Joe Nelson, Staff Writer
Posted: 12/16/2011 03:19:40 PM PST

Highland has lost a $10 million federal grant to widen Fifth Street north of San Bernardino International Airport due to an ongoing FBI investigation at the airport.

The city had planned to use the money to widen Fifth Street between the 210 Freeway and Del Rosa Avenue to improve traffic flow near the airport.

A Dec. 8 letter from U.S. Secretary of Transportation Ray LaHood to Highland Public Works Director Ernest Wong said the Oct. 20, 2010, grant was contingent upon the street widening project meeting all applicable federal statutory and regulatory requirements and conditions.

After awarding the grant, the Department of Transportation learned of the FBI’s investigation into allegations of conspiracy, money laundering, theft of public funds and wire and mail fraud at the airport. Airport developer and convicted felon Scot Spencer, San Bernardino Mayor Pat Morris and former airport director Donald Rogers are among the individuals implicated in the investigation.

“Given these changed circumstances, the Department (of Transportation) does not believe that the project will be able to serve its intended purpose, which was to attract additional air service to the airport and stimulate an increase in economic activity that would create and preserve jobs,” LaHood said in his letter.

As a consequence, LaHood said his department is withdrawing the grant.

Roughly 80 FBI agents raided the airport on Sept. 21, seizing dozens of boxes of official documents that filled a 26-foot U-Haul truck. The warrants served at the airport and the gated Riverside mansion that Spencer rents listed 16 corporations Spencer is affiliated with in which investigators were also seeking records.

On Tuesday, Highland City Councilman Sam Racadio, who sits on the San Bernardino International Airport Authority (SBIAA) board, sent a letter to A.J. Wilson, interim executive director at the airport, breaking the news.

“This is bad news, but we have to move forward with our efforts and keep improving the airport,” Racadio said in his e-mail.

To read entire story, click here.