Board backs audit as Burke vows to return funds
Los Angeles County supervisors have endorsed a comprehensive audit of the troubled Entertainment Industry Development Corp., already under criminal investigation for lavish spending and questionable political donations.
The supes also called Tuesday for the EIDC’s exec committee, which is not scheduled to convene until Oct. 31, to instead meet as soon as possible to launch the audit.
And, in a sign of the fallout from the probe, Supervisor Yvonne Brathwaite Burke promised she would return $2,000 in contributions she received from the EIDC in 1998 and 1999.
No charges have been filed in the probe, which alleges misuse of public funds: $500,000 spent by EIDC chief Cody Cluff and $200,000 in donations to politicians, including many sitting on the EIDC board.
Court documents also show the EIDC paid $341,343 to Radical Media — whose chief, Frank Scherma, serves as chairman of the EIDC board — for work on the EIDC Web site.
The EIDC, which handles film permits for shoots on public property in the county and city of Los Angeles, has argued it has done nothing wrong because it operates as a private entity designed to expedite and encourage local production.
“We welcome the board’s decision, which reinforces our view that the EIDC is a private operation,” EIDC VP Morrie Goldman said. He also said Scherma has been attempting to set up an emergency meeting of the exec committee.
The EIDC’s board has 50 members, including the 15 City Council members and the five supervisors, and meets once a year; the exec committee meets each quarter.
“It’s not a structure that’s designed for maximum accountability,” admitted Supervisor Zev Yaroslavsky, who made the motion Tuesday.
County chief administrative officer David Janssen also told the supes an audit is needed because the EIDC may still be keeping records secret. The probe by the DA and auditor-controller included Sept. 4 searches of EIDC’s offices in Hollywood and Cluff’s homes.
“We believe that the agency has been less than forthcoming,” Janssen asserted. “The directors have an absolute right to all the records that are in there. That’s why the executive committee can meet and accomplish what the auditor was not able to.”
The motion included recommendations from Janssen and county counsel Lloyd Pelham that the EIDC review Cluff’s performance — a step that could lead to his ouster — along with EIDC’s bylaws, policies and procedures.