Response to Investigation and
Censure Discussion
It is both disappointing and deeply concerning that the discussion surrounding my likely censure as a council member has been fueled by prejudicial conduct and an investigation riddled with missing information, procedural shortcomings, and a lack of transparency. It is important to clarify that my inquiry with the fireworks vendor, Mr. Richard Legaspi was not an overreach but a reflection of my commitment to fiscal integrity. Claims against me for inquiring with Mr. Legaspi about cash irregularities reflect a deliberate mischaracterization of my obligations as a Director and public servant committed to fiscal transparency and accountability.
To address this matter, I will highlight several points of concern regarding the investigation and the circumstances surrounding this matter:
1. MISSING AND WITHHELD INFORMATION
• Communications: There is a glaring lack of transparency concerning key communications, including email exchanges between the undersigned and Mayor Nefulda, Mayor Pro Tem Shelly Hasselbrink, and Council Member Tanya Doby, as well as between the “investigator” and Mr. Richard Legaspi. The only available documentation pertains to communications between the investigator and Council Member Emily Hibard, as well as between the investigator and myself. These missing communications are crucial to establishing consistency and fairness. Without them, the validity and impartiality of the investigation are seriously undermined.
• Scope of Services: Investigator failed to provide clear and pertinent information about the scope of services or objectives the investigator was tasked with. This lack of clarity undermines the credibility of the investigation and suggests that it may not have been conducted in an impartial or comprehensive manner.
• Financial Documentation: Ms. Carol Churchill’s letter references financial records that clearly indicate $20,000.00 in contributions, gifts, grants, and similar amounts mysteriously missing from IRS Form 990-EZ, submitted by Foundation Treasurer Shelley Hasselbrink in October 2023. However, these critical documents were withheld and excluded from public review in this report. This omission obstructs a comprehensive and accurate evaluation of the allegations, making it impossible to fully verify the extent of the irregularities.
Suppressing such evidence while leveling accusations against me not only compromises the integrity of the investigation but also undermines its credibility entirely. • Failure to Specify Violations Undermines Credibility: On page 6 of 68, Section 2 of Resolution No. 2024-60 references the Code of Conduct, Governance Protocols, and Code of Ethics but fails to cite the specific section or provision allegedly violated. This omission is a significant procedural flaw, as it denies clarity and specificity regarding the alleged misconduct. Without identifying the exact section, it is impossible to determine how the
referenced codes were breached or to evaluate the validity of the allegations. This lack of detail further undermines the resolution’s credibility and fairness.
2. LACK OF COMPREHENSIVE INVESTIGATION
• Prejudicial Conduct: The investigation failed to account for or address the acrimony between myself, Mayor Jordan Nefulda, Mayor Pro Tem Shelly Hasselbrink and Council member Tanya Doby, which has clearly influenced the process and created an environment of prejudicial conduct. Statements and actions by these members reflect bias rather than objective assessment. Such underlying tensions and biases should have been addressed to prevent prejudicial conduct and meet the standards of objectivity and fairness required in this matter.
• Selective Investigation Undermines Integrity: On page 6 of 68, Section 3 of Resolution No. 2024-60 states that the City Council has taken into account ALL of the evidence presented to it, including the report by the investigator. This assertion is false, as the investigator was instructed to disregard the whistleblower complaint as it was not the scope of the current investigation and no additional information would be provided. This directive led to a selective and incomplete investigation, excluding critical evidence that would have provided necessary context and balance. By failing to consider the whistleblower complaint, the Council compromised the integrity of the investigation, rendering the conclusion invalid and raising serious concerns about fairness and transparency in this process.
3. MISUSE OF CLOSED SESSIONS
• The repeated misuse of closed sessions to justify private discussions among elected officials is a violation of transparency laws. There has been no evidence or indication of potential litigation that would warrant such sessions, making this an abuse of the process.
