Probe of Hubbell’s L.A. Deal Sought

Citing “apparent gross improprieties,” two members of the Los Angeles City Council are calling for an investigation of a contract won two years ago by Webster L. Hubbell, the former Clinton administration official now serving time in prison for mail fraud and tax evasion.

The request is being made by Councilwoman Ruth Galanter, and it has won the endorsement of Council President John Ferraro. Galanter’s request is expected to be voted on Friday. The request comes in response to articles in The Times last week raising new questions about Hubbell’s contract.

The Times reported that Hubbell’s work for the city fell far short of what he had claimed in two letters to city officials. The Times also reported that Hubbell won the no-bid contract after being recommended by a Clinton presidential appointee who had been Clinton’s top campaign fund-raiser in California.

Hubbell received the contract in August 1994 without competitive bidding and at the same time he was being accused of cheating his former clients and law partners at the Rose Law Firm in Little Rock, Ark. Hubbell was hired at the direction of then-Airport Commission President Theodore O. Stein to help with the city’s effort to persuade the U.S. Department of Transportation not to block the city from transferring $58 million from a Los Angeles International Airport fund to the city’s treasury.

Hubbell, a former mayor of Little Rock, was a law partner of Hillary Rodham Clinton in the Rose Law Firm. After Bill Clinton’s election as president, he appointed Hubbell as associate attorney general, the No. 3 position at the Department of Justice.

The Los Angeles deal would have paid Hubbell $49,500 over six months. But Hubbell actually received $24,750 because his contract was terminated effective Dec. 6, 1994, the day he pleaded guilty to the charges. Hubbell admitted bilking his former clients and law partners of $482,410 and evading $143,747 in federal income taxes. He is serving a 21-month prison term. In court papers filed Tuesday in Little Rock, Hubbell agreed to pay his old law firm $300,000 in restitution after his release from prison.

The formal motion by Galanter, whose district encompasses neighborhoods in the area of Los Angeles International Airport, said the “apparent improprieties . . . have raised serious questions as to the city’s involvement in this matter.” An investigation by City Controller Rick Tuttle is needed, Galanter said, “to assure that city contracts are awarded solely to further necessary city purposes and never, as alleged in this case, as a conduit of funds to political friends.”

Galanter wants Tuttle to “investigate and report to the City Council on the circumstances and events relative” to Hubbell’s arrangement, including “how this contract was awarded and monitored.”

Tuttle already has said that he would seek a reimbursement from Hubbell, based on what The Times reported last week. An aide to the controller said Monday that the office stands ready to accommodate Galanter’s request.

“We view it as a reasonable request,” said Deputy City Controller Tim Lynch. “We were already pursuing it. They’ve added a little bit to our scope.”

Tuttle had withheld any payments to Hubbell last year, until Hubbell and airport officials submitted documentation to verify that he did any work for the city. Those documents were in the form of the two letters that Hubbell submitted in March and July 1995 in an effort to get paid.