Local Elections : Costly, Bitter Campaign : Ex-Norwalk Officials Heat Up Council Race

This year’s campaign for City Council is the costliest and perhaps the most bitterly fought race in the city’s 29-year history.

Seeking reelection April 8 are Mayor Marcial (Rod) Rodriguez, 53, and Councilmen Cecil Green, 61, and Lou Banas, 39. Six challengers include two former city officials who were forced from office by the current five-member council.

They are former City Administrator William H. Kraus, 47, who resigned under fire in 1983 after a decade in office, and Grace Musquiz Napolitano, 48, a 12-year member on the city’s International Friendship Commission who was removed from that panel by the present council in 1984.

While Kraus and Napolitano denied they are seeking political revenge, the intensity of the campaign has been unusual in this city of 85,232, where no council member has lost a bid for reelection since 1958.

Banas flatly admits that without Kraus and Napolitano in the race, “the incumbents would walk in with relative ease.”

‘Trust Our Judgment’

Regarding the forced departure of Kraus and Napolitano from city government, Banas said, “The people are going to have to trust our judgment that we made the right moves.”

Four other challengers are on the ballot: Bob Espinosa, 32, a lawyer; Louis C. Krebs Jr., a 41-year-old mechanic; William Brady, 48, a businessman, and Guy Churchouse, 39, a lawyer.

The incumbents have raised and spent thousands of dollars to win reelection to four-year terms that pay only $622 a month.

The latest campaign finance reports on file say that, as of Feb. 22, Green had raised $35,205 and spent $11,418, Rodriguez had raised $16,679 and spent $12,147, while Banas had raised $11,016 and spent spent $5,595.

In past council elections, Rodriguez holds the record for campaign contributions with $9,285 in 1982, and for campaign spending, with $9,056 that same year.

All three incumbents have accepted contributions from firms that do business with the city.

$2,500 From Cable Firm

Green’s largest contributors include $2,500 from Falcon Communications of Pasadena, which holds the city’s cable TV contract; $2,000 from Norwalk Toyota, which last year in expanding its business purchased a small piece of property that was condemned by the city’s redevelopment agency, and $1,250 from R. F. Dickson Co. of Downey, which holds a contract to sweep Norwalk streets.

Rodriguez’s campaign chest includes $1,100 in contributions from Mullikin Medical Center of Artesia, which provides medical care under a group plan for city employees, and $1,000 from Aquire Corp. of Norwalk, an auto auctioneer that leases property from the city.

Banas’ contributions include $1,000 from Consolidated Disposal Service Inc. of Santa Fe Springs, a firm that has a contract with the city to haul trash, and $1,000 from Keystone Ford Inc. of Norwalk, a firm that has sold cars to the city.

Among the challengers, as of Feb. 22, Napolitano had raised $21,204, including $15,300 that she has loaned her campaign. She had spent $16,442, according to city records, while Kraus had raised $869 and spent $462.

As of Feb. 22, Espinosa had raised $2,213 and spent $1,896, while Brady, Krebs and Churchouse all filed papers that said they plan to raise and spend less than $500 during the campaign.

Rodriguez and Banas--both elected to the council for the first time in 1982--said they should be reelected because of the success of the city’s 2-year-old redevelopment program. Since 1984, the council, sitting as the city’s redevelopment agency, has approved $39 million in new development, including shopping centers, condominiums and apartments, and a renovation of stores along Front Street.

Price Club Lured Away

Last December, in a major move, the agency enticed the Price Club to move from Cerritos to Norwalk. When the store opens in August, it is expected to provide the city with $800,000 in annual sales taxes, said Michael Wagner, the city’s redevelopment director.

In the past two years, the council also has given preliminary approval to $90-million worth of new development. The projects include an eight-story hotel and office complex on the former Wright School property, a major expansion of the Paddison Square shopping center, and the addition of a Ralphs grocery store that will occupy the former Zodys department store building on Imperial Highway, Wagner said.

“We’ve started building a new Norwalk,” said Rodriguez, a salesman for the Prudential Insurance Co.

“The Price Club was a major coup,” said Banas, a customer relations manager for General Telephone of California.

Green, a council member since 1974, said he doesn’t always “see eye to eye” with other city officials on redevelopment, including Rodriguez and Banas. Last year, Green, a planning and zoning consultant for real estate developers, unsuccessfully lobbied other council members for a master plan to oversee the city’s development in a “more businesslike fashion.” In a recent interview, Green said the plan is still needed. He said he also favors appointing a residents committee to act as an advisory board on redevelopment.

