City of San Bernardino Bankruptcy: What Did They Know and When Did They Know It?

By Michael Reiter, Attorney at Law

We do not yet know the full story about what went wrong as far as misstatements or miscalculations (incompetence) or concealment (fraud) of numbers in the City of San Bernardino that led to the situation wherein the City of San Bernardino had or has, at some point, less than $150,000 in its bank account.

First, from primary sources, City staff (on July 9, 2012) stated that as of April 3, 2012, City staff was still misreporting the fund balance.

The Finance Department of the City of San Bernardino created a report, dated July 9, 2012 , Page 7:

Starting General Fund balance has been erroneously stated for the past 2 fiscal
years

Fiscal Year                                July 1st Audited Fund Balance              Staff Reported Fund Balance
FY 2009-2010                           $2,708,319                                                     $2,557,900
FY 2010-11                               $410,293                                                             $1,770,400
FY 2011 -12                              $(1 ,181,603)                                                       $2,044,100*
*Mid-Year report presented April 3, 2012.

Going back to the April 3, 2012 meeting in the City of San Bernardino’s online archives, I was unable to find any minutes after January 23, 2012.  Here is the April 3, 2012 Agenda for the Joint Adjourned Regular Meeting of the Mayor and Common Council.

In a staff report by Rebecca Garcia, through City Manager Charles McNeely, for Item 3A, the purpose of the workshop was to “Discuss proposed revenue enhancements and cost containment strategies and provide direction
as to measures to be researched and presented for further Council review, analysis and consideration at a future meeting.”  This staff report includes the chart that gives the $2,044,100 opening fund balance for FY 2011-2012, but also has a different number (then in the July 9, 2012 report) for 2010-2011: $2,998,000.

In the staff report by Jason Simpson, Director of Finance, for Item 1A,  on the April 3, 2012 agenda he warns on Page 10:

A major concern that needs to be noted is that the City’ s General Fund continues to be in an
increasing weakening condition and immediate changes need to be made to reverse this financial
condition, build the General Fund Reserve, and stabilize this fund. If these efforts are not made,
insolvency or bankruptcy may result. The Council has an opportunity to resolve the issue and
change the City’ s course. If not, control may be taken out of the Council’ s hands. [Emphasis Added]

However, on packet page 12, Jason Simpson’s report gives the opening fund balance for 2012 as $2,044,100.

Imran Ghori wrote an article published April 3, 2012 at 9:15 p.m., “San Bernardino: City Faces $3.8 millon shortfall[;] The decline in sales and property taxes are hurting the city, a mid-year budget report shows.”  The story starts:

San Bernardino could be headed for insolvency or bankruptcy if it’s not able to get its general fund budget under control, according to a mid-year budget report presented to the mayor and City Council on Tuesday. [Emphasis Added].

The first time the fund balance issue was in the traditional press is in The Sun, “San Bernardino facing bankruptcy if deep cuts aren’t made” by Ryan Hagen, posted online on July 7, 2012 at 8:13:10 p.m. PDT.  In the article, ”

“[Council member Wendy] McCammack also said she was troubled by the budget report’s note that the general fund’s starting balance has been erroneously stated for the past two fiscal years.

That reached a peak several months ago, when then-City Manager Charles McNeely said the fund had a balance of $2 million but the audited fund balance on July 1 turned out to be in the red by $1.2 million.

It appears that the first time that City Attorney James F. Penman mentioned, in public, that 13 out of 16 budgets may have been falsified (and I am paraphrasing from the press account) was at the July 9, 2012 Council Meeting.

As far as what did people know and when did they know it, the rest is from press articles. This article, from public radio station KPCC, “San Bernardino authorities confirm probe into city finances” by Steven Cuevas with Nick Roman, posted 6:00 a.m. on Friday, July 13, 2012 says:

Before the San Bernardino City Council’s bankruptcy vote Tuesday, City Attorney Jim Penman announced that unidentified city administrators had cooked the books to make it appear the city had more cash in reserve than it actually had.

The alleged deceit was uncovered during an audit by new finance staff working under interim city manager Laura Travis-Miller, who took over four months ago.

