Anaheim leaders want to explore if they can halt funding to Visit Anaheim, following allegations the agency may have diverted $1.5 million in coronavirus pandemic relief funds to an Anaheim Chamber of Commerce nonprofit in 2020.
Anaheim councilmembers agreed in a 6-1 vote Tuesday night to ask city staff to come up with options and to see if the city can also force Visit Anaheim to end its contracts with the Chamber of Commerce.
Tuesday’s council meeting came after the July 31 release of a city-commissioned investigation into City Hall dealings, including questions of corruption, past campaign contributions, contracts, city dealings, council decisions and potential Brown Act violations.
It was the first council meeting after the report on the investigation’s findings and the council was considering a slew of initial reforms in response.
Visit Anaheim markets the city for tourism and books the Anaheim Convention Center. It gets its funding from a 2% assessment on hotel rooms rates in a city tourism district.
“So, what Visit Anaheim does with those funds once they are released to them, it’s really between Visit Anaheim and the chamber,” City Manager James Vanderpool told the council, but added, “It’s certainly something we can explore.”
In 2020, the city earmarked $6.5 million in support to the tourism agency during the early months of the pandemic to promote tourism recovery. Investigators from the JL Group alleged that $1.5 million of that money may have been diverted to an Anaheim Chamber of Commerce nonprofit, but they couldn’t determine how it was used.
Mayor Ashleigh Aitken said she potentially wants to request Visit Anaheim give back the $1.5 million.
Tuesday’s council meeting went late into the night and Visit Anaheim and Chamber of Commerce leaders could not be immediately reached for comment.
Councilmember Jose Diaz was the lone vote against exploring cutting off funding to Visit Anaheim, raising concerns that the actions against the agency could harm the city’s tourism business. He said the city should wait for a state audit into public funds sent to the agency to be finished before taking action.
“We are rushing before having information,” Diaz said. “I don’t support these people. I just believe it’s gonna hurt the people of Anaheim.”
While looking at the proposed initial reforms, the council also directed city staffers to come back with options for potentially strengthening the city’s lobbying ordinance. And councilmembers agreed to rebrand the city’s fraud hotline to encompass whistleblower reporting.
Early in the over seven-hour meeting, Councilmember Natalie Rubalcava gave an impassioned speech for how the City Council should move forward. She also said the report got it wrong in parts where it accused her of violating the city’s charter, including by giving direction straight to a city staffer.
Rubalcava also pointed out the report made no suggestion that any current councilmembers did anything to warrant stepping down, adding that the council should take its time to consider the JL Group’s recommendations.
“We must resist pressure campaigns and rushed reactions,” Rubalcava said.
The City Council did not move forward with a resolution to lower the threshold for what contracts the city manager has authority to sign, instead opting to study best practices from other cities and the county.
Councilmember Stephen Faessel stressed the importance that the city work quickly to take up the JL Group investigators’ recommendation to create an ethics officer.
This is a developing story, please check back for updates.
Source: Orange County Register
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