ELECTIONS / MANHATTAN BEACH : 'The Thompson Affair' Dominates Race as 8 Vie for 3 City Council Seats

By MARC LACEY

March 26, 1992 12 AM PT

TIMES STAFF WRITER

The most oft-repeated name in the Manhattan Beach City Council race will not appear on the ballot next month, but former City Manager David J. Thompson is on the minds of voters and candidates nonetheless.

Since Thompson’s retirement in 1990, the current council has been locked in a bitter struggle over his retirement package, which council members maintain Thompson inflated and then slipped through the council in his final days in office.

As it turned out, Thompson’s retirement package included a cash payout for 18 years of unused sick leave and vacation time, swelling his annual pension to a level $50,000 greater than the $88,968 he earned on the job.

The wealthy beachside community has been in an uproar since the snafu was discovered last May, and council members have rushed to quell what residents have begun to call “the Thompson affair.”

After closed-door negotiations with Thompson last year, council members voted to reduce his pension by $60,000 and then braced for legal action. It came Feb. 13 when Thompson filed a claim against the city alleging breach of contract, libel and slander, invasion of privacy, misrepresentation, infliction of emotional distress, deceit, and fraud. It seeks an unspecified amount exceeding $10,000.

The issue, which is being investigated by both the district attorney’s office and the state Public Employees’ Retirement System, remains at center stage during the current campaign, even though almost two years have passed since Thompson stepped down. There are three council seats up for grabs, those now held by Steve Barnes and Patricia (Pat) Collins and a third being vacated by Mayor Bob Holmes. On April 14, the seats will go to the top three vote-getters among the two incumbents and six challengers.

“Incumbents will have a hard race,” predicted Jan Dennis, a former councilwoman who is backing challenger Philip (Tom) Lieb. “People have been so disillusioned. I think the Dave Thompson issue is the number one issue.”

The two first-term incumbents, Barnes and Collins, are acknowledging that they erred in voting to approve Thompson’s retirement package and at the same time are trying to move the spotlight to other issues facing the city’s 32,000 residents. Their campaign literature ignores the Thompson matter altogether.

“We made some mistakes but we’ve made a lot of good decisions,” Barnes, a 47-year-old lieutenant with the Los Angeles County Sheriff’s Department, said at a meeting of the Manhattan Beach Property Owners Assn. last week.

Collins, 51, said the affair has brought to light longstanding procedural problems in the city that the council is attempting to address. The incumbent said she was proud of her term on the council, citing among her accomplishments her vote to cut off Thompson’s excess salary once the pension was revealed.

But the most vocal of the challengers will not let the Thompson affair die. As they campaign against better-financed incumbents, the rivals are using Thompson as a symbol of council neglect.

Leading the pack of critics are Steven A. Napolitano, a 25-year-old graphic designer who waged a strong write-in campaign for the council in 1990, and Lieb, a 51-year-old auto parts manufacturer who has clashed with the council in the past.

Lieb, who has lived in the city for 17 years, is seeking to maintain the small town atmosphere of Manhattan Beach. He has been a critic of the current council’s development stand and maintains that some residences have been built higher than the city’s maximum allowable limit.

Napolitano, a lifelong Manhattan Beach resident, also contends that the community’s character is being harmed by excessive development. He said he believes in individual property rights, as long as they do not infringe on the rights of others.

Another rival, 40-year-old attorney James A. Shalvoy, said the community needs “fresh eyes, fresh faces and fresh blood on the council.” A nine-year city resident, Shalvoy criticized the council for postponing consideration of a salary increase for itself until the election is over. He called the move a political ploy and vowed to turn down the $200-a-month salary that council members currently receive if he is elected.

Also competing are Claudia K. Medl-Rilling, a 35-year-old chiropractor who has told audiences that the council needs to listen more closely to the people, and John S. (Rocky) Miller Jr., a 42-year-old lawyer who says he is seeking to win Holmes’ open seat and not unseat the incumbents.

