In a sworn deposition released Monday, the Great Park's former CEO said Councilman Larry Agran had such a close relationship with two of the park's private consultants that he and the rest of the park’s staff were, in effect, working for the very consultants they were supposed to be overseeing.
Michael Ellzey, who was the CEO until earlier this year and is now Irvine's assistant city manager in charge of the park, said the consultants were Yehudi Gaffen of the project management firm Gafcon and Arnold Forde of the public relations firm Forde & Mollrich.
Gafcon was part of a joint venture that received $43 million in consulting payments related to the park, and Forde & Mollrich received more than $7 million to promote the park, according to auditors.
“I knew that Yehudi Gaffen was in very tight with Arnold Forde and with Larry. I had been told almost from my first day, if not from my first day, that Yehudi Gaffen was in charge of this project,” Ellzey told Anthony Taylor, an outside counsel hired by the city for its investigation, in his June 18 deposition.
“I began to figure out that, at best, Yehudi Gaffen was my counterpart, and at worst, I was, de facto working for him. Certainly working for Arnold Forde,” Ellzey said.
“It was just wrong that a contractor/consultant was directing a public body,” he added.
Ellzey went on to say that when he identified wasteful spending, the contractors blocked his efforts to curtail it.
“It was one of those things where if we eventually rose to the level of trying to shut down something that we didn’t believe was…worth our investment, it would go to…Gaffen, it would go to Arnold Ford, it would come back, and we would be told to shove it, basically,” Ellzey said.
Investigation Into Spending
Ellzey’s deposition was part of an ongoing forensic audit into more than $200 million in Great Park spending, and was released to reporters Monday in response to Public Records Act requests.
Also released Monday was a deposition of former Great Park employee Marsha Burgess, who was responsible for approving invoices for park contractors.
Auditors with Hagen, Streiff, Newton & Oshiro Accountants are currently investigating more than $200 million in spending that stretches back to the early part of the last decade.
Great Park leaders have faced withering criticism for years over no-bid contracts at the park, and in the auditors’ preliminary report, they claim to have already found major waste and abuse.
During a January presentation, one of the city-hired auditors suggested that the Great Park project experienced gross mismanagement of tens of millions of taxpayer dollars over the better part of decade.
In her deposition, Burgess said she and other park staff had to spend a significant amount of time correcting errors in the work submitted by Design Studio consultants.
Park leadership experienced frequent turnover, she added, and she was tasked with organizing large public events in short timeframes.
“It was just chaos,” Burgess said, pointing out that she had been overseen by five difference CEOs in four years.
In her deposition, Burgess the backtracked from the “chaos” comment, expressing concern that her words would be misconstrued.
“Here’s the problem,” Burgess told Taylor. “I said something to one of the auditors when she interviewed me on the phone and she brought it up at a public meeting, and then the press ran with it. And then the next thing I know there were articles all over the place saying things about me that were totally untrue.”
She clarified her comments about a chaotic environment at the Great Park: “There was just a lot going on, very high expectations, very unclear roles and responsibilities.”
Burgess said her frustration eventually led her to retire from the city in 2008.
Deep Connections Among Agran, Consultants
After coming on board as the Great Park’s deputy CEO in 2008, Ellzey said it was clear that Gaffen, who oversaw the park’s design studio, was “very connected to Larry Agran.”
Agran has spent much of the 2000s as Irvine's most powerful councilman, and much of that time as chairman of the Great Park Corporation’s board of directors. He is the park's biggest booster and at the center of the ongoing furor over how more than $200 million spent on the project has been managed.
Agran has described the audit, called for by members of the Irvine council's current Republican majority who won election largely based on pledges to investigate park spending, as essentially a political witch hunt orchestrated by powerful interests who want to privatize the park.
The Republicans, meanwhile, say they’re simply trying to get to the bottom of how the city spent so much public money with so little to show for it.
Said Ellzey in his deposition: “The Design Studio was being managed by an individual who did not appear — or did not manifest a lot of technical capability, but much more of a relationship-based presence and a political acuity with — with Chairman Agran.”
For example, Ellzey said, Gaffen’s influence prevented him from canceling payments for a useless software system.
“It became a source of great frustration for us at the [Great Park] corporation as a waste of money,” Ellzey said of the software, called SharePoint360.
“It was because either the Design Studio had information in SharePoint360 that they were unwilling or evasive in sharing with us, or by the time they finally got around to sharing it, the information wasn’t up-to-date, and so therefore, it was useless,” Ellzey said.
But when city staff tried to stop using and paying for the software, Ellzey said, they “ran into some serious blowback from Gafcon.”
'They Literally Laughed'
Ellzey also discussed Forde & Mollrich’s controversial $100,000 per-month public relations contract at the park.
Ellzey said that after he became CEO in August 2008, he went to Great Park finance staffers Kurt Mowery and Debbie Gunderson and raised concerns about the pricey contract for what was then a "very small" park.
“We’ve got to reduce that. I mean, that’s way too much. We’ve got to reduce that,” Ellzey recalled telling them.
“And they literally laughed…I asked them, ‘What’ — ‘why are you laughing?’”
“Good luck on that,” recalled Ellzey.
“They knew exactly how — how strong and powerful Forde & Mollrich were…how connected they were to Larry Agran, and how — how powerful Larry Agran was as an individual, and don’t even think of messing with it because you — you will get smothered if you even try,” Ellzey said.
Realizing he wasn’t "powerful enough” to affect that contract, Ellzey said, he “left it alone.”
“I came to understand that Arnold Forde spoke for Larry Agran,” Ellzey said.
“When I became CEO, it became clear that people were afraid of Larry, and they were afraid of Arnold. And because they figured that Yehudi Gaffen had Arnold’s and Larry’s support, they were afraid of Yehudi Gaffen,” said Ellzey.
“So the project was being managed by those three, basically.”
Ellzey said he eventually convinced Forde that Gaffen “was a bullshitter” who “was not serving the interests of the project.”
And while Arnold Forde’s firm was being paid for promoting the park, Ellzey said, Forde was heavily involved in issues outside the contract’s scope.
Forde “got involved in design decisions, design discussions, construction scheduling, personnel, organization structure. He was essentially a right-hand person to the chairman,” said Ellzey, referring to Agran.
“I was told by Arnold himself that he — he speaks on behalf of the chairman…a number of times, ‘I’m here on behalf of the chairman,’ ‘I’m speaking on behalf of the chairman,’ ‘The chairman is asking for this,’ ‘The chairman wants this.’ ”
The raw documents released this week are available below, and include redactions made by the city:
- Deposition of Great Park CEO Michael Ellzey (large file)
- Statement by Ellzey
- Deposition of Marsha Burgess (part 1)
- Deposition of Marsha Burgess (part 2)
- Deposition of Walter Kreutzen
- Deposition of Colleen Clark
Two more deposition transcripts will be released Tuesday, according to city spokesman Craig Reem.
The forensic audit is expected to wrap up by the end of August, with a final report ultimately made public.
Notice anything else interesting in the documents? Let us know in the comments below or by tweeting with the hashtag #GreatPark.