220121 1309 FW_ FPPC Complaint No. COM-01192022-00138 (City of Cypress, Peat, Herz-Mallari)_REDACTEDFrom:Fred Galante
To:Paulo Morales; Jon Peat; Anne Hertz-Mallari; Frances Marquez; Scott Minikus
Cc:Peter Grant
Subject:FW: FPPC Complaint No. COM-01192022-00138 (City of Cypress, Peat, Herz-Mallari)
Date:Friday, January 21, 2022 1:08:42 PM
Attachments:COM-01192022-00138; City of Cypress - 3 Day Redacted.pdf
Dear Mayor and Council Members,
Fred Galante | Equity Partner
Aleshire & Wynder, LLP | 18881 Von Karman Ave., Suite 1700, Irvine, CA 92612
Tel: (949) 223-1170 | Dir: (949) 250-5410 | Fax: (949) 223-1180 | fgalante@awattorneys.com |
awattorneys.com This email and any files transmitted with it may contain privileged or otherwise confidential information. If you are not the intended
recipient, or believe that you may have received this communication in error, please advise the sender via email and delete the email you
received.
From: Ginny Lambing <glambing@fppc.ca.gov>
Sent: Thursday, January 20, 2022 8:46 AM
To: ahertz-mallari@cypressca.org; jpeat@cypressca.org; Fred Galante <fgalante@awattorneys.com>
Subject: FPPC Complaint No. COM-01192022-00138 (City of Cypress, Peat, Herz-Mallari)
*** EXTERNAL SENDER ***
Good morning,
The Enforcement Division of the Fair Political Practices Commission has received a
sworn complaint against the City of Cypress and Councilmembers Peat and Hertz-
Mallari. Please see the attached letter for more information.
If you would like to respond to or refute any of the allegations made in the complaint,
please do so in writing to me by 2/1/2022.
Thank you,
Ginny Lambing
Political Reform Consultant II, Enforcement Division
FAIR POLITICAL PRACTICES COMMISSION
1102 Q Street, Suite 3000 | Sacramento, CA 95811
STATE OF CALIFORNIA
FAIR POLITICAL PRACTICES COMMISSION
1102 Q Street • Suite 3000 • Sacramento, CA 95811
January 20, 2022
City of Cypress
c/o Fred Galante, City Attorney
Via email: fgalante@awattorneys.com
Jon Peat
City Councilmember
City of Cypress
Via email: jpeat@cypressca.org
Anne Hertz-Mallari
City Councilmember
City of Cypress
Via email: ahertz-mallari@cypressca.org
Re: Complaint No. COM-01192022-00138; City of Cypress, Peat, Hertz-Mallari
Dear Mr. Peat, Ms. Hertz-Mallari, & City of Cypress,
The Enforcement Division of the Fair Political Practices Commission has received a
sworn complaint against you. It appears the complainant is alleging you have violated the
Political Reform Act’s 1 conflict of interest provisions. The information filed in the
complaint is below and any attachments filed are enclosed. The complaint was filed
against all those listed above.
The person filing the Complaint is:
George Pardon
Cypress, CA 90630
The violations alleged are:
Conflict of Interest
City of Cypress and Valley Vista Trash Services
In 2015, the Fair Political Practices Commission fined George Briggeman from
Valley Vista Services for his support of City Council candidates in 2012. Two of
1 The Political Reform Act is contained in Government Code sections 81000 through 91014, and
all statutory references are to this code. The regulations of the Fair Political Practices Commission are
contained in Sections 18110 through 18997 of Title 2 of the California Code of Regulations, and all
regulatory references are to this source.
Page 2 of 4
COM-01192022-00138
those individuals were candidates for the Cypress City Council: Rob Johnson and
Mariellen Yarc. The contributions ended up being good investments by George
Briggeman when in September 2014 Valley Vista was awarded a 10-year trash
services contract in Cypress starting in July 2015. Unfortunately, the residents
did not know about the fine assessed to George Briggeman until after it was
reported in the newspaper in 2015 and the contract was already awarded. (Orange
County Register article enclosed) Prior to the award of the contract, I had met
with Rob Johnson about the contribution he had received and asked him to recuse
himself but he refused.
