POSSIBLE SWEETHEART DEAL IS FOCUS OF INVESTIGATION.

Byline: Beth Barrett Staff Writer

Local and federal investigators are looking into whether an Airport Commission member or other city officials sought a sweetheart deal for a Taiwanese shipping and airline company during Mayor James Hahn's 2002 Asian trip, according to two sources.

Indications that the inquiry has intensified comes as Hahn is facing a tough re-election battle and is defending his administration against allegations of ``pay-to-play'' contracting practices and other abuses.

The sources, who are familiar with the ongoing investigations or had spoken with investigators, said in recent interviews that an important part of the inquiry is focused on a meeting in Taipei involving Commissioner Leland Wong and Deputy Mayor Troy Edwards, port executive director Larry Keller and officials of Evergreen Marine, a sister company of EVA Airways. All three city officials have since resigned.

The essence of the inquiries, the sources said, was whether Wong, who also was a consultant to Evergreen Marine, was going to get EVA Airways business for Ontario International Airport in exchange for a lucrative deal at the Port of Los Angeles and whether he stood to profit as a result, the sources said.

The inquiries included whether the port stood to make more money if the Evergreen Marine lease had been bid competitively. Investigators also questioned whether port staff members had objected to the terms Evergreen got, and if so whether they had been pressured by Wong or others, they said.

Wong did nothing wrong, his attorney said. Edwards could not be reached for comment.

Hahn, who signed a letter of intent with EVA Airways Chairman K.C. Chang in Taipei on Nov. 26, 2002, for the company's air cargo component operations to move to Ontario, acknowledged he has become concerned about Wong's possible conflict of interest but insisted he was unaware of it at the time.

``If I don't know about something, I can't be held responsible for something I don't know about,'' he said when questioned at a mayoral campaign event on the steps of City Hall.

``I think that's something that needs to be looked at; it certainly wasn't something I was aware of at the time. Certainly I'm interested in finding out everything I can. I want everybody to cooperate in every investigation.

``So far, what we have are investigations; so far what we have are allegations ... we don't have facts.''

Last month, Los Angeles County District Attorney Steve Cooley's office and the city's Ethics Commission asked the airport for travel expense statements and reimbursements for Wong, Edwards, Hahn and other top mayoral officials on the 10-day November 2002 trip. They also sought lease contracts and other documents associated with EVA Airways, a Taiwanese carrier.

The document requests are the most recent development in a far-reaching, 18-month-long City Hall pay-to-play corruption investigation by federal and state grand juries. Cooley sought the documents as part of the overall probe, said Joe Scott, his director of communications.

The investigation already has included significant inquiries into the deals with EVA Airways and its sister company, which were both tentatively hammered out in Asia by the mayor's delegation, including Wong, who was a Hahn appointee to the Airport Commission as well as a consultant to Evergreen Marine, according to city ethics records filed a month before the trip.

EVA Airways was to move its cargo operations from Los Angeles International to Ontario where a new cargo facility was to be built. Evergreen Marine, which already had a lease at the port through 2028, was to get a noncompetitive 86-acre land lease on Terminal Island to expand its operations.

The new facility has yet to be built at Ontario, and another firm is in negotiations over the land lease.

The sources said port officials described being pressured by Wong and Edwards to award the 86-acre lease to Evergreen Marine over port officials' preference for a new tenant, P&O Nedlloyd.

Wong's attorney, David Scheper, said his client did nothing wrong.

``Mr. Wong attempted to act properly and made the appropriate disclosures,'' he said.

Hahn moved Wong to the Department of Water and Power Commission in 2003, and he resigned the following year amid allegations he misused funds of his employer, Kaiser Permanente, for political purposes.

Councilman Antonio Villaraigosa, who is challenging Hahn in the May 17 election, said the request from the District Attorney's Office again raises the issue of corruption in the Mayor's Office.

``Jim Hahn can't accuse people of misrepresenting the record when he is being investigated,'' Villaraigosa said.

``Here we have another example of an administration pushing through contracts without any debate. Another example of an administration rife with allegations of corruption, rife with problem of ethics, rife with examples of misrepresenting their record.''

Councilman Bernard Parks, who announced his support of Villaraigosa, said the inquiry was part of the reason he entered the race for mayor and was backing his council colleague over the mayor.

``I don't think we will see these kind of investigations with (Villaraigosa) as mayor,'' Parks said.

Hahn said there was no special dealing on Evergreen's behalf.

``We were very interested in having Evergreen, one of the biggest tenants at the port, continue to be a tenant at the port; we also were very interested in seeing if their airline, their cargo airline, could work at Ontario,'' Hahn said.

Staff Writer Rick Orlov contributed to this story.

Beth Barrett, [phone]

beth.barrett(at)dailynews.com