Coalition Review: Violations by Paul Koretz and his Campaign

Issue(s)

  • Violation of Campaign Finance Ordinance 49.7.1

  • Accepting contributions from the DWP Management Employee union.

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Coalition Review: Koretz Action To Overturn Variance Denial

Coalition Conclusion

  • Violation of LAMC 49.7.1

    • It is our opinion that the Paul Koretz and his campaign violated city ethics rule LAMC 49.7.11.

    • This violation is rated as very serious, an example of bad judgment, and very troubling.

  • Contributions from the DWP Management Employee Union

    • It is our opinion that the Mr. Koretz and the Koretz campaign violated the pledge made to the Coalition concerning accepting contributions from those who have or will have business before him – in this case, from the DWP managers union and other unions with Memorandums of Understanding with the City.

    • The Election Committee of the Coalition believes it is improper and represents bad judgment to take money from those subject to audit by the Controller or those with agreements with the city such as the LADWP managers union.

    • Further, Mr. Koretz currently chairs the City Council committee that reviews and approves Memorandums of Understanding (MOUs) from the same unions that have now contributed to the Koretz campaign. This is unacceptable.

Koretz is running for LA City Controller.  Being able to catch violations of laws or rules beforehand is an essential part of the job.  Accepting contributions from the DWP manager’s union or other unions which have agreements with the city shows bad judgment and creates a perception of impropriety.

Background

  • Paul Koretz’ campaign distributed a flyer promoting an October 23, 2021 fundraising event at the home of Jill Banks Barad. The invitation is shown below.

  • Jill Banks Barad was a DWP Commissioner at the time of this fundraiser.

  • The Paul Koretz received a campaign donation from the DWP Management Employees union on 12/30/20.

Campaign Finance Ordinance – Los Angeles Municipal Code §§ 49.7.1

LAMC 49.7.11.A.2 defines “Prohibited fundraising” as any of the following:

  1. Requesting that another person make a contribution;

  2. Inviting a person to a fundraising event;

  3. Supplying names to be used for invitations to a fundraising event;

  4. Permitting one’s name or signature to appear on a solicitation for contributions or an invitation to a fundraising event;

  5. Providing the use of one’s home or business for a fundraising event;

49.7.11.C states: “A member of a City board or commission who is required to file a statement of economic interests or a general manager or chief administrative officer of a City department shall not …Engage in prohibited fundraising on behalf of an elected City officer, a candidate for elected City office, or a City controlled committee.”

Koretz Response

The Koretz campaign does not deny the event occurred and therefore, that LAMC 49.7.1 was violated.  Koretz responded to an inquiry from the Coalition that “No one involved, Jill and myself included, caught it.”  The Koretz campaign manager, Parke Skelton, responded in a Los Angeles Times article about this violation by saying that holding this event was an “inadvertent mistake.” They also respond that they “voluntarily” returned all funds raised at the event. Paul Koretz resisted admitting that he violated the LAMC despite acknowledging the event occurred.

On the LADWP union contribution, the Koretz campaign called the DWP Managers’ union “innocuous.”

Coalition Process

For alleged campaign law/ethics violations, the Coalition:

  • First evaluates if a violation occurred vis-à-vis the law, regardless of who the violator is.

  • Eliminates the past history of the candidate and keeps its focus on the violation of concern.

  • Assesses the violation in the context of the office the candidate is seeking.

  • Assesses the explanation for how this violation occurred.

  • Removes the post-violation actions from the equation because although important, we are not evaluating the resolution, we are assessing the violation.

For campaign contributions of concern:

  • Is accepting the donation contrary to the pledge the candidate took to not be involved in any way with a campaign contributor or a contributor’s client(s)?

  • Is the contribution from a source that reasonably may have matters before the candidate if the candidate is elected to office?

  • For current elected officials: Is the contribution from a source with business before the candidate in their current position.

