This April will mark 13 years since I first started writing as a business reporter.
One thing that I have learned over this time is that, typically, successful businesses and business interests never do anything without the expectation of return.
Now, this is not to say that successful companies are necessarily evil or nefarious because they expect a return on all investment. After all, that is what companies do. In many ways, they are very organic. They exist to propagate. To grow. To thrive. Much like any living thing. And like the diversity of organisms in the wild, businesses can range from hamsters to great white sharks and from kittens to grizzly bears.
The common thread, if there is such a common thread, is the expectation of return, be it in market growth, profit, revenue or even good will among the community. These are all legal tender in the growth cycle of a successful business.
For example, successful companies that rely in part or whole on municipal governments for their business spend a great deal of time and money courting city governments. It would be nice to think that a great track record alone would bring in the contracts, but with low-bidder language nearly ubiquitous throughout government, often times reputation is not nearly enough.
So companies hire lobbyists to ‘explain’ to local government officials why they are so great. The name of the game is political access to the decision makers and even in this regard companies expect a return on their lobbying investment.
This investment can take on many forms, from simply the cost of hiring a lobbyist who will arrange meetings and sit down with City Hall officials, to more extreme methods of influence. Keep in mind that a lobbyist, who has few rules to govern his ethical conduct other than his or her own soul, can use many tools beyond the face-to-face meeting to secure the influence his or her client desires.
But now, in the wake of the Craig Beck debacle, where the former-RDA chief accepted gifts from lobbyist friend Mike Murchison, we find City Hall making moves to implement new rules regarding lobbyists.
Being pushed forward by Councilmembers Robert Garcia and Gerrie Schipske, the new ordinance would seek to force lobbyists to register and report their client lists, report any one-on-one conversations with city officials on matters up for a vote and prohibit gift giving to city officials.
Current rules allow city officials to accept gifts valued over $50, but must report them. If a gift is worth more than $250, current rules state that the city official must recuse themselves from any matter dealing with the gift giver. And, no gifts from a single source of more than $420 are permitted.
Councilmember Schipske wrote on her blog several weeks ago that “All department heads and all elected officials need to come clean about whether or not they have accepted a gift of any kind from anyone having business at City Hall.”
Your intrepid writer could not agree more. Oh, except for one thing. What are we calling a ‘gift?’
It would appear by the context of the current rules that a gift is seen as anything that is given away that might result in improper influence or consideration being garnered by the gift giver.
Readers of this column know that your writer has a zero tolerance when defining such things. No loop holes, no spin, no wiggle room.
So your writer believes that a gift should be considered anything that involves money going to a city hall official from a person with business before City Hall.
It could be a straight gift, as in the case of former-RDA chief Craig Beck’s ‘vacation-with-a-lobbyist’ in Napa Valley. Other straight gifts could include a fancy lunch at a local restaurant with the lobbyist picking up the tab, or free transportation or lodging for a junket.
However, in addition to these more obvious gifts, there are others that are not normally talked about by politicians, despite the fact that they are exactly the same–money given with the expectation of return. These include such things as a donation to the City Hall official’s favorite charity or even the old tried and true campaign contribution.
As Councilmember Schipske went on to say on her blog about gift giving, “We need a complete investigation — everyone.”
The problem is, such an investigation might involve a lot of city officials, including Councilmembers Schipske and Garcia that are pushing the new lobbying rules.
For example, while Mr. Beck has been pilloried here and in other places for taking a discount on a hotel room from lobbyist friend Mike Murchison, Councilmember Schipske received a $350 campaign donation from the president of one of Mr. Murchison’s client firms, Lyon Apartment Companies. This donation is roughly equal to a one-night presidential suite room rate at the same hotel Mr. Beck stayed at in Napa Valley.
You might know Lyon Apartment Companies better as the developer of the $42 million Lofts at Promenade and the $94 million West Gateway mixed-use project being developed along Broadway.
And, Councilmember Schipske is not alone. Every single current councilmember and Mayor Foster have all accepted campaign contributions from Mr. Murchison’s clients, or executives of these firms.
A comparison of Mr. Murchison’s client list to campaign records over the past four years reveals that 26 of Mr. Murchison’s 67 listed client firms, and the executives of those client firms, have contributed a total of nearly $65,000 to the various campaigns of Mayor Foster and each sitting City Councilmember over the past four years.
Keep in mind that this is just the client list of one lobbyist.
The 26 contributing firms on Mr. Murchison’s client list, which is no longer available on his website but is viewable by clicking here, have directly contributed a total of just under $23,000 to the various campaigns of the Mayor and seven City Councilmembers. These firms made more than 40 direct contributions to the Mayor and Council members ranging in value from single donations of $700 to single donations of $100. It should be noted that Councilmembers Tonia Reyes-Uranga and Gerrie Schipske received no direct donations from the firms on Mr. Murchison’s client list.
