Report shows no irregularities

June Casagrande

NEWPORT BEACH--The results of an independent review of how the

Airport Working Group and Citizens for Jobs and the Economy spent a

$3.6-million grant from the city shows no irregularities, city

officials say, though it is still up to the City Council to decide if

all is on the up and up.

The review of the groups’ expenditures has been turned over to the

city manager, who in turn put the matter on Tuesday’s City Council

agenda. “It appears there aren’t any irregularities, but it’s up to

the council to decide whether or not they feel everything’s

appropriated,” City Manager Homer Bludau said.

The review of the expenditures was done by contractor Vavrinek,

Trine, Day & Co. LLP. Representatives of the company emphasized that

the report is not the same as an audit.

“We were not engaged to and did not conduct an audit, the

objective of which would be the expression of an opinion on the

financial records and compliance of the Airport Working Group of

Citizens for Jobs & the Economy,” the Vavrinek, Trine, Day & Co.

representatives wrote.

The report shows that the Airport Working Group has $51,887 left

over and Citizens for Jobs and the Economy still has $29,965.

The report also verifies what the groups had previously announced:

that $458,062 went to David Ellis and his firm, $346,622 went to

Bruce Nestande and $330,134 went to Cheveliar, Allen & Lichman. Their

fees were mainly for legal, research and consulting services. The

largest payee on the list, though, was Greenstripe Media, which

produced and aired media spots about the airport. Greenstripe

received $931,168 -- about 26% of the total grant.

City Councilman John Heffernan said he will use the issue as a

launchpad to discuss how such grants are awarded in the city.

“When we do roadwork, buy tires, buy computer equipment, we always

have multiple bids,” Heffernan said. “The idea is it makes you more

efficient as a buyer ....It also lets you get a look at the

relationships between vendors and the council to consider whether

there is any conflict there.”

Heffernan said that he did not necessarily think that Ellis’ work

as campaign consultant for some City Council members constituted a

conflict but that an open bidding process would give citizens the

opportunity to consider such factors up front.

* JUNE CASAGRANDE covers Newport Beach and John Wayne Airport.

She may be reached at (949) 574-4232 or by e-mail at

june.casagrande@latimes.com.