Is Lake Forest For Sale? Part 3—The Special Interests

This is the third installment in our multi-part series on corruption in Lake Forest. Part 1 provided a background to the way in which money has influenced the voting patterns of city council members. Part 2 showed just how expensive it can be to run an election campaign, and how much money developers and real estate interests pay to have their candidates elected. Today we examine the developers in some detail, and in Part 4 we will look at what happened when these same developers went to the council asking for favors.

Brookfield

Brookfield Residential (BR) is public company that describes itself as “a land development and homebuilding company active in ten North American markets” (Calgary, Edmonton, Toronto, San Francisco, LA, San Diego, Riverside, Washington, DC, and Denver). It controls over 100,000 lots, $2.8 billion in assets, and is the “fifth largest” company in its market segment. In 2012 they reported $1,340,000,000 in revenue. Their general strategy is to build homes on 15 to 20 percent of their land and then partner with other companies. Corporate offices are in Calgary and the local office is in Costa Mesa.

According to their annual report, they have 78 “unentitled lots” in Lake Forest, which is a small portion of the 4,682 lots they control in the “LA/Southland” area, and an even smaller percent of the total 100,000 lots they control. Indeed, Lake Forest is one of their smallest projects.

Dave Bartlett is the “VP of Land Entitlement”. He has been President of the OC Building Industry Association (BIA), and he’s the one who shows up at our City Council meetings to lobby for his company’s interests.

Trumark

Trumark Group of Companies “is a diversified real estate developer and builder with expertise in land acquisition, homebuilding, community and commercial design, and the entitlement process.” Between 2009 and 2012 they raised more than $140 million to fund their projects that include nearly 2,500 lots statewide, nearly 30 percent of which are in Southern California.

Trumark has been active in Silicon Valley, San Jose, Milpitas, Upland, and Sunnyvale. This is not Trumark’s first foray into land deals in Lake Forest. In 2011 they sold the 143 acre Whistler Ranch property to KB Homes who went on to build homes that are currently being sold.

Gregg A. Nelson is the Managing Director of Trumark. In addition to his work at Trumark, Nelson is listed as the Agent for Foothill Village according to the California Secretary of State. Foothill Village and Trumark share the same Danville address. As far as I can tell, Foothill Village exists solely for the purpose of dispensing money to politicians.

James O’Malley is responsible for land acquisition as well as securing entitlements in the broader Southern California region. In addition to his work at Trumark, he sits on the board of BIA OC, where Dave Bartlett, from Brookfield, also served. O’Malley is also the Trumark rep who shows up to lobby the City.

Brookfield and Trumark have worked together before. In 2010 they sold 89 lots in San Jose.

Richard Goacher/RGP Consulting

Richard Goacher was a Planning Commissioner for the City of Lake Forest when it first incorporated. He moved on to serve on the County Planning Commission, and founded RGP Planning and Development, a consulting firm headquartered in Irvine. His main clients in RGP Consulting are developers, and one of his clients in Trumark. On Dec 11, 2011, Richard Goacher wrote to then Mayor McCullough on behalf of his client, Trumark Companies, urging the City to cooperate in their latest project.

(FWIW - Jeremy Krout, previously a Planner for the City of Lake Forest, is now a Principal at RGP.)

So that’s the list of characters. It's only a partial list but for our purposes they are the main focus. Here’s what they did.

3rd Party Payments

In October 2012, Brookfield  and Trumark (through Foothill Village LLC) gave $42,500 to the Republican Party of Orange County (RPOC). With that money, the RPOC spent $31,187 on the Lake Forest election as follows:

• $10,970.13 to support Adam Nick
• $10,970.12 to support Dwight Robinson
• $8,107.41 to oppose Marcia Rudolph
• $1,140.11 to oppose Terry Anderson

Under the name “Taxpayers for Safer Neighborhoods” (TSN), Trumark/Foothill Village provided an additional $22,500 and was joined by various other individuals/groups including the Building Industry Association (BIA) that contributed another $5,000 (James O’Malley from Trumark, currently sits on the Board of the BIA and Dave Bartlett is a past President). TSN then spent the following:

• $5,625.35 to support Adam Nick
• $6,435.35 to support Dwight Robinson
• $8,817.93 to oppose Marcia Rudolph
• $2,628.00 to oppose Terry Anderson

Direct Payments to Candidates

Apart from these payments, Foothill Village/Trumark and the BIA also made the following direct payments:

• $5,000 to support Marcia Rudolph (Foothill Village)
• $2,500 to support Dwight Robinson (Richard Goacher)
• $1,000 to support Dwight Robinson (BIA)
• $500 to support Dwight Robinson (Foothill Village)
• $250 to support Terry Anderson (Foothill Village)
• $250 to support Kathy Zechmeister (Foothill Village)

Brookfield made the following direct payments:

• $500 to support Kathy Zechmeister (Dave Bartlett)
• $500 to support Marcia Rudolph (Brookfield)

Summary for Election 2012

Here is the amount of money spent by the two developers, directly and indirectly, either through their businesses, associated businesses, or individuals/associates.

• Trumark – $59,500
• Brookfield - $21,000

Here is who received the benefit of the money, either directly or indirectly.

• Supporting Dwight Robinson - $21,405
• Supporting Adam Nick - $16,595
• Supporting Marcia Rudolph - $5,500
• Support Kathy Zechmeister - $750
• Supporting Terry Anderson - $250
• Opposing Marcia Rudolph - $16,924
• Opposing Terry Anderson - $3,768

Previous Elections

Of course, to understand the votes, we need to look at more than one election cycle. The footprint for these developers stretches back to the previous election as follows:

• Scott Voigts - $6,050

o Brookfield gave $250 on 10/12/2011
o Trumark gave $250 on 10/11/2011
o Richard Goacher gave $2,800 on 9/16/2011
o Richard Goacher gave $2,000 on 10/27/2010
o RGP Consulting (Richard Goacher) gave $250 on 11/17/2010
o BIA gave $500 on 10/25/2010

• Peter Herzog - $1,250

o James O’Malley (Trumark) gave $250 on 12/25/2010
o BIA gave $1,000 on 9/30/2010

Going into the December 2012 meeting of the City Council, Brookfield and Trumark, either directly or through third parties and associates, contributed more than $80,000 to the election campaigns of 4 of the 5 city council members – Robinson, Nick, Voigts, and Herzog. They even had significant contributions to Marcia Rudolph, who was defeated in 2012, but who didn’t fail to show up and speak in favor of the two companies that gave her more than $5000 for the 2012 campaign. And just to be safe, they sprinkled some money to also-rans Terry Anderson and Kathy Zechmeister. Of course the money to Anderson and Zechmeister wasn’t completely wasted. Anderson served on the Planning Commission as did Zechmeister’s husband, and passing through the Planning Commission was crucial for the developers.

Note that even though the money was spread widely, most of it went to Robinson and Nick, with Voigts getting the lion’s share of the rest.

This is the background to the city council meetings and discussions about the fate of the project sponsored by the two development companies. That’s the topic of our next article.