Laguna Seca racetrack | Joe Livernois
By Royal Calkins
A second formal complaint has been filed against Monterey County officials over the award of the Laguna Seca raceway management contract to a well-connected hotel manager without racing experience.
The Fair Political Practices Commission complaint by veteran racing promoter Christopher Pook of Long Beach alleges the contract award to hotelier John Narigi was “an inside job” and that a Board of Supervisors majority had made the decision before soliciting bids or holding a meaningless public hearing last month.
“Political financial bias at its worst,” says Pook’s complaint, filed Monday. “A brazen behind-closed-doors decision made well in advance of any public notice! Political donations are fine, however leveraging large unabashed PAC (political action committee) contributions in such a biased manner is just not correct.”
The FPPC, the state’s campaign watchdog, is already investigating allegations by political consultant Christian Schneider regarding campaign contributions to Board of Supervisors Chairman John Phillips and Supervisor Chris Lopez as Voices reported last month.
The commission is overwhelmed with complaints and is selective about which to pursue formally. It elected to officially take on Schneider’s complaint, requesting documents from the county in the spring, but it may or may not act on Pook’s.
Schneider, a serious student of elections law, worked on the last two sheriff’s campaigns in Monterey County. He alleged in his FPPC complaint that the supervisors improperly benefited from campaign contributions essentially laundered through a network of political action committees, three of which shared Narigi as an officer. Until the spring, Narigi was general manager of the Monterey Plaza Hotel and was heavily involved in hospitality industry politics.
The Laguna Seca operating contract went to A&D Consulting, a firm set up by Narigi just days before the contract was awarded in November. County officials did not publicly disclose the existence of the FPPC investigation before selecting Narigi over Pook and the longtime Laguna Seca operator, the Sports Car Racing Association of the Monterey Peninsula, SCRAMP.
Schneider’s initial complaint to the FPPC raises questions about more than $60,000 in contributions to Phillips and $10,000 to Lopez and additional questions about what could be improper coordination of campaign activities by candidates and political action committees.
Phillips, Lopez and Narigi have declined to comment. Supervisor Luis Alejo, who received a $9,000 contribution from a Narigi-associated political action committee, argued during the public hearing that Schneider’s complaint was part of a “political smear” campaign even though it was filed eight months before the contract came up for consideration.
The commission is overwhelmed with complaints and is selective about which to pursue formally.
Pook founded the Long Beach Grand Prix and developed and promoted large racing events in a dozen cities. He once headed one of auto racing’s best known organizations, CART, short for Championship Auto Racing Teams, which promoted Indy-type racing. His time there was controversial, with some accusing him of overspending, but he remains well connected in racing circles and is receiving support from the industry press. Racing magazines have been critical of Monterey County’s decision to bring in an untested operator for such a significant property.
In his complaint, Pook said that former county Supervisor Dave Potter, who is now a lobbyist and mayor of Carmel, arranged for him to meet separately on Sept. 9 with Phillips, Lopez and Alejo. He said the county had decided to find another race track operator because SCRAMP, a mostly volunteer organization, was deep in debt and struggling to make necessary improvements at the county-owned track.
“At the outset of each conversation, each supervisor confirmed that they would not be renewing the SCRAMP contract at the end of the current year, and would I be interested in putting together a management team to operate Laguna Seca Raceway,” Pook wrote.
“No details were provided, other than Supervisor Phillips informed me that he had requested a good friend of his, who had recently stepped down as the manager of a major Monterey hotel, to form such a company, however he had declined because he had sold his home in Monterey and was moving back to the state of Washington. When I inquired as to what was his friend’s experience in motor sports. his answer was ‘None, he’ll figure it out, anyway it could not be any worse than it is now with SCRAMP; we have three votes and we’re going to make a change’.”
Narigi’s home was in escrow at the time but he canceled the sale. Narigi has been highly active in hospitality industry politics and political fundraising. He has been on the board of Phillips’ Rancho Cielo job training program and has worked with Phillips in support of Cal Am Water Co.’s highly controversial desalination proposal. He told the supervisors he would take a lower profile after receiving the contract.
