Key Aide to Hahn Quits Amid Probe of Agencies

A top deputy to Los Angeles Mayor James K. Hahn, who raised millions of dollars for the mayor’s 2001 election and who had overseen three city departments facing criminal investigations into contracting practices, resigned Thursday.

Deputy Mayor Troy Edwards, 37, has been one of Hahn’s most loyal supporters and served as the mayor’s liaison to the multimillion-dollar agencies that run the airport, port and the Department of Water and Power. He has been a controversial figure since the Los Angeles County Grand Jury began investigating allegations that contracting at the agencies is linked to campaign donations.

Edwards’ departure, set for April 9, came as two other deputy mayors also announced their resignations. A fourth left last month, leaving seven deputy mayors still in the administration. But it was Edwards who has been closest to the mayor, as a trusted aide and friend.

The wave of resignations comes as Hahn faces multiple challenges: He must build support for a $9-billion airport modernization plan and close a $250-million gap in the budget for the coming fiscal year. The mayor, who faces reelection next year, also is striving to maintain public confidence in city government amid ongoing criminal probes into contracting.

Hahn said the three resignations announced Wednesday night and Thursday were voluntary and unrelated to each other. But the scope and timing of the exodus surprised many city officials.

“You have grand juries and inquiries going on and now you have a bunch of people leaving,” said Councilman Dennis Zine. “It doesn’t send a positive message.”

The mayor acknowledged that his own job would be more difficult. “You don’t have something like this happen without a bump,” he said. “But I am confident we will be able to continue our momentum.”

Hahn dismissed any suggestion that the departures indicated a problem in his administration. “There is nothing wrong,” he said. “I think people see changes in lineups all the time in elected offices. I would caution anyone from reading too much into this.”

But with the mayor under persistent legal and political pressure over contracting practices at Los Angeles International Airport, Edwards’ departure was seen by some political observers as an attempt by the Hahn administration to clean house.

Councilman Antonio Villaraigosa, who had called for Edwards’ removal, called his resignation “good for the city of Los Angeles.”

“While there has been no evidence of wrongdoing on his part, the appearance of impropriety has cast a pall over City Hall that the mayor is obligated to remove,” he said.

Edwards stressed that he chose to resign because he needed some time off and wanted to explore other interests.

“It’s my decision,” Edwards said Thursday. “I believe strongly that it’s my time. I think most people will agree that I deserve a vacation, and I’m going to take it.”

Fernando Guerra, director of the Center for the Study of Los Angeles at Loyola Marymount University and a friend of the deputy mayor, said Edwards was concerned about being linked to the investigations and worried that he was hurting the mayor.

“He’s the kind of guy who internalizes things,” said Guerra. who said he had spoken to Edwards a few weeks ago. “I think he has been struggling with this for some time.”

Edwards, who helped Hahn raise more than $5.7 million during the 2001 mayoral campaign, was the mayor’s liaison to the city’s three biggest money-generating departments: Airports, Harbor and the Department of Water and Power.

Last fall, he was stripped of responsibility for the DWP. For a time, he also oversaw appointments to the commissions that run those departments and administer hundreds of millions of dollars in contracts.

In recent months, Los Angeles County Dist. Atty. Steve Cooley has been investigating whether officials at those departments traded campaign contributions for favorable treatment during negotiations.

The county grand jury called Edwards to testify earlier this year. The deputy mayor said he was called as a witness and was not a target.

In February, in a separate probe, the U.S. attorney’s office subpoenaed hundreds of pages of contracting records from the departments Edwards oversees.

As the scope of the probes widened over the last few months, the City Council enacted a ban on city commissioners raising money for political campaigns. And several council members joined Villaraigosa in calling on Hahn to remove Edwards, saying he was an impediment to the mayor’s agenda.

Some also have called on the mayor to remove Airport Commission President Ted Stein, who has been a Hahn fundraiser. Stein declined to discuss his plans Thursday.

Councilwoman Cindy Miscikowski, a vociferous opponent of Hahn’s airport plan, had written the mayor a letter earlier this year calling on him to fire Edwards. She said she hoped the deputy mayor’s departure would put the airport plan on a new track.

Other City Council members said the loss of so many high-level staffers in the mayor’s third-floor suite of offices was of great concern.

Sarah Dusseault, deputy mayor for housing, resigned Wednesday, saying she wanted to spend more time with her family.

Then on Thursday, the mayor’s office announced that Joy Chen, deputy mayor for workforce development, would be leaving to work as a consultant to the city’s Workforce Investment Board.

Also on Thursday, Donald J. Smith, director of the city’s Housing Authority, stepped down. And last month, Deputy Mayor Barbara Sandoval, who oversaw parks, libraries and schools, departed.

Many council members said they were particularly saddened by the departures of Dusseault and Chen.

“She was the best person they have,” Councilwoman Wendy Greuel said of Dusseault. “I am disappointed and confused by the loss of a shining star in the mayor’s office who has been the lead advocate on housing issues.”

Councilman Jack Weiss praised Chen as “a rarity, an apolitical policy intellectual,” and said the departures left “gaping holes” in the mayor’s staff.

“I hope they are filled by people who put public policy and not politics first,” he added.

Because of a hiring freeze, Hahn cannot replace his departing deputies without council approval.

For the time being, Deputy Mayor Renata Simril will assume the duties of Dusseault and Chen, in addition to her economic development responsibilities.

Edwards’ tasks, meanwhile, will be farmed out to two people.

Phillip Depoian will become Hahn’s senior advisor on aviation. Since 1993, Depoian has been the airport’s deputy executive director of external affairs. He was a close aide to Mayor Tom Bradley for 20 years before that.

