In the last few weeks, LompocToday has been providing access to various uncoverings of City Council Actions found by residents of Lompoc.
Don’t Let the Fox Guard the Henhouse – by Martin Bender
(Full Report that was Submitted to City)
We’ve all heard the saying before, and while it seems like it should go without saying, this is exactly the position the Lompoc city council find themselves in today. At issue is a contract valued at ~$9.1 million between the City of Lompoc and Visit Lompoc LLC. The purpose of the contract is to administer a Tourism Business Improvement District (TBID) within Lompoc whereby visitors to hotels pay a “TBID Assessment” resulting in a 3% extra fee on their hotel stay. The City of Lompoc collects the assessment fee once a month from hotel owners and then transfers it, minus a small percentage, to Visit Lompoc LLC. Visit Lompoc LLC is then charged with using those funds to drive tourism to Lompoc, specifically tourism that results in overnight stays at Lompoc hotels. The Lompoc city council is charged with overseeing the contract, including reviews of its annual financial reports.
Sounds great in theory, a giant collective marketing pool of money to drive local tourism, and it’s been extremely successful in some local cities and counties. I recently had the opportunity to meet with a local Lompoc hotel owner who told me that he’s received no benefit from Visit Lompoc LLC in years and even worse is that he’s paying $4,000-$7,000 a month to the city to fund the Visit Lompoc LLC, money that he says the hotel could desperately use. The hotel owner, who wished to remain anonymous, expressed that he believed the Board of Directors of Visit Lompoc LLC had several conflicts that prevented them from running it unbiasedly.
The most glaring issue is that four of the seven board members are in the same extended family and not a single hotel owner outside of that family is on the Board of Directors. That is except the President of the Board who represents Legend Hospitality, Inc., an LLC that does consulting and management…you guessed it, for the same family of hotel owners on the board for Visit Lompoc LLC. Between the five of them, they have a super majority control of everything Visit Lompoc LLC does and doesn’t do for Lompoc hotels.
This is the same family that in 2018 bought the President of Visit Lompoc LLC a $58,000 truck and paid for her to go on a $7,000 vacation according to financial filings. This is the same family that in 2022 sold her a home worth nearly $1,000,000 for only $650,000….a gift of nearly $350,000 (a violation of the Political Reform Act).
To make it worse, this particular individual also sits on the city council of Lompoc. That’s right, the President of Visit Lompoc LLC, that has a $9.1 million dollar contract with the City of Lompoc, is on the very city council whose responsibility is to oversee the contract with Visit Lompoc LLC. The same person who also has a limited hotel ownership with the aforementioned family on the board of directors of which her interest is valued at greater than $100,000. The same person who has a consulting business (making $100,001 to $1,000,000/year) in some of the very hotels that Visit Lompoc, LLC is promoting over others. You really couldn’t make this stuff up if you wanted to but here we are. So who is this mystery woman, none other than Lompoc city council member Gilda Cordova.
A few weeks ago I wrote an article questioning the residency of Ms. Cordova as the house she purchased in 2022 was located outside the city limits and she had listed the address on official forms she filed with the state. Since council members can’t live outside the city limits I sent an inquiry to the city attorney to look into. Instead of just addressing the concern I raised, Ms. Cordova made a video statement and released several subsequent statements claiming to be the victim of some local hate group that was determined to remove her from city council because she was a successful minority woman. Ms. Cordova went on to state that any allegations that she’s using her position on city council and Visit Lompoc LLC are “untrue, unfair and unfounded.” I guess I shouldn’t have been surprised that she tried to bring race and gender into the discussion but it definitely felt like her reaction seemed angry, dare I say infuriated that someone would dare question her.
Ms. Cordova even went on to say that “none of those people that are willing to speak out in such a negative manner are ever going to show up to a council meeting because they’re the same people that don’t show up for the things that need to be done and the hard work that needs to be performed in this community.”
Well Ms. Cordova, tonight I showed up to the council meeting and presented the city council with an 11-page report of violations that you’ve committed as both the President of Visit Lompoc LLC and as a member of the city council.
