When Frank Foggiano steps onto the Grossmont High basketball court several times a year, he’s more than just a coach. He’s also playing host to tournaments that cost his teams and others hundreds of dollars to play in.

But rather than deposit the tournament fees into the school’s basketball account, Foggiano takes the money, asking for checks to be made out to a nonprofit organization he and his wife formed in 1999 that’s registered to their home in El Cajon.

The Grossmont High basketball account also cuts Foggiano’s nonprofit a check for tournament participation, an expense he requests and signs off on, Grossmont Union High School District records obtained by Voice of San Diego show. The money in the basketball account comes from donations, concessions, ticket sales and student fundraising, district officials said. Foggiano collects additional money from tournament attendees at the door, usually at least $5 per person.

The set-up has for years allowed Foggiano to insert himself as a middle man and earn extra revenue beyond his roughly $107,000 annual teaching and coaching pay. It’s an arrangement that may also violate district policies, though district officials defended the relationship, saying payments are made “at arm’s length” and are also approved by students. Past team rosters located by VOSD show at least two students who signed off on the payments were also members of the basketball team at the time and therefore under Foggiano’s direct supervision.

Foggiano’s nonprofit, called Destined To Be Stars, organizes high school tournaments primarily on district property and runs a children’s basketball league that Foggiano has his high schoolers referee for free for community service hours, according to a Patch.com article from 2010.

It’s no small operation for a side hustle. IRS tax filings show Destined To Be Stars has brought in more than $882,600 in revenue over the years, not including 2019. More than $74,000 in revenue was reported for 2018 alone.

Foggiano and his wife are Destined To Be Stars’ only officers. Some years the Foggianos report to the IRS a profit, and other years, a loss. Payments to unspecified “officials/referees” make up the lion’s share of Destined To Be Stars’ expenses annually, with smaller amounts reported for telephones, supplies and other expenses, tax filings show.

In 2001, Frank Foggiano reported taking $12,500 in compensation as president of Destined To Be Stars. In later years, the Foggianos reported taking $1,340 or nothing in annual compensation as officers in the nonprofit tax filings.

Grossmont school district records produced in response to a California Public Records Act request show Destined To Be Stars owes the district at least $3,400 for missed facility rental payments normally required of third parties. Approvals to use district property were granted anyway. Destined To Be Stars has used district property dozens of times over the years, but district officials could only locate a $150 payment from the organization.

There is no contract in place with Destined To Be Stars for the current basketball season underway and the district couldn’t locate facility rental applications for every year and tournament held, Grossmont district spokeswoman Catherine Martin said.

It is also possible the district isn’t closely tracking Foggiano’s events held on district property.

Martin initially told VOSD, “there are no further (DTBS) events scheduled. The ‘current season underway’ ended in Feb 2019. His latest COI (certificate of insurance) has an expiration date of 10/18/19.”

When VOSD pointed out the current basketball season actually began with games in November 2019 and the annual Destined To Be Stars “Winter Classic” game was held just last month for several days at Grossmont High, Martin wrote, “You are correct. We have learned that DTBS hosted a tournament last month without a facility use permit application on file.”

Aside from the Destined To Be Stars tournaments, district records show district basketball programs paid several schools directly to play in their tournaments, as well as a few third parties, though Foggiano’s simultaneous roles as coach, tournament host and money recipient appears to be unique.

Neither Foggiano nor his wife, Ellen Foggiano, answered several VOSD inquiries by phone, email and social media. Ellen Foggiano is listed as the group’s secretary on tax forms.

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Various Grossmont school district basketball programs paid Destined To Be Stars at least $42,815 since fiscal year 2015, with more than a dozen payments exceeding $1,000, district records show. At least $3,775 came from the Grossmont High boys’ basketball program overseen by Foggiano, paid in eight separate payments — the largest for $990 in October 2016.

Records show Foggiano himself signed off on thousands of dollars of payments to Destined To Be Stars from the Grossmont High boys basketball account.

A flier provided by the district shows a “‘GameOn’ Challenge Boys Basketball Tournament” held from Nov. 29 to Dec. 10, 2016, sought $450 from schools for junior varsity and varsity participation.

