Local boy finds little comfort at ports.

After a long silence, Nick Tonsich stated the obvious--that it was no fun being drawn into the widening investigations of city contracting practices.

"No one," he said deliberatively, "would like being audited or investigated by a grand jury. I don't think it's unique to me. How do you avoid it? Once it's ongoing, you just deal with it. I think that's my attitude, to deal with it as it comes."

Tonsich, L.A. Mayor James Hahn's choice as president of the Board of Harbor Commissioners, prefers to stay out of the public eye even as he administers one of the city's largest departments.

But he has begun to speak up, especially as it relates to last year's audit of the harbor department by City Controller Laura Chick--an inquiry quickly followed by the current federal and local grand jury investigations into contracting practices at the city's three revenue-generating departments.

Late last month, Tonsich said a number of harbor employees who were interviewed as part of Chick's audit told him that their comments were inaccurately portrayed and he called for the audit to be reviewed.

"I was shocked," Chick said. "Can you imagine being an employee of the harbor and being called into the commissioner's or some high-level supervisor's office and hearing, 'Did you say this to the auditor?'"

Tonsich later retreated from that stance, saying in an interview that he would instead contract another auditor to review port leases after a panel appointed by the mayor to review city contracting procedures delivers its report.

The port, Tonsich said, cannot obtain "best practices" in its leases by relying only "on the controller but (by) getting an auditing firm of national repute who can assist us. If it's consistent with the controller, so much the better. If it conflicts, hopefully it can be enlightening."

Uncomfortable with controversy

L.A. City Councilwoman Janice Hahn, sister of the mayor and also a resident of San Pedro, backed Tonsich. "At the end of the day, we're going to find out what we can do better and more effectively to be more accountable," she said. "I don't have a problem with a second opinion by the department if there were inaccuracies."

In an interview with the Business Journal, Tonsich seemed uncomfortable engaging in the controversy--as well as most every subject. "I don't seek that kind of attention," he said. "I don't undertake commission duties to gain personal exposure for myself. It seems as though staying under the radar can be more effective to achieve some of the harbor's and mayor's goals."

But that management style might have contributed to an environment that Chick criticized in an audit of the port's leasing practices last summer.

Tonsich, appointed along with the four other harbor commissioners by Hahn in August 2001, tried to break the hold of longtime staff members by getting more involved in leasing negotiations and urging more environmentally friendly projects to accommodate the community surrounding the port.

"Part of the mayor's goal has been to make amends with the community with the port of L.A.," said Janice Hahn. "I think Nick is a good businessperson and good attorney, but he's really worked hard to make this port accountable to the community. He's taken some controversial issues and has kept pushing them for the good of the quality of life for the people who live around here."

His style, she added, is a marked departure from that of Ted Stein, president of the Board of Harbor Commissioners from 1998 until 2000. Stein, appointed president of the Airport Commission by Hahn in 2001, resigned recently amid the ongoing investigations.

"Ted Stein gave the classic line when the community came to a Harbor Commission meeting (and he said), 'I am not interested in a two-way dialogue with the community,'" Janice Hahn said. "Nick ... is engaged in dialogue with people from the community. He talks back to them, asks questions, gets qualifications and defends what he's doing."

Plugged in

While never particularly actively in local politics, Tonsich grew up in politically powerful San Pedro, attending Bishop Montgomery High School in Torrance with Tim McOsker, the mayor's chief of staff.

"He's one of my best friends," Tonsich said (the two were best men at each other's weddings). "We played Little League baseball together."

With a finance degree from the University of Southern California and a law degree from Whittier Law School, Tonsich began his law career as a clerk in the environmental crimes unit of the L.A. County District Attorney's office. He later joined a mid-sized firm, where he remained for nine years until starting his own firm with two other partners and three associates.

His first political move came in 1995, when he set up an office to run in the Republican primary for state Senate. He raised between $30,000 and $40,000 but failed to get enough signatures for placement on the March 1996 ballot.

Tonsich called the experience exploratory, saying he was talked into running for the office. He said he has no ambitions to run for public office.

His political activity shifted to contributions, particularly to the Hahns. Along with law partners John Glaser and Joseph Brajevich, Tonsich and his firm contributed $7,000 to the mayor and $2,750 to Janice Hahn between May 1999 and October 2003, according to the City Ethics Commission.

