Outside Spending To Reelect John Lee Tops $1M As City Council Member Remains Under Ethics Scrutiny

Some of City Hall’s biggest players are spending major money to try to ensure the reelection of Los Angeles City Councilmember John Lee, even as he faces allegations he violated city ethics rules by accepting illegal gifts from developers.

The largest contributors include the labor unions that represent L.A. police officers, firefighters and Department of Water and Power workers, as well as both the L.A. Area Chamber of Commerce, and the Hollywood Chamber of Commerce.

Independent expenditure committees have spent more than $1 million to help Lee defeat his only challenger, former Ethics Commission President Serena Oberstein, in the race to represent District 12, which covers much of the northwestern San Fernando Valley, including Northridge, Chatsworth, and Reseda.

Because there are only two candidates in the race, whoever draws the most votes on the March 5 ballot wins the seat.

How the spending compares

“It's an awful lot of money in a city council race,” said Bob Stern, former general counsel of the state Fair Political Practices Commission and one-time head of the Center for Governmental Studies in Los Angeles.

One other race this election cycle has seen more than a million dollars in independent spending and that is District 4, where outside groups are trying to oust progressive incumbent Councilmember Nithya Raman.

The amount of money raised to support Lee far outpaces that of his opponent, who has styled herself as more progressive than Lee, a former Republican who is now a declined-to-state voter. The race is non-partisan.

Oberstein said the allegations against Lee were a big reason she is challenging him for the District 12 seat.

“I knew that this community needed to be a place where we had elected officials acting with integrity,” she told LAist. “We have someone who is acting on behalf of special interests, who is fighting to maintain the status quo of a government that’s broken.”

Lee declined to be interviewed for this story.

He is one of two current members of the City Council who have been accused of wrongdoing, but he is not facing criminal charges. The allegations, which Lee has denied, are from the city’s Ethics Commission.

Councilmember Curren Price is the other, but unlike Lee, Price is charged in Superior Court. He pleaded not guilty last month to charges including grand theft and embezzlement, all felonies. 

Three former council members have been sentenced to prison for corruption in the last five years.

Where is the money coming from?

The single biggest spender on Lee’s behalf is a political action committee funded largely by the union that represents L.A. police officers, the L.A. Area Chamber of Commerce and the Hollywood Chamber of Commerce, which contributed more than $500,000, according to campaign finance reports. The union that represents city firefighters has spent nearly $200,000 on behalf of Lee.

None returned requests for comment

The political action committee of the L.A. County Business Federation has spent $58,000. It is a group of more than 200 business organizations representing 450,000 employers.

“He’s been a great partner of the business community,” said the group’s political consultant Rob Korinke. “His office has been a leader in providing grants to businesses that struggled during the (COVID-19) pandemic.”

Lee has “always been somebody we can work with,” Korinke added.

He said he had no comment on the allegations that Lee violated city ethics rules.

The political action committee of the Central City Association, a small business organization, is another backer of Lee. Its president, Nella McOsker, said Lee “has been a longstanding champion of the business community” but declined to comment on the ethics allegations against him.

One of the biggest individual donors is housing developer and philanthropist Gregory Perlman, who has contributed $30,000.

“My donation has zero to do with any business interests,” Perlman said. “It's totally because I believe he’s got the biggest heart of any council person that I’ve come across.”

Perlman said Lee has worked closely with his nonprofit charity, The Change Reaction, which provides direct grants to small businesses and families in need.

Councilmember John Lee, shown at the Sept. 27 L.A. City Council meeting, is facing ethics charges

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LA City Clerk

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Screenshot from YouTube

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Lee himself has raised about $393,000 for his campaign. Oberstein has raised about $131,000. Candidates have contribution limits of $900 per donor during the primary campaign.

There are no independent expenditures on behalf of Oberstein.

Independent expenditure committees have long been controversial. They are legally prohibited from coordinating their campaigns with the candidate but often exert as much or more influence over a race, given the committees can raise money in unlimited amounts.

Stern said the funders usually want something from the candidate — such as favorable legislation, lucrative labor contracts, or approval for developments.

“They have a corrupting impact on the process,” said Stern. “It's almost legalized bribery.”

The U.S. Supreme Court has ruled independent expenditure committees are legal.

What are the ethics allegations about?

The allegations against Lee by the Ethics Commission stem from his time as chief of staff to former Councilmember Mitch Englander, who spent 14 months in prison on obstruction of justice charges.

At the center of the allegations is a 2017 Las Vegas trip taken by Lee and Englander. The commission alleges Lee accepted free food, hotel rooms and poker chips from a businessperson and a developer with business before the city.

The businessperson and developer are not identified by the Ethics Commission. In one case, Lee allegedly accepted poker chips valued at $1,000 and bottle service with a group of people at a restaurant valued at more than $5,600 per person, according to the Ethics Commission.

Lee has denied the allegations, saying the commission “drastically inflated” the amount of food and beverages he consumed.

“Commission investigators are not interested in the facts. They have preconceived notions about where their investigation should go and have ignored any exculpatory evidence they obtained,” said Lee said in a statement issued in October when the allegations were made.

The Ethics Commission is expected to determine later this year whether the alleged violations occurred and, if so, what penalty should apply. The maximum penalty is “the greater of $5,000 per violation or three times the amount of money that was improperly received or reported,” according to the commission’s website.

Oberstein, who is endorsed by the L.A. Times, is the former executive director of Jewish World Watch. She has vowed to work harder than Lee to develop affordable housing in the district.

“It's not just that we need more affordable housing that houses the homeless — we need affordable housing at every level,” she said. “We need it for the working class.”

Oberstein also said she’d use an anti-camping law known as 41.18 less than Lee, who has used it more than any other member of the City Council to remove homeless encampments around schools and daycare centers.

“It's not a starting point for me. I’ll have a people first approach,” she said.

She presents herself as a more ethical alternative to Lee. “I will take my oath incredibly seriously. I would never go to Las Vegas with a lobbyist and developer” as Lee is accused of doing, she said.

What are voters saying?

Voters who spoke to LAist appeared to have varying levels of awareness about the allegations against Lee.

“I think he should have resigned a long time ago,” said Katherine Tattersfield, an organizer with the West Valley People’s Alliance who said she’s followed the case against Lee. “People deserve integrity and honest leadership.”

She decried the amount of independent expenditures on behalf of Lee..

“I think it's disgusting,” she said, adding that she would be voting for for Oberstein.

Other voters said they were unclear about the details of the alleged ethics violations and expressed more concern about crime and homelessness.

Janet Nineberg is a 73-year-old retired nurse who lives in Northridge. She supports Lee.

“I feel like he is really the only one speaking up for homeowners,” said Nineberg, who added that there was a homeless encampment behind her house until recently when it was cleaned up.

“I like to walk in the neighborhood, and I just felt unsafe walking near them,” she said.

Hermine Zanki, 41, is an undecided voter from Northridge who said she, too, sees homelessness as the No. 1 issue in this year’s election.

“It just gets depressing to see so many people in this area who are living in makeshift homes, Zanki said.

She said she hadn’t done a lot of research on the ethics allegations. She wondered aloud whether it “is it just him or did he just happen to be the only one who got caught.”