The Ontario-Montclair school board is circling the wagons to protect its superintendent in the wake of disclosures about his more than $700,000 in compensation and his handling of the $331,000 in housing assistance he received as an incentive to live within the community.
Emails and text messages obtained through a public records request paint a picture of an elected board that is deferential and fiercely loyal to its subordinate. The exchanges indicate that Superintendent James Hammond coordinated the board’s media responses and provided talking points to the elected officials. He also reminded them not to speak to reporters separately, as the board’s policy is for President Elvia Rivas to serve as the spokesperson.
“She has already been in contact and is prepared to address any inquiries that may be submitted,” Hammond wrote in an email to all five board members.
In another email, board member Sonia Alvarado, who previously served as Hammond’s real estate agent, joked that the superintendent should meet those questioning his salary “in a boxing ring.” Separately, board member Flora Martinez expressed her disappointment that the superintendent was facing backlash at all.
“I’m so sorry you’re going through this,” she wrote in a text message.
Even the district’s two unions appeared unwilling to cross Hammond, with both the leadership of the Ontario-Montclair Teachers Association and the California School Employees Association reaching out to Hammond to warn him in advance that a reporter had contacted their respective offices, according to an email from Hammond to the board.
Former board member’s concerns
Former board member Samuel Crowe supported Hammond’s hiring in 2010. But by the time he left in 2018, he said the board was unwilling to do “anything that would be difficult for Mr. Hammond to agree to.”
Crowe, who says he chose not to run for re-election in part over concern’s about Hammond’s compensation and influence, alleged the superintendent’s contracts were rarely discussed before they were approved.
“He was as much as politician as he was a superintendent,” Crowe said in an interview in November.
Resolution absolves superintendent
More recently, the board on Dec. 16 took steps to protect Hammond from apparent violations of a loan agreement he made with the district. The trustees unanimously voted on a resolution stating that Hammond had fulfilled his obligations for a $100,000 home loan and $231,000 in principal payments he had received from the district to assist with a town house he purchased in 2011. At the same time, the board approved a quitclaim deed, a legal document that removed the district’s interest in the property it had helped him buy and then later pay off.
Yet, Hammond had sold the property four years earlier. By all accounts, Ontario-Montclair had already lost all its interest — and any collateral for the loan it later forgave in full in 2018 — once the property changed hands, according to four different attorneys consulted by the Southern California News Group. All agreed that the board’s resolution appeared designed to protect the district and Hammond in case the payments were challenged.
Hammond sold the town house for $389,000 in 2017. He never made any payments on the loan, which was designed to be forgiven completely if he stayed with the district for 10 years, but then was later reduced to eight years. After he sold the house, he collected $114,000 in payments in 2018 and 2019 described as “for the purposes of paying down the principal” remaining on a mortgage and a line of credit that he took out against the town house. Both would have been paid off when Hammond sold the property.
Deed not recorded
The district has been unable to provide documents showing that Hammond formally notified the board of the sale, as required by his loan agreement. He seemingly was able to sell the property without getting the district’s approval or repaying what he owed on the district’s loan because Ontario-Montclair did not record its deed of trust with the county, public records suggested. The quitclaim approved this month also refers to the promissory note and a subsequent amendment as “unrecorded.”
A deed of trust acts as security for a loan by establishing the property as collateral. While the district could have sued if Hammond defaulted, it would have had less of a priority for repayment than others debts where the deed of trust was recorded, according to Joel Ruben, a real estate attorney. Banks would not provide a loan without a deed in place, he said.
“If it was properly recorded, then the district would have been asked to put in a demand (for repayment) during escrow,” Ruben said.
Documents provided in a records request raised questions about how the deed was missed for so long. A title report for the property requested by the district’s staff in 2013 shows the deed of trust was not in place at that time when it should have been. That same year, the board agreed to an amendment to the loan agreement that would place its deed of trust behind Hammond’s mortgage and a new $46,000 line of credit opened against the property.
Mum on transaction history
Yet, a transaction history obtained from county records in November 2021 shows the district did not record the deed then or in the years since.
Hammond and his real estate agent should have become aware of the unrecorded deed when he attempted to sell the property and it did not show up as an encumbrance. At the Dec. 16 meeting, Hammond declined to answer questions in person and asked a reporter to email him instead. He did not respond to the subsequent emails. President Rivas, the board’s spokesperson, also did not respond to requests for comment.
Alvarado, one of the board members who voted in support of the resolution and quitclaim deed, served as the real estate agent on the sale prior to joining the Board of Trustees. She also did not respond to a request for comment.
‘Nobody followed up’
Crowe, who voted for the initial home loan but against the principal payments later on, said the board’s intent in 2011 was for the deed to be recorded as security for the loan, but that it was originally delayed because the district’s loan was provided months before Hammond officially took possession of the property. He recalled seeing a copy of the incomplete deed of trust, but said he didn’t know why the district never submitted it to the county after the sale concluded.
“Probably nobody followed up on it,” Crowe said. “I just assumed it was taken care of.”
Crowe alleges it would have been Hammond’s responsibility to record the deed of trust on the board’s behalf.
The Dec. 16 resolution approved by the board states that Hammond’s sale of the property and his subsequent move to a larger house in the district were “common knowledge” and that by agreeing to an unrelated amendment that extended his contract in 2018, the board was effectively approving of his sale of the property a year earlier.
“This Amendment #5 excluded all prior discussions and all extrinsic evidence which meant that the change of household and underlying promissory note and first and second deeds were acknowledged and the structured compensation to ensure Dr. Hammond continued to live in the district while he served as superintendent were achieved,” the approved resolution states.
The original loan agreement states that Hammond was not permitted to take out additional loans or sell the property without first notifying the board. The resolution argues that Hammond’s payments were to incentivize him living in the district and that it did not matter that he moved to a different home.
“The district’s financial interest was not to secure interest in real estate — its interest was to secure what few school districts ever achieve, a long-serving superintendent who is bound to the community he serves,” the resolution states.
The language in Hammond’s contract in 2015 seems to contradict the board’s resolution, too. It states the payments were “for the purposes of paying down the principal” on related debts tied to the specific property. It also states that the terms would be “securitized against the property,” which would have required the deed of trust to be recorded.
The resolution was recommended to the board by Hammond. There was no discussion or staff report at the meeting prior to the unanimous vote.
Crowe, the former board member, scoffed at the idea that Hammond’s move was widely known. He said he learned of it after Hammond had sold the town house already, though not from the superintendent, but from another employee.
“I certainly wasn’t aware of it,” Crowe said. “In fact, I was surprised.”
Crowe believes board members at the time would not have contested the sale and would have worked out an agreement in the superintendent’s favor if they had been notified. But that didn’t happen.
“They didn’t do anything,” he said.
Source: Orange County Register
Be First to Comment