“Slush” Funds used for other purposes

DISCRETIONARY PHOTO 3_MITCH O FARRELL_AUGUST.jpg 2015

Mitch O’Farrell

Over $8.6 million has been transferred from a discretionary fund intended to fix and remove blight in Los Angeles but used instead for salaries and other items not related to community redevelopment or the reduction of blight, what the funds were intended for.

According to documents obtained by the Ledger from the Los Angeles City Clerk in response to a California Public Records Request regarding individual councilmember use of so-called AB1290 funds from 2012 to date, over $5.5 million was used directly for salaries, over $2.5 million for non related items or programs and over $600,000 to balance the city’s budget.

Specifically, $100,000 was used by Los Angeles City Councilmember Mitch O’Farrell (District 13) to purchase a command table for a fire station in his district and for a 2014 transfer of $590,000 in AB1290 funds to Los Angeles Mayor Eric Garcetti for “Veterans Affairs, Immigration Affairs and Entertainment.”

O’Farrell also used another $375,000 to set up and renovate space—an old laundromat—for a CD13 field office in Echo Park.

“While the funds were used for the build out, including installation of telecommunications, I think it’s worth noting that the entire office was furnished using repurposed furniture at no cost,” O’Farrell said through a spokesperson.

Other high ticket uses for the funds include $145,540 by former Los Angeles City Councilmember Tom LaBonge that went to the Los Angeles Zoo in 2013 and 2014; $62,500 to the Los Angeles Cedars Rotary Foundation and $50,000 to Catholic Charities of Los Angeles, Inc.

Additionally, now termed out city councilmember Bernard Parks gave nearly $175,000 to the Regents of UCLA in 2012.

DISCRETIONARY PHOTO 2 JOSE HUIZAR.KCET

Jose Huizar

Other high expenditures were from council district 14, by city councilmember Jose Huizar who provided just over $1.2 million in 2012 and 2013 for “general services” of the Boyle Heights Constituent Center where Huizar has a field office.

The city received $36 million for AB1290 funds.

Of that total, more than two-thirds—or just over $24 million—were transferred by various councilmembers back into city coffers.

During that time, Los Angeles City Council President Herb Wesson transferred just shy of $1 million in AB1290 funds back into city coffers for salaries, including $495,000 this past June.

Additionally, Wesson used $72,000 for Beltrans Rents and Sales for a July 2014 event.

Additionally, Parks, whose last day in office was June 30th, spent more than $36,000 using AB1290 funds also for an event in October of 2014.

According to Parks’ son, Bernard Parks Jr. who spoke on behalf of his father, the funds were probably used for what Parks’ called his “State of the 8th” event, a gathering usually held near Halloween to showcase high-achieving students in the district. However, Parks Jr. was unable to confirm that.

Herb Wesson

Herb Wesson

The issue of discretionary fund spending and misuse became a campaign issue in the recent election for LaBonge’s District 4 seat. Councilmembers have at least three such discretionary funds: AB1290, Street Furniture Revenue Fund and the Pipeline Franchise Revenue Fund, the latter two earmarked for redevelopment or to repair infrastructure.

Earlier this year, the Ledger reported LaBonge moved nearly $1.6 million from funds allocated to his office for street, public transit, sidewalk repairs, redevelopment and community services for the purpose of salaries since 2006, with 80% of those transfers occurring since 2012.

In reference to a 2012 motion by LaBonge to transfer $500,000 from AB1290 to LaBonge’s salaries account, then LaBonge senior advisor Jeanne Min wrote to a fellow staffer: “Hope it doesn’t raise any eyebrows and gets approved without a hitch.” The second staffer, then LaBonge’s legislative analyst, Lisa Schechter, responded: “I’m sure it will” get approved, and then described how the motion would be considered on a day when the City Council would be distracted by larger issues.

David Ryu, who beat LaBonge’s former Chief of Staff Carolyn Ramsay for the Council District 4 seat, in part due to constituent outrage over the use of such funds, campaigned that he would create a “Discretionary Funds Taskforce,” if elected, which would provide community leaders an opportunity to prioritize and determine how such discretionary funds should be used.

“For too long discretionary funds have been treated as a councilmember’s personal ‘slush fund’ with their uses closely guarded and protected by City Hall insiders,” Ryu said during the campaign in a statement.

According to Ryu Chief of Staff Sarah Dusseault, Ryu, who assumed office July 1st, is meeting with his transition team, composed of community members, soon to get input on how to best form the task force.

Requests for comment from Huizar and Wesson were not returned.

1 Response

  1. Allison Cohen says:

    This email was received from Mitch O’Farrell’s office after this story published.

    I hope this email finds you well. I wanted to follow up on the story Funds Used for Salaries, Office Remodels & Events that was published in both the Los Feliz Ledger and the Larchmont Ledger.

    There are a couple of items left out of the story that are worth mentioning, as well as additional funding for projects that I have listed below.

    1) In my previous email, I said that the office is saving money with our new Echo Park location. Approximately $2,000 per month in savings, which is locked in for a multi-year lease.

    2) We just renewed our AB1290 contract for LA Conservation Corps to continue the “Clean Streets” and “Clean River” contract for $239,000 (previous year was $205,000) as we have added the “Clean Silver Lake Reservoir” Walking Path Team.

    3) We have renewed our $50,000. Armenian Relief Society support for the organization’s East Hollywood Social Services Center, to provide multi-lingual social service assistance.

    4) $131,000 to LA Youth Network to offset program costs and maintenance of the homeless youth center in Hollywood.

    5) $75,000 to People Assisting the Homeless to defray the costs of services to homeless people in the East Hollywood, SIlver Lake, Westlake, and Rampart service areas.

    6) LACERS $10,000 for recreational programming and gym mats for Hollywood High School

    7) $42,000 Central City Action Committee, Gang Prevention and Clean and Green operator to fund $42,000 in Streetscape maintenance and beautification contracts. (2 yr contract)

    8) $287,000 matching funds to the CDBG Grant to do the Fletcher Dr Streetscape and Median project. This project is expected to break ground in the fall.

    This adds up to about $834,000 that will go back to the community.

    Just to clarify, AB1290 funds are not restricted, and can be used at the discretion of the Council office.

    Hope this helps. Let me know if you have further questions.

    Tony Arranaga
    Communications Director
    Los Angeles City Councilmember Mitch O’Farrell

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