News Summary
The Anaheim Chamber of Commerce has filed a lawsuit against Visit Anaheim, claiming the termination of their funding agreement was politically motivated. This decision has resulted in a significant loss of funding for the chamber, threatening its financial stability. Visit Anaheim ended the agreement amid a state audit that criticized the arrangement, raising concerns about mismanagement of funds and the impact of political pressures. The chamber is seeking $7 million in damages while Visit Anaheim faces scrutiny over its decision-making process and operational oversight.
Anaheim – The Anaheim Chamber of Commerce has initiated legal action against Visit Anaheim, claiming that the termination of their funding agreement in September 2023 was driven by political motivations. The lawsuit was formally filed on July 24 in Orange County Superior Court, marking a significant turn in the relationship between the two organizations, which have historically enjoyed a close partnership, including sharing office space.
The funding agreement that Visit Anaheim terminated provided crucial financial support to the chamber, with a percentage of revenue from hotel stays allocated to them. According to the chamber, this abrupt termination resulted in the loss of approximately 80% of its funding overnight, pushing the organization towards financial instability and damaging its reputation within the community. The chamber’s leadership highlighted that the funding agreement, under which they received approximately $4.4 million from Visit Anaheim from 2012 to 2022, was not just a financial lifeline but a partnership that supported mutual objectives.
The lawsuit also emphasizes that the decision to end the funding was made while a critical audit was ongoing. A 2024 California state audit criticized the funding agreement, revealing that the city was unaware of the arrangement and that Visit Anaheim had not obtained permission for its subcontracting. It noted that some of the funds had been misused for unallowable services, including political advocacy. Amidst these findings, the Visit Anaheim board terminated the agreement, citing the criminal actions of former chamber CEO Todd Ament, who had pleaded guilty to fraud charges in relation to a city corruption case.
Chamber CEO Dara Maleki, who took over in spring 2023 during a critical time when the chamber was contemplating closure, stated that the organization should not be held accountable for the misdeeds of Ament, which occurred without the knowledge of the board. The chamber is seeking approximately $7 million in damages as restitution for the financial and reputational harm caused by the termination of their funding agreement.
In defense, Visit Anaheim President and CEO Mike Waterman has indicated that the organization has not yet been formally served with the lawsuit. Meanwhile, the fallout from Ament’s actions has extended beyond the chamber; he is set to be sentenced on August 22, and the chamber is also pursuing over $1 million in restitution from him.
The strained relations between the two organizations have raised concerns about the future of tourism and business support within Anaheim. Critics of Visit Anaheim’s decision to end the funding have suggested that the organization gave in to external political pressures, thereby undermining the collaborative partnerships essential for community growth. Maleki has reiterated the importance of cooperation between the chamber and Visit Anaheim rather than pitting one against the other.
In response to the controversies surrounding Visit Anaheim, the Anaheim City Council has recently increased oversight of the organization through a revised contract which emerged following the problematic circumstances surrounding the organization’s former chief executive, Jay Burress, who resigned due to improper fund diversion. The new agreement includes stringent performance standards and requires Visit Anaheim to provide annual reports on performance metrics such as convention events and hotel occupancy rates. Any subcontracting over $150,000 now necessitates approval from Anaheim’s city manager, a move aimed at increasing accountability.
The City Council unanimously approved the updated agreement, although discussions concerning transient occupancy taxes (TOT) revealed concerns regarding declining revenue affecting the general fund. Some council members proposed amendments to conduct more frequent reviews of the contract, which faced opposition from other members. Additionally, discussions arose regarding the compensation of Visit Anaheim’s leadership amidst the current budget gaps.
The unfolding developments between the Anaheim Chamber of Commerce and Visit Anaheim could have lasting implications for local business support and tourism in the region, as both entities navigate this legal dispute amidst broader scrutiny and increased oversight.
Deeper Dive: News & Info About This Topic
HERE Resources
California Attorney General Sues Trump Over Tariffs
Federal Judge Blocks California’s Acrylamide Warning Requirement
California Attorney General Advocates for Corporate Emissions Reporting Law
San Jose Chamber Offers Support Amid Los Angeles Wildfires
California’s Clean Truck Partnership Faces Legal Challenges
Additional Resources
- OC Register: Anaheim Chamber Sues Visit Anaheim
- LA Times: Visit Anaheim Contract News
- LAist: Anaheim Chamber Poised to Close
- Encyclopedia Britannica: Anaheim
- OC Register: Visit Anaheim to Repay City
Author: Anaheim Staff Writer
Anaheim Staff Writer The Anaheim Staff Writer represents the experienced team at HEREAnaheim.com, your go-to source for actionable local news and information in Anaheim, Orange County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as major conventions at the Anaheim Convention Center, including NAMM and VidCon, exciting games at Angel Stadium and Honda Center, and developments at Disneyland Resort Our coverage extends to key organizations like the Anaheim Chamber of Commerce and Visit Anaheim, plus leading businesses in hospitality, entertainment, and innovation that power the local economy As part of the broader HERE network, including HERECostaMesa.com, HEREHuntingtonBeach.com, HERESantaAna.com, and HERELosAngeles.com, we provide comprehensive, credible insights into Southern California's dynamic landscape.
