Local Elections : In West Covina : Non-Interest Loan Dominates Election

Leonard Eliot never wanted to be drawn into city politics, much less become a campaign issue. Serving dual roles as assistant city manager and executive director of the city Redevelopment Agency, he says his job is to work with politicians and avoid the rhetoric that gets them elected.

But with the April 12 election looming, a challenger for one of three City Council seats has made one of Eliot’s decisions last year the prime campaign issue. That decision was to allow a developer to repay a $567,264 debt to the Redevelopment Agency over a 12-year period without interest.

“I guess it’s not unexpected when it is election time and people are looking for issues,” he said. “But I stay out of the politics.”

In a campaign in which the two incumbents and five challengers agree on maintaining the current level of police protection, hastening the closure of the troublesome BKK landfill and controlling growth, the repayment plan has become a lightning rod for the challengers. The incumbents back Eliot’s decision, but the challengers have criticized it as well as the policy that allowed the decision to be made without council approval.

Challenger William (Bill) Tarozzi has made fiscal responsibility his main issue. That has rankled Mayor Kenneth I. Chappell and Councilwoman Nancy Manners, who are seeking reelection and say the accusations have hurt the city’s reputation.

“When you run for City Council, and you don’t know anything about it, you haven’t put any time into the community until the day you decided to run, you spend all your time trying to find Watergate things,” Chappell said. “Some of the literature put out by the non-incumbents has been detrimental to the city.”

Tarozzi, a self-described fiscal conservative, denies that he has been trying to dig up any dirt. “I didn’t raise any issues that weren’t already there,” he said.

The four other challengers--George Castro Jr., Bradley J. McFadden, James E. Schoonover and Severo Villamon Bantolo--have supported Tarozzi’s contention that Eliot’s approval of the repayment was improper.

At a campaign forum in March, Tarozzi charged that the council should have voted on the repayment arranged with Ziad Alhasson, one of the city’s most prominent and successful developers.

The city and Alhasson agreed to split cost overruns on land acquisitions stemming from the $30-million West Covina Village retail project, which was completed late last year. The city has already paid for all the overruns, so the repayment schedule approved by Eliot covers the portion Alhasson still owes the city.

Tarozzi said that if elected, he would seek to ensure that all such agreements be subject to a council vote.

City Benefit Cited

Eliot has said that the city will benefit from the agreement, and that Alhasson deserves financial considerations because he incurred more debt than first projected by luring to the village two big money-making establishments--the Seafood Broiler and Circuit City--that boosted the city’s estimated tax revenue by $100,000 annually.

By Eliot’s estimates, sales taxes from the project will be $1.8 million over the 12-year repayment period, far outstripping any lost interest from the debt. Eliot said he cannot understand the controversy, saying he approached the redevelopment project like any other.

“I don’t know if it was anything more than a misunderstanding of the redevelopment process,” he said. “If the council wants to alter policy, we’ll follow that too.”

Although it unanimously backed Eliot’s decision last week, the council approved a review of redevelopment policy. Council members said they may consider a process for ratifying future decisions to avoid controversies.

“I’m satisfied what was done was correct,” Manners said. “It’s very likely it would not have made a difference, but (council action) would have deflected some of the concerns.”

Despite the waves created over the repayment schedule, Tarozzi said the main issue in the election should be what he called an $18-million city budget shortfall over the last four years. He said the city has covered the deficits with reserve funds.

“When they start spending more than they are receiving, I think we better take a look at it,” he said. “You cannot continue to dip into your reserves.”

But Chappell and Manners and the two council members who are not running in this election have denied that the city is on unsteady financial footing.

Since 1984, West Covina has had a balanced budget and has not had to dip into its reserves, according to Basil Panas, city accounting manager.

From June, 1985 through June, 1987, the city’s reserve funds dropped from $19 million to $9.9 million, he said. But, he said, the money was loaned to the Redevelopment Agency, not used to balance the budget.

