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HMG INVESTIGATION: Santa Fe Springs City Officials Involved in Questionable Billboard Scheme

 

BY BRIAN HEWS • May 20, 2020

Since 1961, the Kudler family has been an integral part of the city of Santa Fe Springs. Bob Kudler, along with his brother Joel, purchased a building and started the very successful Kudco Diversified, Inc. (Kudco) in 1962 in this tiny southeastern city in Los Angeles County.

The Kudler’s built the family business stressing hard work and ethics, providing for their families, as well as their many employees and customers.

Bob’s son, Mark, followed and started Bulletin Displays, which has evolved into one of the largest independently owned billboard companies in the Los Angeles market.

Kudler became expert at helping cities and legislators secure large revenue projects, working with many state and city officials drafting innovative sign ordinances that allowed cities to share in the revenue of the billboards.

He was instrumental in designing all the Landmark Message Centers for Buena Park, Baldwin Park, and Lynwood, generating millions in annual revenue for those cities.

Back in 2013, Kudler proposed the Santa Fe Springs Landmark Message Center on the 5 Freeway.

Liking what they saw from Kudler, the city requested four additional signs on the 605 Freeway, but there was a problem; State law prohibited signs along that section of the freeway.

Kudler told the City’s Billboard Committee, which at the time consisted of Vice Mayor Richard Moore, Councilmember Jay Sarno, City Manager Ray Cruz, and the City Planning Director Wayne Morrell, that he could get approval for the 605 signs.

Based on that statement, the Billboard Committee, led by Morrell, emailed a “Black and Red Agreement” (BRA)  to Kudler.

A BRA is sent by the originator in black “ink” to the vendor, who writes back in red “ink” accepting the terms; in contract law it is called implied contract, which is a legally-binding obligation on both parties.

Kudler relied on the agreement and went to work, only later to be caught in a dirty web that extended to many corners of Santa Fe Springs City Hall.

Get the Property Approved

With the BRA in hand, Kudler went to work and enlisted the help of L.A. County Supervisor Janice Hahn and Assemblywoman Blanca Rubio, who worked with him to write a law that would help Santa Fe Springs.

In a little under three years, Rubio’s AB 3168 passed and the state allowed the billboards.

Kudler told HMG-LCCN, “This was a major victory that would generate millions for the city of Santa Fe Springs. We were told this could not be done, yet we got it done.”

Kudler and his company began the pre-work need to begin construction of the billboards, which can sometimes take years.

Elections Have Consequences

During the 2018 City Council elections, Vice Mayor Moore chose to retire and Councilmember Sarno inexplicably lost his re-election; the elections changed the membership of the Billboard Committee, which was put on hiatus for many months.

That is when the questionable actions by City Manager Cruz, Planning Director Morell, and the property owner, the same property that Kudler spent two years to get approved for billboards, began.

Kudler had an iron-clad lease with the owner to build signs on the Dollar Self Storage property located at 8717 Pioneer Boulevard.

After the property was approved by the state, making it much more valuable, the landlord, Jack Thompson, suddenly told Kudler he was “talking to sign competitors.”

That was a violation under the term of Kudler’s lease.

Thompson’s attorneys tried an end run, contacted Kudler, and informed him they wanted to terminate the lease if he “could not show progress.”

Kudler showed them the extensive work progress at the site, which Kudler said the attorneys called “impressive,” so they could not legally void the contract.

The lawyers subsequently agreed to have Thompson attend a Billboard Committee meeting and sign the required consent form to continue the process.

Quid Pro Quo?

On May 28, 2019 the Billboard Committee reconvened with Vice Mayor Bill Rounds and Councilmember Annette Rodriguez as new members, along with City Manager Cruz and Planning Director Morrell.

Like the attorneys, everyone in the meeting was impressed by the progress Kudler had made, except for Morrell, who Kudler suspected was talking to Thompson’s attorneys.

Towards the end of the meeting, Morrell inexplicably stated that he was told by “competitors” that Kudler did not have a lease.

Sensing a scheme, Kudler asked Morrell who the competitors were, but Morrell refused and actually told Kudler he would refuse to answer a public records request.

“Why would he be talking to competitors,” an incredulous Kudler told HMG-LCCN, “I had the lease.”

Thompson, his attorney, and city officials kept up the ruse and scheduled a July 18, 2019  Billboard Committee meeting where Thompson would “bring a notarized copy of the consent form that the city needed,” presumably ending the stalemate with Kudler.

But only three hours before the meeting, Kudler received an email that Thompson “could not show up.”

Kudler attempted to negotiate at the meeting but Morrell told Kudler he would “put the property out to bid to other sign companies.”

Santa Fe Springs Councilmember Annette Rodriquez voiced her concerns saying it was unethical to stop the process started by Councilmembers Sorno and Moore, but it only delayed the inevitable.

Two months later, Morrell drafted a letter, signed by Cruz, stating that the property would be put out to bid.

Shockingly, and illegally, Morrell and Cruz excluded Kudler from bidding, citing, similar to Thompson’s attorneys, that the “Santa Fe Springs Landmark Message Center on the 5 Freeway was not complete.”

But Morell knew it was complete, recently meeting and receiving a modification of Kudler’s building permit for the property; a permit that clearly showed progress in the building of the signs.

And, according to Kudler, Cruz was in on the scheme too. After sending information to Morrell, Kudler sent Cruz photos and video of the fabrication and documented proof of the progress.

But Morrell and Cruz refused to acknowledge the progress and attempted to put the property out to bid, so Kudler was forced to file for arbitration on August 19, 2019.

The Competitor Emerges

On October 8, 2019, Kudler received word from Alim Malik, Thompson’s new attorney, who is partners in a firm with Michael Tidus.

 

Michael Tidus (left) and Alim Malik

 

Malik told Kudler not to communicate with Thompson’s former attorneys.

HMG-LCCN researched and found that Michael Tidus represented Glen Emanuel of the mega-billboard company Outdoor Associates during a billboard project on the 5 Freeway in Santa Fe Springs.

Kudler was incensed, “this probably would have surfaced earlier if Morrell did not illegally threaten to refuse my public records request.”

“I just want to get the billboards done so the city can get the revenue. During this time, a city can use revenue from any source, this project can provide that, it is a real shame this is going on.”

Kudler’s arbitration case is due to be heard soon.

 

 

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