. . .

Sixth District [sic] councilman Rikke van [sic] Johnson said Penman gave a short briefing to council members prior to the council’s emergency budget meeting Tuesday. But he said it was short on details.

“It wasn’t nothing as far as, ‘OK, this year that happened’ or ‘that year, this happened’ or anything like that,” said Van [sic] Johnson.

“There wasn’t no specifics, other than he said that it’s under investigation. And unfortunately, what was said in that so-called briefing should have stayed in that so-called briefing and went to the right parties. Because we’re dealing with an even bigger issue then that that as far as bankruptcy. All the sudden your issue becomes the lead issue when it shouldn’t be.”

Presumably, this information was given in closed session.
This blog piece comes from an interview yesterday with Interim City Manager Andrea Travis-Miller:  The piece appears in the Los Angeles Times Blog LA NOW, posted July 13, 2012 at 7:25, by Abby Sewell and Phil Willon, labled “Criminal Probe

Miller said the city’s financial problems had been evident for many years, but the full scope was not evident until more recently, when she and the new finance director took a hard look at the books.

She said there had been inaccurate financial reporting in the city for many years, which delayed the process of understanding the full financial picture, but she said she had not seen evidence of deliberate wrongdoing.

“I have not found that there’s anything more than negligence, maybe sloppiness,” she said, adding that staffers at the time were stretched thin because of cuts.

Andrea Travis-Miller became acting City Manager on May 8, 2012, but was assistant before.  Jason Simpson began work on March 28, 2012.  So, if the quotes from Andrea Travis-Miller are correct, the problem was found sometime between March 28, 2012 and when the July 9, 2012 report was posted.

Bankruptcy was first mentioned in the April 3, 2012 staff report.  The misstating of the fund balance was found some time after March 28, 2012, but not reported on April 3, 2012 by Jason Simpson in his staff report.  The first public document showing the wrong data for two years was in a report for the July 9, 2012 meeting.  Time will tell  what they knew, and when they knew it.

The information you obtain at this blog is not, nor is it intended to be, legal advice. No attorney-client relationship is established by reading or commenting on this blog. You should consult an attorney for advice regarding your individual situation.

A: 300 E. State St., Suite 517
Redlands, CA 92373-5235
T: (909) 296-6708

What Charter Reform Measures Might Have Helped the City of San Bernardino Avoid Bankruptcy? An Elected Auditor and an Elected City Prosecutor.

By Michael Reiter, Attorney at Law

We do not yet know the full story about what went wrong as far as misstatements or miscalculations (incompetence) or concealment (fraud) of numbers in the City of San Bernardino that led to the situation wherein the City of San Bernardino had or has, at some point, less than $150,000 in its bank account.  Some political campaigns in San Bernardino County have more than that in their accounts right now.

The Finance Department of the City of San Bernardino created a report, dated July 9, 2012, that blames, on page 1 in the Executive Summary:

. . . the City is still facing insolvency due to a variety of issues including accounting errors, deficit spending, lack of revenue growth, and increases in pension and debt costs.

Something went wrong with the way government is supposed to work, with checks and balances regarding these unspecified accounting errors.

The Charter of the City of San Bernardino has a variety of checks and balances, and there are also external checks and balances in the municipal system of government from California law and to some extent in Federal law.

Within today’s Charter, there are eleven elected officials in the City of San Bernardino: Council members from seven geographical wards, an elected Mayor, an elected City Clerk, an elected City Treasurer, and an elected City Attorney. However, the structure if the City lacks an appropriate check and balance to find either a well-concealed fraud, or even a miscalculation of numbers that appeared on financial reports but did not reflect actual amounts.

Here is the problem, from the same July 9, 2012 report, Page 7:

Starting General Fund balance has been erroneously stated for the past 2 fiscal
years

Fiscal Year                                July 1st Audited Fund Balance              Staff Reported Fund Balance
FY 2009-2010                           $2,708,319                                                     $2,557,9oo
FY 2010-11                               $410,293                                                             $1,770,400
FY 2011 -12                              $(1 ,181,603)                                                       $2,044,100*
*Mid-Year report presented April 3, 2012.

