Mayor Quits S & L Post, Creates Ethics Panel : Bradley Moves to Dispel Any Doubts About His Integrity After Narrow Reelection Victory

Mayor Tom Bradley moved quickly on Wednesday to rid himself of the conflict-of-interest questions he said damaged his successful reelection campaign, resigning as a paid director emeritus of Valley Federal Savings & Loan Assn. and creating a commission to seek a new ethics code for the city.

Bradley spoke at a City Hall news conference the morning after he barely won an unprecedented fifth term in a primary election he had expected to be an easy triumph. His 52% margin was far below his 63.8% in 1981 and his 68% in 1985.

“I think unquestionably the issues that have been raised over the course of the last three weeks have raised some doubts on the part of some people,” he said, “and I want to put aside all such doubts.

“You know I treasure more than anything else that bond of trust that has been established over 47 years of my service to the people of this city and I want nothing to tarnish it, nothing to question it, nobody to doubt it.”

The 71-year-old mayor’s admission that the electorate had doubts about his integrity was a reversal for Bradley. For the last three weeks, he had strongly defended his Valley Federal board membership and his paid consultantship to Far East National Bank. The bank held city deposits and Valley Federal financed subdivisions that needed city zoning approval.

But at 6 p.m. Tuesday, Deputy Mayor Mike Gage telephoned attorney Geoffrey Cowan, former chairman of California Common Cause and a respected figure in Los Angeles liberal circles, and asked him to head the ethics panel.

Gage was the architect of Bradley’s early campaign comeback when the mayor, after showing weakness in public opinion polls a year ago, took strong stands on some hot issues. That helped force City Councilman Zev Yaroslavsky out of the mayoral race, removing a potentially strong foe.

Gage’s role in calling Cowan showed he was taking command of this comeback attempt, too.

And Wednesday morning, before the press conference, another decision was made--to quit the Valley Federal board.

That chronology of events, and the mayor’s frank press conference admission, pointed up the importance he and his political advisers place on the furor over his financial house connections.

City Council members, political consultants, Bradley aides and a Times survey of precincts in key areas offered other reasons for a showing so weak that supporters were left shocked and silent for a time at what had been planned as a Biltmore victory gala Tuesday night. Among them were:

--Weakness in predominantly white residential areas, ranging from blue collar to affluent, which have been involved in disputes with the city over quality of life issues. For example, according to a Times analysis of selected areas, Bradley lost the area around the Pacific Palisades oil-drilling site proposed by Occidental Petroleum Corp. He was beaten by the combined votes for City Councilman Nate Holden and former Los Angeles County Supervisor Baxter Ward in a Lake View Terrace neighborhood in the San Fernando Valley. In Sylmar, a center of homeowner discontent, he also trailed the combined Holden-Ward totals.

But the Times analysis showed Bradley held strong in his traditional base, largely black South-Central Los Angeles. In precincts studied there, the mayor beat Holden easily in a battle of two black political leaders.

--Overconfidence. Gage said the mayor told him in January, after Yaroslavsky had dropped out of the race, that he did not want to spend any campaign contributions on television advertising. In fact, the mayor insisted, he hoped to save $1 million, which he would give to charity.

--Low voter turnout, part of a trend of reduced participation in city elections, exacerbated by voters’ perception of a one-sided race. Just 23% of the registered voters went to the polls, the smallest turnout in a mayoral race in at least 32 years.

“Basically, if you read the L.A. Times and all the other media, you read that the election was over, so if you were for Tom Bradley, why bother,” said political consultant Joe Cerrell.

--News accounts of mismanagement in Bradley’s Housing Authority, which had the effect of crystallizing longstanding criticism of the Administration’s ability to provide housing for the poor and to solve the problem of growing numbers of homeless on the streets all over the city.

