The following article was written for CityWatch and published on March 13, 2009.
“Democracy is two wolves and a lamb voting on what to have for lunch. Liberty is a well-armed lamb.” – Benjamin Franklin
The subject of taxpayer dollars spent on outside counsel by the City Attorney’s office continues to be a hot topic. The latest gambit appeared on the Council Calendar last Tuesday (Item No. 17 – Council File No. 09-0148). The City Attorney’s office wanted authorization to spend $500,000 on outside counsel (ostensibly on an ‘as needed’ basis). The money was to come partially from funds the City receives by way of fees and penalties collected from landlords to implement the rent stabilization ordinance, and partially from the fees, fines, and penalties received by the City in connection with the City’s ‘systematic code enforcement program’. This arrangement was ‘worked out’ in private discussions with Councilmember Wesson, the City Attorney’s office, and the Housing Department.
Councilmember Alarcon objected when the matter was first brought up, and Council-member Zine also had questions. Neither, however, asked (until prompted) why it was that the money could not instead go to the hiring of additional personnel or an attorney in the City Attorney’s office; why, in fact, outside counsel was really necessary.
In a public comment on March 8, I had asked the Council to send the entire matter back to Wesson’s committee so that the details could be explored. Instead, on Tuesday, a compromise was reached where the amount to be authorized was lowered from $500,000 to $300,000 – so at least there will be an extra $200,000 now available for Code Enforcement and for administration of the Rent Stabilization Ordinance which would not have otherwise been available.
A small victory; but a victory nonetheless.
When dealing with the City Council, we would all be wise to try to always look for ‘the head fake’ because rarely is anything really what it seems.
What was the real head-fake here? The owner of the Cecil Hotel had sued the City back in early 2008 to challenge its inclusion on the official list of residential hotels. (The owner wanted to renovate some of the upper floors of the property, but to do so would involve dealing appropriately with the tenants in residence. Having the tenants protected by inclusion of the Cecil Hotel on Housing’s official list was problematic for the owner).
However, instead of going to the Council back in April, 2008, and asking for an appropriation to defend the case by the hiring of new personnel in the office, the City Attorney saw it as an opportunity to farm out the case to outside counsel. The law-firm proceeded to rack up $200,000 worth of work despite the lack of advance authorization.
To make matters even more interesting, the law-firm’s general contract with the City expired in December, 2008, and was never renewed until now. So really this motion was not accurately presented to the public by the City Attorney.
Did any City Council member take time to look at the law firm’s billings? Not likely.
Since the public was not given this information, and the CLA (Chief Legislative Analyst’s Office) did not provide the information (assuming it had it), the public was denied an accurate description of what was really happening (not an uncommon occurrence).
So the hidden agenda here was to get that law firm paid its $200,000, while leaving an extra $300,000 in the ‘pot’ just in case.
Whether the City was over-billed will remain a mystery unless and until an enterprising reader files a public records request with the Housing Department asking for the law-firm’s billings to the City in connection with the Cecil Hotel litigation. Meanwhile, we can all take some solace in the fact that an extra $200,000 was put back into the code enforcement program and administration of the rent stabilization program rather than be needlessly diverted to outside lawyers.
Another question which could have been asked, but was not, was why if Wesson and his Committee were willing to put $300,000 into a ‘pot’ for future litigation needs, and why, if the current City Attorney staff is overburdened, some of that money can’t be used right now to relieve the burden?
Equally significant was the fact that the City Attorney said nothing publicly during this entire process. All the testimony was left to Ms. Yolanda Chavez of the Housing Department who is to be credited for being as forthcoming as she was.
In this upcoming budget season, let’s keep in mind that important City services are going to be cut. New, different, practical and more pro-active alternatives are going to have to be found in a number of program areas. It would be useful to ask ourselves how much of the services we will lose can be accounted for by the failure of Rocky Delgadillo’s office to deal fairly, squarely, and competently with the public when it comes to the expenditure of program dollars on outside counsel.
If this little ‘window’ into the inside dealings at City Hall is any indication, we confront a challenge when it comes to these issues.
Because the City Council delegated to the Housing Department the full authority to pay the past and future billings of this law-firm at Housing’s discretion, it is not likely we will really know much unless the Controller takes the time to look at these billings and audit them to see if the City was over-billed.
With Wendy Greuel as the new Controller, this is not a likely prospect.
Our only chance is if one or both of the City Attorney candidates promise the people that if elected, they will insist that the Controller audit all outside counsel billings to see whether they were padded or excessive, or that the City Attorney’s office approve them for payment (something the current motion does not do).
There is no reason why the Housing Department is going to be scrupulous about the billings. On the contrary, the Controller needs to do a public audit of both the Systematic Code Enforcement Fee Trust Fund and the Rent Stabilization Trust Fund.
Will this happen?
Don’t hold your breath.
(Noel Weiss is an attorney and a long-time community advocate. Weiss is an occasional contributor to CityWatch.) ◘
Vol 7 Issue 21
Pub: Mar 13, 2009