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‘It’s not enough.’ CT lawmakers demand changes after former budget deputy indicted

Some state lawmakers are calling for even deeper reforms, after Gov. Ned Lamont’s former budget deputy was charged with extortion and bribery in a multimillion-dollar scheme to rig school construction bids.

John Craven

May 21, 2024, 10:22 PM

Updated 30 days ago

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Could it happen again?
Some state lawmakers are calling for even deeper reforms, after Gov. Ned Lamont’s former budget deputy was charged with extortion and bribery in a multimillion-dollar scheme to rig school construction bids.
DIAMANTIS INDICTMENT
If you wanted to build a school in Connecticut, you had to go through Kosta Diamantis. As head of a little-known – but powerful – Office of School Constructions Grants and Review, Diamantis oversaw hundreds of millions of dollars in state grants for local school districts.
But in a sweeping 22-count indictment, prosecutors accuse Diamantis of rigging millions of dollars in construction projects – and taking a cut for himself.
“The depth of deception, collusion, and abuse of power by the defendants in this case, as alleged, is glaring,” said FBI Special Agent in Charge Robert Fuller. “The willingness to manipulate contracts and blatantly steal by abusing a position of public trust is intolerable.”
The allegations against Diamantis are both stunning and brazen.
According to the indictment, Diamantis threatened to “blackball” one company if they didn’t hire his daughter at an inflated salary. His text messages were even bolder. In one, Diamantis allegedly wrote, “I am very good at what I do … And I always usually work at 5 percent of total [bid price] just FYI.” Another text reads, I need 5k desperately tomorrow from him or anyoneI don’t care who I shouldn’t have to beg he owes me 77 [thousand dollars].”
COULD IT HAPPEN AGAIN?
Lamont told reporters that his former budget deputy committed “a breach of public trust.” But he insisted that more checks and balances are in place today.
“We’ve tried to make changes to make it a little less likely that this could happen in the future,” he said on Monday. “But if it is corruption, corrupt individuals can work around.”
A major issue was oversight – or a lack of it.
After the FBI launched an investigation in 2022, the school construction grants team was split into two groups. A separate audit division now oversees the team that manages grants. The state Department of Administrative Services (DAS) also hired a new director of Grants Administration and a director of Internal Audit. The division’s HAZMAT program, which handles emergency construction, no longer interacts with school districts. Staffers now undergo stricter ethics training, too.
But some state lawmakers want to go even further.
“It’s not enough,” said state Rep. Vin Candelora (R-North Branford), the Connecticut House GOP leader. “You can’t just look at a piece of paper and really understand if there’s money going out the back door.”
Candelora wants to hold legislative hearings, and hear from school districts directly about how they were allegedly pressured to pick certain contractors.
“Maybe we need to look at an independent state inspector, which was a proposal back in the day that [former Senate Republican leader] John McKinney had championed,” he said.
Democratic leaders are open to changes, but they don’t want to bog down the school construction process.
“If people felt like they weren’t heard and they felt pressured, then we should find out what those points are, and we should make changes there,” said state Sen. Bob Duff (D-Norwalk), the Democratic leader in the state Senate.
LOOSER RULES?
Republicans are already accusing Democrats of loosening the rules.
Buried in a 254-page state borrowing package is a provision letting school construction managers also bid on subcontracts they’re overseeing.
“In light of the embarrassing, national news-making school construction bidding scandal, the State of Connecticut should be strengthening its rules, not relaxing them,” state Senate Republican leaders said in a statement. “Rolling back reforms sends exactly the wrong message. Senate Republicans will introduce legislation in the next session to change the law back to its current form.”
The ban on “self performance” contracting was instituted after the Diamantis scandal broke, but it also made construction projects more expensive.
“We are trying to contain costs when it comes to school construction, and I think that this is one of the ways in which you can do that,” state Rep. Jeff Currey (D-East Hartford) told CT Mirror.
Duff said juggling costs and oversight is a delicate balancing act.
“If we can find ways in which to tighten that up, and provide more legislative control on that, then we probably should do that,” he said. “And it should be in partnership with the executive branch to make sure that projects still move forward, but move forward in a way that doesn't give one person too much power.”
LINGERING QUESTIONS
The Diamantis indictment leaves some questions unanswered.
Critics still want to know why Diamantis’ school construction role was shifted from DAS to Lamont’s budget office in 2019. The move came at the urging of budget director Melissa McCaw, who insisted the arrangement was more efficient. But McCaw also appeared to have a personal friendship with her new deputy budget director, according to an independent investigation that Lamont commissioned.
Lamont acknowledged missteps on Monday.
“I generally thought, at that stage, it was very early in the administration, that I hire the best commissioners I can. And they had the right to put together their own team," Lamont said. “So I didn’t get as involved in that, in hindsight, as we should have.”
McCaw has never been accused of wrongdoing, but she resigned weeks after the federal probe launched. Soon thereafter, school construction grants were shifted back to DAS.
WHAT’S NEXT?
For now, Diamantis is scheduled to go on trial in July 23 in Bridgeport. The next legislative session begins in January, but lawmakers plan to meet in a brief special session at the end of next month.


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