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Duran credit card ‘test’ case called weak
By WeHo News staff, West Hollywood, California
What began as a campaign ploy has turned into an investigation that could besmirch the City of West Hollywood’s reputation for good governance and put a sitting council member in jail.
The Los Angeles County District Attorney is weighing charges against West Hollywood council member John Duran for meal expenses he charged to the city’s credit card while conducting city business.
Those familiar with the investigation, however, see the potential case as a weak one, given that the City Attorney wrote the law under which Mr. Duran spent the funds (and the city ordinances that govern expenditures in roughly a half dozen other municipalities) and the City Manager signed off on those expenditures – as well as outrageous spending by staff.
At the time Mr. Duran defended his expenditures - his name cropped up more often than any other single council member after the late-Sal Guarriello’s passing – by pointing out his flexibility as a self-employed person.
“No one else on the council has the flexibility to set their own schedule; they all work for someone else,” he said. “That leaves me able to schedule the time necessary to represent the city’s interests out of town,” he said.
He also said he found it convenient to handle official city business with commissioners, board members and the like over a meal, “killing two birds with one stone,” he said.
He felt confident that, given his expenses received a vetting from the finance department, he stood squarely within the law on his expenditures.
Mr. Duran ate as a rule at Joey’s or Basix across the street from City Hall or at the now-closed Hamburger Hamlet across the street from his Sunset Strip office.
At issue are 128 meals over three years, totaling about $7,000 and averaging less than $55 per meal.
Still, in March of this year the head of the DA’s Public Integrity division, David Demerjian, began making noise about bringing a felony “test” case against Mr. Duran for those luncheon expenditures.
According to Mr. Duran’s attorney, (and easily checked against the records) “those meals were with city commissioners, city advisory board members and residents. He doesn’t deserve to be the victim of this test case.”
In an unprecedented response, the city issued a response to the LA Times story, saying in part, "The City of West Hollywood has adopted a formal policy in accordance with state ethics laws that requires full documentation of all meal expenditures at public expense that involve City business. These expense reimbursement policies are comparable to other cities. In response to suggestions from the District Attorney’s office, the City is updating its expense reimbursement policy to assure that it is current.”
In addition, Mr. Jenkins stated that, “The City has been informed that the District Attorney has completed its investigation as regards the City and its employees and the City does not expect any further action by the District Attorney with respect to the City or City employees," continued City Attorney Mike Jenkins.
“The referenced credit card is the City's main credit card and is used by all City departments to transact purchases that cannot be done through the City’s normal check/purchase order system (many small businesses do not accept a City purchase order for payment),” said David Wilson, Interim Director of the Department of Finance and Technology.
“The amount referenced in the Los Angeles Times article, $121,000, was for a period of three years (approximately $40,000 per fiscal year). Each purchase is authorized in advance by a Department Director and all documentation is on file with the Department of Finance and Technology,” said Wilson.
“The use of a City credit card is for the purchase of miscellaneous food and supplies for community meetings and events, on-line purchases for information technology products and services, subscriptions, city wide staff registrations for conferences, training and meetings, business travel (airfare and hotels), and other business related activities,” said Wilson.
George Bird, a Torrance Lawyer Mr. Duran hired when it became apparent that David Demerjian, head of the district attorney's Public Integrity Division, would be pursuing charges, said that his client was being treated in a “grossly unfair” manner.
He said that Mr. Duran ought not be charged with a felony for his use of city credit card and for paying for meals with constituents and third parties while at all times conducting city business.
“John Duran is an honest, decent public servant who at all times conducted himself ethically and within the bounds of the law
“I hope that, upon further investigation and consideration of all the information, including the fact that John Duran met with the District Attorney’s office before he hired a lawyer to answer their questions. [Especially] after District Attorney’s review of the information provided with all the individuals he met with and all that was discussed to verify that city business was being discussed, I hope that the DA does the right thing and does not file any charges.”
According to Mr. Bird, “the District Attorney’s office informed us that California prohibited public officials from having the cities pay for meals within the city even though they conducted business.
“We provided a declaration from [Assembly Member Simon Salinas] one of the authors of AB 1234 [the law controlling expenses incurred by public officials] that John’s conduct was lawful.”
