By Gustavo Arellano
By R. Scott Moxley
By Alfonso Delgado
By Courtney Hamilton
By Joel Beers
By Peter Maguire
By Charles Lam
By Charles Lam
Like Orange County, this property—North America’s largest lima-bean field before World War II—is a monument to contradictions. It’s ironic that a spot where men trained to kill for half a century is, at least by outward appearances, such a peaceful spot now. It’s even more ironic that its tranquil appearance is an illusion. Even today, this land is steeped in conflict. Today’s combatants don fine suits and chow on $29 plates of spaghetti while directing the moves of platoons of public-relations flacks and lawyers.
One last irony: Like the wars in Iraq and Afghanistan, the public is oblivious to the vicious tug-of-war over this soil. The Irvine property, which could play a dominant, positive role in Southern California’s future, as well as make or break the reputations of a number of politicians and real-estate developers, remains in a puzzling limbo.
You can thank the current inactivity on the manipulations of Irvine’s most-powerful politician: City Councilman Larry Agran, the 1992 Democratic Party presidential candidate who controls the city’s 3-2 council majority and thus the conversion of the Marine base into a public/private partnership called the Great Park. Agran—the county’s most-prominent progressive figure until 2005, when all local news outlets here documented his penchant for secrecy, half-truths and reckless spending—sounds defensive when asked about the continual delays.
“I don’t know where the idea materialized out there that somehow we would have the great metropolitan park developed full-scale within a matter of a few years,” Agran told The Orange County Register in May. “Nobody ever promised that. . . .”
Hmm, I wonder who wrote the Aug. 4, 2002, opinion piece for the Los Angeles Times with the headline, “A Park to Surpass Other Great Parks—Speedily”? In it, Agran wrote, “We expect the sports park, with at least 50 soccer fields, baseball diamonds and other facilities for field sports to be built and available for public use within three years”—which would be 2005.
Two years earlier, Agran’s political machine sold $25 T-shirts reading, “The Great Park . . . established 2000,” and in fund-raising pitches, he tied his candidacy to construction of the park. His 2002 campaign literature guaranteed voters a completed park “every bit as beautiful as San Diego’s Balboa Park . . . sooner rather later.” That year, I also repeatedly watched him promise in speeches, “This time next year [fall 2003], we’ll be having jackhammer parties at El Toro to tear up the runways and begin construction of the Great Park!”
In 2003, Agran claimed during a race for mayor that the Great Park “is 90 percent done,” and his allies proclaimed, “Mission accomplished!”
By his own promises, Agran is now 120 months late and counting. The jackhammer parties haven’t materialized. The runways remain intact. Indeed, except for creating an impressive, if expensive, master design plan, not a single major-project goal has been achieved. There is no park—no soccer fields, no educational facilities, no lake, no garden, no wildlife park, no museum, no cemetery or war memorial—and yet he and his second-fiddle allies on the council, Beth Krom and Sukhee Kang, have already allocated or spent an extraordinary amount: more than $220 million.
Where has all that money gone? Why hasn’t it been used to launch park construction? Can a lifelong politician without any business experience continue to divert public attention from the warts of his operation by offering free balloon rides over the old Marine base?
* * *
Jeff Lalloway is a stocky, gregarious 48-year-old Irvine family-law attorney and New Jersey native who is unafraid to admit he watches MTV reality show Jersey Shore. A father of two young kids, he’s also a city finance commissioner who has announced he’s seeking a seat on the Irvine City Council.
“I’m not a Larry Agran-hater,” he says. “But I don’t admire his policies and tactics.”
Based on history, Agran will invariably attempt to smear Lalloway as anti-Great Park and a conservative nut. Never mind that his chief concerns are reasonable: aiding the city’s financially troubled public-school system, increasing government transparency and accountability, exposing wasteful city spending—and building a Great Park.
“I’m a regular guy,” Lalloway says. “I’m also a Republican, but I’m not an ideological loon. I want Irvine and the county to be a better place. When I used to live in Philadelphia, I ate lunch all the time right in view of the Liberty Bell. It might sound corny, but we’ve lost touch with the basics in our country. We’ve created an environment where politicians and their buddies are making all this money, and the rest of us are wondering where it all went.”