Private discussions used to target an elected official without proper public deliberation only further erode public trust. This misuse not only violates the principles of open governance but also further undermines the legitimacy of the actions taken against me.
4. UNDENIABLE TIES BETWEEN THE FOUNDATION AND THE CITY
• The Foundation’s Connection to the City: Despite Mayor Pro Tem Shelley Hasselbrink’s claims that the Foundation is not closely linked to the City, this assertion is clearly false. Foundation meetings are held at City Hall, City employees are involved in both operations and events (including the fireworks stands and Beverage Garden), and until mid-2024, the City maintained a link to the Foundation’s website. Furthermore, the Foundation was established in 2021 by two council members who serve at the City’s pleasure. These facts clearly demonstrate a direct and undeniable connection between the Foundation and the City of Los Alamitos. • Questions of Oversight and Separation Between the Foundation and the City: Furthermore, while it is acknowledged in the findings of the Memorandum of Understanding (MOU) that the Foundation regularly interacts and cooperates with the City to supplement or organize community events, there is clear evidence that the Foundation’s
involvement extends beyond mere interaction or cooperation. The Foundation has directly paid City staff for their services, blurring the lines of separation between the two entities. This raises significant questions about the extent of the Foundation’s entanglement with City operations and the potential implications for oversight, accountability, and transparency. Such actions warrant further investigation to ensure compliance with established protocols and to safeguard public trust.
• Mayor’s Authority Reveals Close Ties Between the City and the Foundation: Per the Bylaws of the Los Alamitos Community Foundation, the Mayor of Los Alamitos serves as the ex officio sole statutory member of the corporation, with significant authority to elect or appoint members of the Board of Directors, remove members of the Board, and vote on the disposition of all or substantially all of the corporation’s assets. This clearly establishes a direct and substantial connection between the City and the Foundation, as the Mayor wields considerable influence over the governance and operational direction of the Foundation. The Mayor’s authority to make such impactful decisions underscores the City’s inherent influence over the Foundation’s governance and operations. These facts contradict any assertions of independence between the two entities and clearly demonstrate that the Foundation operates in close connection with the City of Los Alamitos. This relationship highlights the need for transparency and accountability in the Foundation’s activities to ensure public trust is upheld
5. DEBUNKING THE APPRECIATION EVENT CLAIM
• The claim made by Council member Tanya Doby that my removal [from the Foundation Board] was due to an “appreciation event” has no merit. There is no evidence that any discussion or directive to this effect took place during a public meeting.
6. FALSE ALLEGATIONS REGARDING VENDOR COMMUNICATION
• Mayor Pro Tem Shelly Hasselbrink’s assertion that council members were directed not to contact vendors is false. There is no evidence—either in meeting minutes or public policy discussions—that such a directive was ever issued. My discussion with the TNT Fireworks representative was conducted in good faith and with the intent of investigating cash irregularities.
7. INTERNAL CONTRADICTION OF FACTS
• Contradictory Findings Undermine the Resolution’s Credibility: The findings in Resolution No. 2024-50 present a clear internal contradiction. On page 5 of 68, it states that Mr. Legaspi explained why he could NOT provide me with confidential financial and proprietary information, implying that such information was never made available to me.
However, later in the resolution, it is alleged that I improperly used my position as a Council Member to OBTAIN records I was not entitled to access. These two statements are fundamentally inconsistent—if Mr. Legaspi did not provide the information, it is nonsensical to claim that I obtained it through misuse of my position. This contradiction seriously undermines
the credibility of the resolution’s findings and raises concerns about the thoroughness and accuracy of the investigation.
• Furthermore, on page 6 of 48, Section 1 of Resolution No. 2024-50 asserts that the recitals are true and correct. However, this statement is inaccurate due to a clear internal contradiction within the document, which calls into question the validity of the conclusion.