In an interview, Green said one reason why he should be returned to office is experience.

‘Good Rapport’

“I have a good rapport with assemblymen, senators, congressmen and judges,” Green said. “That’s experience that you can’t buy.”

The two most prominent challengers, Napolitano and Kraus, have criticized the incumbents for a variety of reasons.

Kraus said he wants to unseat Banas because the council member has engaged in “power politics” that have spread an atmosphere of “fear and mistrust” among employees at City Hall.

Banas denies the charges, and said Kraus is “not an honest man” who “took this city through hell and back once and he’s attempting to do it again.”

Kraus resigned in 1983 as Norwalk city administrator after a highly critical report raised numerous questions about his personal business dealings. The report was written by a Los Angeles lawyer hired by the city to investigate allegations against Kraus made by city activist Ed White. Of the incumbent council members, Banas was the most active in pushing for the investigation.

The investigation centered on Kraus’ dealings with convicted criminals and a number of loans that Kraus had defaulted on. The report said Kraus might have committed a crime when he used a property deed that he had no financial interest in as collateral to borrow $27,000 from a San Diego bank in 1978. But no charges were ever brought against Kraus.

Federal Indictment

Kraus also is under federal indictment in San Diego for 23 counts of mail fraud as part of what a federal prosecutor said was a sophisticated eight-member fraud ring that allegedly conspired to bilk a dozen investors out of more than $1.4 million. Kraus maintains that he is innocent. The case is not expected to come to trial until August.

According to Deputy Dist. Atty. Candace J. Beason, Kraus also is under investigation by the district attorney’s office for a possible conflict of interest while he was city administrator and deputy treasurer of the Joint Powers Insurance Authority.

The district attorney is investigating whether Kraus had a conflict of interest in 1982 when he deposited $100,000 of the insurance consortium’s money in California First Bank in Woodland Hills for a lower-than-market interest rate. Within days of that deposit, Kraus, along with a business associate, obtained personal loans for $60,000 without any collateral, Beason said. The investigation is expected to be concluded April 1, Beason said Thursday.

Kraus said he did nothing wrong and that the deposit and loans at California First Bank were unrelated. He questioned the timing of the investigation of a 4-year-old incident. Kraus also charged that Banas and White have manipulated his personal financial difficulties to maintain a “campaign of smear and harassment” against him.

Napolitano has made the council’s travel expenses the centerpiece of her campaign. In an interview, she said council members are wasting taxpayers’ money by taking their spouses and other city officials on trips such as a $22,904 conference last Oct. 6-9 in San Francisco sponsored by the League of California Cities.

‘No Longer in Touch’

“They (the incumbents) have been in there too long, they’re no longer in touch with the people,” Napolitano said in a recent interview. She was removed from the city’s International Friendship Commission because council members said she was interfering in the politics of Hermosillo, Mexico, Norwalk’s sister city. Napolitano, however, said she was removed because council members knew she planned to run for City Council.

Among the challengers, Espinosa and Krebs have previously run for council. Espinosa made an unsuccessful council bid in 1984, finishing third out of 13 candidates to council members Bob White and Peg Nelson. In an interview, Espinosa said he is running to offer residents “a more sophisticated approach” to problems facing the city. Espinosa said the city needs a master plan for development because it now looks like a “hodgepodge” of small shopping centers.

Krebs, a mechanic for Gemstar Inc. of Wilmington, is running because “I think the city needs some new blood.” He ran for the council in 1984, finishing 12th. A member of the city’s Blue Ribbon Commission, Krebs said he wants to improve the city’s recreation facilities for children.

Churchouse also is a member of the city’s Blue Ribbon Commission, a residents advisory board. He complained that the council does not listen to the advice of commission members. He said that, if elected, he would work to attract more business to the city.

Brady is the owner of W. M. B. Service of Norwalk, which sells and services machinery, tools and supplies. He said he is running because he is angered by the council’s expenditures of $87,019 on travel and meeting expenses in the 1984-85 fiscal year. “There’s no excuse for mismanagement of public funds,” he said.

The incumbents, however, have defended the travel expenses, saying the money was used to promote the city and lobby for legislative programs that would benefit Norwalk.

“That’s money well spent,” Green said.