L.A. on the Record: Did Mejia’s apartment referral fees violate any city rules?

Good morning, and welcome to L.A. on the Record — our City Hall newsletter. It’s Julia Wick.

Earlier this week, two high-level former employees accused Controller Kenneth Mejia of creating an uncomfortable work environment where personal boundaries were often blurred in the controller’s office and on his campaign, and the complaints very publicly spilled out into social media — as we wrote about on Wednesday.

They say Mejia frequently made comments about the sex lives of two young campaign workers before his election and pressured employees and former campaign staffers to move into his apartment building after the election.

Mejia’s office denied the allegations, but confirmed that Mejia has received $1,000 in fees for referring employees to apartments in his building. (They say he acted only as a friend in informing them of the open units, providing advice “at their invitation, and without any coercion.”)

Which brings us to the question that countless City Hall sources have asked since the story came out: Does it violate any rules for an elected official to collect those referral fees?

The city attorney’s office and City Ethics Commission declined to comment.

Mejia’s communications director Diana Chang said Friday by email that there were no legal implications for the fees he received.

“The referral incentive provided to Kenneth doesn’t raise any legal issues because it is a discount available to the general public by the property manager that services the apartment building Kenneth rents in. The discount was provided as a reduction in rent — not as a standalone payment,” Chang said, adding that Mejia has no personal or professional relationship with the property manager and “the work of the controller’s office has no impact on the company.”

Two $500 fees are admittedly picayune in the grand annals of potential violations (as well as relatively small potatoes for a guy who makes $252,042 a year). But the matter is worth exploring, given Mejia’s role as the city’s fiscal watchdog and his promises on transparency.

Which is why we brought the question to some of the state’s foremost ethics and charter experts. The answer, it seems, is pretty murky.

To be clear, there is nothing in the Los Angeles City Charter or code of ethics that expressly forbids an elected official from repeatedly telling employees about open units in their apartment building, talking up the amenities and then receiving two $500 referral fees.

But the city’s governing document does forbid elected officers from receiving “any compensation, including honoraria, for their services,” apart from their work for the city or other authorized government entities. The charter also bars elected officers from being “compensated by fees or commissions.”

UC Berkeley School of Law Dean Erwin Chemerinsky, who chaired the city’s elected charter reform commission in 1999, said he wasn’t sure if Mejia’s apartment referral fees would fall under either section of the charter.

“The goal of these Charter provisions was to make these positions full-time and to lessen the chance of conflicts of interest by preventing other employment. I don’t know if referral fees fit within these provisions,” Chemerinsky said Thursday by email. “I never have looked to see if there are cases interpreting them.”

Bob Stern, co-author of the state’s 1974 Political Reform Act and former general counsel for the California Fair Political Practices Commission, was equally unsure. But even if Mejia’s actions did constitute a violation, Stern didn’t think it was a serious one given the relatively small amount of money in question, he said.

“If I were in his position, I would probably say, ‘I didn’t realize this was a problem, here’s $1,000, Mr. Landlord, I’m just going to pay you back,’ ” Stern said, saying that in his mind this would take care of the issue.

The more troubling part, Stern said, was that Mejia had brought his own employees to the apartments, rather than friends or family. Doing so does not constitute a violation, but it could create the impression that someone was having his employees help him financially.

Loyola Law School professor and former City Ethics Commission President Jessica Levinson seconded that sentiment, saying she thought the fees were “potentially an issue.”

“I don’t think it’s the thing that brings down city government in Los Angeles,” Levinson said. “But frankly, I think it raises some concerns beyond the $1,000 in the sense of ‘Is he using his position as a superior and as an elected official to try and pressure his friends into doing things that will benefit him?’ ”

State of play

— BASS’ BIG WEEK AHEAD: Mayor Karen Bass will deliver her first State of the City address Monday evening in the City Council chamber, then will present her first budget as mayor early in the week. Expect funding for Inside Safe and LAPD staffing to be some of the most closely watched items.

— CIRCLING BACK: Shortly after being elected in November, Bass invited all staffers in then-Mayor Eric Garcetti’s office to remain in their jobs through April 22 — an atypical move intended to steady the ship during her transition period. In that November memo, Bass also said that current employees could interview for permanent jobs during the transition period.

Spokesperson Zach Seidl declined to answer whether April 22 was still seen as the internal deadline, saying “We will continue to make personnel decisions based on the needs of the mayor’s office and the city.”

— RESULTS CERTIFIED: It’s official — Imelda Padilla will face Marisa Alcaraz in a June 27 runoff for former Council President Nury Martinez‘s seat. Just 11.4% of voters in Council District 6, which covers the central and eastern Valley, took part in the April 4 election, according to certified results released Friday by the Los Angeles County Registrar/Recorder.

— ROAD TO REFORM: As they tackle independent redistricting, the City Council’s Ad Hoc Committee on Governance Reform will be venturing outside the building and across the city to take public comment from community members. Here’s the full schedule, from Council President Paul Krekorian.

— COURT TROUBLES: A federal judge declared a mistrial Thursday in the bribery prosecution of former Los Angeles Deputy Mayor Raymond Chan after doctors confirmed his attorney needs months to recover from a recent hospitalization.

— WAGE HIKES? The minimum wages of workers at larger hotels and Los Angeles International Airport would rise to $30 an hour by 2028 under a proposal put forth Wednesday by Councilmembers Curren Price and Katy Yaroslavsky.

— OOPS: Brentwood residents saw a familiar face shoveling asphalt repair mix into a hole in the street on Tuesday: former governor and movie star Arnold Schwarzenegger, taking to DIY fixes after he said he’d waited three weeks for the city to repair his local road.

But what he thought was a pothole, it turns out, may have actually been a service trench for gas line repairs.

— 988 INVESTIGATION: L.A. County planned to hire privately contracted teams so crisis therapists could respond to the 988 hotline 24/7, up from 18 hours a day, the county statement said. More than eight months later, my colleague Lila Seidman’s investigation finds that this hasn’t come to pass.

— NEWSOM’S PLEDGE: Sen. Dianne Feinstein’s weeks-long absence from Washington as she recuperates from shingles not only led to calls for her retirement, it refocused attention on Gov. Gavin Newsom’s promise to appoint a Black woman if either of California’s U.S. Senate seats opened up, our former City Hall colleague Ben Oreskes reports.

Newsom has been silent about whom he supports in the state’s 2024 Senate race to succeed Feinstein, even though the field includes just one formidable Black woman candidate: Democratic Rep. Barbara Lee of Oakland.

— ARE YOU A CITY WORKER? Are there things happening in your office that you think we should be covering? Or other scuttlebutt from around the building that you think we are missing? Please reach out! I’d love to chat with you, on or off the record. Email me here.

QUICK HITS

• On the docket for next week: State of the City is Monday, followed by budget reveal early in the week.