Waste Hauler Claims 2 Cities Sought Payoffs

A waste-hauling firm said it was asked to pay $4 million to a friend of Compton’s mayor and to contribute tens of thousands of dollars to campaigns run by South Gate’s city treasurer while the company was seeking to renew its trash hauling contracts in the two cities.

The firm, a subsidiary of Waste Management Inc., did not pay and lost multimillion-dollar contracts in both cities, said John Newell, an attorney for the company.

South Gate City Treasurer Albert Robles told Waste Management last year he would make sure it lost its city contract after the company declined to make the campaign contributions he wanted, Newell said.

Robles at the time reminded a company official that the firm had raised only $7,000 in 2001 for the candidates he was backing and reneged on a promise to pay $15,000 for a political mailer, Newell said. Robles then told the official, said Newell, “‘You’re out of town.’ ”

In Compton, Michael Aloyan, a close friend of then-Mayor Omar Bradley, asked Waste Management in 2000 to pay him $4 million to secure the city’s garbage-hauling business, Newell said. Aloyan now runs the city’s garbage collecting business himself, employing Bradley’s brother and cousin.

Aloyan and Robles denied Waste Management’s allegations. Robles acknowledged that he solicited campaign donations but denied linking the request to contracts. Aloyan said through his attorney that he never asked the firm for money.

Bradley said Waste Management’s claims sounded like “sour grapes.” He said he had no knowledge of any approach for funds.

Aloyan has an exclusive 15-year contract with Compton that is expected to bring him $100 million in gross receipts. The 10-year South Gate contract, which expired in 2001, was worth about $40 million.

State and federal laws make it a crime for public officials to offer to sell their influence and for firms to seek to buy it.

The alleged solicitations are the second and third reported by Waste Management. Newell told The Times last month that Carson Mayor Daryl Sweeney urged the company to hire his personal lawyer during contract talks in 2001. The lawyer, Robert Pryce, asked for nearly $1 million in fees to help Waste Management renew its municipal trash-hauling contract. Waste Management refused.

A commercial refuse-collection contract expected to bring in $35 million in revenues over 10 years was awarded to a rival firm that hired Pryce.

Neither Pryce nor Sweeney would comment.

In Compton, Waste Management said it was solicited by Aloyan shortly after the City Council had decided to let the firm’s contract expire and operate its own waste-hauling operation.

A City Council majority, led by Bradley, selected Aloyan as a consultant to set up and run a city sanitation department.

Aloyan had long experience in the trash business and in Compton politics. He had worked for Murcole Inc., which held a Compton waste-hauling contract in the late 1980s and early 1990s. He testified under a grant of immunity in federal court in 1995 that he served as a go-between for Murcole’s secret payoffs to a local politician, Walter R. Tucker III, a former Compton mayor and member of Congress. Tucker was convicted of a separate extortion charge in the same case.

Shortly after Compton chose Aloyan as its garbage-collection consultant in early 2000, Newell said, Aloyan asked to meet a Waste Management executive. In May, Newell said, Aloyan told the executive he would sell his company for $4 million. The company’s only apparent asset was Aloyan’s $300,000 per-year consultant’s fee.

The Waste Management executive asked why the firm should pay so much, Newell said. Aloyan answered that his company would soon have the city’s multimillion-dollar trash hauling contract, according to Newell.

“‘I’ll have the city,’” the executive recalled Aloyan as having said.

The executive reported that comment right away, Newell said, because he was suspicious about Aloyan trying to sell a contract he didn’t have. Newell refused to name the executive, citing a company privacy policy.

Compton officials were planning at the time to form a city sanitation department, which Aloyan would manage. The city sanitation department was scheduled to begin operation in the fall. The city issued $6 million in tax-exempt municipal bonds in June, and bought garbage trucks, bins and other trash-hauling equipment.

Aloyan had another idea. He opened negotiations with the city as early as May or June to let him use the equipment to pick up the trash himself, his lawyer said.

Aloyan declined to be interviewed and referred questions to his lawyer, Richard Haft. Haft denied Aloyan had made any offer to sell his company to Waste Management.

Haft said Aloyan had told Bradley about his idea of taking over the trash operation. “I think [Bradley] realized the city was biting off more than it could chew,” Haft said. “The mayor ... said if you can get this through the city attorney, [convince] the bond counsel [that] you can assume the bond, and come up with an upfront franchise fee, then I will get behind it.”

Haft said negotiations began in late spring or summer 2000 and the arrangement was approved by the City Council in February 2001, with a contract that prohibited Aloyan from selling his firm. “This is not some deal that was concocted over a drink at the mayor’s house,” Haft said.

Aloyan’s franchise allowed him to use the city’s newly purchased garbage trucks and bins. He paid Compton a $2-million franchise fee and agreed to repay principal and interest on the bonds. No other firms were invited to bid.

