Pact Profits Family of Supervisor

For the family of Los Angeles County Supervisor Don Knabe, the bid by a Dallas-based firm to computerize county records has been lucrative: The supervisor’s son was paid to lobby for the contract, and after Knabe and the other supervisors approved it, his wife then was hired to stage a major corporate event for the company.

Knabe voted with his four colleagues last year to select Global 360 BGS Inc. from among 13 bidders for a $7.4-million contract. In its effort to secure the job and additional county work, Global 360 paid $72,000 to companies that employ the supervisor’s son, Matt Knabe, who has worked as a lobbyist since 2004.

The supervisor said in an interview last week that neither he nor his family had done anything wrong. His wife, Knabe said, had not yet been offered work by Global 360 when he voted for the contract. And Knabe stressed that his son, despite his regular lobbying of county officials, has no special influence with the supervisor.

Matt Knabe agreed. He said his father made it clear that he could not depend on special treatment as a lobbyist for Global 360 or any of his other clients.

“You have to understand that he’s more willing to tell me no than anyone else who comes in there,” Matt Knabe said. “It’s like when he coached me at Little League: He was always harder on me than anyone else.”

County and state rules do not prohibit relatives from lobbying local elected officials. And county lawyers said the Global 360 contract does not bar the company from hiring county employees or their spouses to do limited work.

Nevertheless, several government ethics watchdog groups raised concerns about Don Knabe’s involvement in decisions that affect his relatives’ clients, calling it an ethical conflict of interest if not a legal one.

Said Doug Heller, executive director of the Foundation for Taxpayer and Consumer Rights, a nonpartisan group based in Santa Monica: “When his son is getting paid by the company and his wife is later paid by the company, it brings a real stink to the process.”

Don Knabe is a veteran of county government. Before running for the Board of Supervisors, he served for years as chief deputy to former Supervisor Deane Dana. Dana stepped down in 1996, and Knabe ran to succeed his former boss; with Dana’s endorsement and support, Knabe won.

Since then, the Illinois native has won reelection twice, sealing his hold on a large swath of the county that stretches from Marina del Rey along the coast to the Orange County border with his Midwestern charm and blunt talk on public safety.

During an interview in his wood-paneled county office in downtown Los Angeles, he expressed anger that anyone would question his ethics. Emphasizing his point, Knabe gestured toward a collection of photos of his family: his wife of 38 years, his two sons and two grandchildren.

“I think you just look around my office -- you can see what my family means to me, and I’d never jeopardize that,” he said. “I’ve worked very hard to protect my integrity. And I try to do the right thing. And I have had to make some very difficult political decisions -- not based on what I personally believe, but what’s best for the public.”

Matt Knabe spent six years working for his father in the supervisor’s office but left in July 2004 to strike out on his own. He joined a lobbying firm known as the MWW Group.

The firm’s Los Angeles office was headed by Harvey Englander, a former campaign consultant to Don Knabe, and had among its clients companies with business before the county government that Matt Knabe had just left.

Soon after his departure, an assistant county counsel issued an opinion that Matt Knabe’s work “would not constitute the basis of a conflict of interest” even if he lobbied the county government because he was financially independent of his father.

For Matt Knabe, 31, the move to Englander’s firm represented a chance to make “a little bit more money” and to move out from under his father’s shadow.

“I wanted to do my own thing,” he said.

The Global 360 negotiations began just a few months later, in the fall of 2004, when Los Angeles County sought bids on a three-year contract to computerize paper documents and reels of microfilm for the district attorney’s office and the sheriff’s and probation departments.

In a county brimming with paper reports, the project was designed to make it easier for employees to retrieve important paperwork and save precious filing space by putting 110 million documents on computers.

The contract included an option for the county to add two years to the deal. If the county exercises that option, it will bring the total value of the contract to $12.4 million.