On Oct. 15, a month before the public hearing, the county announced that it was soliciting raceway management proposals. Narigi had formed his company, A&D Consulting, a week earlier. The name comes from his sons’ initials.
Pook wrote, “On Tuesday, Nov. 12, we learned that the Monterey County Hospitality Association had held a meeting and interviewed SCRAMP and A&D Consulting as to their credentials and credibility to be the new “managers” of Laguna Seca; that in spite of ZERO experience or qualifications, they had chosen A&D Consulting for their recommendation to the county.”
The next day, five days before the public hearing and official contract vote, Pook received an email from a deputy county administrator, Dewayne Woods, informing him that the county had entered into negotiations with another operator and would not be considering his proposal, according to Pook’s complaint.
The day before the public hearing, Potter arranged for Pook to meet with County Administrative Office Charles McKee.
“After the usual introductory pleasantries, Dewayne Woods basically took over the meeting and stated just how badly SCRAMP had managed Laguna Seca, what a great job the county had done in making improvements and that the decision to hire A&D Consulting had been made,” Pook told the FPPC. “However, if I wanted to address the board the next day and convince them to change their minds, I was welcome to do so … .”
If Pook’s account is correct, the supervisors may have violated the state’s Brown Act, the open-meeting law that, among other things, bars elected officials from making informal decisions before casting official votes. McKee, who was the county’s chief lawyer before becoming administrative officer, didn’t respond to an email and a call seeking comment on that issue Wednesday
Pook wrote that Woods told him that the supervisors had not seen his plans for the track or his proposed management team.
Pook continued, “The meeting ended without discussion on our proposal, other than my pointing out that I had operated three venues, Long Beach, St. Louis and Memphis, on an annual administrative budget less than Laguna’s Seca’s one-year budget and that if we were awarded the contract, we would get Laguna’s Seca’s administrative expenditures into line with normal industry standards – that without having actually seen the detail of the expenditures, we could reduce it by at least $50,000 a month, and probably more!
“Both Woods and McKee seemed stunned by that comment and Woods asked how we would achieve it. My response was, because we have more than 60 years combined of motorsport management experience and we know how to run a motorsports company; that we are also bringing an experienced and qualified parks manager and a recently retired senior partner from Ernst & Young as a part of our management team.The response was, ‘Well, you are too heavy on oversight management and forward planning’.”
Pook called the Nov. 15 public hearing a “kangaroo court.”
“It was clearly an inside job where at least three of the supervisors were ‘following the money.’ … There was no discussion about experience or management – it was ‘we have decided that our friend John Narigi and his company A&D Consulting should be rewarded — he needed a job and this would be a good one for him’.”
The supervisors approved the contract with Narigi on a 5-0 vote. Supervisor Mary Adams told supporters afterward that the picture painted by the county staff left her with little choice on how to vote. SCRAMP’s contract is set to expire at the end of this year.
A week before Pook’s complaint, Schneider added to his earlier FPPC complaint, alleging that the Narigi contract should be reviewed and possibly rescinded because the process smacked of conflict of interest even if no laws were broken.
Schneider wrote, “A public contract was awarded to a company less than a month old with no industry experience or track record (excuse the pun), but whose sole proprietor is the treasurer/donor of several PACs who coordinated possibly unlawful payments/services to the supervisors who were now voting on awarding the contract to him.
“The people who spoke in support of this were the actual donors to the PACs and who also may profit from serving on boards and becoming ‘vendors’ as described by Narigi in his proposal. Such as Don Chapin, for example.”
Chapin is a Salinas construction contractor with deep connections to local politics.
Schneider said he was filing his complaint under a section of state law, Government Code Sec. 1090, that requires the FPPC to forward the matter to the state attorney general.
“My understanding is that GC 1090 is intended ‘not only to strike at actual impropriety, but also to strike at the appearance of impropriety.’ (City of Imperial Beach v. Bailey (1980),” he wrote.
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