Shouldn’t an audit have found the problem? Maybe, but if there was actual fraud, it can be difficult to find because some skilled in financial deceit can falsify document to make the numbers match up.  Even if a skilled City Council member with a background in accounting exists, they probably won’t find the discrepancy.   However, from these numbers, it seems that an audit did catch these numbers, though it doesn’t say when and who it was reported to.

What about the City Treasurer?    The Treasurer’s Duties are:

The Treasurer shall receive and pay out all moneys belonging to the City, and shall keep an account of all receipts and expenditures, under such rules and regulations as may be prescribed. He/She shall make a
monthly statement to the Mayor and Common Council of the receipts and expenditures of the preceding month, and shall perform all duties required of him/her by law and the Mayor and the Common Council. He/She shall not pay out any monies belonging to the City except on claims presented, allowed and submitted in the manner provided by this Charter.   Charter section 70.

However, if numbers are falsified by members of the Finance Department (which the Charter gives day-to-day supervision to the City Manager), the City Treasurer’s Office may not catch the problem.

What then, is the answer?  Part 1, Create a City Auditor, like the City of Los Angeles Controller, that is elected and has the power to audit, investigate, and request prosecution or discipline according to the needs of the situation.

The Controller in Los Angeles, per the Los Angeles City Charter, has these duties:

BookmarkSec. 260.  Auditor and General Accountant.

The Controller shall be the auditor and general accountant of the City and shall exercise a general supervision over the accounts of all offices, departments, boards and employees of the City charged in any manner with the receipt, collection or disbursement of the money of the City.  The Controller shall be elected as provided in Section 202.

BookmarkSec. 261.  Powers and Duties.

The Controller shall:

(a)     appoint assistants, deputies, clerks and other persons as the Council shall prescribe by ordinance;

(b)     prescribe the method of keeping all accounts of the offices, departments, boards or employees of the City in accordance with generally accepted accounting principles, except that any change of the system of accounting shall first be authorized by the Council;

(c)     regularly review the accounting practices of offices and departments and upon finding serious failings in accounting practices, be empowered to take charge of the accounting function, and thereafter assist the office or department in implementing appropriate accounting standards and practices;

(d)     maintain a complete set of accounts which shall be deemed the official books and accounts of the City, which shall show at all times the financial condition of the City, the state of each fund, including funds of departments responsible for managing their own funds, the source from which all money was derived and for what purposes all money has been expended;

(e)     in compliance with generally accepted government auditing standards, audit all departments and offices of the City, including proprietary departments, where any City funds are either received or expended; be entitled to obtain access to all department records and personnel in order to carry out this function; establish an auditing cycle to ensure that the performance, programs and activities of every department are audited on a regular basis, and promptly provide completed audit reports to the Mayor, Council, and City Attorney and make those reports available to the public;

(f)     maintain a reconciliation between the accounts in all offices and departments with the accounts in the Controller’s office, and from time to time, verify the condition of all City funds in the City Treasury, and report to the Mayor and Council thereon;

(g)     allocate among the several respective funds all public money at any time in the City Treasury not otherwise specifically allocated and appropriated by law or ordinance, and promptly notify the Treasurer of the allocation or appropriation;

(h)     report to the Mayor and Council, at times established by law, the condition of each fund, and make other reports as the Mayor or Council requests;

(i)     maintain each fund on a parity with its obligations at all times by transferring from the Reserve Fund as a loan to any fund which may become depleted through tardy receipt of revenues, and upon receipt of revenues sufficient to make an allocation as will restore each fund to parity, retransfer the amount of the loan to the Reserve Fund;

(j)     monitor the level of debt incurred by the City and report periodically to the Mayor and Council on City debt; and

(k)     conduct performance audits of all departments and may conduct performance audits of City programs, including suggesting plans for the improvement and management of the revenues and expenditures of the City.  Nothing in this subsection shall preclude the Mayor or Council from conducting management studies or other review of departmental operations.

