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Owner of Huntington Park Trash Firm Involved in Las Vegas Hotel Bankruptcy

September 11, 1988|RICHARD HOLGUIN | Times Staff Writer

HUNTINGTON PARK — When the City Council awarded a garbage contract to a fledgling firm owned by a businessman with no experience in the trash industry, the council majority reasoned that a successful entrepreneur could run any operation.

City officials have indicated in recent interviews, however, that they did not thoroughly investigate the business background of Eugene C. Fresch, owner of the new firm, H.P. Disposal.

As Fresch's new company prepares to begin hauling garbage Oct. 1, creditors continue to submit claims in federal bankruptcy court in Las Vegas to recoup what they say they are owed by a failed hotel and casino operation owned by Fresch and a Texas investor.

Mayor Jack W. Parks and councilmen Thomas E. Jackson and William P. Cunningham, who voted last June to award the contract to H.P. Disposal, said they did not know about the financial problems of Fresch's Las Vegas business venture. The firm, Airport Casino Inc., ran the Marina Hotel and Casino on the Las Vegas Strip until last year, when liquidation proceedings began under Chapter 7 of federal bankruptcy laws.

Not Aware of Bankruptcy

"I wasn't aware of that (the bankruptcy), but that happens a lot of times with a corporation," Parks said in a recent interview. "It doesn't necessarily mean the individual himself is a bad businessman. I think the guy's a pretty intelligent and smart businessman and will do a decent job for us."

Parks said he probably would have voted the same, even if he had known about the casino's business problems. But, he said, "I would probably have researched it a little bit closer. . . . " Cunningham echoed the mayor.

Jackson, who spearheaded contract negotiations for the city, said, "We studied this in great, great detail. He was a hell of a businessman." But Jackson also acknowledged he did not know of the Las Vegas firm's bankruptcy. "I don't think anyone ever asked him," he said.

Asked whether the city should have investigated Fresch's business background more thoroughly before awarding the commercial garbage contract, Jackson said, "I don't think it was our intention to know every detail of his (background)."

Donald L. Jeffers, the city's chief administrative officer, said Huntington Park officials did not research Fresch's business background. The Huntington Park Police Department found that Fresch had no criminal record, said Chief Patrick M. Connolly.

Meanwhile, H.P. Disposal, which had no headquarters or trucks when the contract was awarded, is gearing up to pick up trash from the city's businesses next month, General Manager Jack Leonard said this week.

The company has set up a trailer as its temporary headquarters on a lot it acquired on Holmes Avenue, just outside Huntington Park's western border. On Tuesday, Leonard showed one of the company's white, red and green trucks to the local Kiwanis Club.

"Everything's ahead of schedule," Leonard said. "If need be, we could start hauling trash tomorrow."

Leonard said all but one of the firm's seven trucks, which together cost about $800,000, are ready to roll. The company is still hiring drivers, he said. In all, H.P. Disposal will employ about 15 workers, a spokeswoman said.

Eliminate Graffiti

The new company will assign a worker to paint over graffiti that often mar garbage bins in the city, a plan lauded by Jackson. The councilman also said the locally based firm would be more responsive to customer complaints than the current contractor, Laidlaw Waste Systems Inc., a Canadian firm with U.S. headquarters in Hurst, Tex.

City officials said billing problems and Laidlaw's unresponsiveness to complaints led the city to terminate the contract, effective Oct. 1. Laidlaw still holds Huntington Park's residential garbage contract.

A Laidlaw spokesman acknowledged some billing problems, but said they were quickly corrected. He said Laidlaw has been responsive to Huntington Park.

In June, several area trash haulers opposed the contract with Fresch's new company, and questioned whether the 66-year-old businessman received favorable treatment because his two sons run the Huntington Park Casino, which provides the city with about $500,000 in revenue annually. Eric T. Fresch is president of the company that operates the casino. Curtis Fresch manages the casino.

Councilman Jackson acknowledged that Eugene Fresch had an inside track on the new contract because he had become acquainted with city officials as a result of his sons' positions with the Huntington Park Casino.

But Jackson denied that the decision to award the contract to Fresch was influenced by the casino's financial importance to Huntington Park.

Fresch did not respond to numerous interview requests.

It is unclear how Fresch found about the city's dissatisfaction with the firm. Leonard said Fresch approached him to run the new firm. The Fresches and Leonard enjoy good relations with city officials.

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