Bell's Low Income Housing Funds Used to Pay Officials: Audit

Public money was "used as a self-indulgent slush fund," state Controller says

View Comments ()
|
Email
|
Print

    NEWSLETTERS

    Money that was supposed to be used to provide affordable housing for Bell residents was instead used by city leaders to pay for administrator salaries, cell phones, car washes, car batteries and landscaping, according to a state audit released Wednesday.

    "Public money dedicated to increasing affordable housing and maintaining local roads were used as a self-indulgent slush fund to pay for excessive salaries, perks and other unlawful expenses," state Controller John Chiang said.

    According to the audit, city leaders routinely raided a pair of funds controlled by the city's Redevelopment Agency, which is charged with providing affordable housing for residents. The city also made thousands of dollars of payments to contractors using city transportation funds, the audit found.

    According to the audit, $244,850 was taken from the Redevelopment Agency's Low and Moderate Income Housing Fund to pay for salaries, vacations, retirement contributions, holiday pay and other compensation. Of that amount, $66,100 went to former Chief Administrative Officer Robert Rizzo, while $24,856 went to Lourdes Garcia, director of administrative services, the audit found.

    Meanwhile, $242,268 was inappropriately taken from another Redevelopment Agency fund for "labor" purposes, according to the audit. Rizzo received $171,444 from the fund, Garcia was paid $38,117 and former Assistant City Administrative Officer Angela Spaccia received $27,066, without any evidence that they performed any work related to the fund, the audit found.

    Rizzo, Spaccia and six other current and former Bell city officials have been charged with misappropriating public funds, with prosecutors alleging they bilked about $5.5 million from public coffers through exorbitant salaries and benefit packages. They are all scheduled to be arraigned Thursday.

    Chiang's audit also found:

    • City Council members who also served on the Redevelopment Agency board were paid $55.38 every two weeks, despite the authorized maximum of $60 a month. Two board members also received stipends of nearly $28 every two weeks even though they were no longer serving on the board.
    • The city paid $301,810 in gas tax funds to a consulting firm owned by the city's planning director, although there was no contract for services.
    • The city made $129,600 in overpayments for street maintenance, using gas tax funds; paid $76,992 for street-sweeping services without a written contract; and made $4,878 in overpayments to an asphalt contractor.