BookmarkSec. 262.  Approval of Demands on Treasury.

(a)     The Controller shall, prior to approval of any demand, make inspection as to the quality, quantity and condition of services, labor, materials, supplies or equipment received by any office or department of the City, and approve before payment all demands drawn upon the Treasury if the Controller has adequate evidence that:

(1)     the demand has been approved by every board, officer or employee whose approval is required by the Charter or ordinance;

(2)     the goods or services have been provided, except that advance payment may be authorized by ordinance for specified categories of goods and services;

(3)     the payment is lawful;

(4)     the appropriation for the goods or services has been made;

(5)     the prices charged are reasonable;

(6)     the quantity, quality and prices correspond with the original specifications, orders or contracts; and

(7)     any additional criteria established by ordinance have been satisfied.

(b)     Notwithstanding subsection (a), the Controller shall delegate to the various offices and departments the duties of inspection of goods and services and approval of demands, in accordance with methods for inspection and approval established by the Controller, but the Controller may suspend the authority delegated pursuant to this subsection upon a finding of abuse of that authority or on a determination that the office or department lacks adequate controls to exercise that authority properly.  In the event of suspension of the authority delegated pursuant to this subsection, the Controller shall assist the office or department to achieve adequate controls and standards prior to reinstatement of that authority to the office or department.

(c)     The Controller shall withhold approval of any demand, in whole or in part, if there is a question as to whether it is improper, illegal, or unauthorized, and immediately file a report with the Mayor and Council stating the objections to the demand.  The Council shall promptly consider the report and may overrule or sustain the objections of the Controller.

(d)     The Controller shall keep a record of all demands on the Treasury approved by the Controller and of all demands to which objections have been made and overruled.

BookmarkSec. 263.  Approval of Expenses of Controller.

All demands for the expenses of the office of the Controller shall, before payment, be presented to the Mayor, who shall have the same powers as to approval or disapproval as are exercised by the Controller in the case of other demands. The action of the Mayor shall be subject to review by the Council.

BookmarkSec. 264.  Reduction of Demand on Treasury.

No demand upon the Treasury shall be allowed by the Controller in favor of any person or entity indebted to the City without first deducting the amount of the indebtedness, to the extent permitted by law.

BookmarkSec. 265.  Payment of Bonds.

Nothing in this Article shall be construed as interfering with or preventing the payment by the Treasurer of principal and interest on bonds payable by the City in accordance with the California Constitution, laws and ordinances authorizing the issuance and payment of those bonds.

BookmarkSec. 266.  Periodic Surveys of Proprietary Departments.

(a)     The Controller, Council and Mayor shall jointly cause, at least once in every five years, an industrial, economic and administrative survey to be made of the business and property of each of the Harbor, Water and Power and Airports Departments and shall select an independent qualified industrial engineer or organization specializing in such surveys to conduct the survey.  The cost of each survey shall be paid for from the funds of the surveyed department.

(b)     Each survey shall be made in consultation with the Mayor and City Council to ascertain if the surveyed department is operating in the most efficient and economical manner.

(c)     A copy of the report of each survey shall be transmitted to the Mayor, Council, and board of the surveyed department and shall be made available to the public.

Solution Part 2: Create an Elected City Prosecutor.  The City Attorney in San Bernardino is already the City prosecutor.  However, by splitting the functions, the City will have the best of both worlds.  An elected City Attorney will give advice to the City as an entity without the fear of being fired for not giving advice to the other elected officials in power, and a City prosecutor can prosecute violations of the Municipal Code and the areas of State law given by Charter or state law with the independence necessary, with the independently elected City Auditor, to root out these kinds of corruption.

If an elected City Attorney is an elected watchdog, a City Prosecutor would be doubly so.  The City Attorney’s client is the City of San Bernardino, the entity, and the City Attorney must protect the entity’s pocket book.  The role of exposing corruption sometimes is at odds with that goal.  Adding a separate elected City Prosecutor can rectify that situation and protect, in the long run, the People’s interest without regard to the City’s financial interest.