Chappell said that Tarozzi has improperly interpreted the city’s financial position. He called Tarozzi’s claim that the city has used the reserve funds to balance the budget “a bunch of malarkey.”

Chappell and Manners said most of the reserve funds have been loaned to the Redevelopment Agency. A small portion has been used to pay for fire equipment and other capital improvements, he said.

‘One of the Best’

“Financially, we’re one of the best cities in the valley, if not the county,” Chappell said.

Manners compared the reserve funds to a homeowner’s nest egg, set aside to make expensive repairs.

“If you’re making $30,000 a year, and you’ve got a little nest egg and the roof is starting to leak . . . you use that money to fix the roof,” she said. “So if you spend $35,000 that year, it doesn’t mean you’re deficit spending.

“We’re spending our savings at times and replenishing them at other times,” she said. “That’s what a contingency is for--you dip into it when you need it.”

But Tarozzi said: “They say they are using reserves and I say that they are spending their reserves, and if they continue that path we are going to be in serious trouble.”

Manners said she is “insulted” by Tarozzi’s claims. “To work so hard, and to do such a good job, and to have it impugned by somebody who wants to have a job is aggravating.”

Tarozzi, 54, a retired businessman, said he would like to put the brakes on redevelopment in the city.

Although he now supports the Lakes project--an office and Marriott hotel development slated to get under way April 6 after 10 years of setbacks--Tarozzi said as a councilman he could never back a project that took more than a decade to start.

“If a project comes on the drawing boards and they can show me that they will start paying back the city in three or four years, I will approve it,” he said. “If a project comes up and it will take 10 or 15 years, then I wouldn’t back a project like that.”

Late Tax Payments

At a candidates forum last week, Tarozzi was asked why he was consistently late in paying his business license tax when he owned Perino’s Liquor store. The store, which was bought by the Redevelopment Agency in January, was delinquent in paying its tax in 1977, 1979, 1980 and 1982 through 1987, according to city records.

Tarozzi said he paid the tax late to protest the city’s practice of earmarking a portion of the tax to subsidize the West Covina Chamber of Commerce.

Although the matter never entered legal proceedings, Tarozzi said he withheld payment “right down to the day when they were ready to take me to court.”

“I don’t feel that as a businessman in the city of West Covina that I should have to support or subsidize the Chamber of Commerce,” said Tarozzi. Tarozzi said he belonged to the chamber two of the 10 years he was in business.

In each of the last two years, the city gave about $300,000 of the $370,000 allotted for business improvement to the chamber for its work, city officials said.

“The problem I have with that is that the Chamber of Commerce is supposed to be an impartial body for the merchants of West Covina,” Tarozzi said. “But if something should come up before the council that might be conflicting, I don’t see how the chamber can make a rational decision when they are being paid by the city.”

While Tarozzi is making his first run for city office, Mayor Chappell has a long track record, having been on the council since 1968, serving as mayor six times. The mayor is not elected separately; the position is rotated among council members each year.

Chappell, 65, said the civic pride that prompted him to run in the 1960s still fuels his desire for reelection.

“The ideas that I started with 20 years ago, of bringing in more retail sales development, are coming true,” said Chappell, who owns Edgewood Insurance Service Inc. “When I first got on the council, (the city) was a bedroom community with a very high property tax.”

Now the city collects more than $8 million in sales tax, or one-third of the city’s $25-million operating budget, Chappell said. Under his stewardship, he said, the city brought in the Fashion Plaza mall, the city’s “restaurant row,” and five auto dealerships.

New developments, including the West Covina Village and the proposed Lakes project, will improve the city’s financial position further, he said.

But after 20 years of development, Chappell agreed with Tarozzi that it may be time to slow the pace.

“We won’t be doing any of these big projects anymore,” he said. “First of all, we don’t have the land to do it.”

First Councilwoman

If Manners is reelected to a second term, she is in line to become the next mayor. She became the first woman to serve on the council when she was elected in 1984, and would be the city’s first woman mayor.