Specifically, while page 5 claims that Mr. Legaspi could NOT provide me with confidential financial and proprietary information, the resolution later accuses me of improperly using my position as a Council Member to OBTAIN records I was not entitled to. These conflicting statements cannot both be accurate, thus undermining the validity of the overall findings.
8. MY ROLE AND RESPONSIBILITIES
• As a former Director of the Los Alamitos Community Foundation and an elected official, I have a fiduciary responsibility to protect resources and address concerns regarding financial irregularities. My inquiry with Mr. Legaspi was conducted in good faith, driven by a commitment to accountability rather than any intent to exceed my role. Attempts to characterize this action as misconduct are both unfounded and contrary to the principles of transparency and oversight that the public rightfully deserves.
CONCLUSION
The investigation and subsequent actions against me are riddled with inconsistencies, missing information, and procedural violations. Furthermore, the lack of transparency and adherence to fairness, and comprehensive analysis undermines the legitimacy of this entire process.
The investigator’s claim that my credibility is questionable—based on her belief that I downplayed my conduct on March 19, 2024, to avoid public censure or disapproval from my City Council colleagues—is both nonsensical and unsupported by evidence. Given my lack of a collaborative relationship with Mayor Jordan Nefulda, Mayor Pro Tem Shelly Hasselbrink, and Council Member Tanya Doby, this assertion is unfounded. It underscores a significant failure on the investigator’s part to accurately assess the dynamics within the current City Council or to ground her conclusions in factual evidence.
Moreover, my legitimate inquiry into the lack of accurate accounting and reconciliation of cash has been willfully ignored.
Furthermore, it is deeply troubling that the procedural impropriety of allowing Foundation President John Delavigne to act unilaterally—without majority Board approval—to pursue formal action against me has gone unacknowledged. Despite this, his letter is cited as supporting evidence in the investigative report.
It comes as no surprise to me that the majority of this Council has chosen to pursue this discussion “let’s be truthful - impending action” to censure me. This decision clearly reflects the lack of ethics and integrity within the Council majority, especially given the unnecessary timing of this censure on the very night I am set to leave office.
My actions have always been guided by an unwavering commitment to transparency, fiscal accountability, and integrity. These values have been the foundation of my work as a council member, as demonstrated when I uncovered over $4 million in errors—building on Ms. Carol Churchill’s discovery of more than $10 million in numerical discrepancies, as well as an auditor’s report reflecting roughly $6 million, or 25%, in journal entry corrections. This was compounded by numerous typographical errors, misallocation of data and ongoing discrepancies with the warrants. What’s truly disheartening is that, instead of viewing these errors as opportunities for improvement, actions were taken to withhold invoices and statements, claiming that the task was too labor-intensive. Steps should have been taken over the past few years to streamline the process, enabling council members to better fulfill their responsibilities to the community.
Lastly, I want to sincerely thank the City staff for the countless opportunities to truly understand the concept of “continuous improvement.” Your unparalleled dedication to setting unique benchmarks has undoubtedly been a highlight of my time in office, serving as a constant and unforgettable reminder of what it means to aim for higher standards.
Regards,
Trisha Murphy
Cc: David Young of The Event NewsEnterprise - [email protected] KTLA - Cameron Kiszla - [email protected]
Voice of OC - Spencer Custodio - [email protected] OC Register - Kaitlyn Schallhorn - [email protected]
ATTACHMENTS: Relevant Documents Highlighting Governance and Financial Oversight Concerns
1. Resolution No. 2024-50: Copy of the official resolution detailing findings and conclusions.
2. TNT Fireworks Letter: Correspondence addressed to the Los Alamitos Community Foundation regarding fundraising activities.
3. Los Alamitos Community Foundation President John Delavigne’s Letter:
Letter from John Delavigne, read during the May 2024 Los Alamitos City Council meeting.
4. Kramer Workplace Investigation Report: Confidential personnel investigation report dated December 10, 2024..
5. Missing IRS Form 990-EZ: Prepared by Shelley Hasselbrink, Treasurer for the Los Alamitos Community Foundation, but withheld from public review.