Just 2 years later in 2017, Valley Vista through George Briggeman requested an
extraordinary adjustment to their contract which included service reductions and
rate increases. The city hired a consultant to review the request. The consultant’s
conclusion was that there was no basis for the adjustments requested by Valley
Vista but the City Council approved the changes anyway. Rob Johnson and
Mariellen Yarc were still on the City Council at that time. Both Rob Johnson and
Mariellen Yarc termed out in November 2018. In 2016, Jon Peat was elected to
the City Council and he was a strong advocate for the substantial contract
changes. While the FPPC didn’t refer to a campaign contribution connection to
Jon Peat, there remains a significant connection to George Briggeman since
George Briggeman has been a strong supporter of the Cypress Boys and Girls
Club and Jon Peat has been on the Board of the Boys and Girls Club since 2013
now serving as 1st Vice Chair. (https://www.theboysandgirlsclub.org/board)
Along with the other contract changes in 2017, the City Council also extended the
contract with Valley Vista for 2 years making it a 12-year contract.
In 2021, Valley Vista came back to the City Council for additional concessions.
They wanted to build a trash transfer station and a Compressed Natural Gas
facility on the City Yard in order to reduce their costs further. The proposed
project was next to a residential area and there was substantial pushback from the
residents and the City Council backed off. A political controversy did arise
during the consideration of the transfer station as the City Council appointed a
two-person subcommittee to review the Valley Vista request. One of the
individuals that Mayor Jon Peat wanted to appoint was newly elected Council
Member Anne Hertz. Anne Hertz is a long time Executive Director of the Boys
and Girls Club of Cypress and is now the CEO of the Boys and Girls Club of
Greater Anaheim and Cypress. At the time the subcommittee was formed,
Council Member Stacy Berry challenged the appointment given Anne Hertz’
relationship with George Briggeman. Responding to that challenge, while
Council Member Hertz acknowledged that she and George Briggeman have
known each other for 15 years and he’s donated to Boys and Girls Club events
and given them free trash services for 15 years, she believed she would do a good
job on the committee. Also, in the original contract proposal from Valley Vista,
the relationship that George Briggeman has had with the Boys and Girls Club and
other Cypress organizations is shown to be significant.
Page 3 of 4
COM-01192022-00138
The effort to reward Valley Vista continues. The requirement by the State for
cities to implement an organic waste disposal system has led to yet another review
of the Valley Vista agreement. Rather than the proposed revision being limited to
the organic waste program, the revisions also included an adjustment increasing
the recycling cost because Valley Vista says they are losing money on it. The
changes also include a substantial increase to the cap on annual CPI increases and
probably the most egregious change is an extension to the contract to 2037. The
original contract was a 10-year contract with an allowance for a 2-year extension
and 2 one-year extensions. This would have allowed a total of 14 years. With
these new changes, this will end up being a 22-year contract without going out to
bid. Neither Jon Peat nor Anne Hertz recused themselves.
To add to the suspicious nature of this, the proposed changes were pushed through
during Thanksgiving week and the residents are now being given until January 24
to protest the changes. Unfortunately, the threshold set is 50% plus 1 of all the
parcels in the city have to submit a written protest for these contract changes to be
rejected. Starting this process during Thanksgiving week and expecting residents
to focus on it during the holidays and a heightened COVID transmission period
raises the serious question as to the transparency of these contract changes.
Probably the most glaring cause for concern is that Los Alamitos, which is an
adjacent city to Cypress, went out to bid for the new state changes and saw their
price go down with only a 7-year contract. In fact, if the changes proposed by the
Cypress City Council are ultimately implemented, Cypress residents will pay
$21.43 per month which is 54% more than Los Alamitos residents will pay at
$13.90 per month plus Los Alamitos residents will get significantly more bulky
item pick-ups. When challenging what the city is doing, the response received
from the City Manager is that I am making a careless assessment and that “It is
typically less expensive to collect less refuse in a small city than more refuse in a
larger city.” That last statement made no sense to meet since Los Alamitos has a
population of 12,000 residents and Cypress has 50,000 residents. Economies of
scale would actually suggest that Cypress would pay less.
I spent my career in the California State University system retiring as the Vice
President for Administration and Finance at Cal State Los Angeles. The proposal
to significantly extend a contract term at a price substantially higher than an
adjacent city raises serious red flags for me. While there may not be a known
direct campaign contribution to either Jon Peat or Anne Hertz, the fact that one of
them is a Board Member and another is a high-ranking employee of an
organization supported by George Briggeman, there is cause for concern. The
concern is even more profound given the difference in the rate being charged to
an adjacent city by a different company and the significant extension to the term
of the contract. Many residents agree that the contract should go out to bid
before such substantial changes are made especially given the existing
relationships.
Page 4 of 4
COM-01192022-00138
I hope that you will question this as well and initiate an investigation. Ideally, I
think an injunction should be put in place that prohibits any of these contract
changes until an investigation can be completed.
Please feel free to contact me if you have any questions or need additional
information.