Manners, a one-time municipal consultant and former Covina assistant city manager, said she has delivered on campaign promises to make government more responsive to the public.

“People know that when they call me, something will get done,” she said.

Manners sought to find out what residents wanted from city government when she sent out 900 surveys in September. She said 336 people responded.

Manners said the results indicated widespread satisfaction with the way the council has managed development. Of the respondents, 29% said they wanted more commercial growth in the city, 22% wanted less, and 41% said the current rate is fine, she said.

Challenger Castro has often stated that city government needs new blood.

“I am tired of seeing the same people running for office and being shoo-ins,” he said. “If you look at the board, Mayor Chappell has been in there for 20 years. . . . They sometimes tend to stagnate.

“The city of West Covina needs a better cross-representation, and I believe that the incumbents need to make room for new people and new ideas,” said Castro, a 37-year-old county Department of Children’s Services worker making his first bid for office in West Covina.

Castro has proposed a two-term limit for council members.

“It’s like the Presidency (of the United States). People should only be there for two terms,” he said. “I think there are people in the community who have as much or more experience that they could share in running the city.”

Castro and challenger Bantolo are running on limited budgets, according to campaign contribution statements released at the beginning of March. Each filed a short disclosure statement, indicating he had received $500 or less in contributions. “I want to run a grass-roots campaign,” he said.

No. 2 Fund-Raiser

But challenger McFadden has more to spend. He reported $13,440, slightly behind Tarozzi’s $14,332 in the early March expenditure statements. No candidate had raised more than Tarozzi.

McFadden, 32, a lawyer, said his legal training propelled him into politics.

“As a lawyer, I’ve been trained to deal with legal problems,” he said. “I became a lawyer because I want to serve in public office.”

Like Castro, McFadden has called for a change in leadership. “The city needs a diversity of people on the City Council to give personalized, independent views,” he said.

McFadden said the incumbents have become complacent, often approving city staff recommendations with little forethought to the effects.

McFadden has said he wants to control development in the city.

“I’m not against development, but I’m not going to rubber-stamp everything that comes through,” he said. “I don’t want to see the city of West Covina run rampant with high-rises on every corner and little stores popping up all over the city.”

Despite the attractions of the Lakes project, McFadden said he is leery about the benefits for the city. The lack of an arts or entertainment facility, such as a theater or a gallery, could dampen expectations that the project will become a major moneymaker for the city, he said.

Development is also a prime concern of challenger Schoonover, who has been a planning commissioner since 1977.

Schoonover, 40, said he got into the race only after two-term Councilman Forest Tennant announced that he would not seek reelection. Schoonover has since received a $500 campaign contribution from Tennant.

Citing the dwindling amount of open space in the city, Schoonover said he would advocate stringent standards on development to keep a mix of commercial and residential projects.

Pointing to his experience with city government, Schoonover said he would bring a stable but independent voice to the council.

“I haven’t been a rubber-stamp on the Planning Commission, and I will continue that on the City Council,” said Schoonover, who is acting administrative deputy for the Los Angeles County Public Defenders Office.

Bantolo, a Philippine immigrant who became an American citizen in 1982, got his campaign off on a high note last week when he sang a portion of his opening statement at a candidates forum.

The singing, he said, injected something new to the stately and slightly stale West Covina political scene.

“That’s how it’s been done in the Philippines,” he said. “You want to come across to people and tell how you stand.”

In part, the song went: “People/exploiting people/what kind of people . . . are we.”

His neighbors’ concerns about noise and pollution at the BKK landfill have been ignored by the City Council, he says, reminding him of governmental insensitivity in his native Philippines during the Marcos era.

Bantolo, 40, a computer programming instructor at Pacific Coast College in Whittier, is working on a master’s degree in business administration from Pepperdine University.

A political novice in this country, Bantolo said he doesn’t expect to win but is looking ahead to future elections.

“I know we have good leaders, but their view is different from someone who was born later,” he said. “My goal is to just finish fourth. That’s a good average in the race. It depends on the people if they want to move it up to three.”