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BOOMING SALES : Fireworks Firm's Domination of Lucrative Culver City Market Could End if Election Shifts Council Majority

April 06, 1986|JEFF BURBANK and MATHIS CHAZANOV | Times Staff Writers

Dressed for the occasion in his overseas cap with all the medals on it, Harold Sikoff reached into a small cardboard box Wednesday and pulled out a pink card to start the lottery for the right to sell fireworks in Culver City.

The half-dozen onlookers at City Hall laughed when Sikoff, commander of the L. Bushnell Post 123 of the Disabled American Veterans, chose his own ladies' auxiliary as the first winner among 14 applicants.

His own group was chosen next, and soon all 10 winners were determined, among them eight veterans groups, Troop No. 113 of the Boy Scouts of America and the Culver Palms Y's Men's Club.

The ritual is part of a yearly routine leading up to seven frantic days of fireworks sales before the Fourth of July.

But 1986 may be the last year of fireworks sales in Culver City, the only source of so-called "safe and sane" fireworks in the Westside.

Although a 3-2 majority of the City Council favors the sales, next Tuesday's election could tip the balance the other way, depriving the fireworks empire once controlled by convicted political corruption figure W. Patrick Moriarty of one its most lucrative outlets.

Moriarty, who is scheduled to go to jail for mail fraud April 21, still owns stock in Pyrotronics Corp., the Anaheim-based firm that markets Chinese- made Red Devil fireworks, according to his lawyer, Jan Lawrence Handzlik. Although no longer chairman of the firm, he has stayed on as a consultant.

Tapping a market that stretches from the beach communities to central Los Angeles, agents of Bishop Fireworks Co., Pyrotronics' local subsidiary, sell more fireworks in Culver City than anybody sells anywhere in the state, industry sources said.

Unlike other cities, however, where regulations require that the sponsoring organizations do a large part of the work, Pyrotronics, through its subsidiary, dominates the fireworks trade in Culver City from top to bottom.

Its employees fill out the paper work, pay the fees, supply the fireworks, set up the stands, do all the selling and bookkeeping and report the results to city officials without any outside monitoring.

Revenues on the yearly sales at busy intersections as far west as Lincoln Boulevard, as far east as Fairfax Avenue and as far south as the Fox Hills Mall are estimated at more than $500,000, with all but about $100,000 going to expenses.

The Bishop company splits the remaining $100,000 profit with the 10 sponsoring groups, which means that the veterans and other nonprofit organizations are left with about $50,000--or 10% of the gross revenue--to divide among themselves, according to Fred Brookins, Culver City coordinator for the supplier. By contrast, in nearby cities where service groups are required to staff the stands themselves, they generally keep 40% of the gross.

Local officials said they see nothing wrong with the system, which is permitted under the Culver City Municipal Code.

"The city doesn't dictate who the nonprofit corporations purchase fireworks from. We have no participation in that decision at all," said Councilman Paul A. Jacobs, who opposes the sale of fireworks in Culver City because of fire hazards.

"Whoever they hire to guard and work the stands, it's their business," said Councilman Richard Brundo. "It's not our affair. We allow the sale of 'safe and sane' fireworks. How they go about it is their business."

Officers of the city's veterans groups said they, too, are content with the system. One exception is Sikoff, who pulled his group out of a citywide veterans' council in 1984 complain ing, of being short-changed in fireworks sales. He said his group received $1,800 last year from the gross sales of $36,000 at the Disabled American Veterans stand.

"We're getting shafted, in plain words," he said.

Still, he sees no alternative to the existing system since Brookins saves each sponsoring organizations a considerable financial burden by advancing the $2,600 required in permit fees, Sikoff said.

"There's no other way to get fireworks," he said. "We don't have that kind of money."

With the average age of World War II veterans reaching 65, most groups would rather leave the operation of the fireworks stands to Red Devil's professionals, said Nate Whitman of Cpl. David Allen Post 667 of the Jewish War Veterans.

"We just found that it was easier to do it this way," he said.

"You can see that we are not disturbed by the way the percentage is distributed. Without fireworks, we wouldn't exist."

However, Don Coleman, treasurer of Boy Scout Troop 113, said his group might be able to earn more money on its own.

"But they have the equipment all set up because they do it every year," he said. If an organization could be sure that it would be authorized to sell fireworks every year, it might be worthwhile to set up as an independent, he said.

According to Brookins, a former vice president of Pyrotronics and now its local coordinator, the Culver City stands gross about $525,000 in a typical year.

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