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Daily Pilot

Hatch alleges Friday Night Lights misled city

City CEO says popular youth sports program wrote a letter that got it out of $50,000 in fees.

By Bradley Zint

6:30 PM PDT, March 28, 2014

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Officials with a popular flag football program allegedly made misstatements to the city of Costa Mesa to avoid paying nearly $50,000 in fees to use a public field, according to allegations contained in a confidential city memo reviewed by the Daily Pilot.

City CEO Tom Hatch contends in the Feb. 18 memo that Newport-Mesa Friday Night Lights owes taxpayers back payment for its use of the city-owned Jack R. Hammett Sports Complex.

In the memo addressed to the City Council, Police Chief Tom Gazsi and high-ranking administrators, Hatch asserts that former municipal Recreation Manager Bob Knapp granted Friday Night Lights its fee waiver based on a "likely fraudulent" letter written by President Mark Broersma of Orange County Youth Sports Assn., which operates the youth football league.

"I believe Bob Knapp knew that the letter was not accurate," Hatch wrote in the memo, "and he did not investigate it further to help his friend" — a reference to Newport-Mesa Friday Night Lights Commissioner Scott Mahaffy.

In an interview, Knapp strongly denied knowing the letter's credibility was in question when he received and accepted it to waive the fees certain leagues are required to pay. In addition, Friday Night Lights officials said they did not mislead the city and, since the memo was written, have repaid $10,000 and are working with the city to settle the matter.

At issue is whether Friday Night Lights officials are compensated for their work. All-volunteer, nonprofit leagues can qualify for waivers that let them use city fields for free.

Hatch, in his memo and in a follow-up interview, argued that Friday Night Lights provides compensation to some staff members that would negate its ability to use fields without charge.

In the letter that Friday Night Lights provided to Knapp — which the Pilot reviewed — Broersma wrote that Mahaffy "does not receive financial compensation from the profits" of the K-8 football league — a statement strongly disputed by Hatch.

In a follow-up interview, Broersma said his organization is a federally recognized 501(c)(3) nonprofit and that Mahaffy "is a compensated employee of Orange County Youth Sports Assn."

When asked to clarify the apparent contradiction between his statement and the claim in the Friday Night Lights letter that Mahaffy does not receive compensation, Broersma declined additional comment.

Hatch contended in his memo that City Hall has not been able to confirm that the football group's nonprofit status is in good standing.

More than a month later, that remains the case, according to a city spokesman.

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Field-use policy changes

The discrepancy stems from a June 18 council directive — unanimously recommended by the Parks and Recreation Commission the month before — that changed the city's athletic field use and allocation policy. It stated that if sports organizations pay their executive staff or board members any profits, they are no longer considered for the top "Group 1" status. Group 1 teams receive priority to use public fields and can be granted fee waivers.

Before the policy change, as a Group 1 user, Newport-Mesa Friday Night Lights fit the bill for the waivers. Since the change, though, it has not, and it is now a Group 3 user that must pay field-use fees to City Hall because it pays either its executive staff or board members, according to city staff.

In his memo, Hatch argues that Knapp, the former recreation manager, was aware of Newport-Mesa Friday Night Lights' status change and nonetheless waived the fees "in complete contradiction" to city policies.

"Bob used a likely fraudulent letter, or at least a deceptive letter," Hatch wrote in his memo, "to justify waiver of fees in violation of council direction from last June."

Knapp denied knowing that anything contained in Broersma's letter was misstated.

"Staff and the city get applications, forms or files from any number of groups to use facilities," Knapp said in an interview. "We don't go back or verify and audit those outside groups."

Hatch also wrote in the memo that a few days before Knapp's Jan. 31 resignation, Knapp had been placed on administrative leave "for work performance" unrelated to matters of field allocations.

Hatch wrote his memo in response to a Daily Pilot article about Knapp's resignation in which the departing administrator accused top city management of not following recreation policies.

In that article ["Playing hardball over softball," Feb. 12], Knapp told the Pilot that he had resigned from his position after senior city management decided to jettison a long-standing city softball league and two Group 1 organizations from using the TeWinkle Park Athletic Complex on Friday nights. Replacing them was a private flag football program affiliated with former NFL player Matt Leinart.

Knapp argued that it was wrong for the Leinart program, a "Group 3," to displace the softball league and Group 1 users, and said the fact that his interpretation of the policy differed from that of city management partly led to his resignation.

