Dual Role Raises Lobby Questions

For four months, the Rose & Kindel lobbying firm had unusual access to Los Angeles Unified School District policymakers: It worked for the school system it also was being paid to lobby.

District officials hired Rose & Kindel in March to run a $100,000 campaign to educate voters about a $3.3-billion school construction bond measure on the Nov. 5 ballot. Until last month, the powerful firm also represented construction companies, developers and consultants seeking contracts with the district.

Though there was nothing illegal about the way Rose & Kindel lobbied for both sides, some school board members and ethics experts say the arrangement is a strong argument for tougher rules on lobbying and potential conflicts of interest in the nation’s second-largest school district.

The district does not track or register lobbyists, and the rules it has are not enforced consistently. In 1998, school officials called for a filing system to be set up to track lobbyists, their clients and their fees, but the proposal was delayed for lack of funding.

Few school boards have detailed lobbyist disclosure rules unless they are affiliated with county or municipal governments. The independent school districts of San Diego, Sacramento and San Francisco, for example, do not have lobbyist registries. New York’s, as part of city government, does.

But Jim Knox, California director of the political watchdog group Common Cause, said L.A. Unified, which controls more than $9 billion a year, is too large to have toothless disclosure rules.

“Any agency that controls such a large amount of public funds is going to be subject to tremendous lobbying pressures,” said Knox. “And it’s important for the public to know where that pressure is coming from and how interest groups may be using money to gain unfair advantage.”

Several of the companies Rose & Kindel represented stand to make millions if voters approve the construction bonds, intended to finance 120 new school buildings and 79 campus expansions in the next five years.

As a result of inquiries made by The Times, however, about its simultaneous relationship with L.A. Unified and aspiring district contractors, Rose & Kindel issued a July 15 letter saying it was “terminating our representation of clients before the district in favor of working exclusively for the district.”

“We do not want even a perception of conflict to interfere in any way with the objective we share with the district,” wrote the firm’s president, Maureen A. Kindel, who, with co-founder Cristina Rose, expanded the company’s influence after she served in Mayor Tom Bradley’s administration.

She insisted that her firm had never represented both sides on an issue.

But school officials acknowledged that Rose & Kindel had represented two firms seeking construction management contracts to be funded partly by the bond issue while the lobbying firm also worked on the bond campaign.

Rose & Kindel lobbied L.A. Unified personnel on behalf of Parsons Infrastructure & Technology Group Inc., which won a $29.9-million contract, and a joint venture of 3D International Inc. and URS Corp, which was awarded a $14-million job.

District staff members then recommended the two joint-venture firms for an additional $20.6-million contract. But that was put on hold after The Times disclosed that the Baltimore County school system had terminated a large contract with 3D International because of alleged management problems.

Supt. Roy Romer argued that, strictly speaking, he hadn’t hired Rose & Kindel to be a district lobbyist on construction bonds because the firm was providing information, not advocating before government agencies.

L.A. Unified used a $100,000 grant from the billionaire SunAmerica chairman, Eli Broad, to hire Rose & Kindel for the information effort. Under state campaign laws, public agencies are entitled to fund educational outreach efforts on ballot initiatives, as long as they are not overtly political or persuasive in nature.

“They’re not lobbying for us,” Romer said of Rose & Kindel. “I just hired them to help us build a network of opinion-makers.”

Nonetheless, while working on the information campaign, Maureen Kindel in July arranged for a fund-raiser at the exclusive California Club downtown to raise money for passage of the bonds. And Romer acknowledged that he had made fund-raising calls from Rose & Kindel’s offices.

Kindel said she saw no problem with arranging for the fund-raiser. “I did it as a nice gesture, as a member of the California Club,” she said.

The firm’s other activities included educating such public officials as Sheriff Lee Baca and groups like the League of Women Voters about the bond measure, Kindel said. She tried to convince them that the district has changed for the better and is hiring skilled professionals to buy property and to design and build schools.

“I know a lot of people, and people answer my phone calls,” said Kindel. “People know I’m credible, and the district needs that.”

Rose & Kindel’s contract with the district ended last month. Now it is working for the nonprofit Alliance for Neighborhood Kids on an avowedly political campaign in support of the bonds.

To one school board member, Genethia Hudley-Hayes, all this overlap adds up to a problem. “The bottom line is that it’s a conflict of interest for Rose & Kindel to be working for the district and have clients trying to lobby the district,” she said.

Board President Caprice Young, however, denied that lobbying arrangements had led to undue influence or favoritism.

