Mayor Has Some Taxing Issues

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Santa Ana Mayor Miguel Pulido appears to be an equal-opportunity tax scofflaw. Whether it’s his consulting business, his family’s auto repair shop or his personal income, you can count on Pulido having had an issue paying the required taxes in recent years.

In every year since 2004, Pulido has listed Orange as the location of his consulting firm, The LaFarga Group, according to disclosure forms filed with Santa Ana City Hall. Officials in Orange have no record of Pulido’s business having acquired a license, making him potentially delinquent on the tax for several years.

The lack of a business license is just one of several examples of the mayor’s penchant for not paying his taxes.

The LaFarga Group’s articles of incorporation have been suspended since September 2008 by the California Franchise Tax Board because the business has not paid $2,000 in corporate income taxes, according to John Barrett, public affairs spokesman for the board. That bill has yet to be paid, but the firm continued to receive income in the years after, disclosure forms show.

Because of the suspension, the business has no right to its name and has no right to sue, Barrett said. “If you were a prudent businessman, you wouldn’t want these hanging over your head.”

In January, the state placed a $1,963 lien on Pulido’s nearly two-acre estate in the city’s Floral Park neighborhood for unpaid 2009 personal income taxes. The state lifted the lien on Pulido’s house last month. In 2005, a lien was placed on Pulido’s house because of $13,838.57 in unpaid income taxes. That lien also was released a year later.

The family business, Ace Auto Care, has since 2008 been delinquent in its property taxes totaling $19,471.17. The OC Weekly’s Gustavo Arellano reported in 2009 that the business had several tax liens and its articles of incorporation suspended.

Where Does Pulido Do Business?

Under the business license rules for Orange, The LaFarga Group is required to pay the tax if the business operates primarily from the city.

But where Pulido actually conducts most of his business — and what The LaFarga Group actually does — remains unclear. Pulido did not return a phone call from Voice of OC.

The address Pulido lists for his business is the same address as the accounting firm Pleman & Hinckley. According to one official with the accounting firm, the office only keeps the books for The LaFarga Group.

Jim Pleman, the accountant listed on the secretary of state’s database as The LaFarga Group’s agent for processing, did not return phone calls seeking comment.

Paul Sitkoff, business and public affairs manager for Orange, said that the city doesn’t track down businesses that might not have paid their business license tax. “We don’t have the manpower to go culling through many reams of documents from the state looking for this information,” Sitkoff said. “At the moment we’re satisfied.”

The city of Santa Ana did check, however, and according to records from the state Franchise Tax Board, Pulido’s consulting business has not received income in the city of Santa Ana, said Jose Gonzalez, Santa Ana’s public information officer.

Yet as numerous public records and news accounts show, Pulido is earning income as a consultant from somewhere.

Prism Realty and George Gemayel each paid The LaFarga Group at least $10,001 in 2004, according to Pulido’s financial disclosure forms. Prism Realty that same year sold a 10-acre property to Gamayel’s First Standard Real Estate.

The property was used for washing, fueling and restocking food trucks. In a 2008 lawsuit that named Pulido and his father as defendants, one of the main investors in the business alleged that Pulido was directly involved.

Pulido cast City Council votes in 2005 that granted a permit to the truck-station owner, Abel Salazar, the OC Weekly reported. In an interview with the Orange County Register, Pulido denied he had a financial stake in the business.

Last year, Voice of OC revealed that Pulido was paid consulting fees to pitch products to other mayors on behalf of an alleged con artist who claimed to be manufacturing lithium-ion batteries that would solve the world’s energy woes. Good-government experts said that other mayors might not have known that Pulido’s motive was personal gain, not the public interest.

Pulido claimed that he was an engineering consultant for the company.

Sources with Pulido’s client, iCeL Systems — including iCeL head Chaz Haba and the company’s former chief engineer — disputed Pulido’s claim.

Haba said that Pulido was paid specifically to pitch iCeL products to mayors at the U.S. Conference of Mayors. Pulido’s role as chairman of the conference’s energy committee made for lucrative access to key mayors, Haba said. Pulido was paid more than $10,000 in 2009 for the work, according to Haba.

It was also revealed in 2010 that Pulido was in line to receive a $500,000 finder’s fee for his efforts to help a consortium buy state buildings that the Schwarzenegger administration was auctioning. The sale was canceled, however, and Pulido never received the fee.

Please contact Adam Elmahrek directly at aelmahrek@voiceofoc.org and follow him on Twitter: twitter.com/adamelmahrek.

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