Pougnet Says He Won’t Step Down Over Corruption Probe

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palm springs mayorPALM SPRINGS – Palm Springs Mayor Steve Pougnet insisted Wednesday night he will not resign over a federal corruption probe, and said the city is also conducting its own investigation into the sale of former redevelopment agency properties.

Speaking to a packed council chamber at City Hall, Pougnet asked residents to be patient and not to jump to any conclusions and the local and federal probes. He also stressed that the city is cooperating with investigators who raided City Hall Tuesday.

“For many of you here in the crowd hoping to hear the words that I’m going to resign tonight, I’m not going to resign tonight,” Pougnet said. “So I will continue to lead this city for the next few months until the end of my term before I go and be with my family in Denver, Colorado.

“So, I also ask everyone, don’t jump to all the conclusions,” he said. “This investigation will be thorough, and we’ll all live by the conclusions.”

Investigators with the federal Inland Empire Public Corruption Task Force, including the FBI, Internal Revenue Service and Riverside and San Bernardino county district attorneys’ offices, served search warrants at City Hall on Tuesday, forcing the closure of the building for the day.

Agents also visited the mayor at his home, although Pougnet took issue with characterizations by the media that investigators “seized” items at his residence.

“The mayor cooperatively met them at my house to give them my iPad and my iPhone,” Pougnet said. “… It was very cooperatively given.”

Laura Eimiller of the FBI said the search warrant affidavits were filed under court seal, so no details were released about the nature of the corruption probe.

Pougnet, however, has been under fire in recent months for his ties with developer Richard Meaney.

Pougnet admitted this year collecting more than $200,000 in consulting fees from Union Abbey, a firm owned by Meaney that has an expired business license and unpaid state tax liabilities, The Desert Sun reported.

Pougnet initially said his work for Union Abbey in recent years involved consulting on development work solely outside Palm Springs city limits, but he later conceded he played a role in advising the firm about Palm Springs’ economic development plans.

On May 5, the mayor said he mistakenly cast a vote to approve the sale of a city-owned parcel of land to another Meaney enterprise, at a cost that was far below market value, the newspaper reported.

Pougnet announced the following day he would not seek a third term as mayor.

The sale of the property was later rescinded.

Meaney still owns another, larger parcel of land he purchased from the city last year at a price that is also believed to have been well below market value. In the case of both sales, prices were based on sales of commercial properties elsewhere in the Coachella Valley — where values are typically lower than in Palm Springs — and the parcels were not put on the open market to allow other prospective buyers to bid up the price, the Desert Sun reported.

Both of the sale prices were also well below what taxpayers paid for them years earlier, according to the paper.

The state’s Fair Political Practices Commission announced in mid-May it was investigating whether Pougnet violated the state’s political ethics law.

At tonight’s meeting, Pougnet noted that the city “a month or two months ago” began its own investigations into the handling of the redevelopment agency properties, as well as a redevelopment incentive program that last year paid $250,000 to Meaney’s Hacienda Cantina.

“There is no doubt that we will continue to provide as much information with this investigation or any additional information needed in the upcoming report on the RDA property,” Pougnet said.

City Councilwoman and mayoral candidate Ginny Foat said Tuesday she was at a complete loss about what prompted the raid.

“I’ve never known anything to happen at City Hall that wasn’t above board,” she said. “I’m totally shocked. I heard about it on the news.”

No one was arrested during the raid.