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O.C. Company's Gift-Giving Gets Attention

April 11, 1993|TED JOHNSON and ERIC LICHTBLAU | TIMES STAFF WRITERS

When the Orange County Board of Supervisors appointed a new chairman last year, the engineering firm of Robert Bein, William Frost & Associates marked the occasion by sending him a dozen roses.

When the Orange County Water District hired a new director several years ago, the Irvine-based outfit helped him celebrate his first two Christmases on the job with $75 fruit baskets. And when government officials countywide attend black-tie dinners around the Southland, the company is often there to pick up the tab.

Such political freebies have become tools of the trade for RBF and many other Orange County companies that rely on government contracts. But the practice has suddenly thrust the well-respected, 49-year-old firm into a central role in the growing scandal over gifts accepted by managers at the Santa Margarita Water District.

RBF has won millions of dollars in government contracts for design and engineering work on bridges, landfills, roads, reservoirs and other large public works projects in Orange County. At the same time, the firm has achieved a formidable presence on the political scene.

The company employs the services of two well-known political figures--county Republican Party chairman Thomas Fuentes and Costa Mesa City Councilman Peter F. Buffa, who also sits on the agency overseeing the San Joaquin Hills toll road. RBF has given officeholders tens of thousands of dollars' worth of gifts and campaign donations. And it has hosted many politicians at special company events, such as an annual Christmas party aboard a yacht in Newport Harbor and an Easter prayer breakfast at Le Meridien Hotel in Newport Beach.

The company appears to have developed a particularly close relationship with top officials at the Santa Margarita Water District.

RBF has provided district General Manager Walter W. (Bill) Knitz and his assistant, Michael P. Lord, with nearly $14,000 worth of meals, trips and other gifts in recent years--at the same time the firm was receiving about $13 million in engineering work from the water district.

The FBI and the Orange County district attorney are now seeking to determine whether Lord and his boss violated federal or state laws governing the gifts that public officials can receive from people who have business before them.

Friday, both water district officials were suspended with pay pending the outcome of the investigations.

The firm also did detailed architectural planning and other home design work for Lord. An attorney for Lord says that the contractors on the project were paid for all but $100 of the $3,350 in work done. Nonetheless, the work has raised questions about the propriety of relations between Lord and RBF.

From time to time, the company has also hired relatives of water district employees. Lord's son, Ken, worked as an intern in the survey department from 1988 until 1990, while Diana DePietro, daughter of former operations chief C.J. DePietro, has worked in media services for almost two years.

Beyond the issue of whether Lord paid fair-market value for the housing work, industry officials questioned why the firms did the work at all. Companies as large as RBF ordinarily do not bother with projects at single-family homes, several corporate executives said.

"It's not a market that would appeal to a large company," said Dan Heil, president of Willdan Associates, an Anaheim engineering firm.

RBF officials, while declining to discuss specific elements of the case in interviews, defend their relationship with Santa Margarita district officials.

In a written statement this week, Bein said the gifts to Lord and Knitz "were not attempts to influence contract awards. . . . We never felt compelled to make gifts, and none were ever demanded."

Fuentes, the chairman of the Orange County Republican Party, is RBF's senior vice president for corporate affairs. He said the firm sees good government relations as part of its corporate obligation. "We try to be as hospitable in the community as we can," he said in an interview. He added that flowers, meals and other gifts are "very proper and appropriate."

Government and industry officials say that RBF has developed a reputation as a dependable and versatile firm with more than three dozen top-flight engineers on staff. "Their work is of the highest professional order," said Orange County Supervisor Thomas F. Riley.

The firm was founded in 1944 by Jack S. Raub and benefited from postwar construction of homes, schools and hospitals. William Frost, a land surveyor, joined the company in 1952; Bein was hired as chief engineer 10 years later.

In the early 1970s, the founder's son left to start his own firm, and the company changed its name to Robert Bein, William Frost & Associates. Frost retired in 1982, leaving leadership of the firm to Bein.

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