Appointed, like other Hahn backers, to a plum commission post after the election, Tonsich has found that his efforts have not always yielded speedy results, especially at a port with a history of contentious relationships.

What's more, said a friend, whatever inroads he was able to make were often stymied by senior port staff workers who excluded commissioners from certain business deals. "Much of this has been done in the dark," the friend said. "I don't think he knew everything that was going on."

Rudy Svorinich Jr., the former L.A. City Councilman now working as a lobbyist in San Pedro, stressed that Tonsich is not afraid to argue for something he believes is right.

"Nick doesn't go out looking for conflict," Svorinich said. "But if there is something out there for which he believes an alternative perspective needs to be presented, he'll present that perspective."

Not everyone is enamored. Janet Gunter, a frequent critic of port operations who regularly attends commission meetings and has sparred with Tonsich on numerous issues, said he can be arrogant with those who disagree with him.

She said Tonsich's tone can be condescending and that he debates with a "slight grin on his face when he listens to people with opposing views from his own."

"He's demeaning to anyone who says anything opposite to the port perspective," she said. "There's an arrogance that permeates the room when he's in it."

Gunter has also challenged what she said was a conflict for Tonsich because he served as president of the commission and also works as a lawyer whose firm represents Alameda Corridor Transportation Authority.

Last year, she wrote a letter to the District Attorney's Office drawing attention to the alleged conflict. In a February 2003 letter signed by District Attorney Steve Cooley and the head deputy of the public integrity division, David Demerjian, the office declined to investigate.

"The whole function of the Alameda Corridor is to serve at the behest of the ports of L.A. and Long Beach," Gunter countered. "Without the ports, there is no Alameda Corridor."

RELATED ARTICLE: Track record.

IN his 30 years as a government auditor, Kurt Sjoberg insists that only a handful of his recommendations have come under question.

But in the past year, Los Angeles city officials at the harbor and airport departments have picked apart the findings of two audits commissioned by City Controller Laura Chick--and conducted by Sjoberg, who was the state's auditor for 11 years before forming his own firm in 2000.

"Our new firm is often asked to conduct audits of the most sensitive or controversial topic areas," said Sjoberg, co-founding partner of Sjoberg Evashenk Consulting. But "it's fair and more accurate to say most of those audits did not have instances where agencies disagreed. And never in my history--as 20 years of being state auditor or as a partner--have we ever had to change a report or issue a retraction on a report."

In January, Airport Commissioner Peter Weil recommended that the Board of Airport Commissioners hire its own auditor to review business practices after calling Chick's audit of airport contracts biased. Los Angeles World Airports, which operates Los Angeles International Airport, also disputed several of the numbers relating to leases at Van Nuys Airport in the audit.

More recently, Harbor Commission President Nick Tonsich has questioned the accuracy of auditors' interviews with port staff in an audit of port leases that Chick released last summer.

Chick said she selected Sjoberg because of his reputation. "In performing the more complex audits, and ones which unfortunately have turned out to be fairly contentious, he's highly skilled and qualified," she said.

Initially a supervisory auditor with the General Accounting Office, Sjoberg was California state auditor from 1989 to 2000, during which about 80 percent of his recommendations were implemented. He recommended imposing restrictions on local government investments after legislators hired him to review Orange County's bankruptcy recovery plans in 1995.

Also, Sjoberg helped re-write the industry's handbook, the Yellow Book, from 1997 to 2001.

Sjoberg has not been immune to controversy. When he worked as a private consultant to Oracle Corp. in 2002, he concluded that the state of California could have saved $110 million to $160 million as part of a contract with the computer giant. But the report became a political lightning rod when an audit by Elaine Howle, the new state auditor, found the same contract could result in a loss to the state of between $6 million and $41 million.

"His reputation got damaged a little bit on the Oracle deal because it was so well publicized," said John Chen, chief of audits at the state Controller's Office.

Sjoberg said there was "nothing more highly charged than that" in his career. Both he and Howle said discrepancies occurred because they used different information that became available to them at different periods in time.

--Amanda Bronstad

Staff Reporter David Greenberg contributed to this report.