Builder Accused of Influencing Council Elections : Politics: Group that spent $17,000 to endorse three candidates received funds linked to the developer of a controversial project.

SIGNAL HILL — In a town where City Council candidates often win with less than $1,000 in their campaign coffers, Concerned Citizens of Signal Hill spent more than $17,000 last spring to support three candidates, campaign finance statements show.

More than half of that money came from a political action committee that received $27,500 from a development company with a large project pending before the city.

The barrage of campaign flyers and mailers distributed by Concerned Citizens sparked a controversy in this town of 8,000 people, where critics allege that the development company, Southwest Diversified Inc., attempted to indirectly influence the last election.

“I knew Concerned Citizens wasn’t spending its own money. And the only people who had a vested interest was Southwest,” said Jessie M. Blacksmith, one of two former council members defeated in the election.

Concerned Citizens supported Sara Dodds Hanlon, Mike Noll and George E. Papadakis for three at-large seats last April. Dodds Hanlon and Noll won, defeating Blacksmith and Louis A. Dare. Councilman Richard Ceccia was the only incumbent to retain his seat.

Southwest, an Orange County-based development company, donated $27,500 to the political action committee Southern California Caucus, according to recently filed campaign statements. Southern California Caucus, in turn, donated $10,000 to Concerned Citizens of Signal Hill, a powerful neighborhood group that supported candidates who were willing to renegotiate with Southwest on its proposed development project, which had been cut back by the City Council.

Then, as now, representatives from both Concerned Citizens and Southwest denied any connection between them.

Pike Oliver, a vice president at Southwest Diversified, said his company chose to donate to Southern California Caucus because it is a broad-based coalition that supports “all kinds of efforts relating to business issues.” Southwest did not tell the political action committee how to spend its donation, he said.

But critics who worry that pro-development forces are out to take over the tiny town are skeptical.

“There’s no way now they can say they didn’t try to influence this election,” said Councilwoman Carol Churchill, who was not up for reelection last spring. “They were trying to conceal what they were doing.”

Ceccia agreed. “I always felt Southwest Diversified funded the campaign for the opposition--given the number of mailers and the amount of money spent.”

Concerned Citizens reported spending $17,245. All seven candidates spent a total of about $21,000 on their campaigns.

Churchill and other critics said that by donating money to a political action committee rather than the individual candidates, Southwest officials legally circumvented the city’s strict campaign finance limits--candidates may not accept more than $250 from one source during a four-year period.

Oliver denied attempting to funnel money indirectly to candidates.

“I’m not aware that anybody has done anything that is unethical, so I don’t understand what the concern is,” he said. “Sometimes, developers are convenient targets for people’s frustrations.”

Southwest’s project became the focus of the heated race.

The incumbents campaigned on a platform of keeping a lid on growth in the city, which is surrounded on all sides by Long Beach. The City Council had cut Southwest’s proposed development for the area known as “the hilltop” to less than half of the 1,200 units originally planned.

The three candidates endorsed by Concerned Citizens, as well as candidate Bill Miller, said the council had mishandled its negotiations with Southwest. All four said they would consider renegotiating the plan.

Larry Forester, president of Concerned Citizens, denied that his group and its 300 members were controlled by the developer. Concerned Citizens sought money from Southern California Caucus without knowing that the developer was donating to the political action committee, he said.

Carl Proctor, a Concerned Citizens vice president, said: “Southwest didn’t use Concerned Citizens. Concerned Citizens was born out of the fact that it was fed up with the way the City Council was running everything. We wanted parks, new homes, better streets and better water, and the council wasn’t providing any of that.”

Tim Carey, executive director of Southern California Caucus, said his group’s 30-member board decided to donate to Concerned Citizens because its goals were similar to those of the pro-business group.

He also told Southwest, when he asked for donations, that the caucus planned to contribute in the Signal Hill races, he said.

“We don’t hide the fact of who we are going to help,” Carey said. “We had selected our candidates before Southwest Diversified came on board with us.”

Southwest gave the caucus $22,500 on April 20 and $5,000 on May 4. The same day it reported receiving the first donation from Southwest, Southern California Caucus gave $10,000 to Concerned Citizens.

Two of the candidates who apparently indirectly benefited from that donation, Dodds Hanlon and Noll, said they were unaware of the contribution. Papadakis could not be reached for comment.

Both Dodds Hanlon and Noll said they were surprised by the amount of money spent by Concerned Citizens, adding that the group acted on its own and did not represent either of them.

“I’m kind of shocked that much money was involved by any one group,” Noll said. “I don’t have any control or take any money from any of these groups.”

Both new council members also said that they have acted independently on all decisions concerning Southwest. The council has been discussing in closed meetings issues affecting the development of Southwest’s 125 acres.

Council members Ceccia and Churchill said they are concerned the developer seems to be winning some concessions that it would not have won under the old council. But Noll, Dodds Hanlon and Southwest officials described the pending issues, from view protection to landscaping, as small technical matters that needed ironing out.