Palm Springs corruption: Criminal charges to be filed
PALM SPRINGS, Calif. — The Riverside County District Attorney's Office will file criminal charges as a result of its investigation into public corruption in Palm Springs.
Prosecutors are set to announce the outcome of the investigation at 10 a.m. PT Thursday in Riverside. The announcement will include details of criminal charges, a person familiar with the investigation told The Desert Sun. The source asked not to be identified because charges had not been filed as of Wednesday afternoon.
Any criminal charges are sure to shake the desert city. The development comes 17 months after investigators from the FBI and other agencies seized documents and equipment from Palm Springs City Hall and the home of then-Mayor Steve Pougnet. The documents taken included records involving businessman John Wessman, the city's most prominent real estate developer and its partner in the unfinished downtown redevelopment plan.
City officials, who were at City Hall on Wednesday evening for a scheduled public meeting, said they were unaware any charges were coming.
"All I know is what I read in The Desert Sun," Mayor Robert Moon told a reporter from the paper.
The raid on Sept. 1, 2015, followed months of reporting by The Desert Sun on Pougnet's ties to developer Richard Meaney. In addition to being Pougnet's personal friend and business associate, Meaney worked with Wessman on projects in Palm Springs and for the Orange County firm Nexus Development.
He said he made the decision well before his announcement that May, but emails later uncovered by The Desert Sun showed Pougnet making plans for a re-election campaign in early 2015.
Since leaving office toward the end of that year, Pougnet has disappeared from the Palm Springs political and social scene. While mayor, he split his time between Palm Springs and Denver, where his husband and two children lived.
When challenged by The Desert Sun, Pougnet admitted that a vote on a land sale to Meaney in December 2014 was an inadvertent mistake but has otherwise maintained he did nothing wrong. He said he sat out of other votes involving Meaney and made the financial disclosures required by law.
A Desert Sun investigation raised other questions about the property sale to Meaney. As Palm Springs sought to sell land once owned by its redevelopment agency, officials never had the properties appraised or sought competitive open bids. Instead, officials used estimates that set the price far below the likely open-market value. The process allowed Meaney to purchase a vacant lot on a prime commercial corridor for $195,561. Earlier that year, Meaney purchased a similar adjacent lot from a private seller for $1 million.
Additional questions arose around a $250,000 city economic development grant awarded to the Hacienda, a restaurant and poolside lounge Meaney and his wife, Heidi, opened in 2014. The business eventually closed and the city sued Meaney to collect some of the grant money. Wessman is involved in the Hacienda project and helped the Meaneys pay off debts after the business shut its doors. Pougnet did not participate in the vote to approve the grant.
While in office, Pougnet prioritized bringing new commercial activity to downtown Palm Springs. After a hard-fought feud with Wessman over the blighted mall he owned in the heart of the city, Pougnet and Wessman came to an agreement in 2011 to partner on sweeping redevelopment plans for the area. The city agreed to chip in $43 million from a newly approved sales tax increase and the derelict mall was torn down.
The $300 million project, which includes a park, two hotels and space for other businesses is only partially complete and progressing slowly, raising questions about the future of the city's downtown.
Contributing: Jesse Marx, The (Palm Springs, Calif.) Desert Sun. Follow Barrett Newkirk and Brett Kelman on Twitter: @BarrettNewkirk and @TDSbrettkelman