Orange County’s two biggest cities were wrapped up in one of the largest corruption scandals in history after two of the biggest power brokers in Anaheim and Irvine were arrested.
The Fall of Reform
Corruption probes in Anaheim are triggering tough ethics discussions across OC and Southern California. Will reform follow?
Investigations by both the FBI and Anaheim-hired investigators found both cities failed to disclose lobbyist and political operative work at city hall, including attempted bribery in Irvine and influence peddling in Anaheim.
Now, Anaheim and Irvine elected officials are taking the first steps to tighten lobbyist rules.
And more cities could follow.
On Tuesday, a majority of the Anaheim City Council members voted to bolster their lobbyist ordinance including requiring in-house lobbyists for companies like Disney to register with the city, as well as doing an annual audit of lobbying activity.
“It’s a good first step in helping us create these better measures that allow for the public to have a better understanding of not only who has access to council members on what issues, but also who’s getting paid to have that access and that potential influence on council members,” said Anaheim City Councilman Carlos Leon at Tuesday’s meeting.
[Read: Disney’s Representative Could Soon be Considered a Lobbyist at Anaheim City Hall]
Irvine leaders have been slower to act after they shot down proposals to investigate their own city hall earlier this year, but discussed a series of possible reforms to the city lobbying ordinance on Tuesday night.
[Read: Irvine Has Largely Ignored Implications of FBI Corruption Probe Released Last Summer]
Orange officials last month decided to create an ad hoc committee in light of the corruption scandal to draft their own lobbyist registration ordinance.
Irvine’s Lobbying Rules Leave Loopholes
Much of the focus in Irvine has fallen on Melahat Rafiei, a former top aide to Mayor Farrah Khan and former head of the local Democratic Party who pleaded guilty to attempted wire fraud earlier this year and confessed she tried to bribe city council members in 2018.
Despite the concerns raised around Rafiei’s work at city hall, city council members voted against investigating her work and there are still questions over how much work she did for Khan after her arrest became public knowledge.
[Read: Did Irvine’s Mayor Keep Working With Consultant Caught Up in FBI Corruption Probe?]
While Rafiei admitted in her signed plea agreement that she was pushing city council members to approve commercial cannabis operations in 2018, she was never a registered lobbyist with the city.
Irvine has weak lobbying regulations according to city staff, who found that most cities they looked at begin requiring lobbying disclosures if someone’s paid $1,000 or more a month to influence officials.
Disclosure in Irvine doesn’t start until someone has made more than $10,000 in a single calendar quarter from lobbying, or around $3,300 a month.
Irvine only has seven registered lobbyists compared to Anaheim’s 21 – a fact that Irvine city staff attributed due to the difference in their disclosure laws.
City Attorney Jeff Melching laid out a series of proposals to strengthen the city’s lobbying rules, including lowering the pay threshold for disclosure and requiring that lobbying of unelected leaders, such as city staff, also be disclosed.
Although the city council didn’t vote on making any of the proposals into law, they shared some concerns and praises for the reform.
Councilwoman Kathleen Treseder, who proposed the reform, was broadly supportive of the changes, including lowering the threshold for disclosure and increasing how much lobbyists have to disclose about their actions.
Other council members had some concerns.
“My main concern isn’t so much how all these various reforms and so-called tightening provisions read, it’s how they really work in the real world,” said Councilman Larry Agran, who then laid out a series of hypotheticals.
“Somebody who’s a high official in a land development company here bumps into one of us at a restaurant and is asked to join us for dessert or a drink, and the conversation is about baseball and the playoffs, and then it drifts over to a pending project,” Agran said. “Is that kind of thing reportable?”
Some council members in Anaheim raised similar questions Tuesday night, with that city attorney saying the lobbyists would have to disclose such actions to the city.
In Irvine, Agran said that he thought no regulations could stop people looking to get around the system.
“When there’s no good faith, no amount of regulation is going to do the trick,” Agran said. if we’re not careful we’re going to create a mechanism here where people are afraid to come forward for fear they need to register as a lobbyist.”
After Agran’s comments, Melching noted that no one would have to register as a lobbyist unless they were being paid to present something to city leaders.
Councilman Mike Carroll also asked for staff to change how lobbying complaints are reported, rerouting them from the city manager’s office to the city attorney.
“This is the one piece of information that’s of serious concern to me,” Carroll said. “I’m not sure what (the city manager’s) role is in determining balls and strikes with regard to the interpretation of law.”
Will Disney Have to Register Their City Hall Representative?
Tuesday’s 40-minute discussion on such reform marked the third time Anaheim officials debated making changes to their lobbyist ordinance since independent investigators in late July released a report alleging loose oversight and no accountability over lobbyists there.
“This investigation has revealed numerous apparent violations of state and local laws when it comes to lobbying in the city of Anaheim,” investigators wrote. “We observed that there has been a lack of oversight and meaningful enforcement concerning lobbying in the City.”
The main change that would be implemented in Anaheim would be to require lobbyists working in-house for companies whose job is to try and influence policy decisions in the city would have to register and report meetings with elected officials.
It’s a change that could require Disney’s Director of External Affairs Carrie Nocella, whose name popped up multiple times in the independent investigators report, to have to register in Anaheim for the first time.
Investigators allege Nocella was at a secret Anaheim Chamber of Commerce retreat detailed by the FBI during which former Anaheim Chamber of Commerce CEO Todd Ament spearheaded a plan to keep as much as $100 million out of city coffers – in a town where nearly half of residents are on public health plans.
She has never had to register as a lobbyist in Anaheim before.
Jessica Good, a spokeswoman for Disney, did not respond to emailed questions Wednesday.
Craig Steele, an attorney brought in to help the city make changes, said companies with in-house lobbyists already have to do this in other jurisdictions and cities and in the past has called Anaheim’s exemption for these types of lobbyists unusual.
[Read: Will Disney’s Representative Have to Register as a Lobbyist at Anaheim City Hall?]
City Councilman Jose Diaz, whose last campaign received over $120,000 in support from a political action committee primarily funded by Disney, called the changes overly complicated.
“I need to hire a lawyer to understand what this is about,” Diaz said.
“It’s too complicated.”
Noah Biesiada is a Voice of OC reporter and corps member with Report for America, a GroundTruth initiative. Contact him at nbiesiada@voiceofoc.org or on Twitter @NBiesiada.
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.
