A group of 12 Grand Terrace residents has filed with the San Bernardino County District Attorney’s Office a complaint alleging that city councilwoman Bea Cortes engaged in multiple flagrant violations of Government Code Section 1090, the state of California’s conflict of interest law.
The complaint, which was provided to the public integrity unit formed by district attorney Mike Ramos in 2003 to deal with violations of the public trust perpetrated by elected and appointed city and government officials, contains allegations that Cortes voted repeatedly over the last four years to approve city payments to her employer, Terra Loma Real Estate and compounded the matter by attempting to hide the matter from public scrutiny by failing to report her relationship with Terra Loma on the economic interest disclosure documents she is required to file as a public official.
Accompanying the complaint were minutes of Grand Terrace city council meetings at which the votes in question were cast, Grand Terrace check registers showing the payments to Terra Loma, newspaper ads for Terra Loma Real Estate in which Cortes is listed as a real estate agent for the company and copies of her California Form 700s from 2002 through 2008.
Elected officials in California are required to fill out yearly statements of economic interest, known as Form 700s. Form 700s are intended to provide disclosure of the full range of elected and appointed governmental officials’ economic interests, including all income and gifts to his or her entire household.
Up until September, Cortes for several years had a professional relationship with Terra Loma Real Estate. She also consistently voted, as a member of the Grand Terrace City Council, to approve the consent calendars that are a part of the council’s agenda at its twice monthly meetings. The consent calendar, in Grand Terrace as in all cities, typically contains multiple items pertaining to the function of the city government, all of which are deemed non-controversial and routine matters and are bundled together so they can be approved in a single yes or no vote of the council. It is unheard of, in Grand Terrace and elsewhere, for the consent calendar not to pass and it is generally approved by a unanimous vote of the city council, although on rare occasion a dissenting vote on a consent calendar vote is registered.
In Grand Terrace as elsewhere, the consent calendar contains the city’s check register, that is, a listing of the checks that have been written to the city’s various vendors and contractors.
Among the companies that have rendered service to the city of Grand Terrace over the last several years is Terra Loma Real Estate, which provided property management services to the city as well as brokering a property purchased by the city’s redevelopment agency. City payments to Terra Loma, as to all other companies, are made by check. Those payments are then ratified by the city council as an item on the consent calendar.
Records available to the Sentinel show that the city made 37 payments totaling $26,076.66 to Terra Loma between January 2006 and August 2009. Cortes participated in the votes to approve at least 34 of those.
While Cortes insists that she did nothing illegal in casting those votes, Government Code Section 1090 prohibits an elected official from participating in a vote on any matter in which he or she has a financial interest. A payment to a business owned by that official or a business that employs the official or one with which the official is professionally affiliated is construed as having a bearing on that official’s financial interest.
In August, Cortes said she had not made any money in the previous 24 months as a real estate agent with Terra Loma so she therefore had no interest tied up with the company. “I have not received money from Terra Loma Real Estate,” she said. “Due to the economy I have not been able to sell any property. For two years I have not been selling any property in affiliation with them [Terra Loma] I have never sold anything for them.” She said she had been working out of the Terra Loma office “a little over three years.”
The sales drought, Cortes said, has lasted “at least two years.”
Moreover, she said, “I spoke with the city attorney and he advised me there was no conflict.”
Cortes acknowledged that she is professionally affiliated with Terra Loma Real Estate and its owner, Gene Carlstrom, but said that payments the city makes to Terra Loma for property management services are not passed along to her.
Last summer, Cortes acknowledged, “I have my real estate license in his [Carlstrom’s] office. Whenever I sell any property, I have to have a licensed broker over me. He is the broker. I have my license under Mr Gene Carlstrom.”
