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Susana Barrios
From: Ryberg, Erinn <Erinn.Ryberg@asm.ca.gov>
Sent: Monday, August 14, 2023 12:19 PM
To: Theresa Bass <TBass@anaheim.net>; Jim Vanderpool <JVanderpool@anaheim.net>
Subject: [EXTERNAL] Urgent Audit of the City of Anaheim
Warning: This email originated from outside the City of Anaheim. Do not click links or open attachments unless you recognize
the sender and are expecting the message.
Hello,
The recent investigation that was released regarding the City of Anaheim and the events of 2022 raised serious concerns
regarding the Anaheim Chamber of Commerce and Visit Anaheim. Assemblymember Avelino Valencia has requested an
audit of the City of Anaheim to review the public funds that have been distributed to these entities, in addition to other
related matters. This audit request has been approved by the Joint Legislative Audit Committee and has been sent to the
State Auditor’s office. For your information, the approval letter and the audit request letter are attached to this email.
Please let me know if you have any questions.
Sincerely,
Erinn Ryberg
Chief of Staff
Office of Assemblymember Avelino Valencia
68th California Assembly District
Capitol Office: 916‐319‐2068
1021 ‘O’ Street, Suite 4120
Sacramento, CA 95814
Erinn.Ryberg@asm.ca.gov
68th Assembly District Website
August 12, 2023
Grant Parks
California State Auditor
621 Capitol Mall, Suite 1200
Sacramento, CA 95814
Re: Approval of City of Anaheim Audit – Committee Rule 18
Dear Mr. Parks:
In accordance with Rule 18 of the Joint Legislative Audit Committee, I am asking your office to
move forward with the enclosed urgent audit request regarding the City of Anaheim. As you are
aware, a recent investigation raised serious concerns regarding the City. I hope this audit will
provide much needed transparency and accountability. I therefore ask and trust that you will
prioritize it appropriately.
Should you have any questions, please contact Committee staff at (916) 319-3300.
Sincerely,
DAVID ALVAREZ, Chair
Joint Legislative Audit Committee
Assemblymember, 80th District
Enclosure
cc: Members, Joint Legislative Audit Committee
Robert Rivas, Speaker, California State Assembly
Toni Atkins, Pro Tempore, California State Senate
August 4, 2023
The Honorable David A. Alvarez
Chair, Joint Legislative Audit Committee
1020 N Street, Room 107
Sacramento, CA 95814
Re: Request for Urgent Audit of the City of Anaheim.
Dear Chairman Alvarez,
I respectfully request that the Joint Legislative Audit Committee approve an urgent audit of the City of
Anaheim to review the public funds they have disbursed to the Anaheim Chamber of Commerce and
Visit Anaheim, and ensure that they have fulfilled their contractual obligations to the City.
The Anaheim Chamber of Commerce and Visit Anaheim are two nonprofits the City of Anaheim works
closely with to generate economic growth in our community. The City of Anaheim is a member of the
Anaheim Chamber of Commerce, and the City has councilmembers on the board of directors for Visit
Anaheim. The mission of the Anaheim Chamber of Commerce is to help strengthen the local economy
and promote Anaheim’s economic development. According to their website, their strategic initiatives for
business development include representing business interests in government and political advocacy.
Visit Anaheim’s objective is to attract tourism to the City of Anaheim to help increase tax revenue. They
work with partners and stakeholders in order to advertise the resort district and convention center
industry in the City. The Anaheim Chamber of Commerce and Visit Anaheim receive public funds from
the City in order to achieve these goals. Recent discoveries have shed a new light on their potential
influence in policy making and a lack of bargained exchange for their receipt of public taxpayer dollars.
Visit Anaheim generally receives funding through a City assessment on the room revenue for all hotel
facilities within the Anaheim Resort and Platinum Triangle districts. However, in March 2020, the
Anaheim City Council approved a $6.5 million grant for Visit Anaheim so they could use those funds to
help the City’s hospitality industry as the pandemic had stunted revenue from travel and dining. The
Anaheim City Manager at the time expressed concerns with the City giving Visit Anaheim this money
and suggested that the tourism bureau should pay back the City for these relief funds, with interest. On
April 21, 2020, the Anaheim City Manager was fired. In October of 2020, Visit Anaheim sent out a
press release outlining their plans for spending $2.5-$3 million of the granted $6.5 million, but they had
yet to spend any money. City councilmembers considered adding an agenda item requesting Visit
Anaheim return funds to the City in order to use it for community needs, such as rent relief and city
services, but it was never added.