The district’s ethics officer, Peter Bowen, said he had not heard of Rose & Kindel or vetted its contract with L.A. Unified. In general, though, “People who are acting as a lobbyist for us are not supposed to be lobbying to us.”

He said he was drafting guidelines on what constitutes lobbying.

Such ethics guidelines have grown in importance as the bond campaign has gained steam. Although voters passed a similar $2.4-billion ballot item in 1997, many were angered later by the district’s mismanagement of some school-repair funds. Both proponents and opponents agree that the new bond measure will be a referendum on the district’s credibility.

“We need to ensure voter confidence and trust in how the district does business with corporations and lobbyists, in light of the billions that will come to the district if the bond is approved,” said one board member, Jose Huizar.

Huizar, who recently proposed a study on the costs of a computerized lobbyist registry and adding ethics office personnel, estimated that he gets lobbied about four times a month by various firms.

“I don’t have a problem with that,” he said. “I just think it should be transparent.”

In other branches of government, officials said, disclosure of lobbying relationships is generally the best guard against impropriety or the appearance of it.

“Then everybody is always aware of what’s happening and you can never be accused of doing anything under the table,” said Chief Deputy City Atty. Terree Bowers of Los Angeles, which requires lobbyists to register with the city.

At the district, some ethicists and school officials also are troubled by board members’ private relationships with lobbyists. In addition to representing private district contractors, Rose & Kindel also was hired by supporters of Young to help advocate for new geographical boundaries that she favored for voting districts.

City records show that the Coalition for Kids, a campaign panel formed by former Mayor Richard Riordan and Eli Broad, hired Rose & Kindel for that purpose last winter. Young acknowledged that the organization had paid Rose & Kindel $30,000 to lobby the Los Angeles City Council on behalf of the map she sought. The City Council vote approved those boundaries in June, three months after Rose & Kindel started working for the district on the bond initiative.

Young said the arrangement was separate from any issue before the board and resulted in no favoritism toward Rose & Kindel.

Municipal records also show that United Teachers-Los Angeles had paid the lobbying firm Cerrell Associates $12,500 to support a rival bid for an electoral map preferred by board member Julie Korenstein. The teachers union lost that battle. Cerrell also worked on the district’s bond information campaign last year, according to Fabian Nunez, a former district lobbyist who is now working on behalf of the bond measure.

Bob Stern, president of the Center for Governmental Studies and an author of California’s political reform laws, said he was troubled by these relationships.

“Obviously, the public perception would be that they would tend to favor people or firms who are representing them privately,” he said.

Separately, both Young and Korenstein said the arrangements had resulted in no favoritism toward the lobbyists. Young added that the district boundary issue was separate from any matter before the school board.

Beyond formal arrangements, some school officials and auditors are concerned about informal contact between district employees at parties and political events. L.A. Unified’s code of conduct does not specify proper or improper contacts; it issues only a caution “to prevent an actual or implied impression that such contacts will result in preferential treatment.”

“I get lobbied several times a day,” said Anne Fischer, L.A. Unified’s procurement chief. She said she often refers lobbyists to other department heads.

Last year, L.A. Unified facilities officials collected thousands of dollars for a Christmas party from district contractors such as Arthur Andersen, Pinnacle One, Gateway Science & Engineering, and Rodriguez & Associates. A confidential report by L.A. Unified’s internal auditor in March called the solicitation of funds from companies that had millions of dollars in district contracts, “a serious violation of the Ethics Code.”

As a result of the auditor’s investigation, the district fired Edie Lopez, an outside consultant, who was Deputy Facilities Executive Kathi Littmann’s chief of staff and co-chairwoman of the party planning committee. Chief Facilities Executive James A. McConnell scolded Littmann in a letter and ordered her office to contact the ethics office for a training seminar on the code of conduct.

Littmann could not be reached for comment on the Christmas party.

Several L.A. Unified board members said they rarely had contact, formal or informal, with lobbyists.

Board members Lansing, Korenstein and Marlene Canter said they had virtually no contact. Young said she has infrequent meetings with lobbyists and with Kindel, who is a personal friend. Board member David Tokofsky said he had lunched with Kindel on occasion, but that she had never discussed her clients.

“She’s much too classy and sophisticated to do something like that,” he said.

School board member Hayes, however, said she is lobbied daily by all sorts of companies and people. Although she said she had not been influenced, Hayes said lobbyists inevitably tilt district procurement toward big companies that they represent.