Kim Day, the interim executive director of the airport, said she was surprised by news of Edwards’ departure, but added that Depoian would be a valuable asset as the mayor and airport leaders work on building support in City Hall for the renovation of LAX.

Despite signals from several council members that the mayor’s airport plan was in trouble, Day expressed confidence that the council would approve the massive renovation plan.

Depoian “has a history of working with elected officials,” she said. “I think there is no question that Phil being down there will increase buy-in for the master plan at City Hall.”

“I just hope it makes things go better and easier,” Depoian said, expressing optimism about building support for the LAX modernization plan.

Deputy Mayor Doane Liu, meanwhile, will begin watching over the port, in addition to his duties in putting together the city’s $5-billion budget.

Tim McOsker, the mayor’s chief of staff, defended the sharing of responsibilities.

“It will be an example of doing more with fewer resources,” he said.

Raphael Sonenshein, a political scientist at Cal State Fullerton, said it was hard to say what the staffing changes would mean. But he said it appeared that Edwards’ departure signaled that the mayor’s office was trying to get in front of the persistent questions about “pay-to-play.”

“The mayor’s office has very slowly been trying to come to terms with these investigations,” Sonenshein said.

But he said the staff changes were unlikely to be a political issue. “Staff comings and goings are simply not of interest to the public,” he said.

Edwards said he did not know what he would be doing next.

Miguel Contreras, head of the Los Angeles County Federation of Labor, said he might hire Edwards as a fundraising consultant.

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Times staff writer Nancy Cleeland contributed to this report.

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How the story developed

What started last year as a routine audit by Los Angeles City Controller Laura Chick of airport contracts has grown into two separate public corruption investigations focusing on political fundraising and the awarding of city business. Dist. Atty. Steve Cooley and the U.S. attorney’s office are probing allegations that campaign contributions bought influence in the winning of contracts. Here is a chronology of how the investigations unfolded:

Early 2001: When City Atty. James K. Hahn runs for mayor, Troy Edwards is part of the fundraising operation.

June 2001: Mayor-elect Hahn names Edwards deputy mayor for special projects. In that role, Edwards oversees the city’s airport, water and power, and harbor departments.

October 2003: City Controller Laura Chick meets with Dist. Atty. Steve Cooley to discuss preliminary findings of an audit of contracting in the Department of Airports.

Dec. 15, 2003: Chick releases the audit of the airports department and says she has asked local, state and federal law enforcement agencies to investigate “potential illegal acts.” She says the audit raised “concerns about potential conflict of interest, fraud, misuse of power and inappropriate award of contracts.” Chick says there are increasing rumors about “a pay-to-play environment in the city of Los Angeles.” Edwards is not named in the audit.

Dec. 16, 2003: Hahn defends the city’s airport commissioners against criticism that they have awarded contracts without proper justification and openness. The mayor says Airport Commission President Ted Stein has assured him that he has not raised political contributions from contractors on the mayor’s behalf.

Dec. 19, 2003: Los Angeles Councilwomen Wendy Greuel and Cindy Miscikowski call for hearings to address allegations of improper contracting practices by the Department of Airports. They call for a ban on fundraising for political campaigns by city commissioners.

Jan. 5, 2004: Hahn orders a ban on city commissioners sitting in on initial interviews with potential contractors.

Jan. 13, 2004: City Commissioner Leland Wong, a prolific fundraiser and behind-the-scenes player in L.A. politics, quits as a member of the city’s Water and Power Commission. A former president of the airport and harbor commissions, Wong also resigns his job as director of governmental relations for Kaiser Permanente after a company investigation alleged that he misused the HMO’s funds for political purposes. He denies any wrongdoing.

Jan. 28, 2004: It is revealed that Los Angeles County prosecutors are investigating possible corruption in the way the city Department of Airports handles lucrative contracts. Edwards, as well as a former airports official and a lobbyist for an LAX concessionaire, are called before a county grand jury.

Jan. 29, 2004: Cooley calls on Hahn to end the practice of allowing city commissioners to solicit campaign funds for city officials.

Feb. 2, 2004: The U.S. attorney’s office subpoenas records from the city’s airports, water and power and harbor departments as part of a wide-ranging investigation of contracting practices.

Feb. 10, 2004: The Los Angeles Ethics Commission recommends that members of city boards and commissions be prohibited from soliciting political contributions for elected officials.

Feb. 18, 2004: Miscikowski and fellow council member Jack Weiss question whether Troy Edwards should continue in his post as deputy mayor. They say he told an employee of a city contractor that there was “no [expletive] way I’m going to hire you” if the employee engaged Rand Corp. for a project. Rand has been critical of Hahn’s plan for a $9-billion modernization of Los Angeles International Airport.

Feb. 19, 2004: After initially resisting calls for reform, Hahn proposes sweeping restrictions on fundraising, lobbying and political donations.

March 2, 2004: Two city councilmen, Bernard C. Parks and Antonio Villaraigosa, call for the removal of Airport Commission President Stein and Deputy Mayor Edwards. Stein says there is no substance to any of the pay-to-play allegations. The City Council approves the Ethics Commission’s proposal to prohibit city commissioners from raising campaign funds for local elected officials.

March 3, 2004: Dist. Atty. Cooley says fundraising by members of Hahn’s administration is the focus of a grand jury probe.

March 17, 2004: The U.S. attorney’s office subpoenas records and notes from Airport Commissioner Stein and James Ritchie, the department’s deputy executive director, relating to review of a contract with URS Corp. and the next phase of planning for modernization of LAX.

March 25, 2004: Edwards resigns.

Graphics reporting by Times staff writer Jeffrey L. Rabin

Los Angeles Times