Last Friday the city of Hawthorne announced the termination of Finance Director Rickey Manbahal after a preliminary investigation revealed he obtained city funds without council approval. The city has now turned over their investigation to the LA County District Attorney’s office. Residents and 2UrbanGirls are wondering why now? City Hall insiders share with 2UrbanGirls Manbahal’s termination could be related to an internal investigation of sexual harassment claims. Mayor Alex Vargas was previously investigated for acting inappropriately with staff in 2015.
During a special meeting held on May 29, 2015, three members of city council voted to fire then City Manager Michael Goodson. Former Mayor Chris Brown and councilwoman Angie Reyes-English voted against his termination. Unbeknownst to the public, Goodson had authorized a $25,000 loan of public funds to Manbahal that the city agreed could be paid back through his sick time.
The Daily Breeze noted that Councilwoman Olivia Valentine regularly supported Goodson, along with Brown and Reyes-English, then swiftly switched sides. Perhaps her legal senses kicked in that she could be implicated in Goodson’s and Manbahal’s deception.
Valentine was rewarded for going against Goodson, Brown and Reyes-English when she was appointed to the city council in February 2016 after losing her 2015 re-elction bid when voters ousted Chris Brown. Now there are two Republicans on the dais.
After Goodson’s termination it came to light he was passing out bonuses, and promotions, all willy nilly to handpicked employees and gave himself a hefty raise without councils approval. Remaining city employees were refused raises due to the city’s financial issues.
The Daily Breeze reported on June 12, 2015, the day after the special meeting, where the only items on the agenda were the budget presentation and two closed session items, Manbahal admitted to misleading Mayor Brown, council and the public over the city’s financial condition.
“I was asked by the city manager to inject fixed assets in (the city’s budget),” Manbahal said. “But (the revenue) didn’t materialize. I was directed to use some of the reserves.
“It really seemed like these projects were materializing, so we went ahead and incorporated them into the budget.”
The minutes reflect that after his presentation, not a single member of the city council questioned why he lied or ask the interim city manager Arnold Shadbehr to investigate the finances. They (Brown, Alex Vargas, Angie Reyes-English, Olivia Valentine and Nilo Michelin) collectively did nothing. Did they already know what was going on in the city’s finance department? Should the District Attorney be looking into them too?
Manbahal was allowed to give another budget presentation September 10, 2015, while residents wondered if he could be trusted to give an accurate account of the finances after previously admitting he lied.
Three years later Manbahal was still on the job, under many members of the previous administration and still in the position of Finance Director.
According to City Hall insiders, the city began investigating claims of sexual harassment against Manbahal which led to finance employees spilling the beans on the incessant fraud in the department and the $25,000 loan that Manbahal received under Goodson and Brown’s tenure.
Inglewood residents fear the same fiscal malfeasance is occuring under Chief Financial Officer/Assistant City Manager David Esparza, who has a documented history of such behavior while working for the Housing Authority of the City of Los Angeles (HACLA) and allegations made by his former colleague at HACLA, turned Inglewood Accounting Manager Barbara Ohno.
KCET’s SoCal Connected did an expose on the egregious spending of HACLA funds under the direction of then HACLA CFO David Esparza. Barbara Ohno was employed there at the time as well.
In Februay of this year he gave a 1st quarter budget presentation that listed a $17 million dollar shortfall that would be shored up with the sale of certain Successor Agency owned properties and the use of reserves.
$11 million would come from reserves, $5 million from savings on healthcare and not filling vacant positions and nearly $5.75 million from the sale of property located at 101 S. La Brea Ave. (the former location of Burger King and AMAN Inc.). Both Esparza and Mayor Butts whittled the deficit to being only $250,000. The report also listed a reserve balance of $61 million dollars.
When the public received the mid year budget numbers on May 15, 2018, somehow the reserve balance increased to $69 million, with no explanation, and the city was still $17 million short. There was no discussion of pending sale of property to reduce the deficit and no discussion of the deficit only being $250,000.
The other inconsistency listed, on both the February and May staff reports were a one-time infusion of cash due to refinancing of their Pension Obligation Bonds. In February the one-time infusion totaled $35.1 million. By May that “one-time” figure ballooned to $36.5 million, again with no explanation. It appears the Finance Department presumes no one reads their reports.
Esparza appears to be back to his old tricks in his day-to-day running of the Inglewood Housing Authority. He recently created an Assistant Housing Manager position, which the department has never had in the entire history of the IHA’s existence. He handpicked Teresa Sanford to receive the promotion, that was not made available for other city employees to apply for, despite an internal investigation that revealed the employees disdain for her management style. They also noted she regularly cries to Esparza to get ahead in the department by throwing colleagues under the bus, and some of which end up terminated and successfully suing the city for wrongful termination.
It was also under Esparza’s tenure that almost $700,000 of HUD funds never made it to the Inglewood Housing Authority, they stayed in the city’s general fund. The city was given a May 2017 deadline to return those funds.
Inglewood finance employees discuss how managment paid themselves unauthorized overtime and were allowed to payback under mysterious terms. Similar to Hawthorne’s Mandhabal repaying his unauthorized loan via sick time? It would appear that certain city employees, have the “goods” on what’s REALLY GOING ON WITH CITY FINANCES and are allowed to run amuck and use it to their financial advantage.
It is still a mystery how the Mayor’s “executive assistant” finagled a position of Parking Director, with absolutely no credentials outside of being a well healed secretary, and is earning nearly $250,000 per year, according to Transparent California. Her salary has DOUBLED in less than four years. While Parking Manager, Mario Inga, who has over a decade of parking management experience, was not considered for the positon and is paid significantly less at $105,000 per year.
Employees stories, in both the city of Hawthorne and Inglewood mirror each other. Outrageous bonuses given to certain staff, positions opening up that employees aren’t given the opportunity to apply for and misstating of the true financial condition of the city’s finances.
When Esparza joined the city of Inglewood in 2014 he reported to Finance Department employees there was only around $25 million in the reserve account. If the city is running a deficit, for every year since, how has the reserve account increase by nearly $44 million dollars with no clear explaination of how? His former accounting manager has already said how.
Mayor Butts touts his experience as a former Police Chief which gives him the ability to have an impeccable barometer of one’s character.
Why would Mayor Butts hire, give bonuses and publicly praise Esparza, who has a documented history of deception and trickery of public funds, unless those deceptive tactics are being used to his advantage to keep him mayor of the city of Inglewood?