A California bill that would contribute to the disincorporation of the controversial city of Vernon in Los Angeles County advanced Wednesday.

Vernon has a tiny population but is home to many industrial businesses and has more than $500 million of outstanding bond debt.

The bill, AB 781, sponsored by Assembly Speaker John Perez, D-L.A., passed out of the Senate Governance and Finance Committee by a 5 to 3 vote.

The legislation offers protection to Vernon's businesses should the city be forced to disband by another bill moving through the state Legislature, AB 46.

The city was created to serve business and industry. It has fewer than 100 residents and found itself in the media spotlight in the wake of the salary scandal last summer in the neighboring city of Bell.

In October 2010, the office of then-Attorney General Jerry Brown, who was elected governor the following month, subpoenaed Vernon, seeking information about the salaries paid to top city executives.

The attorney general's office noted that the city had paid its former administrator and attorney Eric Fresch more than $1.6 million in 2008, and that in 2009 Vernon paid two other city executives more than $785,000 each.

Former city administrator Bruce Malkenhorst Sr., who retired in 2005, receives an annual pension of more than $500,000.

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