There’s been a growing distance between two influential forces in Anaheim residents’ lives, since an ongoing FBI corruption probe first rocked the city over a month ago.
One force is City Hall.
The other is the local Chamber of Commerce.
That distance recently widened around a yearly Fourth of July parade and fireworks show being planned next week in the wealthy side of town, Anaheim Hills, which City Hall decided not to co-sponsor with the Chamber of Commerce in May.
Both organizations’ leadership structures sit frozen under a federal investigation that’s caused nothing short of political upheaval in Anaheim, prompting criminal charges against the Chamber’s former CEO, Todd Ament, and the resignation of former Mayor Harry Sidhu.
The investigation has renewed calls for campaign finance reform to lessen influence from the Chamber of Commerce and other Disneyland resort-connected interest groups.
It’s also revealed what some residents said for years, that the Chamber heavily influenced public affairs and policymaking at City Hall.
[Read: FBI Reveals What Many Anaheim Residents Felt For Years, City Hall is Run By The Chamber of Commerce]
The Chamber also loomed large over Anaheim Hills’ flag-waving community event over the last decade, “usurping” the July 4 celebration’s old organizing body and taking control of it in the early 2010s, according to tax filings and interviews with past leaders of what used to be referred to as the Canyon Hills Community Council.
The group then rebranded under the Chamber’s direction, those former leaders said.
But it might have only been a “precursor” to a longer-term political strategy, to use what looked like grassroots community groups to advance the agendas of resort interests in town, said one of the Anaheim City Council’s lone Chamber of Commerce critics, Jose Moreno.
“It was almost the template by which the Chamber and the mayor, and others involved, constructed Anaheim First,” Moreno said in a Wednesday phone interview.
Anaheim First, which sprang up later, is a chamber-created resident advisory group on city spending issues. But the residents doing the advising on that board had resort ties, critics said.
[Read: Private Advisory Group Anaheim First Criticized as it Begins Citywide Study]
“The model was, you create this presumably community-based nonprofit, run by the leadership of the Chamber and its associates, and they’re really de facto political arms of the Chamber,” Moreno said.
All while creating the impression of “community support,” he added.
The Chamber brought the Hills festivities into scrutiny in the past. A successful 2014 Chamber push to legalize fireworks sales in Anaheim had effectively opened a funding mechanism for the Fourth of July Parade through the proceeds.
That was until the council under former Mayor Tom Tait, a staunch chamber and resort critic, saw disproportionate benefits in the arrangement and moved to split the sales revenue between the city’s high schools in 2017.
The parade-organizing group now calls itself the Anaheim Hills Community Council on its website, which at the bottom of the homepage lists the support and tax ID of a group called the Anaheim Economic Development Corporation – another nonprofit with links to the Chamber of Commerce.
In a May written affidavit attached to Ament’s federal criminal complaint, FBI agent Brian Atkins indicated that the Anaheim Economic Development Corporation played a role in alleged money laundering.
Independence Day in the Hills
It seems the yearly festivities in Anaheim Hills will, for the most part, proceed as usual next week.
Just under separate banners.
“For the Anaheim Hills 4th of July Celebration, we opted not to enter into a co-sponsorship agreement with the Anaheim Chamber of Commerce this year,” said city spokesman Mike Lyster in an emailed response to questions earlier this month.
“It was part of an administrative decision suspending any future financial involvement with the chamber announced by the city manager at the May 24 City Council meeting,” he added.
Lyster said the city will host “its own celebration event for the [Anaheim Hills] community at Peralta Park with fireworks, entertainment and food booths.”
Separately, he said, the Chamber of Commerce will host the marathon and parade that day.
The yearly event highlights how seemingly two different Anaheims mark the July Fourth spirit in seemingly two different ways.
Like every year in West Anaheim, a poorer side of town, families will light legal fireworks in the streets. Illegal mortars and skyrockets will set off car alarms and light up cul-de-sacs. People will watch from driveways and backyards.
The police will get calls and drive around for the illegal fireworks, which every year bring council members into discussions with the police and fire chiefs to figure out some kind of enforcement plan.
On the other side of town, in the hills, there will be an organized parade and city-sanctioned fireworks show where residents are prohibited from setting off their own due to the fire-prone landscape. There will be other events too.
There will be a pancake breakfast. There will be live music from a band called the Smokin Cobras. There will be a dog show, where pooches will stroll onto the Canyon High School softball field at 9 am wearing flag colors.
