Bell gave secret loans to two businesses
Then-Bell City Manager Robert Rizzo gave city loans of nearly $400,000 to two businesses without public discussion, approval from the City Council or collateral to back the loans, according to documents reviewed by The Times.
One of the loans, $300,000 given to a local Chevrolet dealer in 2008, is the subject of a court fight because the dealer went out of business within a year of receiving the loan, having repaid nothing.
Although other cities sometimes lend money to local businesses for economic development, Rizzo granted the loans in a highly unusual way, with no statement of economic benefit to the city -- a step that is commonplace in municipal loans.
The second loan was given to the Steelworkers Old Timers Foundation in 2005, a senior citizens group run by George Cole, who was on the Bell City Council then. It is unclear whether the $72,000 loan was repaid. After saying that he would discuss the loan, Cole did not return calls seeking comment.
Several experts said the secret loans violated basic tenets of municipal government and appeared to violate Bell's charter, which requires that all contracts be approved by the City Council.
"This is a complete breakdown of checks and balances," said veteran municipal lawyer Michael G. Colantuano. "It's plainly illegal."
-- Jeff Gottlieb, Richard Winton and Ruben Vives
Photo: Former Bell City Manager Robert Rizzo and his wife.