Bernson’s Ocean-View Condo Deal Awash in Controversy

City Councilman Hal Bernson of Granada Hills said he negotiated a good deal on the purchase of a half interest in an ocean-view condominium from City Hall lobbyist Neil Papiano.

But as Bernson prepares to vote Friday on Papiano’s request on behalf of a client, to extend the controversial city lease of the Greek Theater, the real estate transaction has raised eyebrows.

“This is not out of line,” Bernson said.

In 1992, Bernson, Papiano and another couple jointly purchased an ocean-view condominium in Encinitas, near San Diego, for $350,000. At the time, Bernson owned 7% of the condo and said he used it once a month.

In a filing last week with the Los Angeles Ethics Commission, Bernson reported buying Papiano’s 50% stake in the condo for $140,000.

The San Diego County assessor’s office set the value of the property for tax purposes at $387,049 as of Jan. 1. Half of that would be $193,524, about $50,000 more than Bernson paid for a 50% interest.

“The assessor is all wet,” Bernson said. “It’s ridiculous.”

Bernson said another condo in the area sold about three years ago for $290,000.

“Do you think $140,000 is a sweetheart deal?” he asked. “I don’t think so.”

Bernson’s own statement of economic interest filed with the Ethics Commission for 1998 estimated the three-bedroom condo to be worth $360,000 at that time.

“He wanted out,” Bernson said of Papiano. “He wasn’t using it. And I agreed to buy him out,” Bernson said. “When you buy a property, it’s negotiable.

“I don’t have any [financial] interest with this man,” he said. “I’m going to decide the [Greek] case on its merits.”

*

HOME AGAIN: Los Angeles City Councilman Joel Wachs sees many advantages in moving his field office from Van Nuys to North Hollywood.

The new office is larger. It’s more modern. It’s near a freeway, providing easy access.

And it’s in his district.

That’s right, Wachs’ current field office in Van Nuys is not in his 2nd Council District, and hasn’t been even close for more than nine years, when gerrymandering moved the boundary a mile to the north.

Wachs’ field office is actually in the 11th Council District, represented by Councilwoman Cindy Miscikowski.

Now, because of construction at the Van Nuys civic center, there is a new urgency to move, said Arline DeSanctis, a Wachs aide. “With all the work going on there, we really need to relocate,” she said.

Wachs is asking the City Council this month to approve a new lease so he can open his field office at 6350 Laurel Canyon Blvd., near the 170 Freeway.

Glenn Barr, a spokesman for Miscikowski, said she has not been bothered by having Wachs’ field office in her district.

Noting that some 11th District residents go to Wachs’ office for help, Barr quipped, “Under the circumstances, it doesn’t hurt to have him in the district if he is reducing our workload.”

*

CONFLICT II: Every once in a while, there is a direct connection between Spring Street, the home of City Hall, and Wall Street.

Such is the case as the City Council in coming months will decide the thorny issue of whether cable television franchises should be opened to all companies providing high-speed Internet access.

The approach of the issue appears to have triggered among council members a sell-off of stock in companies providing Internet service, according to economic interest statements filed this week with the city Ethics Commission.

Among sellers, Councilwoman Laura Chick of Tarzana sold $7,443 in MCI stock on Sept. 24, and Councilman Mike Feuer sold $10,000 in America Online stock in April.

Assistant City Atty. Tony Alperin said, in general, once an elected official sells stock on the open market, the potential for a voting conflict of interest on issues involving that company no longer exists.

*

GENERATION GAP: Los Angeles City Councilman Alex Padilla, 26, seems to have overcome his discomfort at mention of his youth.

Presenting a proclamation last week to mark the 25th anniversary of the rock band Los Lobos, Padilla joked, “It’s a band that has been around almost as long as I’ve been alive.”

*

TRASH TALK: With a vote on the Sunshine Canyon Landfill just around the corner, Councilman Bernson is scrambling to find scraps to toss into the machinery, hoping the council will kill expansion of the dump into his northwest Valley district.

A month ago Bernson had little hope of beating back Browning-Ferris Industries, the giant company seeking to expand the landfill. The council was poised to OK BFI’s plan, making way for 55 million tons of garbage alongside a residential neighborhood in Granada Hills.

But then the city attorney’s office dispensed a bit of legal advice, handing our latter-day David of the 12th District a big rock to hurl at his trash-dumping Goliath.

The city was counting on receiving payments from BFI out of the money the company charges haulers to dump in the landfill. The landfill already operates on county land outside the city’s borders--and pays 10% of the fees to the county.

Under a similar arrangement, the city would have collected $3 million to $4 million annually, according to Deputy City Atty. Keith Pritsker.

But the city can’t just grab a slice of the pie, Pritsker said. Proposition 218, a tax-cutting initiative passed by voters in 1996, prohibits it. The law requires new taxes--even for garbage haulers--be put to a public vote.

“Everyone’s jaws kind of dropped,” said Greig Smith, Bernson’s chief deputy. The councilman quickly mounted an offensive, lobbying his colleagues for a no vote on the expansion.

“We would get all the pain and all of the headache, and none of the money,” Smith said. “Obviously, the council said, ‘Wait a minute.’ ” In a surprise move, the council put off voting on the controversial expansion until Oct. 26.

“I think this will go a long ways for giving us the kind of ammunition that we need to win this case,” Smith said this week. “If there’s no financial benefit to the city, why do it?”

Not so fast. Bernson stands to gain by tripping up the garbage giant any way he can, but there’s more than one way to widen a landfill--especially for a company that spent nearly $350,000 lobbying City Hall.

The city could still get its share by giving BFI a franchise to operate the dump, said Pritsker, who is now drafting an ordinance to do precisely that. Proposition 218 does not apply to franchises, giving the city leeway to decide how much to charge the company annually.

“That certainly helps their cause,” Smith conceded. Councilman Feuer has proposed that any franchise agreement include at least $6 million per year for the city. BFI, for its part, is hoping for a financial deal similar to the one it has with the county.

“From an industry standpoint, 10% seems to be the standard,” said Arnie Berghoff, a spokesman for BFI. “That’s our expectation.”

*

McGreevy is a Times staff writer, and Fox is a Times Community News correspondent.