RECEIVED 8/4/2023
Last year, a Federal Bureau of Investigation (FBI) probe revealed that the former Mayor of Anaheim
had attempted to rush a proposal for the sale of the Anaheim Angels stadium in order to receive
campaign contributions in return. Additionally, the probe alleged the Mayor leaked confidential
information regarding the sale of the stadium, including an appraisal of the property, to the Anaheim
Chamber of Commerce and the Angels Baseball organization.1 In light of these revelations, the mayor
resigned and the City of Anaheim tasked an independent investigator to determine the extent of the
alleged corruption involving the mayor, City staff, consultants, and lobbyists. On July 31, 2023 the
City-commissioned corruption report (July 31 report) was released to the public and detailed that at least
$1.5 million of the $6.5 million in relief funds that the City appropriated to Visit Anaheim were
improperly diverted to the Anaheim Chamber of Commerce.
The July 31 report also highlighted a 2013 audit report of the Anaheim Chamber’s Enterprise Zone
Program. The City awarded the Anaheim Chamber with a five-year no-bid contract for $1.8 million in
February 2012 to implement the Anaheim Enterprise Zone Program, which was designed to provide tax
credits to participating businesses that hired individuals from economically distressed areas. A year into
the program the Chamber requested an additional $1.1 million. Key findings from the audit report noted
that the Chamber had inefficient reporting requirements that did not ensure contract compliance and that
the labor documentation was vague and did not follow standard practices for reporting staff hours. The
investigative report concludes the Chamber took advantage of this opportunity to charge the City for
program costs that were not adequately documented and potentially unjustifiable.
Based on the July 31 report’s findings, it is clear that we need more oversight over the City of
Anaheim’s disbursement of public funds to the Anaheim Chamber of Commerce and Visit Anaheim, as
they may have directly influenced City officials for personal and political gain at the expense of what
was best for the city. Anaheim residents deserve transparency to ensure their taxpayer dollars are spent
appropriately. For these reasons, I am requesting the State Auditor conduct an audit of the City of
Anaheim to determine if there was a misuse of public funds at the hands of the Anaheim Chamber of
Commerce and Visit Anaheim.
In order to comply with Rule 18 of the Joint Legislative Audit Committee that states the cost of urgent
audit requests must not exceed $290,000, this request allows the State Auditor to modify or decrease the
scope of this audit to remain within the monetary limit. The scope of the audit request is as follows:
1. Examine all sources of public funds the City dispersed to the Anaheim Chamber of
Commerce and Visit Anaheim or their affiliates, over the past 10 years, and how
those funds were used.
1 The sale of the stadium was approved by the Anaheim City Council but subsequently put on hold when
the City was sued by the California Department of Housing and Community Development over a violation
of the Surplus Land Act. The City disputed it did anything improper , but eventually settled with the state.
However, prior to the settlement being approved by the court , state officials learned of the FBI probe into
the Mayor and ultimately the sale never went through.
2. For each contract, initiative, project, etc. approved by the City in which the Anaheim
Chamber of Commerce or Visit Anaheim were recipients of public funds, identify the
source of the money, the parameters on those funds, and how each dollar was
ultimately spent. This should include a review of all contracts approved by the
Anaheim City Council, City Manager, and City Director in the past 10 years.
3. Examine the City’s policies regarding projects, grants, contracts, etc. and identify
what went into their decision making process for awarding funds to the Anaheim
Chamber of Commerce and Visit Anaheim, and their affiliates. Additionally, review
the City’s process for monitoring their projects, grants, contracts, etc. with the
Anaheim Chamber of Commerce and Visit Anaheim to ensure compliance, and
recommend ways they can improve their oversight.
4. Identify COVID funds, such as the Coronavirus Aid, Relief, and Economic Security
Act (CARES Act), awarded to the City and then given to the Anaheim Chamber of
Commerce and Visit Anaheim. For any COVID funds allocated to these entities by
the City, identify the amount of money given, the parameters of those funds, and how
the dollars were ultimately spent.
5. Identify the number of no-bid contracts the City awarded to the Anaheim Chamber of
Commerce and Visit Anaheim, and determine whether the lack of competitively bid
contracts were justified and/or complied with the City’s policies and practices.
6. Determine if any public dollars allocated to the Anaheim Chamber or Visit Anaheim
by the City of Anaheim were used for increases in staff salaries or compensation for
professional services (consultants, lobbyists, contractors, etc.) during the COVID
shutdown.
7. Identify the public funds the City has spent on negotiations surrounding the sale of
the Angels stadium and resolving the Surplus Land Act issue.
8. So long as it does not interfere with litigation or criminal indictment, identify and
report any corruption that took place.
9. For the last 10 years, identify any conflicts of interest between the City of Anaheim,
Anaheim Chamber of Commerce, and Visit Anaheim.
10. Determine if the City has adequate practices and policies in place to ensure staff,
councilmembers, Anaheim Chamber of Commerce, and Visit Anaheim comply with
the Brown Act. Identify any violations of the Brown Act.
Thank you for your consideration of this request. Should you have any questions, please contact Katie
Guthrie at Katie.Guthrie@asm.ca.gov or by calling 916-319-2068.
In service,
Avelino Valencia
Assemblymember, District 68