City employees solicit funds for Garcetti-backed charity. Ethics experts have concerns

By Dakota SmithStaff Writer

Dec. 15, 2021 5 AM PT

It was 2018 and staffers in Mayor Eric Garcetti’s Office of Economic Development were in fundraising mode. The office was working with the Mayor’s Fund for Los Angeles — a charity backed by Garcetti that pays for civic programs — on a jobs initiative in the entertainment industry.

Sumi Parekh, then-executive officer in the Office of Economic Development, emailed AT&T asking for a $70,000 sponsorship to support the program. In response, a company representative offered $50,000.

Employees in Garcetti’s office play a key role in creating Mayor’s Fund programs. They also seek funding for programs during the course of their jobs and using their city emails — in some cases, from companies that do business with the city — according to interviews and emails reviewed by The Times through public records requests.

Representatives for the nonprofit and the mayor’s office say the fundraising by city employees is an example of how the private-public partnership works to help Angelenos.

Such solicitations are allowed because they are made in support of a charity and not a political campaign. Some good-governance experts, however, say the city needs to be more transparent about solicitations sought by city employees — or restrict them altogether.

Bob Stern, former general counsel at the California Fair Political Practices Commission and a coauthor of the state’s Political Reform Act, said that because the Mayor’s Fund is closely associated with Garcetti, it is similar enough to a political committee that city employees shouldn’t be raising funds for it.

“I’m sure they are doing good work,” Stern said of the nonprofit. “The real problem is that the mayor is raising, through his staff, big amounts of money for the nonprofit and he’s getting credit for it.”

California law requires that charitable donations of $5,000 or more requested by elected officials or their representatives — money known as behested payments — be reported. Garcetti has reported raising more than $61 million for the Mayor’s Fund, a figure that includes both donations and grants.

It’s unclear how much of that amount was solicited by city employees, who are considered the mayor’s representatives. Garcetti spokesman Alex Comisar declined to provide a breakdown.

Employees across Garcetti’s office, including his deputy mayor for economic development and deputy mayor for international affairs, contacted individuals or companies seeking support for Mayor’s Fund-backed programs, according to interviews and emails reviewed by The Times.

Some of the emails were obtained and reviewed by the First Amendment Coalition, a nonprofit focused on good governance, and shared with The Times. Other emails were obtained by The Times through similar records requests.

Comisar, when asked about the fundraising done by city employees, said the nonprofit’s work “is integrated with the city’s work, and our staff will help them and other nonprofit organizations so they can serve our residents.”

“Our staff may help the Mayor’s Fund or other nonprofit organizations on their own initiative, at the request of the organizations or other staff,” Comisar said. He said mayoral staffers are not required to raise funds.

“Our purpose is to help Angelenos by partnering with city offices and staff to raise funds for and to launch programs that make our city better,” said Mayor’s Fund President Deidre Lind. “Closely working with the mayor’s office as civic experts and guides is inherent to our work in support of our 501(c)(3) charitable status.”

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The Mayor’s Fund, which has office space at City Hall, receives donations and grants, paying for programs conceived of by Garcetti’s office and run by the city. The money also bolsters existing city programs.

Mayor’s Fund employees oversee the financial management of the programs and report back to donors, Lind said.

Garcetti’s 2015 sustainability plan was supported by the Mayor’s Fund. The fund also supported a program that provided free community college tuition and mentoring — an initiative that Garcetti touts as one of his proudest achievements.

Former staff members in Garcetti’s office told The Times that city staffers were encouraged to create Mayor’s Fund programs.

Employees were willing to raise money for the programs they created because it was easier than trying to get them funded through the city budget, former staff members said.

During a deposition this year, Garcetti’s then-chief of staff, Ana Guerrero, said she regularly worked with the Mayor’s Fund. The deposition was taken in the sexual harassment case involving former Garcetti aide Rick Jacobs, who for years was the nonprofit’s treasurer and a board member.

Guerrero explained that her role with the fund is “to engage with the staff at the Mayor’s Fund, to develop the program, to help organize the mayor’s time, in case we should need him to reach out to [the] private sector, potential donors, to raise money for these programs, and sometimes to link the Mayor’s Fund to the city department that [helps] execute these programs.”

Despite the city’s partnership with the nonprofit, many Mayor’s Fund programs aren’t subject to city audits or City Council scrutiny because they aren’t funded through the city’s budget.

