Santa Ana will not renew a sole-source contract with an auto parts supplier that was involved in a real estate deal with Mayor Miguel Pulido that is now the focus of state and local investigations.

“Given the controversy surrounding the contract we wanted to initiate a new process to avoid even the appearance of impropriety,” city spokesman Jose Gonzalez wrote in an email to Voice of OC.

In November, Voice of OC reported that in 2010 Pulido and members of his family swapped a parking lot they owned in downtown Santa Ana for a house in Westminster owned by Rupen James Akoubian, president of NAPA Orange County Auto Parts, a longtime supplier to the city.

The fair market value of the house at the time of the transaction was $230,000 more than the lot, Orange County assessor’s office records show. Then in 2012, Pulido’s family members signed the house over to him solely, and he sold it for $397,000, a $197,000 profit.

Over the course of those transactions, Pulido voted unanimously with the City Council for two separate city contracts with Akoubian’s firm, including a $1.35-million no-bid contract that made NAPA Orange County Auto Parts the city government’s exclusive auto parts vendor.

Pulido did not list his financial interest in the Westminster house on economic disclosure filings as required of public officials by law and under penalty of perjury. The mayor then amended three years worth of filings after Voice of OC published its article on the transaction.

The Fair Political Practices Commission is investigating possible violations of the state’s Political Reform Act, including nondisclosure of the house, votes on the auto parts contracts and a possible illegal gift, which experts said could be as much as $230,000, depending on the size of Pulido’s interest in the house.

Also, City Attorney Sonia Carvalho investigated the issue and referred her findings to an unidentified law enforcement agency, most likely the Orange County district attorney’s office.

Akoubian hung up on a Voice of OC reporter when reached for comment.

Akoubian has insisted in the past that the lot was extremely valuable to his business because he needed space to park his pickup trucks. Also, he claimed that in the real estate transaction he only dealt with Pulido’s father.

But there are other indications that Pulido and Akoubian have had a longstanding relationship. For example, Akoubian contributed $1,000 to the mayor’s 2012 reelection campaign. And at a City Council meeting last year, Pulido publicly honored Akoubian for being a finalist in a small business award competition.

The NAPA Orange County Auto Parts three-year contract expires in June but also has three one-year renewal options. Instead of exercising the renewal, city officials are putting the service out to bid.

Despite the controversy, NAPA Orange County Auto Parts will be allowed to “participate in the process,” Gonzalez wrote.

Correction: Due to an editing error, a previous version of this article incorrectly stated that the real estate deal involving Mayor Miguel Pulido and the owner of NAPA Orange County Auto Parts was the subject of a federal investigation. Voice of OC has confirmed the deal is the subject of state and local investigations, but not federal.

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