Vernon council to consider reform proposals

Faced with a strengthening effort to disband the city, Vernon officials on Thursday will consider a sweeping plan that calls for slashing City Hall salaries, creating a commission to oversee city-owned housing and imposing term limits on council members, some of whom have been in office for nearly four decades.

The proposal marks a major reversal for Vernon’s leaders, who have staunchly defended their municipal government — even after a series of corruption charges filed by Los Angeles County prosecutors and recent revelations that a former city administrator earned over $1.6 million in one year.

The plan comes a month after the state Assembly voted overwhelmingly in favor of a bill that would dissolve Vernon, an industrial city south of downtown Los Angeles that has been dogged for decades by claims that it is a fiefdom run by a small group of people. The state Senate is expected to address the bill, AB 46, sometime next month.

The city’s proposals address several issues raised in a series of Los Angeles Times articles last year that found Vernon’s part-time City Council members were among the highest paid in the state. Under the plan, City Council annual salaries would be cut from about $70,000 to $25,000, and medical benefits would be reduced. Salary caps would also be imposed on other top city jobs, including the finance director, whose pay would drop from about $570,000 in 2009 to $210,000 under the new guidelines.

The author of the plan, City Administrator Mark Whitworth, said last year that the council’s high pay was justified and that the officials were “absolutely” worth the money. He also said previously that administrative pay was crucial to making Vernon “an excellent place for business.”

But in a statement released this week, Whitworth struck a different note, saying his reform proposals would establish a “more open, transparent and inclusive governance structure” and “provide a firm foundation for Vernon’s future.”

If the disincorporation bill becomes law, Vernon City Hall would be disbanded and the L.A. County Board of Supervisors would take over government operations. Vernon officials say the bill is unconstitutional and argue that it would result in higher taxes and utility rates for local businesses and a loss of jobs.

The city, which has a population of less than 100, owns nearly all of the residential property within its borders, essentially making the council the landlord for all voters. Critics call the arrangement a major conflict of interest. Last year, The Times found that more than a dozen relatives of city officials lived in the homes at below-market rates. In the past, residents have needed the city’s permission to lease the homes and have almost never challenged incumbents for spots on the City Council.

The proposal would shift oversight of the residences to an advisory commission, according to an agenda released this week; the homes would still be owned by the city.

The housing commission would consist of seven members: one councilman, two residents, three local business owners and one employee of a Vernon business. Vernon formed a similar committee last month to advise its Light & Power Department on electricity rates.

Critics of Vernon dismissed the plan as window dressing, arguing that it would not change the fundamental flaw of a city in which a tiny pool voters is beholden to its elected leaders.

“This is just another example of Vernon saying or doing anything to protect their corrupt status quo,” said John Vigna, a spokesman for Assembly Speaker John Pérez, who represents Vernon and who wrote the disincorporation bill.

Vigna also noted the slow pace of the reforms. Even with the new term limits, current council members would be eligible to serve at least another decade in office.

Philip Reavis, a former Vernon Chamber of Commerce president who ran for office in 1980, said the proposed reforms won’t make enough of a difference. Reavis, who owned one of the last private homes in Vernon, said the city needs either a much larger, independent residential community, or it needs to find a way to let business owners vote.

“I’m not sure how that would work,” he said. “They need a major structural change. Otherwise you’re just putting Band-Aids on big, big cuts and nothing’s going to happen.”

Still, Vernon’s turnabout generated praise from some critics, who said it appeared city officials were trying to make improvements.

Los Angeles County Supervisor Gloria Molina, whose district includes Vernon, said she thought the proposed reforms were “a positive step” — but not enough to change her stance in support of disincorporation.

“I still think it’s a company town masquerading as a city,” she said.

The Vernon Chamber of Commerce, which has been lobbying for various reforms in recent months, said it strongly supports the measures. The chamber is fighting AB 46 and has argued that city officials need to enact their own reforms to prevent outsiders from doing it for them.

“We are holding our breath until the final votes,” chamber President Marisa Olguin said in a statement.

Fred MacFarlane, Vernon’s spokesman, said the housing commission, if approved, would formulate an overall housing policy that will cover many areas, including leasing terms and rates for the homes. He said it was too early to comment on the specific changes that could result. Right now, the council members and other residents pay rents ranging from $147 to $472 a month.

The reforms also suggest salary limits for city officials ranging from $150,000 to $267,000 a year, far lower than what top administrators and attorneys were being paid recently under an unusual overtime system.

MacFarlane said that Whitworth worked with the city’s staff and attorneys to develop the plan, and that local business and labor leaders were consulted as well.

“I think all of the members of the state Legislature should look at the steps the city is taking and evaluate or reevaluate whether AB 46 is needed,” MacFarlane said.

Vernon’s council, which will vote on the reforms at a special meeting Thursday, has remained remarkably stable throughout its 100-year history. Since its inception in 1905, the city has held relatively few contested races and most of its elected officials have enjoyed long tenures. The previous mayor, Leonis Malburg, served 50 years on the council. His grandfather, who was one of the city’s founders, served 45 years in office.

Malburg stepped down in 2009 after he was convicted of voter fraud. Prosecutors said he lived in a mansion in Hancock Park, not industrial Vernon. Two former city administrators were also charged with public corruption in separate cases, Bruce Malkenhorst in 2006 and Donal O’Callaghan in 2010. Both are awaiting trial.

Vernon canceled its council election this year because there were no challengers to the incumbent, William Michael McCormick, who has held a seat since 1974.

The council members have remained mostly in the shadows since Pérez introduced AB 46 in December, but at a recent council meeting Mayor Hilario Gonzales offered a strong defense of the city.

“We have done nothing wrong,” Gonzales said. “Like any other thing, you may have … bad apples. But that is not the city’s fault.”

Gonzales and the other councilmen have repeatedly refused interview requests by The Times.

John Kruissink, a former Vernon consultant and historian, said the council members “deserve some credit” for considering such a drastic reduction of their salaries.

“I had a feeling that would be the last thing they’d do,” he said. “These guys were living well for a long time, with little or no attention paid to it.”

sam.allen@latimes.com

hector.becerra@latimes.com