Jeffrey Anderson{mosimage}A week after Los Angeles City Attorney Rocky Delgadillo filed
criminal charges against downtown developer Meruelo Maddux Properties
Inc. for illegally dumping asbestos-tainted material, key questions
remain.
Why charge the president of the company, John Charles
Maddux, and not CEO Richard Meruelo, whose Merco Group is listed on
documents filed with the county as the site owner of the property at
1060 North Vignes Street, where Meruelo’s company, Meruelo Maddux
Properties, illegally demolished seven industrial structures last year?
Where did Meruelo Maddux haul the highly regulated toxic debris?
And,
finally, why is Mayor Antonio Villaraigosa refusing to acknowledge what
appears to be a troubling pattern of behavior by Meruelo, downtown’s
largest landowner — and Villaraigosa’s largest campaign contributor —
who recently was charged in a separate case involving building- and
health-code violations, including rat infestation, at the Seventh
Street Produce Market?
“You already wrote a story, so we’re not
going to comment,” complained Villaraigosa press deputy Matt Szabo, a
former spokesman for Delgadillo. “The mayor is not going to comment on
a prosecution.”
When asked about the mayor’s perception of
Meruelo and his business practices, Szabo replied, “We’re not going to
comment about that.”
Last week, Delgadillo charged company
president Maddux and project managers John Durham and John Horrigan
with 16 criminal counts of disposing of hazardous waste, failing to
notify the South Coast Air Quality Management District of asbestos
demolition, and failing to provide documentation of the removal of
toxic waste at 1060 North Vignes Street.
In his September 2006
public stock offering, on file with the Securities and Exchange
Commission, Meruelo proposed building “workforce housing” on the site,
as part of what he characterizes as his “socially responsible”
investment strategy. The site owner listed on documents Meruelo has
filed with the Los Angeles County Fire Department is Merco Group, which
he owns.
When the L.A. Weekly called the number listed on
those documents, a person answered “Meruelo Maddux Properties.” When
asked, “Isn’t this Merco Group?” the person replied, “Same thing.”
Yet
Delgadillo did not charge Meruelo with the dumping crime. Delgadillo
spokesman Frank Mateljan said the City Attorney’s Office filed charges
against Maddux based on the investigation conducted by the smog-control
district, and because Maddux allegedly appeared to play a more hands-on
role in day-to-day operations.
“If other facts emerge, then we’ll amend the filing,” Mateljan said, insisting, “Politics is not a consideration.”
Asked
for a reaction to the mayor’s refusal to comment on the matter or on
Meruelo’s business practices, Mateljan said Delgadillo’s office is
focused more on locating the toxic debris, which has mysteriously
disappeared. “South Coast did its job, we’re doing ours. Others will
have to speak for themselves.”
Little is known about the
vanished toxic debris, except that it was substantial and it was hauled
away by successive truckloads over several days in November 2005. To
date, the City Attorney’s Office has not directly contacted Meruelo
Maddux or its officers.
Asked to explain its efforts so far,
Mateljan said, “We want to know where it is,” pointing to the company’s
failure to disclose that information. “That’s why we charged them.”
This
week, Meruelo spokesman Michael Bustamante refused to say where the
materials got dumped and added, “Our only contact with the City
Attorney’s Office is from reading their press release.”
Meruelo’s
company lacked the required permits when it tore down the structures as
part of his plan to build “350 mid-rise condominium units with 21,000
square feet of retail” on the tainted site. Environmental consultants
have detected lead, heavy oil, diesel fuel and benzene compounds in the
soil, according to a proposed cleanup plan on file with the L.A. County
Fire Department.
The charges come on the heels of separate
criminal charges Delgadillo has filed against Meruelo and another of
his companies, Alameda Produce Market, for building- and health-code
violations at the Seventh Street Produce Market, which NBC Channel 4
recently caught red-handed allowing rat infestation and other
disturbing health-code violations, such as employee urination near
boxes of produce destined for stores and restaurants throughout the
region.
Meruelo’s “socially responsible” investment strategy has
benefited from public money: He purchased the produce market with the
help of an $8 million loan from the Los Angeles Community Development
Bank, and has received a $150 million line of credit from the
California Public Employees Retirement System board, which he has
tapped in part to buy land that the Los Angeles Unified School District
targeted for acquisition.
Villaraigosa’s campaign for mayor
benefited from more than $197,000 of Meruelo’s money. Moreover, Meruelo
is purportedly developing the residential and commercial sector
downtown that is at the core of Villaraigosa’s vision for the city.
Delgadillo’s office emphasizes that its investigation is ongoing.
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