By Gustavo Arellano
By OC Weekly Staff
By R. Scott Moxley
By Michelle Woo
By Gustavo Arellano
By Gustavo Arellano
By Gabriel San Roman
By Gustavo Arellano
Photo by Jack GouldIn November 1997, local government officials and business executives gathered at the 18th annual Anaheim Prayer Breakfast and asked God to make Anaheim a "first-rate city." They also ate sausage and eggs, bashed Bill and Hillary Clinton, and heard inspiring words from then-Orange County Board of Supervisors Chairman William G. Steiner.
"This prayer breakfast is an opportunity to give thanks for what we have in our lives," said Steiner. "It is not the election results or the riches we accumulate on Earth, but our faith in Jesus Christ that will be judged when we are gone."
Steiner was that kind of guy. "Ask friend or foe about William Steiner and get the same answer," Orange County Register reporters Chris Knap and Jeff Kramer wrote in 1995. "He's a nice guy [who] cares about people. He's smart and well-meaning."
It's hard to reconcile that with the facts. For the past several days, I've been studying the former supervisor's campaign-finance disclosure reports for January 1996 through December 1998 and trying to figure out why Steiner accepted and spent more than $54,000 in campaign contributions during the period.
My dilemma: after 1994, Steiner was never a candidate for public office; there had been no campaign and therefore no need for campaign contributions. While some officials raise contributions after an election to retire valid campaign debts, Steiner's 1994 committee had a $3,000 surplus in 1995-after he announced he would not seek re-election. Although the supervisor took contributions for the November 1998 election for the Fourth District (Anaheim, Orange, Placentia and Buena Park) seat, it was Lou Lopez-not Steiner-who ran against eventual winner Cynthia Coad. What's more puzzling is that with about a week left in his term and more than 40 days after the election in which he wasn't a candidate, Steiner grabbed a $1,000 "campaign contribution" from a Huntington Beach businessman.
As accounts in both the Register and Los Angeles Times document, Steiner-who was bitter about public outrage at supervisors after the board lost $1.7 billion overnight on Wall Street in 1994-unequivocally declared on Nov. 17, 1995, that he would not be a candidate for re-election in 1998. He told reporters that "he hated coming to work, the pressure." Steiner admitted he was already soliciting job offers from various corporations three years before his term in office expired. He publicly fretted about the costs of having two kids in college and that the supervisor's job was hurting his "marketability" for "six-figure [job] offers." The board was spending about $1 billion per year in taxpayers' money-a chunk of it going to local lobbyists and businesses-but the supervisor declined to identify his potential corporate benefactors.
We do know, however, who gave Steiner "campaign contributions" for his nonexistent campaign: not average citizens but rather those same lobbyists and businesses who rely on the Board of Supervisors to win lucrative county government contracts, garner political appointments or build massive housing developments. Orange County's most prolific real-estate developers-such companies as the Irvine Co., and Segerstrom & Sons, Signal Landmark and people like Bill Lyon, Doy Henley, and George Argyros-gave Steiner a total of more than $20,000 in "campaign" money when he had no campaign. Huntington Beach businessman Henry Yee, who was appointed to the county's prestigious protocol commission last year, gave Steiner $550 on Aug. 4, 1998. On July 10, 1998, two ambulance companies fighting to win the county's contract sent $1,000 in "campaign contributions." The Diamond Group, which won a plum noncompetitive consulting contract with the county, gave Steiner $1,000 on Jan. 22, 1998. Executives with SunCal, a real-estate development company then in trouble with county officials for a controversial residential hillside collapse in San Juan Capistrano, handed over $1,500 in October 1998. In Aliso Viejo, the AV Partnership, which was seeking county development approval for several parcels, contributed $250. Denver-based engineering consultants Woodward-Clyde gave $1,000. Butier Engineering of Huntington Beach won a $1.8 million government contract last year for a county landfill; it gave Steiner $250. Officials with Edison International Companies who have numerous deals with local government sent $500. Irvine's LSA Consultants, a business that last year boosted the value of its county contract for landscaping services on Newport Coast Drive from $27,000 to $137,320, handed the departing supervisor $750. The Weekly contacted several of the contributors to ask why they had given the supervisor money for a nonexistent campaign. None had an answer.