At the same time, donations to the nonprofit aren’t subject to campaign finance rules that cap the size of the gift or forbid certain donors, such as companies with large city contracts or registered lobbyists, from giving.

Critics have long argued that behested payments can create the appearance of a pay-to-play system. Some donors to the Mayor’s Fund told The Times in 2015 that they enjoyed one-on-one meetings with Garcetti and dinner receptions at Getty House, the mayor’s official residence.

Lind said the nonprofit helps fill a gap that a government budget can’t cover. “This work really does make L.A. better,” she said. “I feel that we are helping so many Angelenos.”

She pointed to the Mayor’s Fund-backed jobs program — the one that AT&T helped fund. The program aimed to diversify the TV and film industry by encouraging the hiring of more youths from disadvantaged backgrounds. It was so successful that it ultimately was spun off from the nonprofit, Lind said.

Parekh, who left city employment to work full time on the jobs effort, didn’t respond to a request for comment. AT&T also didn’t respond to a request for comment.

According to filings made by Garcetti’s office with the city’s Ethics Commission, AT&T has given more than $700,000 to the nonprofit at the request of Garcetti or his representatives. The company regularly has contracts with the city.

The Mayor’s Fund is not alone in how it operates, and government-affiliated nonprofits exist in other cities. The Mayor’s Fund to Advance New York City also allows employees to seek funding, according to that city’s ethics rules.

Garcetti, in an interview, said all behested donations are reported to the city and are publicly available. When asked about city employees fundraising from companies that do business with the city, he said some businesses have an obligation to give back.

“I’ve never had a meeting with somebody who is a business leader — and often they’re coming in because they want to build something, do something, whatever it is in the city — and not say, ‘How many summer jobs are you going to give us for summer youth?’” Garcetti said, referring to job programs backed by the city. “That’s my responsibility.”

Kaiser Permanente spokeswoman Rita Speck, who received a request from a Garcetti staffer in 2017 to support a science, technology, engineering and mathematics initiative backed by the Mayor’s Fund, said she viewed the staffer as highlighting a program Kaiser might be interested in.

“Initiatives that promote health and equity, especially those that encourage girls and women to consider careers in science and technology, have been part of Kaiser Permanente’s community strategy for years,” Speck said. “We would not have sponsored a program or event that didn’t align with this strategy.”

Kaiser Permanente gave $40,000 in 2018 to the Mayor’s Fund, according to city filings. The city of L.A. purchases healthcare coverage for its employees from the Kaiser Foundation Health Plan, which is part of Kaiser Permanente.

Since 2013, Kaiser Permanente has opened new medical offices and expanded other services in Los Angeles, which required approval of permits and entitlements by various city departments, Speck said.

Lesser-known companies also worked with the mayor’s office to support Mayor’s Fund programs, according to emails reviewed by The Times.

Federal Signal Corp., which sells police vehicle lights to the city, gave $7,500 to the Mayor’s Fund in November 2016 at the request of Garcetti or one of his representatives, according to a city filing.

A month earlier, a Garcetti staffer connected the Mayor’s Fund and Federal Signal to each other via email. The Garcetti staffer wrote that Federal Signal was a city vendor, had agreed to support a Mayor’s Fund-backed initiative and the nonprofit would handle the transfer of money, according to the email. Federal Signal declined to comment.

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Glen Smith, litigation director for the First Amendment Coalition, said his view is that those solicited by Garcetti employees will be left with the impression that there’s “no difference between the Mayor’s Fund and the mayor’s office.”

“If [donors] are interested in trying to gain favor with the mayor and City Hall bureaucracy, here’s the way to do it without having to worry about campaign contribution limits,” Smith said.

Doug White, former director of Columbia University’s graduate program in fundraising management, said the mayor’s office should be transparent about how much money employees raised for the nonprofit.

White, who reviewed some of the emails of the employees’ fundraising attempts at The Times’ request, said he was concerned by the overlapping relationship between the two entities.

One email shows that Garcetti’s then-housing policy specialist, Ben Winter, in 2017 helped write a letter for Lind to send to potential sponsors ahead of a planned housing summit. Winter then emailed Lind’s letter to potential sponsors, including an individual registered as a lobbyist, and asked for support, the emails show.

Ultimately, the housing summit never took place. Winter declined to comment to The Times. Lind, when asked about the emails, suggested that if an employee has a relationship with a potential sponsor, they should reach out.

White said that the email exchanges show the Mayor’s Fund is acting less like a traditional nonprofit “than an arm of the government.”