Before the turn of the 2010s, the celebration’s organizing group looked different.
It was once known as the Canyon Hills Community Council. Like now, it ran the parades and marathons. Karyn Schonherz, a longtime Anaheim Hills resident and real estate agent, said she first chaired the old Canyon Hills Board in the early 1990s and did so for two decades.
As the event grew, eventually beyond just a parade, so did its demand for fundraising in a way that strained her group’s bandwidth, she said.
“I was begging for money, literally,” said Schonherz during a Wednesday phone interview. Toward the late aughts, she even appeared on TV and in newspaper articles with such appeals, warning that without meeting fundraising goals, the celebration would be toast.
‘Bow Out and Go Away’
The issue of funding had opened a doorway, and the Chamber of Commerce walked right through it, Schonherz said.
“They (the Chamber) met with us, the entire board, the existing board that I had put together, and said something to the effect of: ‘You guys are struggling. You know it’s hard to raise money for fireworks. We’re willing to come in and help,’” she added.
Phil Beckman was another Canyon Hills board member before he left his old home in Anaheim Hills for Park City, Utah in 2015.
“All of a sudden, Karyn contacted me and said, ‘Have you heard what’s going on?” Beckman said in a separate Wednesday phone interview.
Almost suddenly, Beckman said, “a slew of new board members were in.”
“And we were out.”
Leading up to 2012, the Canyon Hills Community Council listed Beckman, Shonherz and other board members in IRS tax filings per a limited log of disclosures made available through ProPublica’s nonprofit search database. The filings aren’t available directly through the IRS’ own database.
But by 2013, the Canyon Hills Community Councils tax forms were showing a large’ different board roster.
With a new president:
Former Chamber of Commerce CEO Todd Ament, who’s now facing mortgage fraud charges in federal court.
Joining him on the new board that year was the chair of the Chamber of Commerce’s own Board of Directors, Ross McCune, who hung up the phone when reached for comment Wednesday.
“I sort of became an auxiliary person to advise the board. All the members who were actual board members changed. And I was just in an advisory capacity,” Shonherz said.
The Chamber of Commerce had leveraged its financial position to influence the Hills’ community parade group, she added.
“It was – let’s put it this way – the usurping of our authority by the Chamber.”
After leaving town with a “turned stomach,” Beckman reflected on the leadership change in the comments section of an Orange Juice Blog post in 2015, from another state.
“The non-profit Canyon Hills Community Council became part of the Anaheim Chamber,” he wrote at the time. “It is shameful what has happened to that grassroots local volunteer community group that made all of this happen for the first 25 years.”
Beyond the Hills, fireworks became a focal point of the Chamber’s political activities citywide.
Fireworks sales were barred in Anaheim for nearly three decades, until voters rolled the prohibition back by passing Measure E during a 2014 special election.
Ament, at the time, submitted official arguments in favor of the measure. He was also on the city’s Charter Review Committee, which proposed it.
A campaign committee supporting Measure E also employed the services of FSB Core Strategies, a political firm that has since changed its name to Core Strategic and appears in the footnotes of one of the written FBI affidavits made public in May.
Under prior rules for Anaheim’s legal fireworks sales, proceeds were run through Anaheim Arena Management, the company managing the Honda Center. It sold fireworks from two stands, one at the Honda Center and another in West Anaheim, and proceeds would go toward nonprofits based in Anaheim that registered to participate.
Anaheim Arena Management kept 60% of the proceeds, Voice of OC reported at the time.
Ten percent of the total profits were split among all nonprofits that registered with the program. Customers could also bring a flyer from the nonprofit of their choice to ensure 30 percent of their purchase would go to that organization.
Anaheim Arena Management also donated $40,000 toward the Anaheim Hills Fourth of July event, where residents couldn’t light their own fireworks because of the area’s fire risk. Then-Mayor Tom Tait, at the time, argued the program disproportionately benefited Anaheim Hills residents but left “crumbs” for what were considered more ideal beneficiaries: The high schools.
After the Canyon Hills board’s leadership change, Schonherz found herself questioning the role that remained for her in a new political landscape.
“It became clearly obvious to me that they (the Chamber) didn’t want me to be involved anymore,” Schonherz said. That was the moment she said she decided to “bow out and go away.”
Brandon Pho is a Voice of OC reporter and corps member with Report for America, a GroundTruth initiative. Contact him at firstname.lastname@example.org or on Twitter @photherecord.