Since Hatch issued his memo, Mahaffy has paid some of the fees and is working out other details, said city spokesman Bill Lobdell.

The program has paid $10,000 so far, in two $5,000 increments sent earlier this month.

"In the meantime," Lobdell added, Mahaffy is "going to meet with city staff to establish how much time he actually used during the fall season, and he'll be billed the balance."

In an email, Mahaffy confirmed that he is working with city staff to "come up with a satisfactory [payment] schedule for this disagreement, and hopefully it will be resolved in such a way that it does not impact the kids."

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Knapp responds to claims

In an interview, Knapp called Hatch's memo a "smear" attempt to use him as "a scapegoat for the poor decisions of others."

He also took issue with the memo's accuracy. For example, Hatch wrote that Knapp and Mahaffy were friends and former rowing partners at Orange Coast College years ago.

Knapp said he knew Mahaffy from his time at OCC, but denied having a close relationship with him since.

"For Tom to ... say that I made decisions on this based on a friendship is ludicrous," Knapp said. "The decisions we've made were based on the documents we received, not based on a personal relationship."

Knapp called the allegations "very disappointing, and I think it's a real true sign of the nature of leadership in our city."

"And I don't mean the council, I mean the fifth floor [of City Hall]," Knapp added, a reference to where the city's top management keeps offices.

Asked for a response regarding the statements about the city's leadership team, Hatch said he could not comment on the personnel-related contents in his confidential memo.

"I can say that I discovered that $48,800 in field fees had been improperly waived for the Friday Night Lights program, and we are now recovering that money," Hatch wrote in an email, adding, "I'm extremely proud of the city's recreation program — it's one of the core strengths of Costa Mesa."

Knapp said he would defend his year-and-a-half tenure at City Hall.

"You want to be somewhere where you can make a difference and do good work," he said. "I feel that most people in the community know I did good work, and that I'm a man of my word."

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'Tried, judged and sentenced'

Mahaffy of Friday Night Lights denied receiving any special treatment from Knapp.

He also said he has been treated unfairly by the city since being asked on Feb. 26 to pay the roughly $50,000 in field-use fees — $24,507.60 for last fall and $24,381.25 for this spring.

He told city officials he was never notified of the council's changes in June to the field-use policy, which knocked Friday Night Lights down from its top-tier Group 1 status.

He also said the city's field-use allocation rules contain a three-strikes policy that was never applied to him.

"It seems I was tried, judged and sentenced without my knowledge of any of this," Mahaffy wrote in a March 4 email to Hatch, city staff and the City Council.

In response, Hatch told the Daily Pilot that this particular instance was unique, and that the usual field allocation rules don't apply.

Mahaffy submitted an inaccurate letter, saying he did not get paid, Hatch contended, and thus, he also forfeited any benefit of the three-strikes policy.

When asked about his compensation, Mahaffy said that as of May 2013, he cumulatively made about $17,000, mostly in reimbursements and consulting work, from his three seasons of participation in Newport-Mesa's Friday Night Lights league.

He said he receives no compensation to operate the program.

"Working Friday Night Lights is a full-time job," Mahaffy said, "but it doesn't pay as a full-time job. It's a hobby."

He said his compensation since last May hasn't been calculated.

Mahaffy also told the parks commission last year, Hatch noted in the memo and confirmed in a follow-up interview, that he was paid $5 per player for additional growth and that some coaches are paid.

Hatch told the Pilot that he had reason to believe Mahaffy, his wife, or both, were being paid by the Orange County Youth Sports Assn., which runs the league. He pointed to the association's 2012 tax forms, which show another commissioner in Huntington Beach making more than $119,000 that year.

Hatch said that even if Mahaffy didn't make $119,000, it wouldn't matter.

"If he got $1, he's in violation of the policy," Hatch said. "I'm looking out for the public's money."

Mahaffy, a former Xerox Corp. executive, recently moved to Costa Mesa from Huntington Beach. He also works with other youth sports leagues, and said he earns income from investments and by selling sporting equipment online.

Newport-Mesa Friday Night Lights came to Costa Mesa in spring 2011 — the parent franchise started in Los Alamitos in 2006 — after the city dropped its flag football league. It has grown considerably since then, Mahaffy said, from 91 kids in 2011 to about 700 enrolled for this spring season, most of them from Costa Mesa.

Mahaffy said he runs a well-organized league that receives positive feedback.

Otherwise, "if we ran something poorly and we didn't do a good job, our numbers would reflect that," Mahaffy said. "Our numbers would go down."