Destined To Be Stars’ junior varsity and varsity tournaments held in summer 2012, 2018 and 2019 at Grossmont High cost $325 for one team and $600 for two teams each year, while another 2018 summer tournament for freshmen boys cost $300 per team, according to coach invitations obtained by VOSD.

Other district basketball account records from across the district show payments as high as $1,675 to Destined To Be Stars. And that only accounts for money paid in recent years from schools within the Grossmont district, not other schools that pay Foggiano to play from across the region.

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The extra income from Foggiano’s side gig hasn’t been enough to avoid financial trouble, according to court records. Foggiano and his wife have been sued for unpaid bills on at least three occasions in recent years.

In 2015, American Express came after the Foggianos for $20,722, followed by Capital One for $4,235. The American Express collections case settled when Foggiano agreed to pay $15,370 and the Capital One case ended in a judgement against the Foggianos for nearly $4,528, according to public court records.

Bank of America also came after them in 2016 for $16,227, court records show. That case also ended in a judgement against the Foggianos for nearly $16,667.

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Foggiano is not required by the Grossmont district to publicly disclose his personal financial interests on a conflict of interest document known as a Form 700, which aims to prevent self-dealing, and Destined To Be Stars told the IRS it doesn’t have a conflict-of-interest policy either.

“The best practice for any nonprofit organization is to clearly identify conflicts of interest and create transparency with respect to financial transactions and other organizational practices. That is how nonprofits earn and keep the public’s trust,” said Laura Deitrick, associate director of The Nonprofit Institute at the University of San Diego, who reviewed Destined To Be Stars’ tax filings. “… this organization has self-disclosed that they do not require conflict of interest statements and that they do not have an IRS supported process for officers to disclose conflicts. In general, having only two officers who are related to one another as the only board members would not be considered a good management practice for a nonprofit.”

Nonetheless, Grossmont school district policies require employees to refrain from non-school employment that conflicts with their job, and employees are specifically barred from using district facilities or equipment for non-school work.

“Outside paid activities are incompatible with District employment if they require time periods that interfere with the proper, and efficient discharge of the employee’s duties, if they entail compensation from an outside source for activities which are part of the employee’s regular duties, or if they involve using for private gain the District’s name, prestige, time, facilities, equipment, or supplies,” district policy reads.

In an email, Martin, the district spokeswoman, said, “DTBS is 501(c)3, a separate legal entity from the District. Mr. Foggiano is not to be performing DTBS business during District time.”

Yet Foggiano is working on district time in his capacity as coach during many of the tournaments in which his nonprofit is making money. Grossmont High’s performance at Destined To Be Stars tournaments held during the basketball season also affect their standings with the California Interscholastic Federation, or CIF.

Asked about the overlap, Martin acknowledged the tournaments count toward the team’s CIF record, but said they “are not required by, and are not part of, Grossmont Conference league play.”

According to the district, Foggiano’s boys’ varsity basketball coach stipend totals $5,880 this school year. In addition to coaching and leading Destined To Be Stars, Foggiano serves as Grossmont High’s athletic director and teaches math. He has worked for the Grossmont district since August 1980, according to district officials.

“Coaches are compensated for all of their duties via a fixed coaching stipend, regardless of the amount of games/tournaments scheduled and played,” Martin said.

Martin also emphasized the importance of Destined To Be Stars’ nonprofit status.

“Employees that maintain outside business interests, such as Mr. Foggiano and Destined to Be Stars (DTBS), are to do so ‘at arm’s length’ so that the relationship, if any, between the District and the outside interest, is clear. One way to accomplish this is through the establishment of a 501(c)3 organization for the outside business, which is the case for DTBS. In this manner, the district and the organization are separate and distinct with procedures in place for use of District facilities to include fees for facilities use, as appropriate, plus evidence of insurance coverage. Once these are in place, it is a matter between the parties as to services to be provided in the event fees are charged,” Martin wrote in an email.

It is unclear how Foggiano’s facility rental fee lapses followed district procedures, or how his practice of requesting and approving Destined To Be Stars payments out of the Grossmont High basketball account constitute “arm’s length” transactions.

The Grossmont district said it had no records showing an analysis or review of actual or potential conflicts of interest relating to Destined To Be Stars.