"I don't think we need to answer your questions," Brook Gness, business manager for TBI, told a reporter who visited the company's small office suite in a Wilshire Boulevard skyscraper.
TBI's genesis
TBI's name derives from the first initials of its founders: Tarek "Rick" Hijazi, Bassam Raslan and Ivan Kesian.
All three were construction supervisors at the Los Angeles Unified School District when they started the company in 2002 to supply project managers for L.A. Unified's $20-billion building program.
Kesian told a county grand jury last year that Raslan and Hijazi gave their wives majority ownership of the business because it is easier to get government work "if you're a woman-owned business or a minority-owned business."
Raslan pleaded guilty in December to a misdemeanor conflict-of-interest charge for steering L.A. Unified construction jobs to TBI. In return, the district attorney's office dropped eight felony charges. A judge vacated the misdemeanor conviction in January after Raslan paid $250,000 in restitution and performed 200 hours of community service.
None of this affected TBI's participation in the college construction program, where it has been a subcontractor since 2007.
The firm has served as the employer of record for 28 people on the program.
Marshall, who went on TBI's payroll in 2009, said she set foot in its office just once or twice, to drop off time sheets or a tax withholding form. She worked at the district's construction headquarters and answered to Eisenberg.
Her activities included meeting a Fox Studios official for lunch to pitch a speaking appearance for Eisenberg and accompanying him to a banquet at the Jonathan Club in downtown L.A., where the district received a Leonardo Award from the Society for Marketing Professional Services, records show.
Once a month, Marshall sent her time sheets to TBI, billing $100 an hour, records show. TBI and URS added markups that raised the rate to $171, and then URS sent a final bill to the district, records show.
This pattern was repeated over and over with other staff members and other subcontractors, usually with bigger markups.
Amy Yeager, a former aide to Los Angeles City Councilman Jose Huizar, sought grants for the college district in Sacramento and Washington, D.C. She was paid $115,000 a year, but her work cost taxpayers $305,000 a year once URS and subcontractor SASM Consulting collected overhead and profit, records show.
A niece and a nephew of district trustee Sylvia Scott-Hayes also found jobs on the program. The niece, Monica Ramirez, was hired as a project coordinator in 2009. Records show that the district authorized a subcontractor, ECM Group, to pay her at an annual rate of $65,000 to start and that markups for ECM and another contractor pushed the total cost to $179,000 a year.
The trustee's nephew, Rick Ramirez, was paid $100,000 over 20 months in a public relations job, records show. After his employer, Seville Construction Services, and URS added markups, it cost taxpayers $292,000 to employ him, according to the records.
Wage surcharge
It is common for government agencies to hire private contractors to supervise big construction projects. When billing the client, the contractors often add a surcharge to employee wages.
The system is supposed to serve the interests of both parties: Construction management firms recoup their overhead expenses and earn a profit, and the client benefits from the resources and expertise they bring to the job.
Most of the $500 million that the college district is spending on construction management fits this description. Companies draw from staff already on their payrolls to provide seasoned managers who ride herd on builders to make sure projects meet design specifications and are finished on time and within budget.
But the district broke from standard public contracting practice by hiring additional staff members and inviting politically wired firms to employ them on paper and add markups to their pay.
Contractors were eager to take advantage of the opportunity. In an e-mail to Eisenberg, one contractor was explicit, offering to serve as "a shell pass-through" for building inspectors.
The markups varied from one contractor to the next and were approved by URS and Eisenberg with almost no scrutiny by the board of trustees.
After The Times asked questions about the markups, the trustees sought answers from Eisenberg. In presentations to the board last year, he said the markups for more than two dozen companies were based on their expenses, as determined by audits or as stated by accountants.
But in response to repeated requests from The Times, the district produced audits for only two companies: URS and TBI.
In the end, the trustees trimmed markups for a handful of subcontractors.
TELACU Construction Management has employed 10 people through the program, collecting $667,000 in overhead and profit, according to district records.