The alleged violations included: 7 counts of failing to provide timely annual reports in violation of the city contract, some submitted as late as 25 months. That Visit Lompoc LLC is not in compliance with the Ralph M. Brown Act as they have zero transparency of meetings, agenda items or meeting minutes, as is required under the terms of the city contract. That Visit Lompoc LLC has incorrectly calculated city fees they owed, underpaying the city by thousands of dollars.
That Visit Lompoc LLC violated multiple state laws by enacting an increase in the hotel assessment fee (from 2% to 3%) without city council conducting a public hearing and giving notice to the assessed owners of the proposed change, resulting in the city unlawfully collecting over $500,000 from guests who have visited Lompoc hotels any time since 2020 to present. Submitting annual financial reports to the city of Lompoc, that between 2018 and 2022 have had $284,795.51 that vanished into thin air, and that’s not to mention the annual financial numbers Visit Lompoc LLC submits to the city don’t match the financial numbers they submitted to the IRS.
For those who are asking themselves how this was allowed to happen, the answer is that it shouldn’t have. Normally the law states that a member of a political body cannot be financially interested in a contract that was made by them, or their governing body, in their official capacity. Interestingly enough the Visit Lompoc LLC contract with the city became effective 1 Jan 2019 and Ms. Cordova was appointed to the city council on 8 Jan 2019. Technically, because the contract was in place before she took office, there was no violation.
However, I have since brought it to the attention of city council and city attorney that when Visit Lompoc LLC attempted to increase the assessment rate from 2% to 3% in 2020, that that action constituted a modification of the contract and therefore violated state law, consistent with prior opinions of the California Courts, the California Attorney General’s office, and the Fair Political Practices Commission.
The mismanagement of Visit Lompoc LLC seems hard to miss when you start paying attention to things but for so long no one was paying attention because the same person was running both ends of the program, a person that everyone wanted to trust was doing everything right.
Issues like the annual reports coming in years late had no pushback from the city. The last submitted annual report from Visit Lompoc LLC (which was 11 months late) was submitted to city council on February 21, 2023. The submission was signed off by the city of Lompoc’s Accounting and Revenue Manager, Management Services Director, and ultimately the City Manager with a “staff recommends approval of the 2022 Annual Report” despite the fact that a very simple accounting revealed that the report had a discrepancy of funds totaling $264,591.49. Visit Lompoc LLC in their report stated that they had assessment collections in 2021 of $526,509.12 and carry over funds from 2020 of $264,591.49. This is a total of $791,100.61. Explore Lompoc reported their total expenses for the year were $272,926.84. So that $791,100.61 in funds subtracting $272,926.84 in expenses, for an end of year balance of $518,173.77. Explore Lompoc LLC reported that they had an end of year balance of just $253,582.28 and yet somehow all three high level city employees missed it, as did the city council.
And if that wasn’t bad enough, the Lompoc city attorney stated at the city council hearing that he didn’t believe it was a conflict of interest for Ms. Cordova to vote on approving the annual report that her LLC had submitted.
Ultimately, reports are being filed with the FPPC, IRS, DA, AG, County Civil Grand Jury, etc. For those interested, you too can help by filing a complaint with the Santa Barbara County Grand Jury asking that they investigate the allegations against Ms. Cordova, Visit Lompoc LLC, and Lompoc city council for allowing this to happen. At a minimum a 5 year audit of Visit Lompoc LLC should be done to ensure that money hasn’t in fact been misappropriated and that maybe someone was just really, really bad with math (I doubt it though because the “errors” were consistent and the money was never found on subsequent reports and just kept compounding the discrepancies but hopefully I’m wrong. With a big enough voice hopefully the city council, the FPPC, and various other agencies charged with protecting the integrity of our political system step in to investigate the issues that have been raised.
“If Ms. Cordova has nothing to hide then I’ll be the first person to offer her an apology but I was raised to not let the fox guard the henhouse.”
FULL REPORT ANALYSIS
Full Report that was Submitted to City