OC supervisor calls for review of county contract with Rep. Michelle Steel’s campaign mail vendor

Orange County Supervisor Vicente Sarmiento asked the county’s internal audit staff Tuesday to specifically review a county contract with DTN Tech (DTN), after an LAist investigation found Rep. Michelle Steel awarded the vendor $1.2 million in taxpayer meal funds at the same time it was printing her campaign mailers.

The directive from Sarmiento came during a Board of Supervisors meeting in Santa Ana. In a written statement following the meeting, Sarmiento said it was important to thoroughly assess potential issues and implement needed reforms.

“The LAist article uncovered that a vendor, initially engaged in printing work during the campaign, was subsequently awarded a meal contract despite not being in the food industry,” Sarmiento said. “This situation underscores the importance of continuing our internal auditing efforts, as well as bringing in an independent external auditor.”

Steel directed the money to DTN in 2020 when she was an Orange County supervisor running for Congress. The funds came from the federal government and were intended to help needy seniors access food as COVID deaths surged across the county. LAist’s reporting found that Steel agreed to use taxpayer funds to pay DTN far more than vendors billed in districts led by other supervisors. The meals in Steel’s program cost $24 per meal, three times as much as in two of the other districts.

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A campaign spokesperson for Steel previously told LAist that the Congressperson "stands by the work" and that the meals funding also helped restaurants. DTN's CEO told LAist the company "wanted the gourmet experience" and to provide quality over quantity.

Steel, who is a Republican, is behind currently in a razor-tight race to represent the 45th Congressional District. Numbers from Tuesday night show her opponent Democrat Derek Tran ahead by 314 votes.

How we got here

County officials are currently reviewing all contracts, including those funded by federal COVID dollars after Orange County supervisors directed them to do so back in September. They were given 90 days to come back with their findings.

The supervisors unanimously voted to request the internal audit after LAist’s investigation into millions in taxpayer funds — mostly COVID federal dollars — directed by former Supervisor Andrew Do to a little-known nonprofit called Viet America Society. Do’s 23-year-old daughter, Rhiannon Do, held leadership roles at Viet America Society.

FBI agents outside of Andrew Do's home in Orange County in August 2024.

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Adolfo Guzman-Lopez

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LAist

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Do has since pleaded guilty to a conspiracy to bribery federal charge. The county has also filed a lawsuit against the nonprofit, Rhiannon Do, and others, saying they “brazenly plundered” taxpayer dollars for their own benefit. Do’s plea deal is contingent upon Rhiannon Do’s cooperation with authorities in their ongoing investigation. She is also under probation for three years’ and has to complete law school or work. Rhiannon Do, who previously told LAist she never had any role in Viet America Society’s finances, is currently a third-year law student at UC Irvine.

Details from the meeting

During Tuesday’s Board of Supervisors meeting, Sarmiento asked that county staff look into the county contracts for DTN as part of the broader review of contracts.

Orange County Supervisor Vicente Sarmiento at the Board of Supervisors meeting on Thursday, Aug. 27, 2024.

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Brian Feinzimer

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LAist

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During the board meeting, he said that soon after the board called for the review of contracts, “the press showed us that there are other things going on here. A former supervisor was directing work to one of her printing firm[s] that was doing work for her that had no experience in food delivery,” he said.

Sarmiento is also calling for an external audit of all contracts directed by Do during his tenure. The external audit was pushed from Tuesday’s meeting to the following week, and will be on the agenda for Dec. 3.

Sarmiento previously told LAist in a written statement, “Michelle Steel’s misuse of taxpayer dollars to enrich her political allies is outrageous, and confirms my insistence that an external investigation of federal pandemic related funds received by the County must also be conducted.”

During Tuesday’s board meeting, Supervisor Katrina Foley told Sarmiento she has called on county staff to review the contract with DTN, too. Foley also called for a review of the county’s contract with Othena, a vaccine app that received millions of dollars in taxpayer funding despite numerous high-profile glitches with its roll out.

Supervisor Don Wagner didn’t immediately respond to a request for comment from LAist on Tuesday. Supervisor Doug Chaffee declined to comment.

Lawmakers previously spoke out

State Senate Judiciary Chair Tom Umberg (D-Santa Ana) and state Sen. Janet Nguyen, a Republican, previously criticized Steel’s use of the taxpayer funds.

In a letter sent early this month addressed to Wagner, chair of the Board of Supervisors, Nguyen called on the county to “immediately freeze” its active contract with DTN and stop all payments to it.