City to seek state opinion on Garofalo controversy

Theresa Moreau

HUNTINGTON BEACH -- Revelations that Mayor Dave Garofalo’s business

received a potentially lucrative contract from the city-funded Huntington

Beach Conference & Visitor’s Bureau will be forwarded to the Fair

Political Practices Commission, Assistant City Atty. Scott Field said.

Garofalo told the Independent last week that his company, David P.

Garofalo & Associates, has held the contract -- which hasn’t been put out

to bid since 1993 -- for the bureau’s visitors guide for at least the

past five years.

State law prohibits any city employee or family members from benefiting

financially from city business.

The publisher of the visitors guide does not recieve a salary from the

bureau but keeps any profits the advertising generates, said Diane Baker,

the bureau’s executive director.

The Independent “has raised a question” as to whether Garofalo owns the

company that publishes the guide, Field said. “We will be collecting

information as to that question, reviewing documents and other relevant

materials, collecting them and then submitting them to the FPPC for

another opinion.”

There’s been confusion over which companies Garofalo owns and which

company publishes the visitors guide.

Garofalo and his entangled business relationships prompted two council

members and a half-dozen residents at last week’s council meeting to push

for explanations.

Garofalo, a local publisher, has said he sold one of his businesses, the

Local News, to Huntington Beach-based Air Quality Consultants in 1997.

Public records filed in December show the new company took over in

January 1999.

In late April -- less than five months after the the consulting firm’s

filing -- Garofalo recorded a fictitious business statement with the

county stating that the Local News is owned by David P. Garofalo &

Associates and has been since 1993.

The issue of ownership is central to conflict of interest allegations

because advertisers in both the Local News and the visitors guide have

had business before the council. Advertisers who have major projects

before the city include the Waterfront Hilton, which has been a key

player in the city’s redevelopment plans; the Crossings at Huntington,

the still-on-the-drawing-board revamp of Huntington Center; and

Commercial Investment Management Group Inc., which has a $46-million

Downtown project wending its way through the city’s approval process.

CIM bought a half-page ad in the 2000 visitors guide and paid $2,995 to

David P. Garofalo & Associates. Four months later, Garofalo voted along

with the rest of the council to push forward with CIM’s controversial

project.

Under the state’s Political Reform Act of 1974, public officials may have

a conflict of interest if they receive money from companies involved in

issues that come before them. As little as $250 received by a council

member within the last 12 months can trigger a conflict.

Garofalo, elected to the council in 1994, has said he hasn’t violated any

conflict of interest laws and that the money from CIM was put into the

“proper accounts.”

“I don’t have the check in front of me, but if I showed you the back of

the check, it would be endorsed,” Garofalo said. “Upon receipt, it was

deposited in the Local News checking account.”

Garofalo also told the Independent he didn’t sell ads for the visitors

guide.

John Given, CIM’s vice president of development, said it was Garofalo who

solicited the ad from the company.

“As I recall, Dave sent us a notice about it or brought it to our

attention,” Given said. “We paid Dave. That’s who we were told to make

the check to.”

Given said the final invoice for the half-page color ad was from the

Local News. When the company called to confirm who to write the check out

to, it was told to make it out to David P. Garofalo & Associates, he

said.

Murray Greer, owner of the Market Broiler, bought a quarter-page ad for

the 2000 guide.

“I purchased it from Dave Garofalo,” he said, “who is the mayor of

Huntington Beach. Here’s our deal. The rate for a quarter-page was $1,995

for the whole year. We paid $300 in cash and gave $300 in gift

certificates.”

Greer said he made the rest of the payments to David P. Garofalo &

Associates.

Baker confirms that Garofalo sells ads in the guide.

“It’s advertising-driven. That’s what that means. I become the

distributor, and he’s the one who sells the ad, puts the book together,

delivers the finished product, does the follow-up with the blow-in cards

for the advertisers,” she said.

In a letter faxed to the Independent just before deadline, Garofalo said

he helped several businesses “accomplish that goal” of advertising in the

guide.

“I receive no income from this effort nor is any compensation I receive

related to, attached to or contingent upon those ads or any other ads,”

Garofalo wrote.

Garofalo has said he gets a $100,000 consulting fee from AQC -- Air

Quality Consultants -- for work he does on the Local News, which also

publishes a local newspaper.

Garofalo’s son, Kevin Garofalo, is listed as advertising manager in the

guide’s staff box.

Though the bureau has the right to review the contract every three years,

Baker said she’s been happy with the guide and saw no reason not to

renew.

“I feel he is very knowledgeable, and this has always been his business,”

she said. “He’s very creative. I think it shows in the [guide].”

But along with others, Baker is unclear what company actually publishes

the visitors guide.

A 1999 renewal letter from Baker was addressed to local businessman Ed

Laird at the Local News, with Garofalo carbon-copied as publisher. Baker

said she thought Laird published the guide, assuming he also owned David

P. Garofalo & Associates.

Laird, the owner of Coating Resource Co., has told the Independent he

doesn’t own the Local News.

Also, the masthead for the 2000 visitors guide lists “Main Street West,

An AQC Company” as publisher. The masthead for the 1999 guide also lists

Main Street West, “A Coatings Resource Company” as publisher. The 1998

guide lists just Main Street West.

The 1997 guide lists David P. Garofalo & Associates as the publisher.

“Maybe I’m confused,” Baker said. “If Dave is the publisher of the Local

News and publisher of the visitors guide, and he sold his publishing

business to Ed Laird, that would make Ed Laird the owner of the Local

News and his publications, but it would not change who is publishing

them. Now, that’s how I see it.”

Jeff Laird, Ed’s son, is listed on county records as the president of AQC

-- Air Quality Consultants.

A public record Garofalo filed with the county in February 1998 shows

that Main Street West is just another name for David P. Garofalo &

Associates. That filing is good for five years, and there are no other

filings on record under the Main Street West name.

The city attorney’s office asked the commission in 1998 to examine

Garofalo’s possible conflicts of interest with the guide and the Local

News, but the agency said it was not provided enough information to give

a definitive opinion.

Ed Laird, a friend of Garofalo’s for 37 years, shed little light when

asked Tuesday about the mayor’s business interests.

“It’s exactly what Dave Garofalo has told you,” Laird said. “Has he told

you who has sold the Local News, and who has bought it? It’s exactly as

he told you. What did Dave tell you?”