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Capitola Councilmember thumbs nose at residents of Library service area

by Bruce Holloway
In his statement of economic interests upon leaving office as library board chair, Capitola Councilmember Mike Termini failed to disclose the true percentage of his ownership interest in Triad Electric, Inc., a local electrical contractor. He also failed to disclose $17,000 worth of business Triad Electric did last September for NHS Inc., a local skateboard manufacturer. That's roughly equal to two years worth of rent that Santa Cruz Councilmember Micah Posner omitted on his disclosure forms. © 2016 Bruce Holloway
termini.jpg
Termini's Form 700 can be accessed via the Library website and is posted here:

http://nf4.netfile.com/pub/?AID=scccls

It's dated January 12 and signed under penalty of perjury. It includes Schedule A-1, for ownership interests of less than 10%, which says his stock in Triad Electric is worth over $1 million. Had he included Schedule A-2, for ownership interests of 10% or more, there'd be a place on the form to disclose individual sources of income of $10,000 or more per year, such as NHS.

On the exact same day, California's Fair Political Practices Commission issued an advice letter to Heather Lenhardt, Termini's lawyer. Capitola is paying for Termini's legal representation (as if this millionaire couldn't afford it). Based on information she provided, the FPPC concluded that Termini really owns 100% of Triad Electric, which in fact did $17,000 worth of business with NHS. The January 12 FPPC letter can be found here:

http://www.fppc.ca.gov/transparency/form-700-filed-by-public-officials.html?SearchTerm=Lenhardt

The Santa Cruz City-County Library system is governed by the Library Joint Powers Board. The Library service area has over 200,000 residents in the cities of Santa Cruz, Capitola, and Scotts Valley and the unincorporated part of Santa Cruz County. In December, the library joint powers agreement between those three cities and the county was revised and the LJPB was revamped. All of the old LJPB members left office and were replaced by a new LJPB.

Termini had to repay the Library $28,612 in 2014 because Triad Electric was doing business with the Library while he was on the LJPB in 2013 and 2014. It's generally against the law for board members of California public agencies to do business with their agencies. Former Library Director Teresa Landers had issued a purchase order to Triad Electric for $25,000, the limit of her authority without LJPB approval.

Even though the Triad Electric invoices ultimately exceeded that authorization during fiscal year 2013-14, City of Santa Cruz employees kept it under the radar. The City eventually reimbursed the Library $1,570 because the City gets a 5.5% administrative services fee for all (lawful) Library expenses. After Termini's illegal self-dealing was uncovered and he paid back the money, the old LJPB unanimously elected him as their chairman.

The Santa Cruz Sentinel knew about Triad Electric's invoices to the Library before the 2014 city council election, but wouldn't print the story and endorsed Termini. Sheriff's sergeant Joe Clarke lost the election by 63 votes. The Capitola City Council knew about Termini's illegal self-dealing with the Library, but unanimously voted to maintain him as their representative on the old LJPB.

Termini told me former Santa Cruz City Attorney John Barisone knew Triad Electric was doing business with the Library for a year before the LJPB found out about it. According to Termini, "Barisone said the worst that might happen is you'll have to pay back $11,000." After their discussion, Triad Electric continued to sell to the Library. The law firm Atchison, Barisone, Condotti, & Kovacevich contracts to represent both the cities of Santa Cruz and Capitola as well as the Library. In its view there has never been any conflict of interest between these parties.

Termini owes the residents of the Library service area complete and honest disclosure according to California's Political Reform Act.
§Heather Lenhardt
by Bruce Holloway
heather-lenhardt.jpg
§Heather Lenhardt's letter to the FPPC
by Bruce Holloway
lenhardt_letter.pdf_600_.jpg
I learned in high school to look for primary sources of information. Everyone in Capitola always told me Termini was the sole shareholder of Triad Electric, but I never had any evidence in writing. Thanks, Heather.
§Termini amends his leaving office Form 700 (for the first time)
by Bruce Holloway
The link to Termini's Form 700 in the original story above shows that an amended form was filed today including Schedule A-2. He continued not to disclose the $17,000 from NHS referred to in Heather Lenhardt's letter.

According to nhs-inc.com, "NHS, Inc. is a privately-held company established 40 years ago in Santa Cruz, California". A current job opening on that website says, "Must live near or be willing to relocate to Santa Cruz, CA." Santa Cruz, CA is within the jurisdiction of the LJPB.

The instructions for Form 700 say "To Complete Schedule A-2":

"PART 3. Disclose the name of each source of income that is located in, doing business in, planning to do business in, or that has done business during the previous two years in your agency’s jurisdiction, as follows:
• Disclose each source of income and outstanding loan TO THE BUSINESS ENTITY OR TRUST identified in Part 1 if your pro rata share of the GROSS income (including your community property interest in your spouse’s or registered domestic partner’s share) to the business entity or trust from that source was $10,000 or more during the reporting period."

That doesn't mean your "salary" -- it means any income source to Triad Electric greater than $10,000, like NHS. Did Heather Lenhardt tell you to fill it out that way? Free legal advice courtesy of Capitola sounds wonderful (even though you're a multimillionaire), but sometimes advice is worth what you pay for it. If you can't follow these simple instructions, one hopes you never try to fill out a 1040!
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