Consultant to Oversee Film Permit Agency

City and county elected officials responsible for overseeing the Entertainment Industry Development Corp. admitted Monday that they have done a poor job overseeing Los Angeles’ film-permitting service and voted to hire a consultant to help.

The consultant, former Los Angeles city Chief Administrative Officer Keith Comrie, will be asked to study the 7-year-old experiment in privatization and recommend changes to improve its financial accountability to public officials who make up a majority of its executive committee.

County Supervisor Zev Yaroslavsky, a member of the executive committee, introduced the proposal, which also banned the organization’s controversial practice of making political contributions. Yaroslavsky made the motion at an emergency meeting of the executive committee “to begin to rehabilitate the credibility of this organization.”

EIDC President Cody Cluff and his organization have been under a cloud for more than three weeks since the district attorney’s office, saying it was unable to get the EIDC to turn over financial documents voluntarily for an audit, obtained a search warrant and raided both the organization’s office and Cluff’s house. An affidavit that prosecutors used to obtain permission for the search alleged that Cluff had used hundreds of thousands of dollars in public funds for political contributions and lavish spending.

Cluff maintains that he has done nothing wrong because he believes the EIDC is a private organization and his job requires him to court Hollywood executives to persuade them to keep filming in Los Angeles. The EIDC is largely funded by fees it charges film and television production companies to help them get government filming permits.

City, state and county lawyers have had conflicting opinions about whether the EIDC is a public agency in disguise. The distinction is critical in deciding whether or not the political contributions were a misuse of public funds, an issue which the district attorney’s office is investigating.

Comrie’s job will be to recommend an auditor to do a forensic breakdown of the EIDC’s $5-million budget, recommend changes to bylaws and operating procedures, develop fiscal policies and work with lawyers to resolve the organization’s public or private status.

Comrie, who retired as the city’s chief budget officer in 1999, endorsed the idea of merging separate city and county film permit agencies into the EIDC in 1995. In 1998, he backed the idea of extending its contract with the city and county for 10 years. He said at that time the EIDC was doing a good job. It was not immediately decided how much Comrie would be paid for his consulting work.

Comrie’s past association with the organization drew catcalls from some agency critics, who called it a potential conflict of interest. Yaroslavsky lauded Comrie as someone of the highest integrity.

Donna Wells, in-house legal counsel for the EIDC, defended the corporation’s political contributions, saying that all staff members were encouraged to become involved in their communities and recommend which candidates and causes should receive donations from the EIDC. Final decisions were made by Cluff.

The EIDC stopped donating to political candidates in mid-2001 but continued giving to initiatives, including $10,000 to a city bond measure to build more police and fire stations and $25,000 to Mayor James K. Hahn’s anti-secession campaign.

Wells also defended Cluff’s spending practices. The district attorney’s office has said that Cluff received $300,000 in reimbursements in one year for expenses. Wells said that Cluff paid for office expenses such as furniture, equipment, promotional efforts and travel on his personal credit cards. She said they were “reasonable and appropriate amounts that are absolutely essential” to the EIDC.

During the meeting, Yaroslavsky and other elected officials acknowledged that they had little familiarity with how the entity operated.

“This is my first meeting,” said board member and Supervisor Gloria Molina, who said her staff members had sat in for her in the past.

City Councilwoman Wendy Greuel said she did not have a copy of the organization’s bylaws.

Yaroslavsky said he did not have a copy of its budget. “Is there an approved budget?” he asked.

Cluff answered that “the budget is approved annually at the board meeting” and sent to all executive committee members.

Yaroslavsky’s motion was quickly and unanimously embraced by the executive committee as, in Yaroslavsky’s words, “a great solution for us.”

The EIDC board consists of all 15 Los Angeles City Council representatives, all five county supervisors and film industry and labor representatives. Some of the elected officials on the board received political contributions.

The board meets once or twice a year. But the executive committee is supposed to be more hands-on. In 2000 and 2001, executive committee meetings were canceled three times for lack of quorums. Three meetings were held. On Monday, executive committee members said they intended to conduct a performance review of Cluff but ran out of time. The executive board will now meet every two weeks.

Yaroslavsky’s motion requires more frequent meetings, executive committee approval of raises and co-signing of checks of more than $1,000 by an in-house lawyer of the chairman of the executive committee. The donation to the anti-secession movement, which has since been returned to the EIDC, has drawn the wrath of Valley and Hollywood secession activists. At Monday’s meeting, Hollywood secession activists said that all board members who had received donations should recuse themselves from deliberations about the EIDC’s future.

Sharon Jimenez of the Hollywood Independence Committee told the executive committee that the EIDC’s spending money “against grass-roots ballot measures is not only questionable but really morally wrong.” She called it “Filmgate.”