LOS ANGELES (CBS) — While the City of L.A. is laying off workers and cutting back services, we uncovered one city agency spending hundreds of thousands of dollars on a party. And we obtained the video to prove it.

It was like a Hollywood premiere party, complete with a red carpet and paid with public money.

Port of L.A. Executive Director Geraldine Knatz was the host.

If the attendees did not look like stars, they might have felt like them. We found thousands of dollars spent for dancers, wine to toast the party, and even miniature Oscars.

“I’m appalled,” said a fisherman, who has been at the port for 18 years and thinks some of the money should have been used for improvements in the harbor — not partying.

“That’s one hell of a party. Why weren’t we invited? We paid for it,” he said.

The Port of L.A. is the busiest port in North America and generates millions of dollars each year. But like every city agency, money is tight.

Workers have even had to give back some of their scheduled raises this year. But that did not stop officials from throwing that lavish party.

The party was held in Busan, South Korea earlier this year for 450 people.

It came during the International Association of Ports and Harbors convention. The event was called “L.A. Night” to promote the convention coming to L.A. in 2013.

We obtained the videotape from the port through the California Public Records Act, along with dozens of pages of receipts revealing a lot more.

It apparently was not enough for port officials to just show clips of Hollywood musicals. The port hired dancers dressed in character — and they were not local. Six dancers and an assistant were flown in from Los Angeles.

The cost: $18,500 just for travel and hotel, $22,500 for the performance — adding up to a total of $41,000.

But for that money they were at least around the next day to pose with some of the guests.

What’s a party without wine? Almost $12,000 was spent for 192 bottles, an average of just over $61 a bottle.

And of course there were Oscars. The miniatures cost more than $3,800!

The total cost for the party was $192,000, but that does not include airfare.

Knatz flew business class. Her round-trip ticket cost the port more than $13,000, even though she made $307,000 last year. That is more than the mayor and more than the governor.

The port is quick to point out that they do not take any taxpayer money from the city, instead generating their own income. But they did accept $23.5 million in federal taxpayer subsidized stimulus money over the past few years.

“How do you justify spending almost $200,000 on a party,” I asked?

“It was a professional promotional event,” Knatz responded, saying we got it all wrong.

“It was not a party. It was a professional promotional event,” she said.

“It was a party,” I asked?

“It was a professional promotional event,” she responded.

It was already a done deal that the convention will be coming to L.A. in 2013 before the party or promotional event or whatever you call it. But Knatz said it was all worth it because she is hoping the convention will generate $4 million in revenue.

“We wanted to give them a little bit of flavor of Los Angeles. It had a Hollywood theme,” she said.

The expenditures were approved by the Board of Harbor Commissioners.
But L.A. City Councilman Dennis Zine wants to know why.

“It’s absurd, absolutely absurd. Another example of frivolous waste in city government,” Zine said.

It is money residents around the port say should be used to better serve the people, not the partyers.

Comments (49)
  1. Ray says:

    Once again, one sided journalism. David Goldstein is digging in the wrong area, and probably won’t do a follow-up story on this, as most of his other investigations. Whatever it takes to generate income; spend 200K to bring in millions is a “NO BRAINER.’ This is his 2nd attempt to attack the Port of LA. If you drive anywhere in the port, you will clearly see that the federal money is completely being used to improve the port, and all dock areas.

    1. wgaf says:

      How do you know where the federal money is going?

      1. Ray says:

        I work there……….This is a bad article with tons of facts left out. The Port of L.A., DWP, and LA World Airports all generate their own revenue, and that revenue keeps Los Angeles a float because Los Angeles cannot manage their own “Tax Payer” funding. You gotta spend money, to make money.

    2. Emo says:

      The Port of LA should be attacked, they it was me I was there first hand, the PORT might generate there own money, but the employees are still City of LA employee and the waste that I saw was sinful, just recently the port took over Banning’s Landing and it is a building that is closed most of the time, and when it is open it’s a large building just going to waste with part time personnel….don’t tell me about the PORT’s wastefulness……the story is just one of hundreds of waste the PORT has done, somebody needs to audit their wastefulness….

    3. Genevieve Gates says:

      The convention was already coming to LA, did you not read the article? They didn’t need to have this party!