6. California DOJ Delinquency Notice: August 11, 2023 notice warning of penalties, late fees, and potential suspension or revocation of the Foundation’s registered status, but withheld from public review..
7. California Secretary of State Filing (12/19/2021): Electronic filing listing Shelley Hasselbrink as Chief Executive Officer and Tanya Doby as Secretary and Chief Financial Officer for the Los Alamitos Community Foundation.
8. California Secretary of State Filing (03/23/2022): Electronic filing listing John Delavigne as Chief Executive Officer, March Chirco as Secretary, and Shelley Hasselbrink as Chief Financial Officer. Notably, no subsequent updates or amendments have been filed since 2022.
9. California Department of Justice (01/19/2024) Incomplete Annual Report Received.
10. Bylaws Excerpts
Excerpt from the Bylaws of Los Alamitos Community Foundation, Inc.
Copy of page 2 of the Bylaws, Article 6: Membership
• Section 6.1: Ex Officio Sole Statutory Member
• Section 6.2: Rights of Statutory Member
Copy of Page 10 of the Bylaws:
Article 9.6.5 - Treasurer
• 9.6.5.1: Books of Account
• 9.6.5.2: Financial Reports
• 9.6.5.3: Deposit and Disbursement of Money and Valuables • 9.6.5.4: Bond
• Copy of Page 11 of the Bylaws:
Article 10 - Transactions Between Corporation and Directors or Officers • 10.1: Transactions with Directors and Officers
• 10.1.1: Interested Party Transactions
• 10.1.2: Requirements to Authorize Interested Party Transactions Treasurer Shelley Hasselbrink’s husband, Kurt Hasselbrink, is employed by the nonprofit organization Los Alamitos Youth Baseball (LAYB) to perform lawn maintenance and receives a 1099 form. LAYB received funds from the 2023 Los Alamitos Community Foundation Fireworks Fundraiser Sale, raising potential concerns about conflicts of interest.
11. Copy of the 2023 Fireworks Fundraiser Reconciliation Report: The report shows that LAYB received $4,180.00 as a “payout” for 10 shifts worked during the fundraiser.
Additionally, the report references cash sales of $40,103.00, but there is no supporting documentation or confirmation to verify that the cash boxes at both firework stand locations (Vons and DaVita) were properly secured, reviewed, and reconciled with appropriate oversight.
This raises significant concerns about the management and accountability of cash transactions during the event. Additionally, failing to utilize the TNT-provided iPads may have resulted in customers not being charged the appropriate sales tax for cash payments.
These documents collectively underscore concerns surrounding governance, financial accountability, and regulatory compliance within the Los Alamitos Community Foundation.
These findings suggest a need for closer scrutiny to ensure compliance with bylaws and safeguard against potential conflicts of interest and financial mismanagement.
12. Copy of page 546 of Los Alamitos City Council June 20, 2023 Agenda Packet: The attached document shows significant numerical errors, including over $3 million dollars in understated total liabilities and misallocation of almost $1 million dollars due to net changes in the total balance from misreported funding sources.
When you compute each line item:
Current liabilities of: $3,002,887
Long-term debt of: $3,767,244
Net OPEB Liability: $6,356,967
Net Pension liability: $14,540,568
TOTAL LIABILITIES is actually: $27,667,666 not $24,664,779
13. Copy of June 24, 2024 City Council Agenda Adjourned Regular Meeting with City Roger’s, Anderson, Malody & Scott, LLP Reports: The attached reports: Pages 237 - 242 of 628 Report on Internal Control Over Financial Reporting and Compliance Based on an Audit of Financial Statements, along with Pages 243 - 252 of 628 the Independent Auditor’s Report and Independent Accountant’s Report, outline significant findings regarding the City’s financial management.
