FBI Probe Targets Ex-Lobbyist for Elsmere Developer

WASHINGTON —  A onetime lobbyist for the proposed developer of a landfill in Elsmere Canyon is under investigation by the FBI as part of the independent counsel’s probe of former U.S. agriculture secretary Mike Espy, sources close to the inquiry said Wednesday.

As recently as last week, FBI agents have requested documents connected with the Elsmere Canyon project from the U.S. Forest Service, Torrance-based waste hauler BKK Corp. and Rep. Howard P. “Buck” McKeon (R-Santa Clarita), who sponsored legislation to kill the contentious landfill.

It was unclear Wednesday what effect, if any, the investigation is having on the project, but it injects another strange twist into the bitter, long-running battle over whether the dump should be built near Santa Clarita.

“They came to us for the specific reason of reviewing paperwork involving Elsmere Canyon and the U.S. Department of Agriculture,” said Armando Azarloza, McKeon’s district director. “The target of this is not us.”

Officials at BKK, the company behind the 190-million-ton landfill proposal, said they provided records to the FBI last year. The subject of the inquiry, those officials said, was a former BKK contractor, Richard Douglas, who once worked as a lobbyist on the Elsmere Canyon project.

“The FBI is investigating a man by the name of Richard Douglas who is a consultant that we previously used on the Elsmere matter,” said Ron Gastelum, a top BKK executive. “But BKK and Elsmere are not under investigation.”

Douglas was fired by BKK in 1993.

The primary focus of independent counsel Donald C. Smaltz’s investigation is possible violations of federal law by Espy, who resigned in 1994 amid allegations that he improperly accepted tickets to sporting events and other gifts from businesses and individuals that are regulated by his department.

Espy maintains that he did not break the law.

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The case, however, has broadened considerably. Earlier this month, a federal appeals court ruled that the Espy investigation could be expanded to include possible improprieties by his associates. Without naming names, Smaltz argued in the District of Columbia federal appeals court that he had found evidence of possible wrongdoing by people close to Espy.

Already, Smaltz’s investigation has prompted James H. Lake, a prominent lobbyist who served as a behind-the-scenes advisor to Espy, to plead guilty to making illegal campaign contributions to Espy’s brother, Henry, who was running for Congress. Lake has said it was Douglas, the former BKK lobbyist, who was behind the scheme.

Although no charges have been filed against Douglas, Smaltz is known to be investigating him and one of his former employers, Sun Diamond Growers, a major California fruit and nut producer. Douglas went to college with Espy and remained a close friend, using the connection in his lobbying work.

McKeon’s files are of interest because he has championed legislation to block current or future plans to use Elsmere Canyon as a landfill. A central element of the dump’s creation would include a land swap involving thousands of acres owned by the U.S. Forest Service. As agriculture secretary--with oversight of the Forest Service--Espy could have determined the dump’s fate.

The independent counsel issued a subpoena March 19 for all U.S Department of Agriculture records relating to the Elsmere land exchange, said Gail Wright, a spokeswoman for the Angeles National Forest. The blanket request included U.S. Forest Service records, Wright said.

The FBI also requested all correspondence between McKeon’s office and Espy, the U.S. Forest Service and BKK. McKeon staffers also were questioned about a meeting the congressman had with Espy about the bill to kill the dump.

Neither Douglas nor his attorney, John M. Dowd, could be reached for comment Wednesday. However, Douglas has previously denied any wrongdoing.

Charles G. Bakaly III, the deputy independent counsel, declined to discuss the ongoing investigation.

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The probe represents the latest point of controversy in the long battle over the 720-acre landfill proposed just outside Santa Clarita.

Opposition from environmentalists and city leaders has been fierce, and a hearing on the proposed landfill last year drew 3,000 people. Civic leaders, wary of the area becoming known as “Valley of the Dumps,” have raised nearly $1 million to support their fight.

But any project remains a long way off. Last fall, BKK announced it was selling the property to rival trash hauler Browning-Ferris Industries, a move that officials said was likely to delay any development considerably.

Times staff writer Lacey reported from Washington. Correspondent Kirka reported from Santa Clarita.