    4. q'sthe truth says:

      well when you work there does not mean you will say the truth… who will come up and said that they did spend the money which meant to use for public benefit. Your answer does not justified the case because you are part of the spender.

    5. Steve says:

      Why they spent the “promotion money” if the conference 2013 location decision has been decided before this “promotion event”? I am not disagreeing on marketing spending but for this cause which the decision has already been made. I do not buy the explaination from Knatz.

    6. rm says:

      Goldstein doesn’t do his homework. The Port’s annual budget is $394 million. NONE of it is tax payer money… it all comes from leases from the shippers based on square footage and cargo volumes. Because Port land is held in trust for the State, NONE of the revenues can be shifted over to the City of Los Angeles. The City of Long Beach was trying to take more money from the Port of Long Beach a few years back, but the courts outlawed it. When the actual City employees paid for by the General Fund are being displaced, the Port tried to pick up many of them so they won’t lose their jobs… because the Port does not run on ANY taxpayer dollars.

      $200K is nothing in the scope of the business that we get from South Koriea. Ina few years, the Panama Canal is set to open, which will divert trade away from Los Angeles and through the Canal. This will mean that we could potentially lose jobs, local revenues, etc. the Ports of LA and LB could stand to lose a lot more money if they don’t build the relationships they need to over in Asia. THAT is business.

      The Port is much more of a business than a City department. They track market share and compete with all fo the other Ports on the west coast… and now they will begin to compete with ports in the Gulf of Mexico and the East Coast becuase of the opening of the canal.

      Let’s be real… big businesses spend big time money to keep their customers happy. Port funds are not City money… and it isnot taxpayer money… it goes to developing the Port… and attracting business… to the largest generator of jobs in the Southern California.

      If you are going to “uncover”… you might want to do your research first. Stop bothering people, like Mrs. Knatz, that are too busy doing their jobs.

  2. John B says:

    Um – except the port of LA is not a public funded agency. They pay their employees with profits from managing the shipping and tenants at the port.
    Thank You – I know some one personally that worked there and I just asked them that.

  3. John B says:

    So I see you may know this because you very carefully left out the word TAX out before the word “dollars”. Was it OUR tax money they spent on this party? It isn’t even news if a private organization spends there own revenue on lavish parties. The revenue again is generated 100% by the large container ship companies that rent dock spaceand pay fees for parking ships there. They spent $200,000 dollars of Maersk – EverGreen China Shipping- Yang Mings etc fees charged for using those shipping docks.. Those are private enterprises. Good one – NEXT.

    1. Jeff H says:

      Who cares. This will bring in tourist dollars. Go to downtown LA during a convention and note how much busier everything is with the convention in town. Anything to make the convention larger is a plus. Instead of shrinking everything, we should be thinking of ways to make things bigger and better. that is the only way the economy will gain steam again.

      1. Genevieve Gates says:


    2. JH says:

      If you don’t know how the stimulus money is handed out and spent then don’t say anything you dumbf**k. The $23.5 million is for a stree construction but the article left that part ou. If you don’t know the facts then keep quiet you dumbf**k.

    3. Ray says:

      23.5 million is being spent on dock improvements, a new buffer-zone with a pare for local residents along Harry Bridges Road in Wilmington, a new port to attrack new cruiseliner, a new Disney port, 4 new parks in the area including 22nd st. Park, get out from behind your computer and take a drive down there………look for the new state of the art Belagio style water fountian.

  4. Al-CIAda says:

    My kind of party.

  5. Joe says:

    Talk about yellow journalism .

  6. Jeff H says:

    Throwing a party overseas to bring in hype for a 2013 convention seems like an amazing way to bring in tourist money. This story is overreaching as it tries to create a scandal out of good business sense. Government agencies should be treated as a business, and this is a nice step in that direction. Maybe the post office should take some notes.

    1. tom says:

      No its a convention for businesses that will bring in millions more than tourists would, dudndf**k!

