Dave Garofalo got VIP treatment in home sale

Theresa Moreau

HUNTINGTON BEACH -- Tim Wetzel drove to the upscale St. Augustine

housing tract early one Saturday morning in March 1998, hoping to snag

one of the half-million-dollar homes in the yet-to-be-built gated

community.

He remembers rolling his eyes when he found out who landed the single

most coveted lot in the tract -- a development by PLC Land Co. -- that

very first day of home sales, before anyone else had a chance.

It was Dave Garofalo.

“The only reason he got it was because he was a council member,”

Wetzel said.

Garofalo got the VIP treatment while he continued to cast favorable

votes for the developer and also served on a council committee that tried

to determine how many millions of dollars the city should rebate to the

developer for extra infrastructure improvements.

But Garofalo wasn’t the only public official who was allowed to bypass

other St. Augustine home buyers. Huntington Beach City School District

Supt. Duane Dishno said he was on a short list of preferred customers

that included Garofalo.

The preferential treatment irked one resident more than others.

Wetzel said a woman who held the No. 1 spot on the general list of

potential buyers had planned to buy the home Garofalo had already

snatched up.

“She was bummed out because that one was sold,” Wetzel said. “She was

No. 1 on the list, so she was certain that she would get it. I remember

her storming off.”

Wetzel never knew the woman’s name, but other St. Augustine residents

said they also remember her frustration.

And when Wetzel learned Garofalo turned around and sold the home to a

friend for an additional $60,000 the day after escrow closed, he rolled

his eyes again.

Garofalo, who was first elected to the City Council in 1994, has

reported that he doesn’t have “those kind of assets” to buy such a pricey

home.

Garofalo, 55, bought the home on Poppy Hill Circle for $565,000 and

sold the four-bedroom, 3 1/2-bath, 2,730-square-foot home the next day to

his good friend, gas station mogul George Pearson, for $625,000. Pearson

had also signed up for the lottery, but he said his number was around

600.

The $60,000 increase in price, the two maintain, was due to upgrades

in the new home. Garofalo has said he made only $1 on the sale.

An executive with the home builder said developer upgrades are

included in the initial price of the home.

Six weeks after the St. Augustine sale, Garofalo bought a $329,000

home in the 600 block of Main Street. He laid down $82,000 for a down

payment.

As for the $60,000 in upgrades, Wetzel, who manufactures warehouses,

said it would have been impossible for any improvements in Garofalo’s new

home to have been reflected in the purchase cost.

“He closed the very next day, and a contractor wouldn’t be able to do

the work in the time he needs to get it done,” Wetzel said.

How exactly did the mayor get the prime lot in the tract?

Garofalo has said that as soon as the plans for the development were

made public, he called Christopher Homes and asked for his name to be put

on the list of buyers. He said he called monthly to check on his status.

“When it was my turn, I selected the lot that I most wanted,” Garofalo

has explained. “It was available.”

At the time of the purchase, Garofalo was living in a local hotel with

his mother. Public documents show that on Sept. 4, 1997, he sold his

modest home in the 16200 block of Fairway Lane for $220,500 -- a mere

$5,500 profit.

Garofalo also has said he was at the release of the homes on the first

day: “I’ve never been told I was No. 1 on the list. We all went to an

open house Saturday morning. Everybody waited in line with their cars,

and we all went in, and if the house you wanted was available, then that

was the house that you got. If it wasn’t, then you picked another house.”

Wetzel and other homeowners interviewed said Garofalo -- who they

would have recognized -- wasn’t there.

Wetzel said he also checked the list of names, which was made

available for public viewing at the tract sales office, and never spotted

Garofalo’s name among the hundreds of others who had signed up.

“It’s an absolute fact that he wasn’t on the list,” Wetzel said.

“Garofalo was never on a general list.”

Wetzel said Garofalo surprised him again when the then-councilman kept

voting on PLC matters.

From the day he purchased the Poppy Hill Circle house in July 1999

until this April, Garofalo has voted at least 18 times on items related

to the Holly Seacliff project.

Garofalo also sat on a committee to determine how many millions of

dollars PLC would be reimbursed for the infrastructure improvements the

company had installed, such as streets, sewage, gutters and a

9-million-gallon water reservoir.

Garofalo is under investigation by the district attorney’s office, the

Orange County Grand Jury, the city attorney’s office and the Fair

Political Practices Commission for conflict-of-interest violations, his

voting record and his business dealings.