Was an agreement made by the Anaheim City Council and Greenlaw Development, LLC to sell and develop city owned land into commercial and residential development the result of “pay to play politics” that FBI agents last year accused the former mayor of engaging in?
That’s one of the questions former City Councilman Jose Moreno wanted his colleagues to mull over before approving an agreement with Greenlaw, a development company, as cities across Orange County face pressure from the state to zone for more affordable housing.
But most of his colleagues felt comfortable moving forward in November with the agreement on a planned housing and commercial development on Ball Road and Anaheim Boulevard.
The deal, however, has since fallen apart.
Mike Lyster, city spokesman, said in a Tuesday email that Greenlaw’s funding partner pulled out.
“We do not see that as a reflection on the project or site, but rather the result of higher interest rates and construction costs in an uncertain economy,” he wrote.
City officials are now expected to put the land on the auction block in an effort to prioritize affordable housing under the beefed up Surplus Land Act.
It comes as the city continues to feel the fallout of an FBI corruption probe into city hall dealings that put an end to the Angel Stadium land sale and as Anaheim is conducting its own corruption probe through contracted investigators.
Moreno publicly raised concerns at a meeting about developer Rob Mitchell contributing to his colleague’s campaigns and being associated with the Chamber of Commerce and lobbyist Jeff Flint.
The Chamber of Commerce and an unnamed political consultant were called out by FBI officials as having undue influence over city hall policymaking in sworn affidavits released last May.
The Los Angeles Times reported Flint was the unnamed political consultant in the affidavits and Flint stepped down from his lobbying firm, FSB Core Strategies, shortly after the corruption probe was made public.
What’s the Rush?
Moreno called on the council to hold off on a vote until the results of the city contracted investigation into alleged “pay to play politics” were finalized.
“If we approve this tonight, we’re simply saying to the public, ‘who cares that we’re doing an investigation,’” Moreno said at the Nov. 1 city council meeting.
“We’re going to go ahead and deliver the contracts and the entitlements, and our property of eight acres that we could have so many other benefits for – with this cloud – with an actor who may or may not be implicated.”
The investigation is expected to be finalized in Spring 2023.
In October, contracted investigators publicly told council members they gathered significant information two months into their probe.
[Read: Anaheim Residents Pressure City Council to Publicly Release Corruption Probe]
During the Nov. 1 public hearing, Mitchell pushed back against Moreno, saying he already invested millions of dollars in the project over the past four years.
He also said that if they wait until expected changes in state surplus land law go into effect and affordable housing developers come in, they won’t pay the over $24 million for land that he will.
“If all of a sudden I come up in March, and I’m cleared and an affordable component comes up and the affordable project is something more than aligns with you, then because I’m innocent, are you going to pay me back the $5 million that I’ve spent?” he asked Moreno.
“You’re saying I’m guilty.”
Mitchell did not respond to a request for comment.
Moreno pointed out that both Flint’s lobbyist firm and the Anaheim Chamber of Commerce are tenants at a Greenlaw property – which Mitchell publicly confirmed – and that Mitchell had hired Flint as a lobbyist for the project.
City lobbyist records show that Rob Mitchell of Greenlaw Partners hired Flint to lobby for the development on Ball Road and Anaheim Boulevard in meetings with City Manager Jim Vanderpool, city staff and council members in recent years.
Flint’s lobbying for Greenlaw ended in May after the FBI affidavits went public. He received $30,000 in 2019 from Mitchell for his services lobbying the city regarding various developments.
Greenlaw entered an exclusive negotiation agreement with the city over eight acres of city owned land by the Ball Road and Anaheim Boulevard intersection in August 2019 prior to FBI affidavits going public.
The 4,500 square foot project is expected to consist of 223 residential units – 15% of which is expected be for affordable to moderate income buyers.
That exclusive negotiation agreement was reinstated in 2020 and again in 2021, according to a staff report.
According to guidelines from the state Housing and Community Development Department, surplus property sales with exclusive negotiating agreements – like Greenlaw’s proposed development – must be completed by Dec. 31, 2022 under the Surplus Land Act.
City Attorney Rob Fabela said at the Nov. 1 meeting that under the new version of the Surplus Land Act, he has no doubt that the state’s Housing and Community Development department would intervene.
“We would have to go back to the drawing board and go through this process before it can get approved,” Fabela said. “There’s the process of having to notify potential affordable housing developers of this project and have a reasonable negotiating period to see if we can reach a deal with them.”
The law requires local agencies with public land deemed “surplus” to put it on the auction block in an effort to produce affordable housing.
Pay to Play?
Moreno publicly pointed out direct campaign contributions Mitchell made to his former colleagues – a rare move from city council members across Orange County.
He also criticized a $25,000 contribution to the Chamber of Commerce’s Political Action Committee, which was made in 2020, according to campaign finance records.
“You have benefited tremendously in our city as a preferred developer, while giving thousands of dollars to folks who sit up here voting on your projects,” Moreno told Mitchell.
“I’m not trying to allege or accuse you of anything, Rob, other than you played in a swamp.”
Todd Ament, the former CEO of the Chamber, along with Sidhu were both called out by the FBI in their affidavits detailing alleged corruption at city hall.
Ament pleaded guilty to federal fraud charges last summer and Sidhu resigned while maintaining his innocence and hasn’t been charged with a crime.
Councilman Jose Diaz defended the deal and said he would be cleared of all wrongdoing in the investigation. He also said people running for office whether it’s the President or Senate all need campaign finance.
“The FBI could investigate my entire life, they’re gonna find zero issues with me,” Diaz said. “Therefore, I had no problem moving forward with this project because I’m clean as you can be.”
Diaz received $2,000 from Mitchell in 2021 even though he wasn’t up for election last year, according to city campaign finance records.
Former Councilmembers Trevor O’Neil and Gloria Ma’ae, who both ran in the 2022 election, also defended the deal.
“From my perspective, no question, it’s a great project, we need it,” said O’Neil at the Nov. 1 meeting.
Mitchell donated $2,200 to O’Neil’s failed 2022 mayoral campaign and the same amount to Ma’ae failed 2022 city council run.
“I have to look at the merits of the project on all levels, not speculation and innuendo. I want to deal with the facts and the facts are our residents will have a great opportunity to live and work here,” Ma’ae said at the Nov. 1 meeting. “It’s a great project.”
Moreno fired back on Ma’ae’s remarks.
“Speculation and innuendo is what got you to vote to void the Anaheim Stadium Deal. That also got you to demand that the mayor resign, even though he’s not been charged with any crime,” he said.
This story has been updated to reflect the developer’s funding partner withdrew.
Hosam Elattar is a Voice of OC reporter and corps member with Report for America, a GroundTruth initiative. Contact him at helattar@voiceofoc.org or on Twitter @ElattarHosam.