Superintendent Edwin Diaz said the district's legal counsel advised him to withhold all records and other details surrounding the alleged theft of Measure Y money that was earmarked for improvements at Washington Middle School in 2006.

"We directed the attorney to investigate all legal options to see what options we have for recapturing the funds" through civil litigation, Diaz said Thursday. "Releasing any information that was part of the investigation could inhibit our options in moving forward."

Through his secretary, PUSD attorney Terry Tao declined to comment.

Upon becoming superintendent in March 2007, Diaz began reviewing Measure Y. He said he uncovered irregularities that prompted him to ask a PUSD attorney to conduct an investigation.

The district turned over the attorney's findings to the Pasadena Police Department, which conducted its own investigation. The police then forwarded a complaint to the Los Angeles County District Attorney's Office, which declined to file criminal charges, citing insufficient evidence.

Diaz said the district is continuing to look into the alleged theft, building a case for a possible lawsuit against a contractor whom officials believe absconded


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with the Measure Y funds. School district officials will decide in the "next few weeks" whether they will sue the company, Diaz said.

Peter Scheer, executive director of the California First Amendment Coalition, said the documents referred by district officials to police are public record under the California Public Records Act.

Public documents can be withheld if they are produced during the course of litigation, Scheer said, but not if they existed before a lawsuit was filed.

"There is an exemption for documents relating to pending litigation, but it has to be pending litigation," Scheer said. "If you're merely investigating and gathering documents like that in anticipation of litigation in the future, that's not enough."

Diaz also refused to say how much the district is paying its attorney to look into the matter. He and other district officials said they did not know how much has been spent so far on legal fees related to the probe.

Before the theft allegations surfaced last week, Diaz had made one public statement regarding irregularities in Measure Y spending - following a closed-session school board meeting on Aug. 28, 2007.

At that time, Diaz told audience members that "certain irregularities were discovered" in the district's facilities department. He said the case was turned over to the Pasadena Police Department for investigation.

Diaz added that he would "update the community when it is appropriate to do so."

On Thursday, Diaz said any further comment at this point would be inappropriate.

"Acting on the advice of our attorney, we have to keep confidential until we develop a course of action," Diaz said.

School board president Tom Selinske said district officials must "maintain confidence and protect everyone's rights" as officials lay the groundwork for a possible lawsuit.

According to the District Attorney's charge evaluation worksheet, the allegations surround Eric Peterson, a former project manager for contractor Pacifica Services Inc.

The District Attorney's worksheet said PUSD officials suspected that the company improperly billed the district for work that was never completed - or was completed by others - at Washington.

The district hired Pacifica to complete the Measure Y modernization projects. The contract required Pacifica to provide regular updates to a citizens' oversight committee. It's unclear if those updates were regularly provided, officials said.

Peterson said Wednesday he was the "13th project manager. Everybody else either went nuts or walked off the project," which he characterized as "pandemonium."

Peterson then declined to comment any further.

Pacifica's relationship with the district ended in 2007, when its contract expired.

On Tuesday, voters will decide the fate of Measure TT, a $350 million bond that PUSD officials say would fund school upgrades and renovations. If passed, homeowners would be taxed about $46 per $100,000 of assessed home value.

Selinske remained confident that residents will support the measure and said that oversight issues that plagued the Measure Y projects will not be repeated.

"We need to do things to improve facilities in this community. We think we're going to see positive support from the community," he said.