Of course, the bad numbers shown above do not add up to the alleged deficit, but if Council members were going on the correct numbers to start with, perhaps they would not have made the political choices that led to the fiscal emergency.

The information you obtain at this blog is not, nor is it intended to be, legal advice. No attorney-client relationship is established by reading or commenting on this blog. You should consult an attorney for advice regarding your individual situation.

A: 300 E. State St., Suite 517
Redlands, CA 92373-5235
T: (909) 296-6708

Why the Impending City of San Bernardino Bankruptcy Matters

By Michael Reiter, Attorney at Law

The news that the Mayor and Common Council voted 4-2-1 to authorize the City Attorney to file for bankruptcy under Chapter 9 of the United States Bankruptcy Code is important from a legal perspective.  We appear to be moving into a new era where bankruptcy is not something to be feared, but is embraced as a solution for municipalities.  San Bernardino is the third municipality in California to move towards bankruptcy this year, and no doubt is not the last.

According to the Administrative Office of the United States Courts,

The purpose of chapter 9 is to provide a financially-distressed municipality protection from its creditors while it develops and negotiates a plan for adjusting its debts. Reorganization of the debts of a municipality is typically accomplished either by extending debt maturities, reducing the amount of principal or interest, or refinancing the debt by obtaining a new loan.

Although similar to other chapters in some respects, chapter 9 is significantly different in that there is no provision in the law for liquidation of the assets of the municipality and distribution of the proceeds to creditors. Such a liquidation or dissolution would undoubtedly violate the Tenth Amendment to the Constitution and the reservation to the states of sovereignty over their internal affairs. Indeed, due to the severe limitations placed upon the power of the bankruptcy court in chapter 9 cases (required by the Tenth Amendment and the Supreme Court’s decisions in cases upholding municipal bankruptcy legislation), the bankruptcy court generally is not as active in managing a municipal bankruptcy case as it is in corporate reorganizations under chapter 11. The functions of the bankruptcy court in chapter 9 cases are generally limited to approving the petition (if the debtor is eligible), confirming a plan of debt adjustment, and ensuring implementation of the plan. As a practical matter, however, the municipality may consent to have the court exercise jurisdiction in many of the traditional areas of court oversight in bankruptcy, in order to obtain the protection of court orders and eliminate the need for multiple forums to decide issues.

What this means is that the City will be able to renegotiate its debt, change certain contractual terms, including agreements with its employees, and possibly reduce or eliminate debts.  The City will not give up control to a trustee in the same way seen in corporate bankruptcy.  There will be no effect on code enforcement prosecutions, and the City will not have any special way to raise money through taxes outside of California law.

What about AB 506, the law codified at Government Code section 53760 et seq.?

That section reads:

A local public entity in this state may file a petition and exercise powers pursuant to applicable federal bankruptcy law if either of the following apply: (a) The local public entity has participated in a neutral evaluation process pursuant to Section 53760.3. (b) The local public entity declares a fiscal emergency and adopts a resolution by a majority vote of the governing board pursuant to Section 53760.5.

There has been no mention of AB 506 in the coverage so far, and the agenda for yesterday’s meeting does not have any mention of such a resolution, but presumably, the City of San Bernardino will take the (b) path.

Posted on our sister site is an analysis of the political implications of such a move.

The information you obtain at this blog is not, nor is it intended to be, legal advice. No attorney-client relationship is established by reading or commenting on this blog.  You should consult an attorney for advice regarding your individual situation.
Michael Reiter, Attorney at Law

A: 300 E. State St., Suite 517
Redlands, CA 92373-5235
T: (909) 296-6708

The Results of the 1995 San Bernardino City Municipal Primary: City Attorney Election

By Michael Reiter, Attorney at Law

I have been researching the history of the City Attorney’s Office in San Bernardino.  In the past, I have written a post which touches a little about the history of the City Attorney’s Office in San Bernardino, but I haven’t published a full history of the office.

In my series about past election results, I included data from past elections that was available from the San Bernardino Registrar of Voters.  I wrote “online sources say that City Attorney Penman beat Stan Tomlinson by a 3 to 1 margin in 1995.” Yesterday, pursuant to a California Public Records Act Request, I received a copy of the results of the 1995 election.  3 to one would be by 75 percent, but it was not quite 75 percent.