In September 2009, after a minor controversy broke out in Grand Terrace following publicity about Cortes’ votes to approve a contract for and payments to the company she was professionally affiliated with, Cortes ceased voting on the consent calendar items related to Terra Loma, and the city’s contract for services with Terra Loma was cancelled shortly thereafter. In the same time frame, Cortes obtained her own real estate broker’s license and ended her affiliation with Terra Loma.
The councilwoman insisted that city attorney John Harper had examined the potential for conflict inherent in the circumstance that existed up until August and found her in compliance with the law, including Government Code section 1090 and any other statutes that are applicable.
Cortes said that both she and Harper deemed her votes as a member of the Grand Terrace City Council to approve the contract with Terra Loma and make the payments to it as legal.
In filling out her Form 700s, Cortes made no reference to her employment by, or any income from, Terra Loma Real Estate, an examination of those documents filed by Cortes with the Grand Terrace clerk’s office between 2002 and 2009 show. Indeed, Cortes shows no reportable income or interests of any type during that same period.
Despite the circumstances that led a dozen of her own constituents in Grand Terrace to file the complaint alleging the 1090 violations on her part, Cortes played a leading role in having the district attorney’s office investigate and then prosecute another member of the Grand Terrace city council, Jim Miller, when he cast votes ratifying that city’s consent calendar which have been construed as providing him with a financial benefit and thus likewise violating government codes section 1090.
On July 15, councilman Miller was arrested by San Bernardino County district attorney’s investigators and charged with violating Government Code section 1090. That charge stemmed from votes Miller had made to approve the consent calendar which contained check registers that contained payments for the city’s legal advertisements that were printed in his wife’s newspaper, the Grand Terrace City News. Miller’s wife is the sole owner of that paper and two others, the Colton City News and the Loma Linda City News.
Miller had never voted to authorize the city to purchase the ads that ran in his wife’s newspaper. The decision to run advertisements and legal notices in the Grand Terrace City News had been made by city staff members who had determined that the rates in the Grand Terrace City News were lower than or comparable to those offered by competing newspapers. Like Cortes, Miller relied upon assurances by city attorney John Harper that as long as the newspaper was his wife’s sole property, the city’s purchase of the ads from her represented for Jim Miller no conflict.
By 2008 Miller’s formerly cordial relationship with Cortes had grown somewhat strained in that he had emerged as the leading opponent to promoting then-acting city manager Steve Berry to the permanent city manager’s position. Cortes was the most enthusiastic of Berry’s supporters on the city council.
As the effort to elevate Berry to the unquestioned top municipal management post progressed, Cortes, in conjunction with Berry, undertook to compromise Miller’s authority.
Both began providing the district attorney’s office with information relating to the city utilizing Miller’s wife’s newspaper, as well as the consent calendar voting that ratified payment for city legal notices and ads that ran in that publication.
Brazenly, Cortes made this approach to the district attorney’s office despite her own parallel entanglement in the similar circumstance involving Terra Loma and the city.
It has been suggested that Cortes felt confident enough to report Miller because of a close personal relationship she has with district attorney Mike Ramos.
Cortes, like many other Republican elected officials in San Bernardino County, has a loose affiliation with Ramos, who is also a member of the GOP. More recently, however, reports have surfaced to indicate that their relationship runs deeper than politics.
Ramos’s womanizing and its impact upon the function of the district attorney’s office has been an issue of some public concern since reports surfaced last May linking him with at least a dozen women who either work for him in the county prosecutor’s office or with whom his official position brings him into contact.
Those connected to Ramos in this way are a former deputy district attorney, three current deputy district attorneys, a woman who served as his former campaign manager and treasurer and then briefly worked as a prosecutor’s office consultant, a paralegal; two investigative technicians; an investigative technician, and an evidence technician, as well as Suzanne Hunter, a training consultant for the California District Attorneys Association and San Bernardino County Public Defender Doreen Boxer.
“Of course I am denying it,” Cortes said of reports, including ones posted on the internet, relating to an affair between her and the district attorney. “Who would intimate that? Who would say that?”