Commission Expertise Said Hindered Under Hahn Order

Staff Reporter

In issuing an executive order banning city commissioners from helping evaluate and then select contractors, Mayor James Hahn was playing catch-up with a rising political chorus opposed to the practice.

But such participation is a decades-long tradition in some departments, and Hahn's action runs counter to the view of several commissioners, contractors and lobbyists who believe that it makes the contracting process more effective.

Harbor Commissioner James Acevedo says that commissioners, who often have a more varied background than department staff, can help attract a better diversity of businesses, many of which may have no prior experience dealing with the city's bidding process.

"They usually have a lot more feedback," he said. "The chairman of one of the proprietary departments is a lot more demanding than the rest of us. Frankly, they'll get information from the mayor's office or the (city attorney's) office, and it may become part of the process. They have a better perspective."

Acevedo said he does not sit on panels, but makes regular suggestions to engineers to cast a wider net in seeking bidders. He also said he gets involved in lease negotiations.

As for Hahn's directive, Acevedo said it would likely frustrate most of the city's 300 commissioners who do not exert undue influence. "Frankly," he said, "I'll continue to give my two-cents to staff and tell them to pick the best and the brightest our community has to offer."

Airport a focus

While applying to all city commissioners, the Jan. 5 order came weeks after City Controller Laura Chick criticized the practice in her department's audit of Los Angeles World Airports.

The practice creates "the appearance of a potential conflict of interest," the audit said. Although she stopped short of indicating any illegal activity had occurred, in releasing the report, Chick said, "I have been looking at the awards of contracts because of, in part, the rumors about pay-to-play." Pay-to-play refers to the awarding of contracts based on candidates' political contributions.

Chick turned over the findings of the audit to L.A. District Attorney Steve Cooley, state Attorney General Bill Lockyer and the U.S. Department of Transportation, to investigate potential illegal wrongdoing.

It is hardly the first time the issue has come up with the airport commission.

Separate audits of LAWA, in 1986 and 1993, discouraged the practice but allowed it in cases where commissioners removed themselves from the board's final vote. A 1999 audit of LAWA took the recommendation a step further, discouraging the practice altogether.

"From our perspective, this has been a long-standing problem," said Gayla Kraetsch Hartsough, president of KH Consulting Group, which conducted the 1999 audit. "I don't think the other two audits got the commission to change its behavior. Our audit was the first with a discussion of not doing it, and it stopped for a while."

It was renewed, she said, under Airport Commission President Ted Stein, who was appointed by Hahn in 2001. Airport Commission Resolution No. 21520, authored by Stein and passed in August 2001, authorizes board members to participate in ad hoc committees that serve as evaluation panels.

"Ted and I add value, in that we have extensive business experience, and we think that's helpful when selecting contractors," said Cheryl Petersen (photo), vice president of the Airport Commission, in a November interview with the Business Journal.

Kraetsch Hartsough noted that "the reason they sat in on contract selections were for good reasons: To ensure that LAX was seeking out improved innovation. They didn't want the same old, same old. They wanted new, creative ideas."

Former Airport Commission President John Agoglia, now a media consultant in L.A., said he discouraged the practice but that he and other commissioners sat on panels early in their terms to become better acquainted with the overall contracting process. "Once you understand the process, you don't have to sit in on these," he said.

Lobbyist Clark Davis said he would rather deal with commissioners, who as politically appointed volunteers can bring balance to a process in which department staff may be inclined to award contracts to the same bidders over and over.

"Staff always has their own personal point of view," he said. "I've seen this practice done legally on numerous occasions."

In 1982, then-City Attorney Ira Reiner issued an order affirming the legality of commissioners sitting in on selection panels. City Attorney Rocky Delgadillo re-affirmed that order in a recent letter to Chick's office.

Aside from the orders, however, city law fails to directly address the issue.

On Jan. 6, the City Council approved a motion that, among other things, requested the City Attorney to draft an ordinance prohibiting commissioners from participating in the evaluation and selection panels. Two council committees are expected to consider the motions.

Councilwoman Cindy Miscikowski, a member of the commerce, energy and natural resources committee, said even with its legality, the practice should have stopped long ago.

"It became a question not of whether it's illegal, but is it a good thing?" she said. "Is there the appearance of a problem? It goes beyond the question of legality or not."

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