Trash Hauler Bought Pricey Meals for Sanitation Officials

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Financial disclosures show that Costa Mesa’s residential trash hauler has paid for hundreds of dollars in golf outings and expensive dinners for board members of the Costa Mesa Sanitary District who are fighting efforts to open the company’s contract to competitive bidding.

The sanitation district’s multimillion-dollar no-bid contract with CR&R Waste and Recycling Services was approved in 2006, has no ending date and requires six-years’ advanced notice before changing providers.

It has become a hot-button issue as dissident board member Jim Fitzpatrick pushes to issue the notice so other companies can eventually submit bids.

Officials at the 68-year-old district say there is no record of ever putting a trash contract out to competitive bid.

The board’s four-member majority supports keeping the process closed. CR&R is proposing a 20-year extension of its contract, which pays about $4.5 million per year.

Three of the directors who are resisting open bidding — Art Perry, Jim Ferryman and Mike Scheafer —were treated to $530 in dinners over the past two years by CC&R, according to mandatory financial disclosures.

Additionally, Ferryman received another $455 in lunch and golf outings paid by either CR&R or one of its former executives, the records show.

While the disclosed gifts don’t exceed the legal limit, a good-government expert says it still “creates the appearance of a potential conflict of interest.”

“Unfortunately it’s kind of business as usual, in which lobbyists will wine and dine” government officials while staying within the legal limit, said Tracy Westen, CEO of the Center for Government Studies.

The gifts, Westen added, invite questioning of whether the sanitation officials are truly acting in the public’s best interest or are influenced by a sense of loyalty to the trash company.

Asked about his dinner, Scheafer said he understands the “imagery” created by the contractor paying for his meal and probably won’t do it again.

“I certainly understand what you’re saying,” he said when asked whether the gifts create the appearance of a conflict of interest. “I think there is some of that. Whether it was appropriate or not for them to buy dinner, that’s a tough one.”

The other two recipients, however, say that the gifts were appropriate and that dinners for by contractors are common among public officials.

“I see nothing wrong with it. It’s done in a lot of different organizations,” said Perry.

“It’s not like $100 will make a difference with the way I vote,” said Ferryman, who received $565 in dinners, lunches and golf outings from CR&R and a former company executive.

“If I’m going to get a lecture because I got a dinner paid for by CR&R, then so be it. I put in a hell of a lot more time and effort than we get compensated for, believe me.”

Fitzpatrick argues that allowing other companies to make offers would lead to the best deal for the district’s 21,500 households. Since the current trash contract requires a six-year notice before the sanitation district can change companies, Fitzpatrick says he wants to start the process as soon as possible.

“I’m not saying I want a different company. All I’m saying is I want the market to tell us if we’re getting the best services and the best price,” said Fitzpatrick.

The board majority, meanwhile, argues that residents are happy with their contractor’s service and its prices are competitive.

“We feel CR&R is one of the best, if not the best, in terms of providing services to our citizens,” said Perry.

“Why fix it if it ain’t broken?” asked Ferryman.

Fitzpatrick, however, questions how the board majority could know CR&R is the best without allowing other companies to submit proposals.

The financial disclosures show that Perry and Ferryman benefited most from CR&R’s expense accounts.

The disclosures show the company paying for a $150 dinner for Perry last August and a $230 “dinner for two” for him the previous year. For Ferryman, the company bought a $110 dinner and covered his $100 entry fee for a golf tournament, according to the disclosures.

Additionally, the records show that former CR&R executive Raul Rangel treated Ferryman to $355 in lunches and golf outings.

Among those who took gifts from CC&R, Scheafer received the least, a $40 dinner last June, according to the records.

CR&R senior vice president Dean Ruffridge didn’t return a phone message seeking comment.

In an interview, Perry also said his dinners were actually worth less than what he reported on his disclosures, because he and his wife didn’t have drinks. “I reported more than my share, because they [looked] at the total bill, and they divided” to find the average, said Perry.

Among the board members interviewed, Ferryman was most upset with Fitzpatrick’s insistence on competitive bidding.

“We’re one of the best-run special districts in the state. … Go ask anybody in the county,” Ferryman said. “So I don’t need Fitzpatrick second-guessing me or my board. I don’t know how he got a burr up [his] rear end, but boy!”

Scheafer says he isn’t opposed to competitive bidding if a vendor can first demonstrate that it would do a better job. “I’m not opposed to putting it out for bid, as long as we do it the right way,” he said.

However, Scheafer hasn’t shown support for competitive bidding when the issue has come up at recent board meetings.

The board majority, including Scheafer, also recently decided to pursue a lawsuit to remove Fitzpatrick from the board, asserting that he can’t serve as both a city planning commissioner and a sanitation board member.

Fitzpatrick contends the move is a political ploy to push him out because he’s been questioning his colleagues’ reluctance to allow competitive bidding.

Scheafer says it’s nothing personal.

“I’ve got no personal vendetta against Jim Fitzpatrick, I really don’t,” said Scheafer. “He made a decision to enter into two offices that may be incompatible, and I just want to make sure that it is or it isn’t.”

That’s “hard to believe,” Fitzpatrick says.

“What is driving an interest in paying $50,000 [in legal fees] to unseat me?” he asked. “These guys are the ethics police with me, and then everywhere I look it’s just the good ol’ boys.”

You can reach Nick Gerda at ngerda@gmail.com, and follow him on Twitter: twitter.com/nicholasgerda.

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