyote Valley or Hollister campus sites without PPV.

"In general, I just don't like the idea of consultants," said Perry, a family law attorney based in Morgan Hill, noting she'd rather have the college's staff do the work if possible. "But so much of it is just out of our area of expertise."

Perry said she did not know Rodriguez' exact contract with Gavilan, but noted that the college paid for him and several trustees to fly to the Midwest to tour housing projects at Michigan State University and the University of Notre Dame.

She said the trip, and resulting help in designing housing projects for Gavilan, was well worth the money.

Too soon to judge

Not everyone on the Delta board of trustees feels Rodriguez should be evaluated just yet.

Trustee Greg McCreary, who represents Tracy and has opposed acquiring the Lodi site, said only time will tell if Delta got a good deal on the land.

Many more studies must be done on the acreage before anything can be built there. A comprehensive environmental review must be conducted — a process than can last more than a year, and add many extra expenses to building a campus.

"If we give someone $400,000 and they don't come up with anything, then we paid way too much," McCreary said last week.

If, on the other hand, the Victor Road site eventually becomes the bucolic campus, complete with a viticulture center and amphitheater in view of the rolling Mokelumne River, then Rodriguez will be worth "every dime" the college paid him, McCreary said.

Contact reporter Chris Nichols at chrisn@lodinews.com.