In addition, executives of Mr. Murchison’s client firms (staff workers of the firms were excluded) have also made total contributions of just over $42,000 over the past four years to the various campaigns of the Mayor and each sitting Council members, with the exception of Patrick O’Donnell. These more than 50 personal contributions made by executives of Mr. Murchison-represented firms also ranged from single contributions of $1,000 to single contributions of $100.
It should be noted that Councilmember O’Donnell received a single $200 donation from one of the client firms, but no personal contribution from executives. Councilmembers Tonia Reyes-Uranga and Schipske, who received no direct donations from the firms on Mr. Murchison’s client list, both received at least one personal donation from executives at these firms. Councilmember Reyes-Uranga received two personal donations worth a total of $600 and Councilmember Schipske received one personal donation of $350.
The largest single recipient of campaign contributions from Murchison-represented clients was Mayor Foster. For his upcoming 2010 re-election campaign Mayor Foster has received $9,150 from firms on Mr. Murchison’s client list and an additional $8,950 from executives of these firms. During his 2006 campaign, Mayor Foster received $4,875 from Murchison-represented firms and another $16,800 from executives of these firms.
Here is a listing of campaign donations over the past four years the Mayor and councilmembers have received from firms represented by Mr. Murchison and executives of these firms.
Mayor – Bob Foster, $14,025 (firms), $25,750 (execs)
1st District – Robert Garcia, $1,100 (firms), $350 (execs)
2nd District – Suja Lowenthal, $1,050 (firms), $8,700 (execs)
3rd District – Gary DeLong, $100 (firms), $2,700 (execs)
4th District – Patrick O’Donnell, $200 (firms), $0 (execs)
5th District – Gerrie Schipske, $0 (firms), $350 (execs)
6th District – Dee Andrews, $3,300 (firms), $2,900 (execs)
7th District – Tonia Reyes-Uranga, $0 (firms), $600 (execs)
8th District – Rae Gabelich, $2,100 (firms), $350 (execs)
9th District – Val Lerch, $800 (firms), $350 (execs)
This is in no way to say that any of these firms or individuals or even the elected officials have done anything improper.
But as pointed out earlier, successful firms rarely do anything without an expectation of some return.
These firms chose Mr. Murchison to represent them and as we have seen, Mr. Murchison is not above creating an ethical dilemma that led to Mr. Beck’s downfall. And just like Mr. Beck’s actions have tainted all he has touched with the air of suspicion, so too should we perhaps look askew at Mr. Murchison’s dealings with City Hall in their entirety. After all, once the suspicion genie is out of the bottle, it can not be put back in. The taint grows like a malignancy, infecting everything past, present and future.
Unfortunately, this infection has all the possibilities of spreading to Mr. Murchison, and through him, directly to his clients, at least as they relate to City Hall.
And perhaps Councilmember Schipske is correct–there should be an investigation of all gifts by people having business with City Hall. But, why use the definition of ‘gift’ that only includes a $50 lunch and not a $1,000 campaign contribution? Does one cause less damage than the other to our government process if the cause and effect are both the product of ethical lapses?
As this column argued several weeks ago, a single ethical breech can cause immeasurable harm. Not just in the short term, which City Hall appears comfortable living in, but also in the long term, which is simply off the radar for most on the top floors of 333 Ocean Blvd.
This is not about a hotel room, or Mr. Beck’s ‘demotion,’ or even a single campaign contribution. This is about undermining the will of the people. It is about putting a “For Sale” sign on the public trust and ultimately eroding the whole concept of democratic representation.
Ethical breeches like that engaged in by Mr. Beck literally exchange the will of the people for a cash register, with elected officials hawking their wares like some carnival barker.
“Step right up folks, get your political access.”
The problem is that the “For Sale” sign is not always so obvious–it is not always out on the front lawn where every passerby can get a good look. Sometimes the “For Sale” sign is a private listing, only open to viewing by a select crowd that too often does not include “we, the people.”
However, the sad fact, only reinforced by the 6-percent voter turnout in the recent 3rd District School Board election, is that we as the citizens of Long Beach have to some degree abrogated control of the city to these carnival barkers.
Think about that–6 percent. Winner John McGinnis managed to convince 2-percent of the registered voters in the district to vote for him. That’s 748 voters out of nearly 36,000 in the district. And he only beat his nearest opponent by 81 votes–or 0.27-percent of the registered voters in the district.
That is not representation. And just saying something like “Well, the other 94-percent of the voters had the chance to make a difference,” doesn’t change the fact that they are not being represented. How can we have majority rule when the overwhelming majority does not even participate? This is governance by ultra-minority.
My friends, the system is broke and the only people that can make the carnival pack up and move on are us.
If we don’t step up to the voting box plate soon with a Louisville Slugger of outrage, then we can only sit back and join the other 94-percent of the electorate that seemingly don’t care who gets elected and quietly watch the game.
Or we will just have to figure out how to come up with some serious campaign donations when we want that pothole fixed or street light changed.
Well, that’s the start of the soapbox for this decade. Ta.
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