  7. Marissa says:

    Right! Yes they spend stimulus money along with “their” money and that is ok, you mention the convention center; if you stop and think about those events and the revenue they bring and how does not cover the expense of most events. The convention center is loosing money that is why they want to tear it down and build a stadium there. Sure the surrounding businesses make money,such as restaurants, parking, etc. Money trickling onto our economy, not much. More a strain on downtown than anything else. North of Pico Blvd. is doing just fine due to other busines, but the southside is a mess. Try driving that area one day and just get a feeling of how much that money is changing that area. No street sweeping, tree trimming, sidewalk repairs, etc……
    The port did not need to spend this kind of money on a done deal. They wanted to party down and they did without thinking of future needs or improvement needs that would have benefited from they $200k. If they reported that amount you know they spent much more than that, it is just hidden within “other needed expenses”

  8. Karen says:

    I am writing to the Academy. If the Academy gave these clowns permission to make Oscars, that is just over the top.

  9. JH says:

    If you don’t know how the stimulus money is handed out and spent then don’t say anything you dumbf**k. The $23.5 million is for a stree construction but the article left that part ou. If you don’t know the facts then keep quiet you dumbf**k.

  10. R says:

    One more proof of corruption in government agencies. Just like the city of Bell
    Living the life of the rich and famous at the expense of tax-payers

  11. JAB says:

    Fire Her, and take the cost of the “party” out of her pay. The state is broke, we’re letting criminals out of jail on a daily basis, and these fools are spending 200k on a promotional event for an event that is already locked in. Workers are taking a cut in their pay raises and this women is living like a queen. Behead her.

  12. Nicolas Cruz says:

    Enjoy the Party It’ your Last !! When the Pamama Canal reopens ! The Los Angeles Harbor will loose 35% of this shipping revenue!! They need an audit! ! Take them down just like DWP ! Down size now ! To many Fire Boats the the rest habors in the US! They payroll City workers who work outside the harbor evryday!!! Remember Charlie Tuna! Sorry Charlie!! Oh Zine your the bad Robo Cop who need to be dismantled ! How many pension are enough gready P.. !

  13. LALALA says:


    Go play on the freeway or something…

  14. Mike says:

    Karen Have you always been a snitch………

  15. Chuck says:

    So if these companies/departments are self funded. can someone explain: Why they require tax payer money for infrastructure maintenance, updates etc. They need to be held accountable for all their expenses.

    1. John says:

      Because infrastructure is the responsibility of the state. When was the last time you filled your own potholes or built a bridge for yourself? The party was paid for with company money. I don’t expect private companies to maintain infrastructure beyond paying their own taxes.

      1. Beavis says:

        John is right. Major ports like LA and Long Beach (#1 and #2 in the US) recieve tens of millions of state and federal dollars for SPECIFIC projects and initiatives (road improvements, security grants, etc.). But those grants and project funds DON’T pay for daily port expenses (overhead) or promotions or events like this. These are dollars spent from port revenues, and in this case the spend is an investment to bring a global conference to Los Angeles and generate $4 million in spending from 800-1000 visitors. $200k for $3-$4million in local spending? Not a bad ROI.

  16. Mehilangelino says:

    Have you been to Koreatown? Its incredible. Have you been to Huntington Park? Cudahay? Boyle Heights? Pico Union?

    I welcome my Korean brothers and sisters!

    Horray for Holeeewoood! Ladaradaradaradaaah!

  17. gypsykat says:

    If Geraldine wants to give those folks a taste of Los Angeles, maybe she should bottle up some of the toxic water from the port.

  18. Tom says:

    Once again the media forgets that this is not a “party” but a marketing tool to bring in more business to the city of LA. And those expeditures? Don’t they go to working people also? There is a huge industry in the event business. and these events all have a devinate marketing purpose. Totally misleading article.

  19. Scott says:

    Once again, David Goldstein gets it wrong. If Mr. Goldstein wants to do some real investigatvie reporting, he should investigate and report how much CBS pays to “party” at the National Cable Show (NCTA), or NATPE, the two big media industry shows, each year. Of course, that would probably cost him his job and that would be too close for his own personal comfort. Has Mr. Goldstein ever investiaged how much the various line items a convention center charges exhibitors or meeting convention attenders for items? the service items are incredibly marked up and inflated. Dr. Knatz, the exectuve director at the Port of LA has it right – it was a professional event, not a party, to create a “buzz” for attending the trade show in LA in 2013,

  20. Elan says:

    $200K is a high amount for an event like this…but its not RIDICULOUSLY high. To put it in context, Vanity Fair spends over $1 million for its Oscar Party. My wealthy cousin spent $250,000 on a Bat Mitzvah.

