Trash Company Secretly Tried to Influence City's Contract Policy

Just when it seemed like the political battle and lawsuit over Los Alamitos' $24.5-million trash contract was winding down, a series of confidential city documents raises new questions about how the contract was awarded.

Memos between the city’s attorney and a lawyer for the trash contractor reveal the company tried to help rewrite the city’s contract-selection policy to achieve the “result desired” of making sure Consolidated Disposal Services kept the contract.

City officials wouldn't say Wednesday if the trash hauler succeeded in influencing their policy. However, after the City Council tentatively approved a revised contract-selection policy in November, the trash company's lawyer fired off a letter attacking the revision and asked if he could help the city reword it.

The next week, instead of granting routine final approval to the new policy, city officials scrapped it without explanation and came back with yet another revision in February that included the trash contractor's suggested changes.

City Attorney Sandra Levin and Consolidated Disposal Services’ attorney Scott Gordon didn't return several calls from Patch for comment.

The trash contract, which is the city's most lucrative outside contract, has long been a source of controversy.

Last year, a group of residents sued Los Alamitos, alleging the City Council violated its own policies in awarding the contract to Consolidated Disposal Services, because it was not the lowest qualified bidder. The suit also accused three City Council members of corruption in awarding the contract to campaign donors.

A but agreed on how contracts can be awarded, thereby nullifying the contract. He left the city several options, including reopening the bidding process or rewriting its contract-bidding policy.

The city has . In the meantime, instead of tearing up the nullified contract and switching to the lowest bidder, the city “clarified” its contract-selection policy in a way that allowed Consolidated Disposal Services to keep the contract.

The revised policy is much more liberal in granting the City Council discretion to award contracts based on various factors, instead of automatically choosing the lowest responsible bidder.

In the wake of their court defeat, city officials took pains to avoid switching to another trash firm, so much so that Consolidated’s own lawyer thought the process looked suspect, according to confidential memos obtained by Patch. In a November email to the city attorney, sent after the council tentatively approved the revised selection policy without consulting him, Consolidated attorney Scott Gordon wrote:

“We have reviewed the Ordinance ... in greater detail and feel that it is problematic, and would likely not survive a legal challenge before Judge Banks. ... It will likely be viewed as a suspect process geared to simply allow the City to re-award the same contract to [Consolidated]. That’s the result desired, but there is no real protection in the process outlined in the Ordinance.”

Gordon also suggested the contract-selection law could be reworded without having to go through a public hearing.

The city's attorney replied: “I'm happy to discuss it with you.”

Consolidated's Gordon, noting that his client was irritated at not being more involved in drafting the new policy, wrote: “The First Reading of the ordinance that we have concerns with isn’t helping on my end, since I have been asked how it is that we were not involved in at least providing input into the content of an ordinance that is supposed to moot a [court] judgment that we are ... jointly defending against. Because [Consolidated] has a substantial contract with the City and the Court’s judgment voids that contract, we feel that we have to have some tangible collaborative involvement in whatever strategies or tactics are developed to win the case. … Ideally this discussion should have taken place when the [revised selection policy] was being conceived and drafted, but I will remain cautiously optimistic that you are willing to entertain revisions to the Ordinance introduced 11/6 that we think are necessary to have a better chance of surviving a certain legal challenge. It seems to me we get but one shot at this, and we feel the ordinance needs to be revised.”

The next week, the city scrapped the version Gordon criticized. The official explanation was that the “staff report was not ready."

But that version never resurfaced. Instead, the council passed a new revised policy in February and reaffirmed the contract with Consolidated Disposal Services.

When reached by phone Wednesday, Mayor Troy Edgar said he couldn’t comment on confidential documents connected with an ongoing lawsuit against the city.

Although constrained from addressing specifics, Edgar said he would welcome an effort to go public with the situation.

“If there is something nefarious, let’s flush it out,” he said. “Have they [Consolidated] crossed a line? I can’t tell. I am not a lawyer. I just don't believe there's anything there.”

Edgar said his biggest concern was an apparent leak at City Hall. Releasing confidential documents protected by attorney-client privilege is a political ploy that exposes the city to more than $300,000 in legal liability in the ongoing trash lawsuit, he said.

The lawsuit was filed during 2010's highly contentious City Council race, and became a flashpoint in the campaign. Edgar said the suit was a political stunt aimed at undermining council incumbents who approved the contract.

Along with Councilman Kenneth Stephens and Councilwoman Marilynn Poe, Edgar has steadfastly defended the trash contract, saying it gives Los Alamitos residents the second lowest trash rates in Orange County.

Wednesday's memo leak unravels some of the strides made to overcome lingering fallout from the trash battle, Edgar said. Earlier this month, the council majority backed off an effort to prosecute Councilman Warren Kusumoto, a trash contract opponent, for Brown Act violations for allegedly leaking information from the council's closed-door meetings. This week, the city announced a partial settlement in the trash lawsuit, with the plaintiffs agreeing to withdraw their appeal of the judge’s decision to throw out the corruption allegations against Edgar, Stephens and Poe.

Against that backdrop, the timing of the leak is very troubling, City Manager Avery said: “At a time when we are trying to create some trust among council members, the leak of information has broken that trust.”

But lawsuit plaintiff Art DeBolt suggested the memos confirm the heart of the original case, that city officials went out of their way to give the contract to Consolidated, even though an equally valid bid was $6 million lower. DeBolt predicted the judge would disapprove of the city's handling of the matter since the first ruling and again void the contract.

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