Stealing a City: Lessons from Bell, California

In 2010, a corruption scandal rocked the city of Bell, California, as eight top city officials were arrested for what the Los Angeles Country District Attorney called “corruption on steroids.” The officials were charged with misappropriating funds from city government to the tune of $5.5 million, and garnering salaries as high $800,000, more than quadruple the California governor’s salary. In a series of trials that stretched on for more than three years, the mayor ultimately pled no contest to 69 felonies, and the trials of the various city officials have been riddled with allegations of voter fraud, extortion of local businesses, taking of illegal loans from the city, and manipulation of the pension system. Bell officials even used (and likely tampered with) a referendum to change the city’s legal structure to a chartered city which allowed them to raise their own salaries.

The United States generally experiences very low levels of corruption convictions, around 1,000 per year across the nation. One might expect that some level of state, federal, or citizen oversight would have prevented the Bell incident. Yet this massive scandal was only uncovered due to quality investigative journalism by the Los Angeles Times, and only after five full years of consistent wrongdoing by city officials. How did this happen, and how can similar misconduct be prevented in the future?

Transparency and accountability are key deterrents of corruption, and Bell was lacking in both. California has very limited monitoring of its cities – the State Controller office requires compliance with federal audit rules for federal awards, as well as audits for state programs, but does not regularly audit small city governments. Regular and comprehensive audits might seem like the most straightforward way to combat the sort of corruption we saw in Bell, but such regular auditing is difficult due to capacity limitations. Nonetheless, there are other, less costly measures that states could take. A set of reasonable policies could have been used to detect wrongdoing in Bell as it started, and could also avoid similar scandals going forward: better data transparency, automated data monitoring, and improved electoral oversight.

  1. Better Data Transparency. Throughout the US, municipal data is difficult to collect, with no centralized clearinghouse for municipal records. California is exceptional in its data collection, providing access to city financial data through the State Controller’s Office, and salary data through Transparent California. Yet even in California, where this data is more centralized, the data are often hard to find or missing. And in most states, city government data are only available through hard-to-navigate municipal websites, if at all. When posted, these data are often in PDF or other non-machine-readable formats, making widespread analysis costly if not impossible. Transparency is not accomplished by posting PDFs in hard-to-find places. The process of uncovering municipal corruption in America begins with greater federal and state transparency efforts to make all public expenditures at all levels easy to find and analyze.
  1. Automated monitoring of data. The proliferation of city government data means that, even when the data are available, it is often too costly to monitor effectively. The highly inflated salaries received by the Bell city officials were reported to the State of California pension system, yet there were no red flags through this channel. Similarly, the high municipal property taxes, sewage collection fees, and municipal bonds that funded the corruption scandal were subject to little or no oversight. A scroll through the California salary data shows a number of unusual officials who earn total compensation north of $300,000 per year. In many cases this may not be due to corruption, but how are we to know, when the salaries are often set by city governments themselves? States could implement very simple checks on the distributions of these data, flagging a small set of outliers for manual inspection, such as when large annual changes occur, or multiple individuals with the same job title in nearby localities receive vastly different pay.
  1. Improved Electoral Oversight. Despite the great attention paid by the Trump administration to unfounded claims of voter fraud, it appears to be a rare phenomenon at the federal level. Secretaries of State oversee federal and state elections, leading to extensive monitoring of the electoral process and a greater ability to detect and punish election crimes. This is not true at the municipal level. In California, the Secretary of State does not collect or certify city elections; instead, 58 separate county offices are responsible for this task. In Bell, officials used absentee ballots to manipulate local elections, securing their power and ability to profit from city resources. The relationship between electoral manipulation and corruption is well explored, but the extent to which absentee ballots contribute to electoral fraud at the municipal level is not. Other cases of municipal corruption, such as the West Memphis, Arkansas vote buying scandal and the Federal Bribery conviction of the mayor of Cudahy, California, relied on absentee ballot manipulation as well. In many states, municipal elections are overseen by the very officials running in those elections, providing a strong incentive to tamper with elections in the low cost, hard-to-detect way of falsifying absentee ballots. Since electoral manipulation is a hallmark of corruption, greater availability of electoral data, particularly the level of absentee ballot usage, could be useful in detection.

We don’t know how widespread municipal corruption is in the United States. There is incredibly limited access to municipal data on salaries, pension, procurement, elections, and more. Municipal elected officials face limited oversight from state governments, particularly in elections, in which they have a strong incentive and capacity to manipulate. The case of Bell, California shows how egregious this corruption can be, and how long it can persist without detection. State and local governments should undertake these transparency and monitoring measures in the interests of public integrity.

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