City Hall Struggles to Meet Ethics Deadline : Government: Confusion reigns as 1,500 city workers race to fill out complicated financial reports. Critics say loopholes allow some officials to avoid scrutiny.

Confusion swept Los Angeles City Hall Friday as about 1,500 employees raced to complete detailed public reports on their personal finances and critics charged that key officials were escaping scrutiny because of loopholes in a new ethics reform law.

Friday evening marked the first time that top city executives and political aides had to file an expanded accounting of their personal income and investments under Proposition H, the ethics measure approved by voters last year after the controversy surrounding Mayor Tom Bradley’s personal finances. Elected city officials will have to file the new reports in April.

As the deadline neared, complaints and numerous questions arose over which employees are required to file the new forms and the type of detailed information to be included.

Getting clear answers has been difficult. The new Ethics Commission, which is charged with enforcing the law, still has no staff to field questions or offer guidance. The part-time commission, appointed last summer, geared up slowly. And this month, the executive director selected by the commission quit when the City Council refused to approve a $90,000-a-year salary.

Officials said the city attorney’s office and the city clerk’s office were being swamped with inquiries, even though neither has the authority to interpret the law for the Ethics Commission.

“It’s been very confusing . . . it’s become the major question of the day: ‘What box do I fill out?’ ” said Assistant City Clerk Pat Letcher, who was temporarily designated to collect the forms for the Ethics Commission.

Those who fought for the ethics reform law worried that one of the first major milestones of the new law was being marked by misunderstandings and controversy.

“You don’t want a state of confusion,” said Geoff Cowan, who chaired the citizens’ panel that drafted the law and pushed for the independent Ethics Commission. “The whole point was to make the law as clear as possible.”

Ethics Commission member Ed Guthman, a USC journalism professor, defended his panel’s efforts. “This is a strict law and we are trying to administer it without a staff,” he said. “Some of these problems are piling up, and they are going to pile up.”

The new city law significantly increased the personal financial data that elected officials and top employees must disclose. For the first time, those officials must report precise values of investments, the names of their stockbrokers, real estate holdings and loans outside the city, details of income earned by spouses and dependent children, and the names of business associates and partners. Even improvements made on personal residences must be described.

Employees can be fined $25 for each day they are late in filing the forms, although extensions can be granted.

City employees complained Friday that the disclosure requirements go too far, that the Ethics Commission’s new forms are ambiguous and that the reforms are not being fairly applied. For example, all employees of City Council offices, including secretaries and typists, must give detailed accounts of their finances and the income of spouses. Virginia Krueger, an aide to Councilman Zev Yaroslavsky, said she refused to put down her husband’s salary on her disclosure forms. “I have no idea what his income has to do with my job,” she said. “It’s gone way too far. I truly believe that it is an invasion of privacy.”

At the same time, some high-ranking city administrators and top aides to other elected officials were exempted from the new requirements, which are designed to expose conflicts of interest.

In City Controller Rick Tuttle’s office, only Tuttle and his chief deputy controller, Antonio Miera, must disclose the new detailed financial information. But Tuttle’s top political aide and administrative deputy, Barbara Friedman, is not covered.

“We knew that we would have to review this,” Guthman said, acknowledging that there may be problems. “We wouldn’t be able to get it perfect the first time.”

But he added that those who think the new disclosure requirements are an invasion of privacy “should not be in public service.”

In theory, all of those with “citywide” responsibilities are supposed to file the new disclosure forms. About 4% of the city’s 45,000 employees are covered by the disclosure law.

Citing the controversy, Yaroslavsky said he would propose changes in the ethics law to ensure that all key City Hall positions will be covered by the disclosure law.

Hundreds of forms were being collected late Friday by the city clerk’s office, which refused to make them immediately available. Elsewhere, managers in city departments were still collecting the forms for forwarding to the city clerk.

Meanwhile, the Ethics Commission met Friday and launched a new recruitment drive to hire its first employee--a staff director. Former California Common Cause director Walter Zelman rejected the job after the City Council voted to cut his proposed $90,000 salary to about $76,000.

Commissioners said they hoped to have a new director in place within a month, although they conceded that is an optimistic estimate.

Commission Chairman Dennis Curtis, a USC law professor, said the recuitment will move ahead as quickly as possible. “We are encouraging everyone to beat the bushes for us,” he said.

Guthman and other commissioners said the new agency, which was supposed to take on its duties Jan. 1, will be hobbled until an executive director is found. “If we don’t have a strong staff we can’t do our duty,” he said.

“Until we get a staff we are going to suffer. We’re not going to be able to do anything quickly until we get a staff.”

Meanwhile, Zelman, who describes himself as the “first, ex, almost Los Angeles ethics chief,” told reporters Friday that he is not surprised by the start-up problems the commission has encountered.

Times staff writer Andrea Ford contributed to this story.