He also said the DA questioned if while meeting with his deputy, Hernan Molina, could “have that meal provided to him while conducting city business and whether that was authorized…”
Mr. Bird offered a third line of investigation pursued by the DA – whether or not the WeHo council verbally reports each meal eaten at city expense, with whom and where and what business was discussed, at every city council meeting.
Council members do report on any out of town trips or major expenses, but according to Mr. Bird, adding to that reporting every meal eaten with every constituent of person with business before the council would be cumbersome, to say the least.
“It is something that has never occurred at any time in the history of West Hollywood,” he said.
He noted that Mr. Demerjian, “identified early on that this was a test case on this issue of city officials consuming a meal within their city. They acknowledged how novel their theory of prosecution was, [in the DA’s own words].”
A person close to the investigation who would speak only on condition of anonymity told WeHo News that the DA’s position “was absurd; do city officials really need to go outside city limits to discuss city business with constituents over a meal?”
When the DA was presented with a declaration from Assembly member Salinas that showed his agreement with the West Hollywood policy and that his legislative intent was to allow localities to create their own policy on meal reimbursement and reporting.
That step apparently failed to give Mr. Demerjian pause, for according to the source, “he came back a couple weeks later to claim that the meals should have been reported in full city council sessions to comply with the law.”
Mr. Demerjian asserts, however, that a close reading of the law states that all meals and expenses, local and while traveling, ought to be duly reported at each meeting, a procedural matter and not a criminal matter.
Mr. Duran defended his buying meals more often than his fellows on the dais by pointing out that he is the only one self-employed inside the city, and therefor more accessible but also more efficient in his use of time by dining and handling business at the same time.
Mr. Duran told WeHo News that he set up the legal defense fund only to be prepared if the DA presses charges, but that the fund contains no money yet.
The DA is now focusing his attention on roughly one-third of the meals at question; those Mr. Duran shared with his deputy Hernan Molina while they discussed city business together, often before or after a council meeting or as Mr. Molina caught him up on important initiatives.
The city attorney, Mike Jenkins, says that such meals stand well within the city’s meal reimbursement policy, which he penned. He or his wife and partner Christy Hogin also wrote the laws governing other municipality’s expenditure policies as part of their duties at Jenkins and Hogin, which specializes in the practice of municipal law.
The firm serves as city attorney for the cities of Chino Hills, Diamond Bar, El Segundo, Hermosa Beach, Lomita, Malibu, Monterey Park, Port Hueneme, Rolling Hills, Santa Paula, and West Hollywood; as General Counsel for the South Bay Cities Council of Governments and the Westside Cities Council of Governments, the Los Angeles County West Vector Control District, West Valley Mosquito & Vector Control District, Antelope Valley Mosquito & Vector Control District and the San Gabriel Valley Mosquito & Vector Control District.
Mr. Jenkins told the LA Times that all the council members “work for a living, and it is very difficult to find the time necessary to conduct city business, so they meet with city employees or their deputies over lunch.”
The Times points out that this case seems miniscule to others the DA has investigated where the dollar amounts run into the tens and hundreds of thousands, if not millions.
They report that Mr. Demerjian said “his office has never prosecuted an official for expensing meals inside the city he or she serves.”
Prior to last week’s regular City Council meeting in a closed session that did not include Mr. Duran, the city discussed whether or not to indemnify Mr. Duran’s legal expenses should the DA actually file charges against him.
According to the City Attorney, Mike Jenkins, that stands as a possibility under the Government Code section 995.8, which allows the city to defend at city expense a criminal proceeding brought against a city officer or employee.
If the city were to fight the charges against Mr. Duran, it would do so with its own attorneys, and not contribute to Mr. Duran’s hastily set up legal defense fund.
Mr. Demerjian has made no moves in over two months to actually charge Mr. Duran, choosing instead to take his “test” case to the press before a jury.
WeHo citizens are taking notice and umbrage, with business leader Joe Clapsaddle declaring the DA’s maneuvering “bullying at its most basic,’ at last week’s city council meeting.
Victor Omelczenko decried the trial by publication, saying that while, “people love West Hollywood, [they] do not love [this] kind of publicity.”