An audit of San Jose's Alum Rock School District indicate evidence of possible fraud and misspending on construction projects.
The audit was released Friday by the state's Fiscal Crisis and Management Assistance Team. The case is now being reviewed by the Santa Clara County District Attorney's Office for possible criminal charges.
The audit is part of a culmination of problems that have been talked about in the district since last fall. Parents have been complaining for months about proposed school improvement projects that were not getting done.
District officials had big plans for Fischer Middle School, where a new, modern multipurpose facility was to be built by the contracted construction and management company Del Terra Group. School bond money paid for the project.
According to the state audit, Del Terra was paid about $330,000 for four projects last year, which have yet to start.
School Board Member Andres Quintero began raising questions long before the state agency audit.
"The findings in the report are incredibly troubling," Quintero said. "Since September, I've asked for audits because I wanted more information because I had concerns."
The Santa Clara County Office of Education said there is a lot at stake.
"School construction bonds are generally around $100 million," Santa Clara County Office of Education spokesman Peter Daniels said. "Some can be even higher, depending on the size and needs of the district. And the public places a great deal of faith in the schools to use these monies wisely."
The school district and District Attorney's Office said they are still reviewing the audit findings.
The school board will address the audit at its July 13 meeting, where Quintero said he will move to terminate the construction contracts.