Mayor Says He Did Not Influence Contract

Mayor Tom Bradley denied Wednesday that his administration helped steer a prized contract to the company of one of his biggest political contributors.

During a City Hall press conference, Bradley disputed the sworn testimony of political contributor Ira Distenfield, who resigned Tuesday from the Harbor Commission amid media inquiries about his role in the city’s 1985 award of a $235-million underwriting contract.

Distenfield had testified before a confidential New York Stock Exchange arbitration panel in 1987 that Smith Barney, Harris Upham & Co., his employer at the time, had secured the lion’s share of the funding for the city’s LANCER trash-to-energy contract because of his political connections to Bradley.

The mayor said Wednesday that he knew nothing about Distenfield’s testimony, and he denied exerting any influence to help Smith Barney win the contract to sell bonds to finance the LANCER project, which ultimately was not built.

“I never heard of that,” Bradley said of Distenfield’s version of the LANCER decision. “I saw it in the newspapers for the first time today. I can assure you there was no such influence by me or my office.”

Bradley said he was also unaware that former Deputy Mayor Tom Houston had testified on Distenfield’s behalf at that same arbitration hearing. Although members of the arbitration panel have told The Times that they believed that Houston was representing the city, Bradley said his former aide testified as a private individual and acted without his knowledge.

Houston said Wednesday that he could not recollect telling Bradley about his testimony.

“I have no memory of ever discussing it with the mayor,” Houston said. “It was a dispute between Smith Barney and Ira Distenfield. I was asked to give my perspective.”

The mayor said he learned of Distenfield’s decision to leave Tuesday after receiving a facsimile transmission of the resignation letter.

“It came as a surprise to us,” he said.

Distenfield said he was departing after citing media inquiries that “imposed a burden upon my family that I have no right to ask them to bear.” He complained specifically about a reporter questioning his former wife.

Distenfield first appeared as a political player in the Bradley Administration in 1985. As a donor to Bradley’s reelection campaign, he eventually raised more than $86,000 in cash contributions for the mayor. He later was appointed by Bradley to serve on the Telecommunications Commission as well as the Harbor Commission.

The LANCER competition, played out largely in 1985, was one of the fiercest in city history and escalated after the City Council bypassed a review panel’s recommendation that Salomon Bros. Inc. and Merrill Lynch Capital Markets be named as the lead firms in the bonding contract.

Comrie’s Recollection

Chief Administrative Officer Keith Comrie recalled Wednesday that soon after the recommendations were made, a concerted lobbying effort was launched that “knocked out” Salomon Bros.

According to Councilman Zev Yaroslavsky, chairman of the Finance Committee, the lobbying effort involved two of the mayor’s top aides, Houston and Fran Savitch, who relayed Bradley’s objection to Salomon Bros.

The mayor contended that 14% of stock in Salomon Bros.’ parent company, Phibro-Salomon, was held by Minerals and Resources Corp., which had business ties in South Africa.

“There was a big whisper campaign against Salomon that nobody could fight, and when you took the No. 1 firm out of the race, it became a confusing free-for-all on the council floor,” Comrie said.

Experts Rebuffed

The council’s Public Works Committee, chaired by Councilman Gilbert Lindsay, rebuffed the city’s experts and picked Smith Barney and E. F. Hutton as its favorites--bypassing the three higher-ranked firms.

Eventually, the full City Council voted 11 to 3 to ratify the Lindsay committee recommendation.

Although some council members credited other Smith Barney lobbyists--not Distenfield--for the political turnaround, Distenfield insisted during his arbitration hearing that it was his political ties to Bradley that made the difference.

Distenfield has not responded to requests by The Times for interviews.