    Investment attraction is not something you can’t do on the cheap. But it something you have to do. And if you try to do it on the cheap, then its ALL a waste of money.

    The problem I have with this is that its nothing more than populist fluff meant to make people angry. $200K on a foreign investment attraction event is not really a “controversy” to anyone who has ever had to put on a major event. Its a tad high, but in the context of the overall budget problems we are facing, the excesses are a drop in the ocean.

    But because of it, how much money was wasted for City Council to investigate it? How much time was wasted by these highly paid officials and their highly paid staff to conduct it?

    The Port of LA is a critical part of the local economy and its activities support millions of local jobs.

    btw…if I were LeBron James, I would have made over $200K playing basketball for the amount of time it took me to write this.

  21. JC says:

    I see the Port “employed” their workers to come here and comment.

  22. joe blow says:

    Who are the real “crooks” they should be in jail.

  23. Michael Chichang says:

    The reason why the U.S. is different from any other country is that all of our systems involve some level of “checks and balances”. In Korea, this author would have been bribed to stop publishing. In Mexico, the author would be kidnapped (or his family). In China, he would been arrested and imprisoned. In Japan, he would be laid off and the lifetime Pension plan he worked decades for would also be cut off.

    The author is simply asking the natural, common sense question of does this spending make sense??????????

    Just looking at the $13,000+ for Knatz airfare, I can tell the author has stumbled onto something. I’ve been to Korea dozens of times and the average economy ticket is about $1500 today, Business class (meaning more leg room, ability to lay back 180 degrees in your seat, open bar, better quality meals, etc) would typically cost about $5000. How it goes from $5k to $13k+ would be nice to know but I already know the more we dig the more dirt we will find.

    Our corporate and government structure allows for this to happen all the time. The Fix? In addition to a CEO, CFO, and COO, there should be a CSO (Common Sense Officer) who’s sole job is to question the logic, quality and financial spending of others in management. I’m sure the cost would justify itself in the long haul for any organization…

  24. Ed says:

    This is unbeiveable, we are hurting for money for the City, and these people go out and party. They should be investiaged, and the book thrown at them. The yacht is another secret. The mayor said, “its a boat, not a yacht”. They dummy, the U S Coast Guard states, “any vessil over 65 ft. is a vacht”. Go do your homework before you start answering questions about the vessil, you jerk.

  25. Kevin F says:

    The Ports of LA/Long Beach generate far more money for LA County than Hollywood does. The international trade industry dwarfs the film/television industry. Why then is it considered normal for Hollywood to throw the Oscars and countless other multi million dollar events (which are done at considerable taxpayer expense covering policing, infrastructure needs, road closures, etc) while the port throwing a $200k party is the epitome of evil?

  26. Michael Chichang says:

    Let’s see here…the public loves celebrities, everyone buys movies, it is a hallmark tradition to take the family or a date to the movies, movies create a massive economy of jobs and wealth from all of the production costs, advertising, distribution channels, it represents the American Dream for most people, millions of fans look forward to the Oscars every year……………

    Who benefits from the yacht rides, the $13k Business Class airfare, and this Party?

    Most importantly, Hollywood is a private pure-profit industry. The PORT OF LA belongs to the PEOPLE who pay taxes. Government-run agencies are SUPPOSE to earn revenues and turn those funds around so the PEOPLE can pay LESS TAXES! We do NOT expect the same from Hollywood by any account.

  27. diana says:

    did you see the news last night? Our Mayor Tony stumbling all over his tongue! Shame on you Los Angeles!!! I bet LA is in with the drug cartel, transporting drugs.

  28. Ronald Smythes says:

    “Its not a yacht, its a boat.” Mr Mayor, I know a yacht when I see one.

  29. SusanK says:

    Let’s pay the consultant to do research to see if those parties are beneficial to the Port of Los Angeles. That’s the problem of spending somebody else’s money. Nobody cares. They just want to spend, spend, spend.. Why? oh because they own money printing machines !!!!

  30. Lance says:

    Fuk the Port!!

    They been raising fees and implementing bu&lsh t surcharges so all th ePort workers can stay fat and collect large wages.

    $ 60 to $ 100 for Pier pass and $50 for clean truck fees, small importers are getting killed with these extra fee’s.

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