Conflict-of-Interest Charges : Testimony Begins in Trial of Ex-Stanton Mayor

A Stanton city councilman and a former colleague who once were political opponents met Tuesday in a municipal courtroom where one of them--four-term veteran Frank Marshott--is being tried on criminal conflict-of-interest charges filed just a week before he was defeated for reelection.

Marshott, a former mayor and vice mayor who was seeking an unprecedented fifth term on the City Council, faces three misdemeanor charges alleging he voted illegally to increase trash collection fees when he was acting as insurance broker for the city’s trash hauling firm.

Four Witnesses Called

Councilman James Hayes, who opposed Marshott for vice mayor last year and who filed the original complaint against him with the Orange County Grand Jury, was one of four witnesses called to the stand on the first day of testimony in the trial. He testified about Marshott’s votes to nearly double garbage fees over a period of a little less than a year.

Hayes, a former aide to Supervisor Harriett Wieder and former Rep. Jerry Patterson, testified that he discovered during the fall of 1983 that Marshott’s Westminster-based insurance brokerage was providing coverage for Stanton Disposal Inc., the company that has held an exclusive franchise for rubbish collection in Stanton since the early 1970s.

Looking back on the minutes of past meetings, Hayes said, he found at least three occasions during 1982 and 1983 when Marshott voted to increase trash fees as part of a group of council items that were approved as a block. Twice, Marshott seconded the motion to approve those items, according to evidence presented in the case.

The three rate hikes increased garbage fees for an estimated 6,000 households--not including apartments and some mobile homes--from $3 a month to $5.90 a month, Hayes said. Stanton Disposal requested two of the increases based on new gate fees charged at the county landfills.

Hayes said he never discussed his concerns with Marshott but filed a letter with the grand jury March 31, 1984, seeking an investigation.

Although the complaint has not been raised as a major issue during the trial, Marshott’s attorneys say they believe it was politically motivated.

“The writing was on the wall. Marshott was going to oppose him (Hayes) as vice mayor because he hadn’t been around long enough,” defense attorney Dennis LaBarbera said during a recess. LaBarbera specifically asked Hayes during questioning whether the vice mayor position had anything to do with the complaint, and Hayes denied it.

Successful Opposition

“And it didn’t have anything to do with the fact that you and Mr. Marshott were often politically at odds?” he asked. Judge Marvin G. Weeks, presiding over the trial in West Orange County Municipal Court, would not allow the question, but Hayes said after the hearing that he and Marshott usually voted the same on issues before the council.

The two were at odds a few weeks after the complaint was filed, Hayes said, when Marshott successfully opposed his effort to be vice mayor. But Hayes said he had sought an investigation for “law and order” reasons, not political ones. The district attorney filed the misdemeanor charges Oct. 30, only a few days before the Nov. 6 election in which Marshott was defeated for a fifth term.

If convicted, Marshott faces a maximum six months in jail or a $10,000 fine.

Tricia Leyes, vice president of C R & R Inc., the parent company of Stanton Disposal, testified that Marshott has acted as the corporation’s insurance broker since about 1968, handling all of the company’s insurance. Stanton Disposal makes up only about 2% of C R & R’s income, she added.

The company’s Stanton coverage includes $500,000 per incident, $1-million personal injury and a $25-million umbrella policy, she said. There was no evidence introduced to show how much Marshott earns from C R & R premiums, but Deputy Dist. Atty. Jim Reilly said it is about $20,000 a year.

Stanton City Manager Kevin O’Rourke testified that Marshott had abstained on several other occasions in votes pertaining to Stanton Disposal, but O’Rourke said he hadn’t noticed it when Marshott voted for the rate increases.

Statement Cited

Donald Carroll, a district attorney’s investigator, testified that Marshott conceded to him in an earlier interview, “Maybe I should have abstained in those votes . . . .”

The key issue to be decided is whether Marshott violated a provision of state law that prohibits officials from voting, participating in or influencing government decisions on issues in which the official knows, or has reason to know, that he holds a financial interest, generally measured at more than $250.

“It is reasonably foreseeable in that particular situation that if the City Council continues not to permit any of these rate increases, it’s going to be a losing proposition for Stanton Disposal, and they’re no longer going to have that contract. So Mr. Marshott will no longer write insurance and derive premiums,” Reilly argued.

But LaBarbera said the regulations that specify how conflict-of-interest laws are to be interpreted state that the business that is potentially affected must realize a net gain of at least $100,000 a year, or 1% of its gross income, among other criteria, none of which applies in this case because none of the individual votes netted that much money.

Action Criticized

“What’s being said here is, ‘We understand, Mr. Marshott, the law tells you you can do it, but the D.A.’s office says you can’t, so we’re going to waste our time arguing it in front of a jury.’ I think it’s ludicrous,” LaBarbera said.

LaBarbera moved for dismissal of all three counts after the prosecution had rested its case, claiming that none of them had been proved. Judge Weeks is expected to rule on the motion when the defense presents its case today.