Ex-official in Bell, Calif., scandal has Auburn farm
In the Northwest, Bob Rizzo is known as a Thoroughbred owner whose horses did well at Emerald Downs and whose 10-acre Auburn farm is an image of genteel country living. But in Bell, Calif., Rizzo is considered the pariah of government corruption and greed.
In the Northwest, Bob Rizzo is known as a Thoroughbred owner whose horses did well at Emerald Downs and whose 10-acre Auburn farm is an image of genteel country living. But in Bell, Calif., Rizzo is the new symbol of government corruption and greed.
Rizzo is a key figure in a scandal in which California state auditors and prosecutors allege Bell officials mismanaged more than $50 million in bond money, levied illegal taxes and paid exorbitant salaries to its leaders.
The audit was made public a day after Rizzo and seven other current and former officials of the blue-collar Los Angeles suburb were arrested for misappropriation of public funds and other charges.
Rizzo was singled out for criticism in the state controller's audit, which said that, as city manager, he had total control of city funds and used some of the money to inflate his salary and pay off personal loans.
Rizzo, 56, was making nearly $800,000 a year — almost twice as much as President Obama — when he resigned earlier this year. His total compensation package in Bell — one of Los Angeles County's poorest cities — reached $1.5 million a year.
At Emerald Downs, however, "He was just one of the owners," said Dave Nielsen, who runs the racetrack 's Turf Club.
"He wasn't flashy. He was a very nice man. Just an ordinary Joe. I was shocked to hear the allegations."
People acquainted with Rizzo through racing say he is a friendly and unassuming man who cherishes his horses more than he does the modest purses they win.
"He impressed me as being a very caring person," said Mary Lou Griffin, a Buckley, Pierce County, Thoroughbred breeder who took on one of Rizzo's mares, Peter's Jewel, for foaling and raised a couple of its offspring.
Horse trainer Mike Chambers said Rizzo is "not flamboyant in any direction." The two had just been out to dinner, and Chambers paid.
"You'd never know he had a cent," Chambers said.
If convicted of the charges, Rizzo's horse-racing days will be over, said Bob Lopez, secretary for the Washington Horse Racing Commission. Horse owners must be licensed and have no felony convictions, Lopez said, and an owner's license can be suspended even while charges are still pending. With the 2010 season ending this weekend, any revocation wouldn't affect Rizzo until next year.
Rizzo entered the Washington horse-racing business in 2004, state records show.
At Emerald Downs, track officials and trainers said Rizzo has generally bought relatively inexpensive horses. Listed as the owners of most of the horses are three California companies he has formed — Rizzo Racing Stable Inc., R.A. Rizzo Inc. and Golden Aggie Ranch Inc.
It could not be determined how much he has spent on his Thoroughbreds, because many sales are private. From 2004 through this month, Equibase figures show, the horses owned by Rizzo's firms have collectively earned about $678,000.
In 2006, his horse Irene's Bonus Baby won the $100,000 Barbara Shinpoch Stakes and another of his horses took second in that race the following year. Rizzo's take on the first-place win alone was $49,500, according to the racing commission.
This season at Emerald Downs, three of his horses — including a gelding named Depenserdel'argent (French for spend money) — brought in $18,195 in winnings. According to the Thoroughbred Times, 18 horses from his Rizzo Racing Stables have started in races this past year, either at Emerald Downs or Berkeley, Calif.'s Golden Gate Fields.
Rizzo bought his Auburn ranch in 2004, state and county records show.
The property, a short drive from Emerald Downs, is assessed at $875,000. It features a 2,600-square-foot Green River waterfront house with a pool, barn and neat paddocks. Rizzo and his wife also have a similarly valued home in Huntington Beach, Calif.
After a Los Angeles Times reporter knocked on the front door of the ranch house on a recent morning before the arrests, Rizzo initially refused to answer, staying behind closed shutters. Then he emerged and barked, "You're trespassing."
A moment later, he apologized and said his lawyer had prohibited any interviews.
Standing barefoot in black shorts and T-shirt, near a knee-high jockey statue with "Rizzo" painted on it, the short, rotund Rizzo complained of being vilified after toiling so hard for Bell, a job he says that ended his first marriage and caused him to gain 150 pounds.
On a recent morning at his ranch, he tried to justify his salary by remarking that although it might look astounding, it wasn't so dramatic, considering his length of service.
"Yeah, the money went bad," he told a Los Angeles Times reporter. "But when you think about it, the 17 years I been there, that's $250,000 a year."
Folks who know him from Auburn and Emerald Downs say he loves his sojourns there and dotes on his horses almost as much as he does on his wife and daughters.
"He's very much a homebody," said Donna Rose, who runs a bed-and-breakfast down the road from the Rizzos in Auburn. "He is a very nice man that puts his family in a position of big importance."
Prosecutors alleged the wrongdoing by Bell city leaders went unchecked for years because anyone who could have exposed the scheme was reaping benefits.
Others arrested Tuesday were Mayor Oscar Hernandez; former Assistant City Manager Angela Spaccia; Vice Mayor Teresa Jacobo; council members George Mirabal and Luis Artiga and former council members Victor Bello and George Cole.
The officials, wearing handcuffs and jail clothing, appeared before a judge on Wednesday but did not enter pleas. Their arraignments were postponed until Oct. 21. Rizzo's bail was set at $2 million.
The eight suspects were charged with misappropriating $5.5 million in public funds. However, the audit questioned well over $65 million in city expenses. Other findings showed the city levied more than $5.6 million in improper sewer, property and business-license taxes, paid exorbitant salaries to city leaders without required performance reviews and paid $10.4 million to two development firms owned by a contractor who also was the city's director of planning services.
As Bell's chief administrative officer, Rizzo was accused of illegally lending city money to himself, his assistant, City Council members, members of the police force and an array of city workers ranging from management analysts to a recreation attendant who borrowed $1,500.
"Our audit found the city had almost no accounting controls, no checks or balances, and the general fund was run like a petty-cash drawer," California state Controller John Chiang said in a statement. "The city's purse strings were tied to only one individual, resulting in a perfect breeding ground for fraudulent, wasteful spending."
It also says Rizzo used more than $93,000 to repay two personal loans and approved $1.5 million in loans to other city workers even though no city ordinance permitted it.
With Rizzo at the helm, four of the five current City Council members were paid just under $100,000 a year for part-time duties; Police Chief Randy Adams made $457,000; and Assistant City Manager Angela Spaccia pulled down $376,000.
Rizzo's attorney, James Spertus, said faulting his client for the salaries and perks that he and the others received is unfair because the council approved them.
"This wasn't a Bob Rizzo fiefdom," Spertus said.
In March of this year, Rizzo's life away from Bell City Hall took a bad turn. He was arrested in Huntington Beach on suspicion of drunken driving. Police say he had a blood-alcohol level of 0.28, 3 ½ times the legal limit. He has pleaded not guilty, and a counselor informed the court that Rizzo has been in treatment for alcohol abuse.
The pending DUI case charted a downward trajectory. Four months later, after his salary made headlines, Rizzo announced his retirement in the face of a public outcry. Investigators soon were seizing records at City Hall.
Information from Seattle Times staff reporter Nancy Bartley, The Associated Press and the Los Angeles Times is included in this report.