No campaign finance reform is coming for Anaheim, a city steeped in one of the largest public corruption scandals in recent Southern California history and whose problems are now discussed at places like the grocery store.
Over the last 60 days, an FBI corruption probe brought waves of angry speakers into a choir at City Hall, demanding that city council members limit the Disneyland-area resort’s influence on policy-making – and their own election prospects – that are sustained by resort money in campaigns.
At the center of the uproar is what the FBI describes as a “cadre” of powerful individuals who influence City Hall, in the written affidavits released as part of the federal bureau’s probe.
Residents and a few critical local officials say the problem partly starts with big corporate money in local elections, where corporate-controlled political action committees, or PACs, spend big on select candidates.
Without enough city council support, all recent attempts at reform have failed, most recently at Tuesday’s council meeting, where residents say they got their clearest signal yet that the interests under the FBI’s microscope are now clinging “with all their might to remain in power.”
Resort-friendly council members Trevor O’Neil, Gloria Ma’ae, and Jose Diaz all voted against each reform policy pushed by their colleagues that night, who supported contribution limits and recusals from donor-related votes to varying degrees. A tamer campaign finance measure was also withdrawn from the floor.
For now, council members will not have to step out of the room during votes impacting someone who donated to them in the past 12 months.
Potential donors will not be barred from contributing to elected officials for another 12 months after a vote they have a stake in.
Since the FBI probe surfaced in late May, residents have laid into every council member through the lens of the scandal except Jose Moreno, the panel’s lone dissenter and frequent critic of city resort subsidies granted at the taxpayer’s expense.
There are different reasons behind residents’ gripes: Council members who ignored warnings about the controversial-but-now-dead Angel Stadium land sale, council members who took money from the same corporate PACs now under the FBI’s microscope.
Some on the dais find themselves siding with Moreno more often these days, as recent meetings have seen consistently large, and emotional, crowd turnouts.
At a prior June 7 meeting – the last time the dais took a crack at the campaign finance reform proposal – Councilmember Stephen Faessel voted for Moreno’s proposal, despite the two usually taking opposite sides, right along with Councilmember Avelino Valencia.
But like on Tuesday, the policy died that month without the support of O’Neil, Ma’ae, and Diaz.
Faessel rescheduled the issue to be reconsidered at Tuesday’s council meeting.
But the same three officials voted “No” again – even when the policies’ chief proponent, Moreno, disaggregated the proposal and asked the panel to vote on each component, one by one, in response to the other side’s cry of overreach. That included a motion by Valencia to include a requirement to report contributions of $250 or more within 72 hours.
Faessel caused some alarm himself on Tuesday. On the agenda for the meeting was not the same proposal by Moreno that the council voted on back in June, the one that council members like Valencia said they assumed would be back before them that evening. And before Faessel could publicly explain why, residents had finished reading what they considered a much tamer version.
To one speaker, Victoria Michaels, the new document showed “what appears to be a very corrupt city council majority” in a struggle “with all their might to remain in power.”
“When I read the staff report, of item 16 … I could smell something rotten in our city,” said Michaels, facing the council during public comment. “A miasm or cloud emanated from the pages – Mr. O’Neil, I would appreciate it if you paid attention.”
Faessel, when it came time for him to speak, said he pared down the earlier June 7 policy, which Moreno supported, to come up with a baseline document.
Faessel said he intended for the document to be expanded or built upon to some sort of compromise, right there at the dais on Tuesday. Though he emphasized the June 7 version of the policy already lacked council support.
Not one resident spoke against any reform proposals on Tuesday.
Unlike the June policy, Faessel’s newer version wouldn’t require donor-related vote recusals if the money came from a PAC. The public would have no route for enforcement if people caught violations.
Also missing, Moreno noted on Tuesday, were the restrictions on campaign debt, an issue that Moreno tied to some of the bribery and quid-pro-quo schemes alleged by the FBI – and to the psychology of the political fundraising culture in town.
“The power of money in politics is so seductive,” he said during the discussion. “We lose ourselves.”