Sincerely,
George Pardon
33 year Cypress Resident
Cypress, CA 90630
http://www.californiacountynews.org/news/2015/10/orange-county-trash-hauler-
facing-max-fine-political-money-laundering
https://event-newsenterprise.com/valley-vista-issue-splits-vote-at-first-meeting-
of-new-council/
Attachments include OC Register article and an excerpt from the original bid
proposal from Valley Vista
At this time, we have not made any determination about the allegation(s) made in the
complaint. Within 14 days, the complainant will be notified of our intent to:
• investigate the allegations of the complaint;
• refer the complaint to another governmental agency;
• take no action on the complaint because, on the basis of the information provided,
the Commission does not appear to have jurisdiction to investigate; or
• take no action on the complaint because the allegations of the complaint do not
warrant the Commission's further action.
A copy of that letter will be forwarded to you. If you have any comments on the
allegation(s), your comments must be submitted in writing directed to Ginny Lambing at
the address shown above or by email to glambing@fppc.ca.gov. Please include the
complaint number referenced above in your response.
Sincerely,
Angela J. Brereton
Angela J. Brereton, Chief
Enforcement Division
AJB:gal
ORANGE COUNTY REGISTER
NEWS
Trash hauler fined for campaign money
laundering
Oct. 5, 2015
Updated 5:02 p.m.
Longtime Orange County trash hauler George S. Briggeman Jr. engaged in political money laundering
and has agreed to pay the maximum fine of $15,000, according to documents released Monday by the
state Fair Political Practices Commission.
The agreement is expected to be get final approval from the FPPC at its Oct. 15 meeting.
Briggeman used a Wyoming company, Green and Clean LLC, to funnel $13,200 into 2012 city council
races in Anaheim, Lake Forest and Cypress, according to the FPPC. The money was transferred from
Green and Clean to Taxpayers for Safer Neighborhoods, which made independent expenditures for six
candidates and against three others in those three cities.
“This case involves a series of transactions calculated to intentionally prevent the public from learning
the true source of funds,” according to the FPPC’s findings. “The violations here are especially egregious
because they were intentional, deliberate and the activity associated with the violations was intended to
circumvent the central purposed of the (state Political Reform) Act.”
Briggeman has since sold his waste companies, Consolidated Disposal Services and Briggeman Disposal
Services, to Republic Services. He did not respond to requests for comment.
Five of the six candidates supported by Briggeman won their races and two of the three he opposed lost.
His company never won contracts in Anaheim or Lake Forest -- in fact, it did not end up bidding on the
subsequent Lake Forest contract.
However, his company operated continuously in Cypress for more than two decades, under the
ownership of Briggeman and then Republic Services. Valley Vista Services was awarded the city’s hauling
contract by the City Council in July, said Cypress City Clerk Denise Basham.
The FPPC settlement isn’t the first time Briggeman’s political donations have raised legal issues.
In 2010, a court petition was filed against Consolidated Disposal and the city of Los Alamitos. It alleged
that Briggeman made campaign contributions through Taxpayers for Safer Neighborhoods “with the
condition that this committee would monetarily support local city council candidates who agree that
they would approve a contract to his business,” according to FPPC documents.
In 2011, a judge granted the petition and invalidated the contract between Consolidated Disposal and
the city, “but did not make a decision whether Briggeman made contributions with an agreement to
contract with his business,” according to the FPPC.
Among the winning candidates supported by Briggeman's campaign money was Anaheim Councilwoman
Lucille Kring.
"This is completely news to me," Kring said Monday. "Briggeman is a new name to me."
Anaheim last approved a new trash contract in March 2012, according to city spokeswoman Ruth Ruiz.
That was before Kring was elected. Losing Anaheim candidate John Leos was also supported by the PAC
that Briggeman helped fund, and winning candidate Jordan Brandman was opposed by PAC.
Neither immediately responded to requests for comment.
In Lake Forest, winning candidates Adam Nick and Dwight Robinson were supported by the Taxpayers
for Safer Neighborhoods PAC, while losing candidates Terry Anderson and Marcia Rudolph were
opposed by it.
Anderson said he felt the money of developers and other special interests, using Taxpayers for Safer
Neighborhoods and other PACs, cost him the close election.
"It's refreshing to see a little justice," he said of the FPPC fine against Briggeman.
Rudolph is deceased. Robinson and Nick said they'd never heard of Briggeman.
In Cypress, winning candidates Rob Johnson and Mariellen Yarc were supported by the PAC. Neither
immediately responded to requests for comment.
Contact the writer: mwisckol@ocregister.com; @MartinWisckol