If there was no campaign for the Friends of Bill Steiner committee, where did the $54,000 in contributions go? Not to election polls, brochures or buttons but instead largely to Steiner himself-or, to be more precise, his prodigious belly.
Official records at the Registrar of Voters office in Santa Ana show that the Republican supervisor used at least $6,788 of the money to enjoy elaborate meals at Orange County's finest restaurants. He spent $2,858 at Antonello Ristorante near South Coast Plaza; his average bill at the restaurant: $476. He bought $3,133 worth of computer equipment, claiming it was "overhead" for the nonexistent campaign. He took $1,327 in cash without explanation other than "out-of-pocket expenses." More than $14,000 went to club memberships, luncheon meetings and magazine subscriptions, as well as charitable and political contributions. He spent $2,503 on posh hotel rooms, car rentals and airfare for personal trips. He paid $1,362 to the Robert Mondavi Winery. He used $20,727 to pay off credit-card bills, including $8,814 worth of unitemized transactions. What $338 "campaign" purchases the supervisor made at the Store of Knowledge and Crate & Barrel are also unknown.
If you thought Steiner's financial windfall would be blatantly illegal, you'd be wrong. Yes, the purpose of Orange County's 1992 voter-approved campaign-reform statute (TINCUP: Time Is Now, Clean Up Politics) was to "ensure that the financial strength of certain individuals or organizations does not permit them to exercise a disproportionate or controlling influence" on local politicians and to "maintain public trust in government institutions and the electoral process."
But according to Shirley Grindle, TINCUP's creator and Orange County's most vigorous campaign/government-reform advocate, there is "obviously a big loophole" in any election law that fails to outlaw campaign contributions to non-candidate elected officials. Grindle also said it was a conflict of interest for Steiner to accept money from corporations doing business with the county. (There is a state law that prohibits public officials from participating in any government decision in which they have a financial stake, but that is rarely enforced.)
Instead of keeping the "contributions" for himself, Steiner should have considered the "awful appearance" of the gifts and refunded them, according to Grindle.
"If he's not running [for public office], then why does he need campaign contributions?" Grindle asked. "Welcome to the world of politics."
Steiner "always liked to hobnob with the big shots in the county. He liked to play everybody's sugar daddy," she said. "I was always suspicious of him, and I told him to his face that I was glad he was leaving [the board]."
If Steiner escapes the scrutiny of California's campaign-finance authorities, he may not ultimately walk away completely unchecked by federal authorities. According to Judy Kindell, an IRS official in Washington, D.C., a political candidate has no personal tax liability for incoming campaign contributions. But an individual-say, someone who wasn't a candidate but nevertheless accepted contributions-may be personally obligated to pay taxes on the money if the contributions were converted to personal use.
"For our purposes, the question is: What did he spend the contributions on? If he spent the money on himself, then that's considered his income," said Kindell. "We look at these situations on a case-by-case basis, but I can tell you that we'd be very interested in taking a look [at how contributions were spent when a campaign didn't exist]."
When Steiner left office in January, he took a management job with Childhelp USA, a politically high-profile, Arizona-based nonprofit group. He did not return calls for comment.
Steiner has maintained a soft grandfatherly reputation, probably due to his work from 1978 to 1993 at the local Orangewood home for abused, neglected and mentally ill children. Among his supporters, it's considered impolite to point out that Steiner was not a volunteer but rather a generously compensated executive with the charity. While at Orangewood, he began socializing with the county's ultrawealthy and politically powerful. Those connections paid off in 1993, when Governor Pete Wilson appointed him to replace Supervisor Don Roth, who had resigned amid a criminal probe into tens of thousands of dollars' worth of meals, trips, loans, golf games, tickets and other gifts Roth and his aides accepted from Orange County real-estate developers and corporate lobbyists.
