Pasadena City Manager Michael Beck and Mayor Bill Bogaard faced the press and media Tuesday, December 30th to discuss the theft of 6.4 million dollars from a fund that had 
been set aside to pay for moving utility lines underground. The L.A. County District Attorney’s Office arrested a former Public Works Employee Danny Wooten, his temp assistant Melody Jenkins and city employee Tyrone Collins, owner of Collins Electric in Altadena for the embezzelment scheme, which could result in state prison for the 60 count felony complaint against all three. Beck says he was troubled to learn about the fraud.
“My first reaction was devastating. This is a significant compromise of the public trust that we have. I know many of th
e 2,000 employees within the city of Pasadena, and I know how hard working they are and how honest and dedicated they are, and to think that one of our own could have taken advantage of weakenesses within our system to leverage their own personal gain is very frustrating and very upsetting. And I was very devastated and continue to be so.”
City Council Member and Candidate for Mayor Terry Tornek says the investigation began after he started asking questions about the underground utility program or uup, something he considered to be a slush fund, during a municipal services sub committee meeting in May. When asked why the questions came up recently rather than sometime within the 11 year time frame, Tornek responded,
” It’s the perfect question. I think the answer is there was a unique circumstance in this particular account.” He went on to say, “The city has not done a good job of executing that program which is why it was a target of mine. At the current rate of work it would take something like 70 years to complete the project. The reason this was such a sitting duck was that there was 50 million dollars sitting in this particular pot, that the city was incapable of spending in an efficient way and this guy, this thief, city employee, identified it as a sitting duck and exploited it.”
When City staff discovered the fraud, they went to police, who sent the matter to the DA’s office. Money for the program comes from residents’ utility bills, about $30 per year. Following this scandal, Tornek says the City has a ways to go to restore the public’s trust.
“Oh this is very serious. I mean the public needs to be confident that the City government is taking care of their money. P
eople don’t like to pay money for government but at least they want to be confident that somehow it isn’t being stolen.”
Both Tornek and the City Manager agree that the 11 year embezzlement proves to be a massive failing of the City’s internal controls. But Tornek says it could cost Beck his job. He says Beck and the City government will have to show how well they handle the situation going forward, and that it will be up to the City Council to decide what happens next since the Council hires the City Manager.
“If the manager is not performing, it’s up to the City Council to take action. His future with his city… I mean he’s been a very capable manager in a lot of areas, has a lot of good will, has earned a lot of respect in the community, but as the results of this investigation comes to light and we have a chance to see how the city government responds to the challenges, I think that will certainly have an impact on his future with the city.”
When asked if this investigation would impact his job, Beck replied, “As it relates to me personally, this isn’t about me, it’s about the City of Pasadena and ultimately we need to ensure that we can rebuild confidence that the community can have with the city of Pasadena, and that’s what we will strive to do.”
In the meantime, Beck says the holes in the system have been closed. He says questionable payments from the U
UP stopped when Wooten was put on administrative leave from an unrelated matter in March. He says the city hired internal auditing firm KPMG which has made 43 recommendations for council approval, and that 4 other City employees have been place on administrative leave. Beck ended the news conference with a message to Pasadena residents.
“I want to close by telling the residents of Pasadena that their government will be stronger as a result of this investigation, that their hard earned money will be protected and the alleged criminal actions of one will not change the values that we hold so dear in Pasadena.”
The Pasadena City Council was not originally scheduled to meet this coming Monday, but scheduled a special session for Monday, January 5th, at 5pm after the arrests were announced. The City of Pasadena website lists documents associated with this story at www.cityofpasadena.net/invoiceinvestigation.