The remark was a subtle reference not just to the city of Bell (a 2.6-square-mile municipality in Los Angeles County that gave its city manager $1.5 million in annual compensation), but also to the Great Park. For nearly half a decade, Agran’s government agencies have given Arnold Forde, Agran’s longtime political consultant and dining partner, a lucrative taxpayer-funded public-relations-consulting contract. The councilman angrily recoils in ostentatious displays of contempt when people question his benchmark-free PR deal with Forde.
But, really, have you ever heard of city officials handing a no-bid, $100,000-per-month contract year after year to a small, local PR shop for a government park that does not exist?
In case Forde needs help spinning the public about the wonders of Agran’s Great Park operation, he can get assistance from two other bureaucrats Agran employs full-time at taxpayer expense: a “media services coordinator” (total annual compensation: $98,106) and a “public information officer” (total annual compensation: $112,579). And if none of those experts can handle the PR task, Agran put an additional $80,000 into an earmarked “contingency contract” for the park’s 2010-2011 budget.
“It’s an amazing situation, isn’t it?” says Lalloway, who, if he joins the council, automatically becomes a Great Park board member. “A guy like Arnold Forde can collect that type of contract and not be required to achieve anything specific. As far as we know, he simply wakes up every month and collects $100,000.
“We’ve got a situation where the council majority are more interested in handing out no-bid contracts to their friends than building a Great Park,” he adds. “That’s just wrong. They’ve wasted so much money and so much time.”
Internal Great Park documents obtained by the Weekly show that in the upcoming year, Agran wants to spend $9,848,714 more on government consultants, $4,019,225 for park staff salaries and benefits, $1,735,000 for entertainment, $1,025,000 for a local law firm, and $928,751 for free balloon rides.
Two other figures to contemplate:
Great Park administrative costs (2008-2011): $56 million.
Great Park construction costs (2000-2010): $0.
Despite those startling figures, park CEO Michael D. Ellzey concluded in a recent memo that the park board had just completed “a rewarding year.”
(For more budgetary figures, see "Money Bags.")
* * *
Let’s return to 2002. Agran’s saintly progressive image is still intact. Lefties love him. The political right despises him but grudgingly admits the man’s prominent role in doing what once seemed impossible: reversing two county elections that supported conversion of the Marine base into Southern California’s newest international airport. The proposed airport’s supporters included heavyweights such as businessman George Argyros, President George W. Bush’s ambassador to Spain; as well as the city of Newport Beach; a majority of the county’s supervisors; and influential business-lobbying groups, all of whom argued that John Wayne Airport was inadequate to satisfy the region’s air-transportation needs in the near future.
Agran and other anti-airport leaders offered an alternative to a massive airport in the heart of residential intensive Irvine. They sold voters on the alternative idea of a “Great Park,” where a remarkable 84 percent of the old base—“over 4,000 acres . . . six square miles!”—would be dedicated permanently to “parkland and open space and for recreational and educational purposes.” Real-estate development would be allowed on only 16 percent of the property, Agran claimed, while noting proudly that he’s “a man of his word.” He used glossy images that depicted kids playing soccer, couples sailing on a lake and, no joke, well-coiffed old folks smelling roses.
In 2002, Agran wrote that a victory that year for Measure W, the pro-park initiative, would mean “the first phases of the Great Park can start to emerge within the next few years—and [at] very little cost.” He went on to describe how easy it would be to convert the base immediately into a public benefit by “quickly” expanding college-campus educational opportunities, creating “hiking, biking and riding trails . . . a nature preserve . . . and dozens of amateur athletic fields—especially soccer and softball fields for Orange County youth.”
Agran added, “Bringing people back to El Toro will help create a sense of community that will be key to the Great Park’s planning, growth and success. These are the things that can happen on the ground at El Toro within the next few years.”
He then concluded, “Good planning creates personal and community wealth.”
Always on the side of wealth, the Orange County Business Journal chimed in, calling Agran’s plan “conceptually brilliant.”
It worked: 58 percent of OC voters chose the park over the international airport. The victory made Agran even more bold.