Global 360 was among 13 companies that bid for the job, and it, as many companies do, decided to hire a lobbyist to argue its case. Matt Knabe said one of his first actions on behalf of his client was to arrange a meeting between a Global 360 representative and the county official overseeing the contract.

County analysts ranked the firm’s proposal as the most attractive, in part because it offered the lowest price for converting paper records. An independent consultant hired to review the bids agreed. But the recommendation was contested by one of the company’s competitors.

In February of 2005, a panel of county administrators listened to Sourcecorp Inc.’s claim that Global 360’s bid had not met the county’s minimum standards and that its quoted price was unreasonable. In attendance, sitting beside a Global 360 executive, was Matt Knabe. The panel declined to address most of Sourcecorp’s complaints.

At a board hearing March 15, an executive with Sourcecorp renewed the company’s protest. The county, he said, had not announced that it would give the cost of computerizing paper documents more weight than other factors. Without discussion and despite Sourcecorp’s protests, Don Knabe and his four board colleagues awarded the contract to Global 360.

In the interview last week, the supervisor defended his decision to vote on the matter involving his son’s client. Knabe said he was never lobbied by his son or anyone else on the contract and noted that the county staff had recommended the deal.

“Why should I recuse myself?” the supervisor asked. “He has a right to make a living.... I’m only one vote. He’s got to be able to have access and work the other offices.”

Steve Levin, an attorney and political reform project director with the Center for Governmental Studies, agreed that Don Knabe’s vote did not appear to violate state law. Nevertheless, Levin described the vote as giving “an appearance of a conflict” and said the supervisor would have been better off declining to vote.

“That just doesn’t look right at all,” Levin said. “It might not mean a difference to the final result, but it does make a difference in the eyes of the public.”

After the contract was awarded, Matt Knabe last summer followed Englander’s lead and left MWW, becoming a partner in the lobbying firm of Harvey Englander & Associates.

He is lobbying on behalf of Agua Dulce Airpark, which is seeking to keep a county land-use permit to operate, and also the union representing county lifeguards. Both the airpark and the union have issues that require county approval.

Meanwhile, Global 360 decided to open a Southern California plant in Cerritos, where Don Knabe previously served as mayor and where Julie Knabe, the supervisor’s wife, is a former president of the Chamber of Commerce.

When Global 360 executives said they wanted to throw a bash to announce their arrival in the community, Matt Knabe recommended his mother.

Julie Knabe has run J.D. Knabe & Associates for more than 14 years. With seven part-time employees, her business organizes focus groups, conducts customer service surveys and plans events. The last specialty equipped her to stage Global 360’s party, and it hired her firm for the event.

And so, on a cloudless day in July, dozens of county officials and members of the local Chamber of Commerce arrived at a balloon-decorated industrial building in Cerritos. Inside, the supervisor’s wife and one of her employees greeted guests, handing out Global 360 brochures and taking business cards for a drawing to win a DVD player.

County Administrative Officer David Janssen was among the speakers. So was Don Knabe.

Vaughn Duck, senior vice president of Global 360, said he hired the supervisor’s wife because he didn’t know any other local firm that could have arranged the event on such short notice. He said he later asked her to mail Christmas cards for the company, and has paid her about $3,000 to $4,000.

“I knew that she was in the event-planning business and her business was in Cerritos,” Duck said. “She did a heck of a job.”

That employment would have violated state law had Don Knabe known of it when he approved the contract, but he said he did not, and campaign experts agreed that in that case he did not violate those laws.

Julie Knabe said she did not realize until told by a reporter that her husband had voted for the firm’s contract.

And she said there was no conflict in her work for Global 360 and her husband’s position at the county.

“That was a one-shot deal,” she said. “Don and I never talk business.... It’s kind of forbidden. You’d have to be around the family to appreciate that.”

To Julie Knabe, the thought that there could be anything improper about her working for a company whose contract her husband approved is ridiculous.

“We’d never do anything that even implies anything unethical,” she said. “We’re just not that kind of people.”