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Chinese Developer Accused Of Illegally Funneling Money In Fight Over Beverly Hills Ballot Measure

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An L.A. labor union representing hotel workers is accusing a Chinese mega-developer of illegally funneling foreign money to fight a Beverly Hills ballot measure, according to the L.A. Times.

Measure HH—or "the Hilton Initiative," as it's known on the mean streets of Beverly Hills—has caused quite a stir in this relatively quiet, moneyed community.

If passed in November, Measure HH would allow Beverly Hilton owner Beny Alagem to skirt the usual public review process in order to merge two previously-approved condo towers and instead build a 26-story tower, according to The Real Deal. If constructed, Alagem's project would be the tallest building in Beverly Hills. It seems legit crazy that one guy can just bypass public review on a building and instead spend three million dollars trying to get the extra height approved via a ballot measure... But I guess they do things differently in Beverly Hills.

The Wanda Group, a Chinese multinational conglomerate run by China's richest man, has launched a vociferous campaign against the initiative—and the group just so happens to be working to erect their own $1.2-billion hotel-condominium project within spitting distance of Alagem's. And yes, the Hilton crowd has tried to block the Wanda project.

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In a complaint filed Thursday, Unite Here Local 11, a hospitality union that represents 22,000 members in L.A. and Orange County, asked state and federal election officials to investigate whether China's Wanda Group had, through a domestic subsidiary, illegally funneled cash to a campaign committee working to oppose the November initiative. Unite Here Local 11 represents the workers at the Beverly Hilton, and has publicly supported the measure.

"We track new development pretty regularly, so we've been very much following and paying attention to what's been going on in Beverly Hills," Rachel Torres, a research analyst at Unite Here Local 11, told LAist.

"It's very important to us, in terms of how money is spent in the process of development, that the process should be transparent," Torres said, explaining that transparency should extend not just to how projects get built, but also "how they get denied or blocked."

Keeping the process transparent "affects our democracy, our community, and our members," Torres said. "We felt that there was a need to bring this to the public and to seek an investigation."

According to the Federal Election Commission, foreign nationals are "prohibited from making any contributions or expenditures in connection with any election in the U.S." The U.S. subsidiaries of foreign companies can, however, form PACS, "so long as it’s American employees running the PAC and contributing the money, and so long as the PAC remains unfinanced by the foreign parent corporation," according to a WNYC report.

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Adam Englander, a consultant for the No on HH campaign, said in a statement that although they had not been sent a copy of the complaints or been contacted by any agencies, they "were confident that all allegations are baseless, as our campaign reports clearly show that this is a campaign fully funded and controlled by American interests with no foreign control or money in any way, shape or form."

"This lawsuit," Englander said, "is just another unethical campaign tactic by the Beverly Hilton and their surrogates to bully those who oppose the Hilton Skyscraper Initiative and their circumvention of the public review process."

In a separate, but not unrelated, controversy, the L.A. Times reports that former Beverly Hills mayor Barry Brucker was accused of illegally lobbying for the Wanda Group in violation of the city's "revolving door" policy, which prohibits former elected officials from taking paid lobby work on a project that he or she had voted on while in office.

Not one to be excluded from the action, current Beverly Hills Mayor John Mirisch has also gone full steam ahead on the No on HH campaign, launching himself on "a virtual public speaking tour," and "appearing at every HOA, PTA and Synagogue he can get into," according to the Beverly Hills Courier.

The mayor has been criticized for taking sides in the war between the two developers ("Our job is not to advocate for one project over another," Vice Mayor Nancy Krasne said at a meeting earlier this summer, according to the Times), and for being overly chummy with the Wanda team.

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Perhaps the Courier put it best last week, when they wrote "The campaign against the Hilton has become dirty, indeed."

There were even reports that "people [were] trespassing on to private property and replacing Yes on HH signs with No on HH signs." Even worse, the No on HH signs were reportedly "oversized," violating Beverly Hills code and marring lawns the city over. According to Therese Kosterman, a spokesperson for the City of Beverly Hills, the city did get a report that some signs were oversized. However, after going to investigate, they found that all signs were, in fact, the correct size and in keeping with the City of Beverly Hills's 885-word policy on yard signs. The City of Beverly Hills adopted their very important yard size regulations because yard signs "tend to be impermanent, flimsy, and vulnerable to the elements," and have a tendency "to proliferate, creating litter, visual blight, and traffic safety hazards."

Related: Beverly Hills Hotel Wars: Beverly Hilton Doesn't Want A New Hotel Across The Street

Note: This was post was updated to clarify that although former Beverly Hills mayor Barry Brucker was accused of violating the city's revolving door policy, these accusations have not been confirmed. We've also added new information about those pesky lawn signs. Despite preliminary reports to the contrary, it looks like those potentially “oversized" lawn signs were in fact sized to Beverly Hills code.