USF sues San Francisco Board of Education over unpaid reimbursement

SFUSD rejected the University’s claim that it had denied its reimbursement invoice. PHOTO BY MIGUEL ARCAYENA/SAN FRANCISCO FOGHORN

USF recently filed a lawsuit for damages and declaratory relief against the San Francisco Board of Education, which represents the San Francisco Unified School District (SFUSD). The lawsuit claims that the board and school district have not fulfilled their agreement to reimburse the University $297,998.68 after it provided “emergency temporary funding” for the San Francisco Teacher Residency Program (SFTRP) back in 2017. 

According to San Francisco Superior Court filings, which are available online in the court’s docket finder webpage, the University filed its lawsuit back on Aug. 17. In the complaint, USF identified three claims: breach of contract, common count, and misrepresentation (Case No. CGC-21-594564).

The two other defendants named in the case are the SFUSD and Superintendent Vincent Matthews. The case is still pending, with the court having issued summons to the board, school district, and Matthews on Sept. 10. This is the most recent online file on the docket webpage at the time of publication. 

When asked for a comment from the University, Kellie Samson, head of media relations, said in an email statement to the Foghorn, “USF essentially advanced SFUSD the money to pay for the program teachers’ stipends when the district asked us to.” She added, “Despite its commitment to do so, and after several requests by us, the district has evaded its obligations to repay USF, which has left us no choice but to pursue litigation for repayment.”  

The central issue between the University and the city revolves around the SFTRP. Created back in 2010, the training program was founded as an answer to the shortage of educators in San Francisco. Alongside USF, Stanford University also took part in the program. As consortium members, SFTR participants or “Residents” earned their credential requirements at both respective institutions, serving as a “staffing pipeline for SFUSD to employ qualified Residents as full-time SFUSD teachers after their graduation,” said the complaint. 

USF claims that during the 2016-17 academic year, the program had sent out admission letters to prospective participants which included benefits from the federal agency, AmeriCorps. The said aid consists of a “living expense monetary stipend of at least $12,000 and an education award of at least $5,500.” Those who accepted the letter took graduate classes at the University’s School of Education and USF additionally “would provide 40% tuition remission.” 

However, in April 2017, both the University and SFUSD chose to eliminate the AmeriCorps financial aid. Still, both parties agreed to continue funding the program for the rest of the year. 

The University claims that between April and May 2017, USF provided a total stipend of $105,103.68 to 33 Residents. In addition, it had also given out a total of $191,895 in education awards, as part of the admission letter SFUSD sent out. 

The University is chasing the school district for the combined total of $297,998.68 in stipend grants and awards it provided. In 2017, USF claimed that when SFUSD asked the University to “provide emergency temporary funding to cover SFTR payment obligations,” then-SFUSD Executive Director of Professional Learning and Leadership Chris Canelake wrote in an email that SFUSD “would fully reimburse the University if [USF] did so.” 

The school district’s Chief Financial Officer Reeta Madhavan also reassured the University in an email, which is included in the complaint, that they would present “an MOU [memorandum of understanding] to the Board of Education at the next available opportunity which sets forth the District’s commitment to transferring approximately $297,000 to USF.” 

In May 2019, when Dominic Daher, the USF associate vice president of tax compliance and internal audit, sent a request for reimbursement to SFUSD, the University claims the school district “did not pay the invoice.” 

Further, in November of last year, USF said it directly presented its claim to SFUSD, but on Jan. 6, 2021, the school district “denied the University’s claim.”  

The University says in the complaint that the MOU between them and the city included “indemnification,” a clause in which a party will compensate for any “liability, loss, expense.” The MOU between the SFUSD, USF, and Stanford was originally entered on Sept. 19, 2011, and subsequently renewed each year following it. 

Samson clarified that there are no precedents for a situation like this where the University had to sue but that “USF has made every attempt to avoid litigation, and it is our last recourse.”

The first claim USF identified in the lawsuit is a breach of contract. Because of the MOU, USF claims the document “provides for SFUSD’s responsibility to indemnify the University for any losses suffered by the University for SFUSD’s acts and omissions (and those of SFUSD’s employees) in relation to the SFTR MOU.” 

By failing to compensate them, USF claims SFUSD breached its contract as the University suffered compensatory damages. 

The second claim the University has is common count. USF claims that the school district “became indebted to the University when [USF] distributed payments to Residents from April to June 2017.” Additionally, USF highlighted that the funds provided by them were “upon SFUSD’s special request.” 

The third claim USF alleges is that SFUSD misrepresented its statements and “omitted material information that if known to the University, would have caused the University to behave differently, namely, that SFUSD did not intend to make the payment as represented.” 

When asked to comment on this lawsuit, SFUSD’s spokesperson, Laura Dudnick, repeated the Madhavan quote that the school district would present “an MOU to the Board of Education at the next available opportunity,” in an email statement to the Foghorn. 

She further refuted USF’s claim that the school district is denying the University payment and “in fact, the District presented an MOU to USF on several occasions but USF declined to execute it. The MOU would have enabled the District to seek Board approval to pay the requested amount.”

The Vartain Law Group, which represents USF in the lawsuit, did not provide any comment when reached out to by the Foghorn. 

This pending lawsuit is not the first time USF’s relation to the SFTR program has been contentious. In May 2020, the University agreed in settlement to pay $2.5 million for claims that the “director of USF’s teacher residency program falsified more than 1,500 timesheets and illegally certified approximately 61 education awards from 2014 to 2016 to acquire more than $1.7 million in federal grants,” reported by the San Francisco Chronicle last year. 

The San Francisco Examiner noted back in April that “USF has called for SFUSD to pay for a portion of the settlement.” Around that time, it was revealed that the University had ended its partnership with SFUSD for the teaching program. 

Samson later confirmed that since March 2021, USF no longer participates in the program. Despite the lawsuit, the University said it continues “to be engaged in constructive and reciprocal relationships with the district,” including the Our Educational Talent Search grant, a  program that helps SFUSD middle and high school students for greater college accessibility.


Miguel Arcayena is a senior politics major and the Foghorn’s news editor. He covers campus breaking news and administrative issues. He can be reached at marcayena@sffoghorn.com.

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