During his swearing-in ceremony, Steiner said "ethical government" would be the "hallmark" of his term in office. He claimed he was joining the board to "restore public trust" after the disillusioning Roth scandal. It "must be clearly understood that there is no substitute for personal integrity," he proudly declared. He immediately tried to distance himself from Roth's cozy lunches with lobbyists; on his first day at the County Hall of Administration, he carried a brown bag with a peanut-butter-and-jelly sandwich to work. "I hope that something as basic, as simple and as informal as a brown-bag lunch would convey an important message," he said at the time. "It would make a statement that I'm not going to let this job go to my head. I'm not going to lose my perspective."
It's probable that if Steiner ever had perspective, he lost it early: the campaign contributions that launched his political career as an Orange City Council member in 1983 were from real-estate developers Lyons, Kathryn G. Thompson and Mission Viejo Company president James Gilleran. There's also the fact that at one point during his tenure, the self-proclaimed fiscal conservative had the largest annual staff budget on the board: $587,743. And that one of his first staff hires was a lobbyist from the Irvine Co. And that he was spending thousands of taxpayer dollars to take business executives to breakfast. And that in addition to his public pay and responsibilities, he took up to $10,000 per year for "consulting" private groups. And that he helped limit an official probe into wrongdoing against children at Orangewood. And even that he routinely sent potential government contractors fund-raising solicitations after their visits to the county Hall of Administration.
Steiner's image fooled most of the people most of the time. But not Peter A. Caruso, a disabled Irvine salesman and volunteer president of the California branch of the National Center for Missing and Exploited Children. In 1996, Caruso had resigned from the nonprofit group in protest over revelations that the supervisor-who served on the organization's board-had secretly arranged to personally profit ($5,500) from fund-raisers for the charity. "I feel very strongly that what you did was wrong," Caruso wrote to Steiner. "And I stand by my personal convictions that I could no longer serve on the board with you."
Specifically, Caruso learned that Planet Hollywood in Santa Ana was padding Steiner's generous public-compensation package (then $82,000 per year, plus a free luxury car and numerous other taxpayer-supported perks) with $500 per month and a $1,500 bonus for luring charity fund-raisers to the restaurant. One of Planet Hollywood's local owners just happened to have a controversial real-estate-development deal (Saddleback Meadows) before the county at the time of the payments. The developers also gave two Steiner-connected charities $13,500 because of their "interest in helping children." At about the same time, Steiner inserted himself aggressively in the process, urging county planners to move the project through quickly.
After the transactions were revealed publicly, Steiner maintained the financial gifts were unrelated to his unusual intervention. The nasal-sounding, stocky supervisor was formally cleared of violating any specific law by Michael Capizzi's district attorney's office and posed wounded that anyone would doubt his righteousness. "To cast a shadow over that [his secret deals] does a disservice to my motives," he said.
Steiner's real motives were revealed in countless questionable transactions, including this dinner in late 1996. We know from Steiner's own disclosure reports a few of the facts-he was eating at Antonello Ristorante, a posh South Coast Metro eatery, and his tab that night ran to $721. The law governing such disclosure reports did not require Steiner to describe the event in greater detail-how many bottles of wine chased down which fabulous appetizers, which sugary desserts followed which entrées of veal or chicken or pasta, which guests entertained the affable politician as he poured out after-dinner port or sherry. We can only guess at the culinary magic behind such a phenomenal bill and allow our imaginations to do the rest of the work: the waiter appears quietly at Steiner's side to ask if there will be anything else this evening. "Just the check," Steiner might say, patting his Victorian middle. "And put it on my credit card."
That's in the realm of imagination. In the realm of documented fact, we know that when it came time to account for the $721 dinner, Steiner handed the waiter his American Express. Later, the credit-card company received a check from Friends of Bill Steiner-a bank account funded entirely by the county's most powerful developers, government contractors and corporate lobbyists for a campaign that never existed.