The Inspector General said the expenditures were inappropriate because they were not related to airport costs. The IG's audit was released on November 16, 1995. Driscoll disputed that also, saying passengers need guarantees the nearby area is safe. Airline industry officiais, who have opposed Mayor Richard Riordan's campaign pledge to turn LAX into a revenue generator for other city programs, including LAPD, said they were encouraged by the audit's findings.
Federal law requires all revenue generated by airports to be spent on airport-related purposes only.
The investigation of improper airport fund diversions at Los Angeles follows a similar audit conducted last year at Hayward Air Terminal in the Bay Area. Hayward's Public Works Director, Dennis Butler, disputed the Inspector General's findings in a similar manner, and no agreement on restitution of the diverted funds has yet been reached, according to Joe Rodriguez of the FAA's Airports District Office in Burlingame. This is to insure that public policy and public funds are safeguarded from fraud and abuse. The illegal airport fund diversions uncovered by the Inspector General at Los Angeles and Hayward are probably just the tip of an iceberg, given the probability that the IG's investigative staff is limited. The government's current budget climate offers no hope for enlargement of investigative staff, and thus the temptation for airport sponsors to take advantage of the situation becomes almost irresistible.