The Budget Standing Committee—comprised of then-Mayor Tanya Doby and Council Member Shelley Hasselbrink, who also serves as Treasurer of the Foundation—did not appear to conduct a thorough review of the City’s financial records. This lack of oversight resulted in numerous issues, including overstatements, misallocations, misstatements, ineffective monitoring procedures, and multiple errors in financial reporting.
On page 239 of the Schedule of Findings and Responses for the Year Ended June 20, 2023, the report highlights Finding 2023-002: Recording Cash Disbursement - Material Weakness. This finding indicates that several checks issued during the audited year were not recorded in the City’s accounting system. Consequently, daily cash balances were overstated, leading to inaccurate financial reporting.
These findings underscore a critical concern regarding the City, including members [then-Mayor Tanya Doby and Council Member Shelley Hasselbrink, who also serves as Treasurer of the Foundation] of the Budget Standing Committee’s financial management practices and reveal substantial weaknesses in its system of internal controls.
A need for closer scrutiny to ensure compliance with bylaws and safeguard against potential conflicts of interest and financial mismanagement.
Dated: December 16, 2024
_________________________________
Trisha Murphy, Los Alamitos Council Member, District 2
From: wendy grose
To: Windy Quintanar
Subject: Letter to be included in special council meeting and council meeting 12/16/24 for public record Date: Sunday, December 15, 2024 7:57:44 PM
IRONSCALES couldn't recognize this email as this is the first time you received an email from this sender [email protected]
Attention Los Alamitos City Council, City Manager, and Los Alamitos Residents The Los Alamitos Community Foundation, Inc apparently is a nonprofit raising money and competing against nonprofits in Los Alamitos. I, Wendy Grose, have volunteered at the firework stand with the understanding the money would go to the nonprofit I supported. At no time was there a schedule or indication of how the money would be distributed or who received the money. The two years that I volunteered I watched as no one from the Los Alamitos Community Foundation, Inc nonprofit had any accountability or responsibility for the money as well. There was a cash box just allowed to be anywhere and anyone could open it without question. There was no reconciliation of money between shifts, there was no accountability of how the money was monitored. In fact, this year I was quite concerned about what appeared to be thousands of dollars being left in the cash box during the day as I observed an individual standing back from the booth more than 20 mins without purchasing anything and then disappearing. I asked several times for Cory Lakin to please take most of the money which he finally did (no one counted it) At closing on 7/4/24 the city staff member, Cory. and myself helped break down the booth but no one wanted the responsibility of the cash box and the Treasurer (Shelley Hasselbrink) for the nonprofit failed to come over to pick it up. What I observed was a poorly controlled method for accountability of the cash at the fireworks stand. This is concerning especially in light of the questions by the state regarding money not accounted for on their tax forms. Now, the three main council members, Shelley Hasselbrink, Tanya Doby, and Jordan Nefluda, want to censor a council member for asking questions. What are they hiding? Why are these individuals wasting our tax dollars? As a nonprofit or city foundation, you have NO rights to privacy according to state regulations on nonprofits. Any resident or in fact anyone can walk into the office of the foundation address and request to see all their financials. It MUST be provided immediately and not at the convenience of whoever is there. Additionally, the bylaws for this nonprofit fail to establish the very foundation of what this organization is supporting, why city employees are being used for events, how they are being paid, why city vehicles are being used to transport anything for this organization, why our tax dollars are being used for a non profit especially without financials, who is paying for insurance for this foundation especially at event where alcohol is not only being sold but those who purchased alcohol were allowed to walk around Winter Wonderland event drinking alcohol. This is not the image that Los Alamitos residents want to teach our children!! Let alone, in the past it was not legal to purchase alcohol and walk around the area drinking alcohol. The image being set by this nonprofit is to allow local bars the same freedom.
The citizens and taxpayers have every right to be informed and expect accountability.
Remember, council members work for the citizens, it is not the other way around!!! Sincerely
Wendy Grose, Los Alamitos Resident