Let it never be said that Lawrence J. Mazzola doesn’t know how to cut a deal. According to various sources, the longtime business manager, secretary-treasurer and trustee of San Francisco’s United Association of Plumbers, Pipefitters and Journeymen Local 38 has arranged to have the U.S. Department of Labor drop planned sanctions against him and other union officers. The department back in November 2004 announced it had filed a civil complaint against the local leadership, current and former trustees, and benefit plan administrator for diverting more than $36 million in assets of five employee benefit plans toward the renovation and operation of the Konocti Harbor Resort and Spa at Clear Lake in Kelseyville, Calif. “The Plumbers plan officials mismanaged the investments and placed the benefits of thousands of union workers at risk,” said Secretary of Labor Elaine Chao at the time. “This Administration is committed to protecting the employee benefits of America’s workers, and we won’t hesitate to act when plan officials are not managing their workers’ benefits responsibly.”
That was then; this is now. A lengthy account in the alternative Bay Area newspaper, SF Weekly, states that it has unearthed court proceedings indicating the DOL has decided to all but exonerate the current regime. Mazzola would remain as business manager and secretary-treasurer. And though he would have to step down from a trustee board controlling benefit funds, he would be allowed to remain for two years on another board overseeing a training fund. His son, Lawrence, Jr., meanwhile, will be allowed to sit on the board of trustees overseeing benefit funds. Other trustees would avoid prosecution as well. As for the Konocti resort, the union is attempting to sell it, but will not have to. A deal reportedly is in the works that would enable the Boca Raton, Fla.-based WhiteStar Advisors, LLC, a real estate-consulting firm specializing in union clients, to pay the San Francisco Carpenters local $25 million to take the property off its hands. Ullico Casualty, a union-supported insurance company itself no stranger itself to recent scandal, would pay the Labor Department $3.5 million in fines. The DOL, like Mazzola’s lawyer, is keeping mum on all details.
Mazzola may well prosper as a result of the deal. He and his family own potentially valuable farmland near the resort. He’d been trying as of late to persuade Lake County (where Kelseyville is located) to rezone the land for a mixed-use development project, the anchor of which would be a tribal casino. The planned move would require restoration of federal recognition of certain California Indian tribes. Sen. Barbara Boxer, D-Calif., drafted the legislation during the same period in which her son Doug, a lawyer, had worked for San Francisco developer Darius Anderson, a prominent Democratic Party lobbyist with close ties to Las Vegas financial backers. Anderson’s top lieutenant at his Kenwood Investments firm is Jay Wallace, who managed current House Speaker Nancy Pelosi’s first run for Congress two decades ago. If the Labor Department’s reticence toward imposing disciplinary measures against Plumbers Local 38 isn’t related to Democrat control of the current Congress, it certainly gives every appearance as such. (SF Weekly, 6/6/07; other sources).