Monday, August 9, 2010

(BN) California's Brown Issues Subpoenas in Bell's $800,000 City Manager Case

Bloomberg News, sent from my iPhone.

California Demands Data on City Manager Paid $800,000

Aug. 9 (Bloomberg) -- California Attorney General Jerry Brown said he expects legal action in "weeks, not months" after subpoenaing personal financial records of present and former officials of Bell, the Los Angeles suburb that paid its city manager almost $800,000 a year.

Brown said legal violations in Bell may involve both civil and criminal statutes. The attorney general's office began serving the subpoenas today, Brown said in a statement.

The state is reviewing the possibility of voter fraud and election violations, Brown said. The Los Angeles Times reported July 27 that Bell police officers collected absentee ballots and told residents who to vote for.

"We want to see their e-mails, we want to see the ordinances, the resolutions, the minutes of meetings -- we want to find out exactly how they ever came to the conclusion that city officials should make so much money," Brown said.

The town of 38,000, about 10 miles (16 kilometers) southeast of Los Angeles, has a largely Latino population with a per-capita income of $24,800 in 2008, according to the city's latest annual report. More than a quarter of its residents live below the poverty level, according to the website

The chief administrative officer, Robert Rizzo, resigned July 22 after the Times reported his total compensation was almost $800,000 a year and that Bell's part-time council members took in almost $100,000 annually, mostly by serving on city- affiliated boards and commissions.

Financing Deal

A $35 million financing deal has also raised questions about the officials' stewardship of the city.

Bell's Public Financing Authority sold a $35 million note that is set to mature in November. The city raised the money to buy a patch of industrial land, with plans to lease it to Berkshire Hathaway Inc.'s Burlington Northern Santa Fe railroad, the Times reported. The plan never went through, however, after the city was sued for failing to conduct adequate environmental reviews, the newspaper reported.

The city has since fallen behind on its payments on the bonds, which are owned by Dexia SA, the Paris- and Brussels- based bank, said Ulrike Pommee, a spokeswoman. The bank entered into an agreement with the city in June aimed at resolving the issue, she said in an e-mail.

Pedro Carrillo, the city's interim chief administrative officer, didn't immediately respond to a message seeking comment.

Brown, 72, a former California secretary of state and governor, is running as the Democratic gubernatorial candidate against former EBay Inc. Chief Executive Officer Meg Whitman, who is on the Republican ticket.

To contact the reporter on this story: Alan Ohnsman in Los Angeles at

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