Stan Wolcott, a municipal bond lawyer at the Orange County law firm of Rutan & Tucker, which was not involved in the Compton deal, said it is legal to allow a private company to use equipment purchased with low-interest municipal bonds. He said such arrangements allow a longtime private hauler to get expensive new equipment, while keeping fees low.

Aloyan hired two Bradley relatives to work at his new garbage collection firm, Hub City Solid Waste.

“The mayor said, ‘My brother’s had a tough life,’” Haft said. “‘If you can give him an opportunity, I’d appreciate it.’”

He said Bradley’s brother, Henry, is in charge of safety. A second Bradley relative, the daughter of Bradley’s aunt, City Councilwoman Delores Zurita, works as Hub City’s government liaison with Compton, Haft said.

Bradley said that he was offended by the allegation that Aloyan tried to sell Waste Management the city contract and that he had no knowledge of any such offer. “How can I comment on a conversation that at this point remains--how shall I say it--imaginary?” he said. “I doubt that Mr. Aloyan will tell the same story.”

Bradley said Waste Management could have gotten the franchise if it had beaten Aloyan’s $2-million franchise fee.

Newell said Waste Management had offered the city $1 million as a franchise fee in early 2000, before the consultant deal with Aloyan was made. He said city officials immediately rejected it and, later, never asked the firm to bid against Aloyan.

Waste Management said it faced a different solicitation in South Gate.

Elected City Treasurer Albert Robles repeatedly asked the firm for campaign contributions, beginning in the 1990s, and expressed disappointment when it did not give at all, or did not give enough, Newell said.

Robles is considered the most influential politician in the city, which is northeast of Compton. When three Robles-backed council members took control of the City Council in December 2000, council salaries tripled, longtime employees were fired, and Robles’ allies and business associates won city contracts. Waste Management officials said they first irked Robles nearly four years ago when he asked them for campaign contributions and they declined.

George Troxcil, a former South Gate police chief, recalled that a Waste Management employee told him at the time that Robles asked the firm to make a $25,000 political contribution. Robles reportedly said because it did not make the contribution, it would be finished doing business in the city. Troxcil said he reported the conversation to the FBI. “What they did with it I have no idea,” Troxcil said.

A Robles political adversary, longtime Councilman Henry Gonzalez, said the same Waste Management employee told him the same story at the time.

Robles said he did not recall asking for money four years ago. As for Troxcil and Gonzalez, he said, “You’re talking to me about statements made by my harshest political critic ... and a former chief of police I was critical of.”

Early last year, as Waste Management’s seven-year hauling contract with the city neared expiration, Robles asked Waste Management for campaign contributions again, Newell said.

This time, Waste Management held a fund-raiser that raised “about $7,000” for candidates Robles was backing, Newell said. Robles, Newell added, “said it wasn’t enough.”

Later, in March 2001, Newell said, Robles asked Waste Management to give him another $15,000 to $20,000 to pay for a last-minute political mailer for allies.

Newell said a Waste Management employee initially agreed, but was told by the company’s government affairs office that it would be illegal.

“We informed [Robles] of that,” said Newell. “Initially, he didn’t really have a response. But several weeks later, he told one of our employees: ‘I came to you four years ago and you said no. I asked you for your help again and you didn’t deliver. You’re out of town.”’

Robles said Waste Management should leave town or he would make trouble for the company in other cities, the Waste Management attorney added. Newell said the employee, whom he would not name, reported the conversation to him soon after it happened.

Robles, who faces felony charges of threatening other public officials, denied making the remarks alleged by Waste Management and said the company was being unfair. “In America, you’re able to face your accuser. So I would say, ‘Waste Management, don’t make accusations into the dark. Bring out the accuser.’”

His attorney, Tom Brown, said Robles “had in the past sought contributions from Waste Management and a variety of other waste haulers but never made any threats to them or any promises to them.”

Waste Management lost its bid to renew its contract last year.

The City Council eventually awarded the $4-million-a-year contract to the Vernon firm of Klistoff and Sons, the highest bidder of the three finalists. Waste Management was the second highest bidder.

A member of the committee that evaluated the bids said he saw no evidence of Robles’ involvement. Senior South Gate engineer Abdulla Ahmed said the committee voted 4 to 1 against Waste Management, citing poor service, a long list of lawsuits and an audit that showed a corporate predecessor’s subsidiary had not paid the city more than $1 million in franchise fees.

Robles’ lawyer Brown said it was Robles who discovered the owed fees and “got them to agree to pay it back.”

An audit report said it was “the hauler [Waste Management] that discovered the error and brought this to the attention of the city staff.”

Robles said if he were as powerful and corrupt as critics claim, he would have asked the council to skip the complicated bid process and simply name his favorite company.

Times staff writers Richard Marosi and Joe Mathews contributed to this report.