Amid a swirl of questions about irregularities involving a city-supported trade task force he has personally promoted for several years, Mayor Tom Bradley on Friday abruptly withdrew his latest $121,000 funding request for the group.
The action came as state and federal officials indicated that the UCLA-based Task Force for Africa-Los Angeles Relations, which has received nearly $400,000 from the city in recent years, has not had the nonprofit corporation status it claimed in funding contracts with the city.
Also Friday, the city controller's office, citing the task force's failure to file required spending records with the city, announced that it was launching an audit to determine how taxpayer funds have been used.
The task force, which its officials said conducts trade missions, seminars and other activities to promote business between Los Angeles and Africa, has come under scrutiny as part of the recent controversy over Bradley's personal financial ties with area firms that do business with the city. Bradley, who has lobbied hard to obtain funding for the task force, is an investor in a Riverside County land deal with the task force's $40,000-a-year director, Juanita St. John.
The city attorney's office is probing the mayor's acceptance of tens of thousands of dollars in fees from local financial institutions but refused Friday to confirm or deny whether the inquiry would be expanded to include the task force. However, Councilman Mike Woo, whose Governmental Operations Committee is preparing its own review of Bradley's finances, said the task force will be included in his committee's probe.
Bradley was on a trade mission in the Far East and could not be reached for comment. But in the past, he has denied his personal lobbying efforts on behalf of the task force--calling council members to try to sway budget votes and in 1987 vetoing a council effort to cut the task force's funding--constitute a conflict of interest.
In a statement released Friday by his office, however, Bradley said some questions recently raised about the task force "are still in the process of being resolved."
"Under these circumstances, I have decided that it is in the best interests of the city of Los Angeles to withdraw the funding request for the task force in the 1989-90 Los Angeles city budget," Bradley said.
Nothing to Hide
St. John, in a telephone interview Friday evening, said she had nothing to hide and would give the city any records it wants.
"I have filed exactly what they asked for," she said. "They never called me and told me they wanted more."
It is difficult to say exactly what the task force's annual budget is because it gets businesses to pick up some costs, St. John said. She said the city's money has been used largely to pay her salary and for supplies.
She acknowledged that she let the group's state nonprofit status lapse. But she said it was unnecessary because the task force is not collecting donations as a charitable trust. While the Internal Revenue Service disagreed, she insisted that the task force had the federal nonprofit recognition it needed.
As for Bradley's move to withdraw funding for the agency, St. John said she is not bothered.
"The task force will continue, " she said.
Council hearings on that budget were scheduled to begin Monday. The mayor's critics predicted that his request on behalf of the task force--a 23% increase over recent years--would not survive.
Because the task force lacks official recognition as a nonprofit corporation, Councilman Zev Yaroslavsky, a longtime critic of the organization, said he may push to recover the city funds.
"It appears they are in violation of their contract," Yaroslavsky said. "If they are . . . they owe the city quite a bit of money."
In contracts with city in recent years, the task force has identified itself as a "nonprofit corporation."
However, the state Franchise Tax Board said Friday the group's nonprofit corporation status was suspended four years ago for failing to file a 1984 tax return. Jim Rebar, a board spokesman, said the organization has not filed returns since.
The IRS, which also approves nonprofit organizations, said its records show the task force applied for that recognition, but it was never granted. Shirley Nakagawa, an IRS spokeswoman, said it was not clear why.
The city's chief auditor, Tony De Guzman, said he hoped to begin delving into the task force's financial matters Friday morning, but St. John canceled her appointment, saying her husband was ill.
Asked about the city's apparent failure to demand required spending records or check the nonprofit status, De Guzman said, "I don't know how it got through."