Medl-Rilling, who moved to Manhattan Beach in the fall of 1989, was president of her homeowners’ association in San Pedro. She said her medical background prompts her to look for symptoms of problems and not just cures.

“Vote for me and you’re voting for yourself and what you want done in city government,” she said, vowing to represent the wishes of the people.

Miller, a resident since 1985, said many of the disputes over building that now take up council time could be solved if better notice is given to neighbors about upcoming construction projects.

“The thrust of my candidacy is that I believe the city is in good shape,” Miller said. “It’s a wonderful place to be and how do you maintain it? . . . I don’t think a lot is solved by finger-pointing and complaining. I think it’s best to go forward.”

Tim Lilligren, a 38-year-old accountant who was born and raised in Manhattan Beach, is campaigning on his experience as city clerk with the current administration. But Lilligren also portrays himself as a reformer whose experience in auditing will prevent future crises.

“Don’t trust amateurs,” he told voters last week. “Be careful how you vote.”

Meanwhile, Winona J. (Win) Underhill, 66, who recently retired after more than a decade as deputy city clerk, is running unopposed for Lilligren’s city clerk job.

The incumbents are urging voters to consider the Thompson matter an honest mistake.

Barnes, a longtime resident, said if he wins a second term it will be his last, because he understands that some elected officials lose their connection with the community if they serve too long.

Collins is playing up her involvement in the community, which she said goes back 25 years. Married to Manhattan Beach school trustee Gary Collins, she portrays herself as an independent voice who works for the community interest. The Thompson matter has found its way into the treasurer’s race as well, where Steve Schlesinger, a 47-year-old accountant who was appointed to the job in 1989, faces Milo Wolff, a 68-year-old scientist.

Schlesinger said he was the one who revealed details of the Thompson pension plan in May, 1990, and that the community never would have known about the package if he had not been monitoring the books. A Manhattan Beach resident for 18 years, Schlesinger said his accounting background and frugal nature qualify him for the job.

Wolff, who has a doctorate in applied physics, has held academic posts in China, Sri Lanka and Paris and bills himself as an investment manager, author, engineer and physicist. He accused Schlesinger of overstating his role in unearthing Thompson’s pension.

Wolff, who is vice president of the Manhattan Beach Residents Assn. and has lived in the city for close to 19 years, pledges to handle the financial aspects of the treasurer’s job but to also expand the role of the position. If elected, he said he would improve communication between residents and elected officials by instituting such innovations as a telephone polling system that would instantly gauge community sentiment.

Chronology of the Thompson Retirement

* David J. Thompson, city manager in Manhattan Beach for 18 years, formally retired on May 1, 1990. His retirement package, paid by both city and state retirement funds, was approved by the council.

* In May, 1991, it was revealed that the retirement package given to Thompson came to $139,000 a year--$50,000 more than his final-year salary of $88,968. It provided for cash payment for a variety of items, including $105,876.21 for unused vacation and sick leave. That increased Thompson’s

final-year compensation to $237,875.14, which became the basis for his pension.

* A report on the matter released by a former councilman last July portrayed the city as a trusting dupe of Thompson. The former city manager, meanwhile, said in one of his few public comments on the matter: “I know the truth, and when it is appropriate, everything will be revealed.”

* Responding to public outrage, last August the city reduced the city’s $82,000 annual share of the retirement pay to about $22,000 and demanded that Thompson return $78,000 to the city.

* Thompson disputed the reduction in a claim filed against the city in February, 1992, accusing officials of disparaging him in public and violating a contract. The council has rejected the claim and is awaiting a lawsuit.

Manhattan Beach Candidates

In Manhattan Beach, eight candidates are running for three council seats, two for city treasurer and one unopposed for city clerk.

City Council

Steve Barnes

Age: 47

Occupation: Incumbent council member; Los Angeles County sheriff’s lieutenant

Patricia (Pat) Collins

Age: 51

Occupation: Incumbent council member

Philip (Tom) Lieb

Age: 51

Occupation: Owner of auto parts firm