Analysis

On the campaign violation:

  • Did a violation occur:  Yes.  LAMC 49.7.11.A.2 and LAMC 49.7.11.C make it crystal clear that an campaign law violation occurred.  The campaign does not dispute that the event occurred and the law is clear.  The Coalition is not alone in forming this opinion.  See https://www.latimes.com/california/story/2022-02-24/dwp-commissioner-hosted-fundraiser-for-la-councilmans-campaign

  • Seriousness of the violation: The law in question was put in place to prevent actual or the appearance of impropriety.  This City has seen more than its share of impropriety. The Election Committee of the Coalition believes that adherence to campaign finance laws is essential and mandatory.  We view the actions of Paul Koretz and the Koretz campaign as a serious violation.

  • Candidate’s Response:  We asked the Paul Koretz and his campaign for a response.  In the response, the campaign did not deny the fundraiser occurred nor did he deny that a violation had occurred.  Instead, Mr. Koretz stated that neither he nor DWP Commissioner Barad “caught” the violation.

  • Relevance to the office being sought: The Coalition believes that this violation is directly relevant to the office Koretz seeks:  That of City Controller.  Even assuming that the violation was unintentional, the job of City Controller is precisely to be a watchdog and to “catch” violations of city rules. This is a clear example of Koretz and his team not being a watchdog and not catching violations before they occur.  We also note that the DWP and the DWP commission have been the focal point of a massive scandal which has involved FBI raids, indictments and guilty pleas.  It is hard to imagine any scenario where ethics issues involving the DWP wouldn’t set off alarm bells.

  • Mitigating factors We do not see any mitigating factors here.  While the Koretz campaign did return the funds raised at the event in question, they only did so after the violation was publicized.  We also believe this violation to be more serious given the current high-profile of DWP-related ethics issues.

We find the excuse of “not catching” the violation unpersuasive.  We also find the campaign manager Parke Skelton’s excuse that this was an “inadvertent mistake” equally unpersuasive.   Mr. Koretz has had three terms as a City councilperson and should be well aware of campaign requirements.  The Koretz campaign manager, Parke Skelton, is a veteran of numerous campaigns in the City.  It is simply not believable that neither Koretz, his campaign staff or campaign manager did not know/did not remember that Ms. Barad was a DWP commissioner.  The Coalition believes that this was either an intentional violation or gross negligence.

On the DWP Management Employee Association contribution:

  • Contrary to a pledge/promise: Yes. Mr. Koretz pledged to “NOT advocate for or be involved in any way with any project or issue that involves a campaign contributor.”  The job of controller specifically involves audits of the DWP and the actions of DWP management.  This is not an innocuous union as Mr. Koretz claimed in his response to us. This is the union that represents non-exempt DWP managers. Mr. Koretz pointed out that  other politicians have taken campaign contributions from this union, and therefore that it was acceptable for his campaign to receive a contribution from the union.  However, the Coalition believes this only furthers the appearance of impropriety in City Hall.

  • Is the contributor likely to have matters come before you if you become controller: Yes.  Since you are seeking the office of Los Angeles City Controller, the Election Committee of the Coalition believes that interaction with the DWP and its managers is highly likely.  Further, the union in question has a Memorandum of Understanding(MOU) with the city.  Paul Koretz sought, and his campaign accepted a campaign contribution from a group that is subject to audit by the Controller’s office and has business before the Council. We note that the Koretz campaign has additionally accepted contributions from other unions with MOUs with the City.

The Election Committee of the Coalition believes it is improper and represents bad judgment to take money from those subject to audit by the Controller or those with agreements with the city such as the LADWP managers union.  Further, Mr. Koretz currently chairs the City Council committee that reviews and approves MOUs from the same unions that have now contributed to him.  This is unacceptable.

This analysis should in no way be interpreted as support of or opposition to a particular candidate.

This analysis should in no way be interpreted as support of or opposition to the unions that represent our City’s workers.