In 2003, Agran again guaranteed that erecting a Great Park could be done swiftly. According to a city document I’ve kept, he asserted that “all backbone infrastructure” at the park would be completed within 24 months. He also said construction of the sports park, drainage corridors and wildlife corridor would take no longer than 18 months.
But there was still the pesky issue of getting the United States Navy, formal owner of the base, to relinquish control. The Navy decided in 2005 to auction 3,700 acres of the site to the highest bidder in a package that assured the city of Irvine 1,200 acres for a public park that would be funded, in large part, through a tax on the property’s commercial developer. Florida-based housing giant Lennar, operating with other Wall Street investors through an entity called Heritage Fields LLC, won the bidding at $649.5 million and agreed to pay Irvine $200 million to construct the adjoining public park and, later, $201 million more for joint infrastructure. The company and the city signed a 2005 development agreement that permitted 3,400 new homes.
Since then, however, Heritage Fields has gained significant post-agreement concessions, including reductions in public open space and the elimination of Agran’s promised golf course, some agricultural fields and cemetery. (Persistent rumors swirl in City Hall that Agran and Lennar reneged on the cemetery pledge because of the fear that potential homebuyers will object to living near burial grounds.)
The company now has the city’s blessing to build an additional 1,600 homes, but look for that number to drastically increase in coming years. According to multiple sources, Krom, who is running for Congress as an environmentalist while she occupies a council seat, has already hinted she’s willing to almost triple the original amount of homes to be built at the Great Park to 10,000.
“Larry has a history of not keeping his promises,” says councilwoman and Great Park board director Christina Shea. “And he’s giving Lennar whatever they want. It’s embarrassing.”
As long as Agran’s majority can thwart a public uprising about his disingenuous past promises, the boost in housing is beneficial to the developer and city officials. Every new home that is built increases profit for Heritage Fields LLC and gives Agran a new source for tax dollars. (Because he has promised to not raise taxes for the project, he calls government revenue from the new homes “tax increments.”) The downturn in the housing market, however, has left the company unwilling to begin construction.
The situation could grow worse. There’s a chance that Heritage Fields LLC won’t have the money to either build their housing project or contribute to the Great Park any time soon. Forest Lawn Memorial Park-Association is suing the city of Irvine and Heritage Fields for committing fraud pertaining to the elimination of a plan for the $20 million cemetery on the property. It would have been the first burial grounds for the city.
Forest Lawn, represented by Texas powerhouse law firm Fulbright & Jaworski, claims the developer reneged on a 73-acre deal with the behind-the-scenes cooperation of the park board. Lawyers for Heritage claim there was never a deal. But if a pending Orange County civil jury decides otherwise, the developer could be on the hook for tens of millions of dollars, if not more, in damages.
The potential loss of the revenue stream from the developer underscores the faultiness of Agran’s plan, according to Shea. She says the need for Great Park funds is now urgent.
“During the next two years, according to Larry’s plan, we’re supposed to raise $400 million for the park,” says Shea. “It’s absurd. It won’t happen. As usual, though, Larry is using his smoke and mirrors, and park staff is scared to death to say anything that might anger him.”
Only “about $20 million” is left in unallocated funds, she says. And all there is to show for it is an orange balloon, some trees planted in boxes in an otherwise-empty lot and some rather wealthy consultants who struck gold because of their ties to Agran.
“We paid $46 million for a detailed design for the park that did not include the old massive runways,” Shea said. “Now, Larry wants the runways to remain. He claims it’s because he wants to honor aviation history.” She laughs heartily at this. “But I think the real reason is how much toxic contamination we’d find there if we dug them up.”
Shea adds, “Larry is the king of spin, but he has mismanaged this whole project. I’m worried that unless we can turn it around, the public is never going to get what was promised. That’s really sad. We can do better.”
Numerous efforts to interview Kang and Agran for this article were rejected. “He and the mayor will pass,” replied city public-affairs director Craig Reem.
* * *
At an August meeting of the Irvine City Council, Agran (dressed in a gray suit accented by an eggplant-colored tie) sits on the dais and nods in agreement with Dan Slater, a droning city bureaucrat who is ripping the Orange County grand jury. Though Slater sounds like a humorless lawyer reading pages of the fine-print legalese on a credit-card application, Agran smiles in appreciation because his staffer is essentially calling members of the grand jury stupid.
