Critics Question Worth of Year-Old Ethics Agency : City Hall: Loopholes left by council have impeded implementation. But the commission’s defenders say the group has turned the corner and point to some progress.

One year after Los Angeles’ heralded Ethics Commission was put in place, a cascade of legal and enforcement problems is prompting critics to question whether the agency can aggressively police City Hall corruption, conflicts of interest and campaign finances.

A pay raise for elected officials, including a $25,000 boost for City Council members, now seems to be one of the few things accomplished by the complex ethics reform package approved by voters in June, 1990, critics say.

“I think many people feel we were deceived. Council members got their pay increase and the public has gotten very little in return,” said Sherman Oaks homeowners leader Richard Close. “It was almost like a bait and switch.”

To overcome a crisis of confidence, the Ethics Commission will have to win an important City Hall corruption case, said several political scientists and neighborhood leaders.

“They need to prosecute a high-profile case,” said Harald Hah, of the South Burton Way Homeowners Assn. on the Westside. “It’s unfortunate, but they have got to get a really big fish and nail him.”

Ethics Commission President Dennis Curtis, a USC law professor, said the agency has initiated some investigations and plans aggressive enforcement.

“We are trying to get away from the nickel-and-dime stuff and concentrate on the really serious stuff,” he said.

Touted as the strictest, most comprehensive ethics law in the country, the Los Angeles ordinance was approved by 57% of the city’s voters after a scandal involving Mayor Tom Bradley’s personal finances and allegations of City Hall cronyism.

It sought to curb special-interest influence through partial public financing of city elections and to create an independent Ethics Commission with broad investigating and enforcement powers. It banned gifts, outside earned income and speaking fees for officials, and it toughened public disclosure rules for lobbyists, candidates and officeholders.

But transforming the reforms into reality has proved more difficult than passing the law.

After passage of the ethics package, along with a pay hike for elected officials, it was discovered that last-minute tinkering by the City Council had created confusion and gaping loopholes in the commission’s enforcement powers.

Councilman Michael Woo, who guided the ethics package through the council, said: “The City Council tried to sabotage the whole ethics reform by watering it down and putting loopholes in the law.” Other council members deny that, but concede problems were created by hasty changes.

Adding to the controversy, the city attorney’s office made strict interpretations of the law, ruling, for example, that a cup of coffee and a doughnut could constitute an illegal gift.

Since the Ethics Commission members were appointed last fall, the fledgling agency has had to battle legal challenges to public financing and disclosure regulations. The commission did not have any staff until this spring and no permanent offices until several weeks ago.

The latest blow came last month when a Superior Court judge temporarily halted detailed reporting of personal financial holdings by thousands of unionized city employees and a handful of other non-elected officials who challenged the law.

Responding to the cloud cast over the law, the Ethics Commission opted to suspend new disclosure requirements for many city commissioners, general managers and top political aides until the legal issues are cleared up at a trial next year, or by the City Council with new legislation.

The setbacks, some political experts say, suggest that the ethics agency could slip into a quicksand of court battles and bureaucratic minutiae and fall short of fulfilling the goal of ferreting out misdeeds and influence-peddling.

UCLA law professor Daniel Lowenstein, who advised a citizens committee that helped craft the ethics laws, said it is “hard . . . to be optimistic” about the course the city reform effort has taken.

Lowenstein, after having served 15 years ago as the first chairman of the state Fair Political Practices Commission, has concluded that political watchdog agencies often get bogged down in relatively minor, often unintentional violations. “The most important thing is to go after people who are really trying to do something wrong,” he said.

Ethics chief Curtis said: “There is a danger . . . of sinking into a morass,” but added, “We are determined to avoid it.”

Curtis and the ethics agency’s defenders point to some signs of progress:

* The commission now has an aggressive executive director, attorney Benjamin Bycel, and is building a young, spirited staff of ethics officers, investigators, auditors and support workers, these supporters say.

* Some investigations, which are required to remain secret under city law, are under way, officials said. And the commission is urging tipsters to report misuse of city property and other forms of corruption to a confidential telephone hot line.

* The commission, in its first public reports, offered fresh analysis of the workings of the city’s multimillion-dollar lobbying industry. Bycel said the commission plans more reports focusing on the links between money and politics, including campaign contributions and city business.

Bycel and commissioners also have tried to build political support in City Hall. Earlier this month, the council agreed not to review Ethics Commission decisions, a power vested in the council by Proposition 5.

Additionally, Council President John Ferraro says a consensus appears to be building for quick approval of the Ethics Commission’s proposals for fine-tuning the ethics law.

The Ethics Commission wants to clarify the panel’s enforcement authority, as well as the rules governing acceptance of gifts and disclosure of financial holdings by non-elected officials.

Under the proposed changes, officials would be able to accept small gifts, such as coffee and doughnuts at a meeting or a T-shirt from a Little League team. But a ban on tickets to sporting events, theater passes, trips and other large gifts from those dealing with the city would remain intact.

Councilwoman Ruth Galanter, who has criticized the ethics package as overkill, said she is encouraged by recent developments. “They’ve got an Ethics Commission made up of people that take this very seriously,” she said. “They are trying to create, instead of this absolutely unworkable monster, something that can work.”

There are signs that the reforms and the presence of the commission have had a subtle effect on the way business is done at City Hall.

Several officials, including Ferraro and Woo, said they have changed their behavior where it could pose the appearance of a conflict under the new rules.

“People want to take me to lunch and I don’t go,” Ferraro said, referring to developers and lobbyists. “I’ve had several invitations and I tell them we should just meet in my office.”

Bycel said his staff now regularly fields questions from elected officials, campaign consultants and employees about such matters--often advising against actions that “just don’t smell right.”

The ethics agency still faces major challenges. The partial public financing of campaigns, and related spending limits, could be ruled illegal under a case pending before the state Supreme Court.

In another challenge, former Councilman Arthur K. Snyder claims that he and other lawyer-lobbyists are exempt from financial disclosure requirements of the law.

Geoff Cowan, who headed the citizens committee that pushed the ethics reforms, said.

“I’m beginning to be optimistic about the commission. . . (that) with the support of the City Council it will be able to carry out the mission the people expected.”