The Orange County district attorney's office has launched an investigation into whether Huntington Beach Mayor Dave Garofalo violated state conflict-of-interest laws by voting on behalf of companies with whom he had financial relationships, officials said Thursday.
Investigators will share information with attorneys for the state Fair Political Practices Commission, the agency that monitors campaign spending, district attorney spokeswoman Tori Richards said.
The probe was prompted by reports of the mayor's involvement in local publications that sold advertising to companies doing business with the city, as well as a letter of complaint, Richards said.
Questions also have arisen about Garofalo's 1998 purchase of a home--and resale a day later for $60,000 more--in a housing project for which he cast repeated votes. Garofalo has said the extra money was for upgrades and that his profit was $1.
"It became apparent that this is something we need to look at," Richards said of Garofalo's voting record.
Earlier this year, Dist. Atty. Tony Rackauckas declined to investigate conflict-of-interest allegations involving Garofalo and Pacific Liberty Bank, of which he is a founding director. Despite his ties to the bank, Garofalo continued to vote on matters involving fellow directors.
Rackauckas was on vacation and couldn't be reached Thursday for comment. Richards said his office could seek civil or criminal penalties.
Garofalo has defended his votes on the City Council, which he joined in late 1994, and said he would welcome an investigation to clear his name. He couldn't be reached for comment late Thursday.
Garofalo has said he hasn't profited since late 1997 from thousands of dollars worth of advertising in the Local News, his bimonthly newspaper, or the city's annual Visitors Guide, which he has published since 1994. He said he sold his "publishing rights" in December 1997 to Coatings Resource, a paint manufacturing company owned by a friend.
"I have not, nor will I ever knowingly commit a criminal offense while in public office," Garofalo has said.
State law bars elected officials from voting for 12 months on matters that could financially benefit anyone giving them $250 or more. Officials also cannot be involved in votes or deliberations if it is likely that the outcome would have an "important impact" on the official's economic interests. If handled administratively, each violation of the state Political Reform Act carries a maximum $2,000 fine; civil penalties can be higher. Misdemeanor violations carry fines of $1,000 each and up to a year in jail.
In June, City Atty. Gail Hutton told the City Council that she would ask the FPPC for a formal ruling on Garofalo's votes involving advertisers, based on new questions about whether he cut his financial ties to the publications. She said she also would seek a ruling on Garofalo's purchase of a house in the gated St. Augustine neighborhood and a second home on Main Street near a major redevelopment project.
Last week, Hutton told the council she had not sent the query to the FPPC because she was waiting for Garofalo to provide more information. The mayor has hired former FPPC General Counsel Steve Churchwell, who left that post in September 1999, to evaluate his voting record.
In October 1998, Churchwell told Hutton in a letter that Garofalo should abstain on votes involving advertisers for a year after selling the newspaper to comply with conflict-of-interest laws. Churchwell said the mayor was disqualified from voting on behalf of anyone who gave him $250 or more.