In June, the panel compared Agran’s Great Park operation to an Alice In Wonderland fantasy. Specifically, they worry about a $134 million shell game involving the city, the city’s redevelopment agency and the park board. They also suggest the money could be masking significant flaws in the project and that Agran—who controls the council, the redevelopment agency and the park board—has created his own personal kingdom.
“Despite [Agran’s] pledges that no new taxes would be needed to build the Great Park, much of the park’s proposed funding will come from new taxes and the redirecting of increased property taxes,” the grand jury observed after its investigation.
The panel also noted, “It is difficult for differing views to be adopted in Great Park planning because the five people who are City Council members are also the redevelopment agency board members as well as the majority of the Great Park board.” They labeled the situation, “Five heads, three hats.” For a healthier process, the grand jury recommended that each agency gain independence from the others.
“Beyond the financing issue is the matter of whether there was adequate transparency and candor by Irvine city officials in keeping taxpayers informed of the full consequences of the park-financing structure,” the panel said.
Needless to say, the report infuriated Agran and his allies. Slater opines that having the same group of people controlling each body “is not a conflict of interest” because most California cities practice the same arrangement.
“The grand jury was off-base on that finding,” says Slater, who recommends the council “reject” all of the grand jury’s findings and recommendations as “unwarranted and unreasonable.”
Krom—who eight years ago campaigned on a pledge to “make the Great Park great!”—suggests the grand jury was playing cynical politics near an election. Kang lamely assures the public that despite the council’s terse rejection of the grand jury’s report, “We will continue to listen to the public.” Shea and Steven Choi, her Republican colleague on the council, say the grand jury has raised “real concerns” and should be treated with respect, not “aggression.”
But a now scowling Agran—who has never hidden his contempt for the grand jury—unleashes his fury. The mayor pro tem calls the report not just “off-base,” but also “absurd,” “false,” “regrettable,” “nonsense” and “a diatribe.”
He says his anti-new-taxes pledge for park construction and maintenance has “never” included a promise to not seek federal and state tax funds, even though, as I type this, I am looking at a 2004 written pledge by Agran, Krom and Kang that they—the self-appointed “Great Park Team”—are “committed to using private funds to develop a world-class park at El Toro.”
Concerning the $134 million loan, Agran opines that he would have been “foolish” not to take advantage of redevelopment loopholes to benefit the park.
“All of our Great Park work has been guided by outstanding lawyers and consultants,” he says. “We’ve put together an action plan that allows us to move forward.”
Agran acknowledges his park operations could look “counterintuitive and complex,” adding, “but that doesn’t mean anything is awry. To the contrary, it’s sound. That ought to have been the finding of the grand jury. . . . Anybody with an ounce of sense knows that.”
* * *
The soundness of Agran’s park operation was revealed in a 2009 random professional audit. It documented proof that the county’s current largest public-works project at $1.2 billion is ripe with incompetence, corruption or, worse, both. Those findings included:
• Missing and incomplete records;
• Loose management controls;
• Questionable records for invoices, time keeping, travel and entertainment;
• Systematic bypassing of accounting rules for questionable spending;
• A “suspicious movement” of unallocated public funds between Great Park consultants.
Plus, the audit found that the park’s records system seemed created to thwart access by legitimate outside inspection, and in at least one instance, financial records were blatantly falsified.
The Great Park board’s response? As with the recent grand-jury report, it called the audit unfair and suggested it was possibly motivated by a secret, nefarious anti-park sentiment. Besides, maintaining a decent records system wasn’t practical because, it was argued, building a park is “inherently a creative exercise.”
Agran might have added another excuse. His stump speech now includes a standard reference to how he views himself. He says he’s a “wealth generator,” which is ironic and funny given his history as a hardcore liberal activist. It also underscores Agran’s enormous ego.
But he’s right.
While weeds continue to wave silently over the abandoned Marine Corps air base, some well-connected people certainly have gotten very rich thanks to Agran.
Now, can we finally build this damn park?
This article appeared in print as "Hot Air: Thanks to Larry Agran, a few people have gotten very rich from the county’s proposed $1.2 billion Great Park before it has even been built."