Although the mayor said his fifth term would mark a “a beginning of our ideas for the future,” interviews with City Council members indicated the narrowness of his margin may make it hard for him to push through some of his pet plans. It also stirred speculation that Bradley would be vulnerable to challenge from several rising young politicians should he decide to seek another term in 1993.

“The influence of the mayor may diminish a bit,” said Council President John Ferraro, who ran against Bradley in 1985. “He always had a 65% margin, but he doesn’t have that now. He can’t take the council for granted anymore.”

This month, Ferraro initiated a complete reorganization of City Council committees, designed to give the legislative body more influence over policy-making in the environment, planning, redevelopment and other major issues.

Councilwoman Gloria Molina said: “It’s an opportunity for the council to take a leadership role. In the two years I’ve been on the council, the mayor only talks with us when he needs something. (Now) he and his people will have to approach us differently.”

Councilwoman Joy Picus, reelected in her West San Fernando Valley district, said: “In truth, the mayor has never demonstrated a lot of leadership with the City Council. The astonishing events of Tuesday will empower the council.”

But strong Bradley supporter Councilman Marvin Braude said that kind of talk “was some of the most self-serving statements I’ve ever heard. The council has always had the power. The mayor has never opposed any initiatives of the council. Quite the contrary.”

The council is considering whether to investigate Bradley’s connections with the financial institutions. City Atty. James K. Hahn is already investigating the matter.

Officials at Valley Federal, who have paid Bradley for his service as a director since 1978, had little reaction to the mayor’s resignation. “We’re sorry to see him leaving,” said spokesman John Marquis. “We really have no comment.”

Bradley said he waited until after the election to resign because his decision was a personal one, not political.

“It is a decision which reflects my determination to hold my office to the highest standards possible,” the mayor said. “. . . A new time demands a new policy--not only on my part, but for all of city government.”

The surprise announcement followed a Times report on March 31 that Bradley had approved of land-use ordinances that permitted a subsidiary of Valley Federal to develop two housing tracts in Los Angeles. Bradley, who was paid $1,500 a month as director emeritus and collected more than $100,000 overall since joining the board, said he was unaware of Valley Federal’s interests in the projects before they were called to his attention by a reporter.

The ethics panel proposed by Bradley will discuss “appropriate sources of income” for elected and appointed city officials, preventing city commissioners from doing business with the city, imposing new City Hall lobbying rules, toughening disclosure regulations and creating a new ethics enforcement body.

Cowan, who accepted the position Wednesday, said he would add the word “tougher” to the mayor’s plans to draft a clearer city ethics policy.

“I think this is a terrific opportunity for the city,” Cowan said. “I think there are serious ethics problems in this as in other cities. The recent discussion of the problems that the mayor has had creates an opportunity for the city to establish an ethics code which would be the most effective in the country.”

Bradley’s resignation from the Valley Federal board was applauded by Councilwoman Joan Milke Flores.

“I know he works very hard, but with a city that is this busy and this diverse and with this many communities, I think the job as mayor is more than full time,” Flores said. “The mayor was wise to decide that maybe he needs to spend even the little time he was diverting to something else . . . back on the city, let alone if he was being paid and there might have been a conflict.”

But Bradley’s proposed ethics panel was greeted with skepticism by Yaroslavsky.

“A blue-ribbon commission is unnecessary and might be construed by some as deflecting the issue,” Yaroslavsky said. “Some serious issues have been raised (regarding Bradley’s financial ties) and they ought to be dealt with immediately in a legislative fashion.”

Yaroslavsky said he will introduce a City Council motion that would ban all city officers from earning outside income. Any ethics policy drafted by the committee must be approved by the council and the mayor.

Bradley also served as a paid special adviser for Far East National Bank last year at a time when the Chinatown bank held more than $1.5 million in deposits from two city departments. The mayor in March returned the $18,000 paid him when he said he learned for the first time about the city investments with Far East.

Times researcher Cecilia Rasmussen assisted in the preparation of this story.

Related Stories: Part II, Pages 1 and 3.