Safety requirements for the annual rave were important to the company because it paid many of the security and first-aid costs. After 15-year-old Sasha Rodriguez died of an Ecstasy overdose, the Los Angeles Police Department said security arrangements were inadequate and drug use at the event was rampant.
Todd DeStefano, who was the commission's longtime assistant general manager for events, began working for the rave company, Insomniac Inc., about two months before the June concert, according to records and interviews. Commission General Manager Patrick Lynch approved the arrangement.
In an interview, DeStefano acknowledged his double employment, saying that he received payment through one of three companies that he has launched from his home since 2006. He declined to reveal the amount Insomniac paid him.
State law generally forbids managers such as DeStefano to participate in decisions affecting a company in which they or their immediate family members have a financial stake. Violations can result in civil or criminal penalties. DeStefano has not filed a financial disclosure required by the state that would show outside income.
DeStefano said his companies have not been engaged in any other business involving the Coliseum or the neighboring Los Angeles Sports Arena, which is also run by the commission. He said he did nothing wrong.
"There was no conflict of interest," he said.
LAPD Deputy Chief Pat Gannon said in an interview that more police and security officers should have been deployed at the rave.
He also said the commission did not provide mobile security cameras that it promised to install, citing a staffing shortage.
During the two-day event in 2010, about 120 people were taken to the hospital, mostly for drug intoxication. An independent review ordered by the commission found that several people were injured when a crowd overwhelmed security officers and stampeded the field, scaling two fences.
Lynch said commission and Insomniac representatives worked as a "team" in planning the event, leaving DeStefano no opportunity to unduly influence the agency's oversight of the company.
"We're all in it together," he said. "I'm in the meetings, the other guys are in the meetings, we're all in the meetings. There's no hidden ball here."
Asked if DeStefano represented both the commission and Insomniac in those meetings, Lynch responded: "I would assume so."
Lynch said he reduced DeStefano's salary and changed his title after he started with Insomniac, but DeStefano continued to work for the commission on the Electric Daisy preparations. Lynch said DeStefano might have taken part in closed-door meetings of the commission in which its dealings with Insomniac were privately discussed.
"I can't remember specifically," he said.
Lynch said he recently informed Commissioner David Israel of the situation and was told that DeStefano's ties to Insomniac were improper and that he should choose between the company and the agency. Israel confirmed Lynch's account.
"I was unhappy," said Israel, who became commission president last week.
DeStefano said he resigned from the commission staff in January to pursue a full-time career as an events promoter — including for Insomniac, which is seeking commission approval for another Electric Daisy. One reason he decided to leave, he said, was that events promotion promised "a much bigger upside" financially.
His total annual earnings from the commission last year were about $93,000, according to the city controller's office. That was after DeStefano's $60,000 salary cut, Lynch said.