Moreno focused on instances where candidates, seeking to contribute to their own campaigns, loan their own money to their fundraising committees.
“One of the original proposals I made was we could only have a 6-month window to pay off whatever debts one may have given their own campaign. A reminder: What is a campaign debt? If I loan myself $10,000 to my campaign, then when I get elected, afterward I may have fundraisers, where an interested party in the city who wants to influence me will provide a $1,000 check to my campaign committee (to help recoup the money a candidate loaned to their own campaign), and that committee will then write a $1,000 check to my bank account,” Moreno said.
“That’s one check short of a bribe,” he said, to applause. “That’s one check short of a bribe.”
But it might start innocently, Moreno said. “Some folks do loan themselves money because … they don’t want to depend on special interests.”
Then Moreno pointed to former Mayor Harry Sidhu, who the FBI alleges attempted to ram through the Angel Stadium land sale for $1 million in campaign support. Earlier in the discussion, Valencia said, “The former mayor of this city used a loophole and requested million dollar campaign contribution not just to his personal committee account but in independent expenditure support.”
Sidhu resigned in late May, shortly after the FBI affidavits were made public. The former mayor had maintained through his attorney that he did nothing wrong and currently faces no charges.
Sidhu’s 2016 state Assembly and 2018 Anaheim mayoral runs incurred more than $100,000 in campaign debt, which Moreno pointed out during a presentation on his different reform proposals.
Moreno said that campaign debt opens one to the “seduction” of special interest money.
Sidhu paid off his Assembly campaign debt in 2019 through fundraisers set up by the Anaheim Chamber of Commerce.
“Let’s get rid of the conditions that create that seduction,” Moreno said.
On Tuesday night, Faessel again sided with Moreno on some of the ideas.
But O’Neil, Ma’ae, and Diaz didn’t budge on their stances. Some called the policy excessive with existing state laws, or claimed it would give an “unequitable” voice to what other people deem “more acceptable” special interests.
The “ordinance before us (Faessel’s version), it is an improvement and I recognize that and do agree with the removal of independent expenditures (from the applicability of the tighter restrictions), but it’s an area in which we have no control, right? We have no control,” said resort-friendly council member Ma’ae.
Before her city council appointment last year, made to fill a vacancy, Ma’ae sat on the advisory board for SOAR, a political action committee Disney uses to spend over $1 million to support resort-friendly candidates through independent expenditures.
Ma’ae said she “never had any experience with campaign reform — this is all very new to me.”
She brought up a hypothetical scenario where a substantial number of council members might receive a donation from someone in the running for a “critical contract for a city operation or ordinance that is needed.”
“I’m also concerned about the impact this could have on candidates who want to run for office in our city,” she added, also arguing staff might be “burdened” by the oversight duties “already handled” by other agencies, agencies “that clearly prohibit quid-pro-quo and pay-for-play.”
Councilmember Diaz, also resort-backed, claimed the pendulum of undue influence might swing the other way as a result of Moreno’s proposed campaign finance policies. Diaz, searching for comparisons, invoked the Jewish American billionaire and philanthropist George Soros.
But both Democrats and Republicans have publicly spoken out against the resort industry’s influence. “It wasn’t labor controlling the council, or Soros,” Moreno responded; it was the “hotel industry.”
Still, the three resort-friendly officials voted against the measures and, at one point, supported rolling back the document that Faessel had already rolled back.
“Many members of the council have stayed quiet until they couldn’t. I don’t presume my public comments here will carry any more weight than some of the special interests that got you elected or appointed,” said longtime resident Carlos Leon during public comment.
“Why would you be against the six-month recusal period? Why would you be against waiting to fundraise until the year of the election? Why would you be against bringing transparency back to City Hall?” he added.
Rather than decide on the entire policy at once, Moreno moved to separate the vote by each component of his proposal, like recusal rules, contribution limits, and public enforcement power if residents saw violations.
When it came time to cast a decision, it was one deadlock after another.
“I was hopeful that through a number of compromises, we might have found a way to go forward,” Faessel said before withdrawing his more basic policy. “Over three meetings now, we’ve not been able to go forward.”