I have created a database of the City Attorney elections from 1907 to present, but other than the winners, and in some case the candidates, and in the rare case actual results, it is most complete from 1987 to present. I  have added all the counts together in one data set.  If there is a blank, I don’t have data.

Race (San Bernardino City Attorney) Candidates (Winner in Bold) Name as shown in records, where available Votes Percentage
19870307 Primary Municipal Election James Frank “Jim” Penman
Ralph H. Prince
19910305 Primary Municipal Election James Frank “Jim” Penman
19951107 Primary Municipal Election Jim Penman 9305 72.82
Stan Tomlinson 3472 27.17
No Vote Recorded 1116 Not included
19991102 Primary Municipal Election James Frank “Jim” Penman
20031104 Primary Municipal Election Jim Penman 7,999 96.11
Write-In 324 3.89
20071106 Primary Municipal Election James Frank “Jim” Penman 7,001 51.46
Marianne Milligan 6,557 48.2
Write-In 47 0.35
20111108 Primary Municipal Election James Frank “Jim” Penman 6,447 51.72
David L. McKenna 6,019                       48.28
No Vote Recorded 489  Not included

The information you obtain at this blog is not, nor is it intended to be, legal advice. No attorney-client relationship is established by reading or commenting on this blog. You should consult an attorney for advice regarding your individual situation.

A: 300 E. State St., Suite 517
Redlands, CA 92373-5235
T: (909) 296-6708

Codification of the San Bernardino Municipal Code: A 2012 Update

By Michael Reiter, Attorney at Law

In 2011, I wrote two pieces on codification of the San Bernardino Municipal Code, and an update on the situation.

From the second piece:

To recap, The Mayor and Common Council, at their November 7, 2011 meeting, passed Resolution 2011-299 Authorizing the issuance of a Request for Proposals for Municipal Code Codification Services.  The staff report to the Resolution painted this unflattering picture of how behind the City is in codification:

Table 1.1 Code Supplement Distribution History from 2008 through 2011

Time Period Distribution Date Note
1/2008 to 3/31/2008 4/2008 on schedule
4/2008 to 6/30/2008 7/2008 on schedule
7/2008 to 9/30/2008 11/2008 1 month behind schedule
10/2008 to 12/31/2008 9/2009 8 months behind schedule
1/2009 to 3/31/2009 9/2009 5 months behind schedule
4/2009 to 6/30/2009 9/2009 2 months behind schedule
7/2009 to 9/30/2009 10/2009 on schedule
10/2009 to 12/31/2009 1/2010 on schedule
1/2010 to 3/31/2010 3/23/2010 1 week ahead of schedule
4/2010 to 6/30/2010 2/2011 7 months behind schedule
7/2010 to 9/30/2010 2/2011 4 months behind schedule
10/2010 to 12/31/2010 Not yet distributed 9 months behind schedule
1/2011 to 3/31/2011 Not yet distributed 6 months behind schedule
4/2011 to 6/30/2011 Not yet distributed 3 months behind schedule
7/2011 to 9/30/2011 Not yet distributed Due this month

What that means is that it is difficult for the lay observer and the outside professional to find out the state of the law.

The Mayor and Common Council will consider, at the February 7, 2012 meeting, awarding  the Code Publishing, Inc. of Seattle, Washington.  However, in the staff report and the resolution, you can see tension between the City Attorney’s Office and the City Manager’s Office:

Proposals were then evaluated by a selection committee comprised of City staff representing the City Clerk’s and City Manager’s offices, Public Works, Information Technology, and Community Development departments. The City Attorney’s Office was invited to participate and identified a representative from their office to take part in this process. The representative was present during one of the presentations; however, the City Attorney’s Office was unable to attend the other presentations and did not participate in the evaluation process.  [Emphasis added]

The selection committee recommends that Code Publishing, Inc., be awarded the contract. While all of the codification companies are qualified to provide the needed services, Code Publishing, Inc., received the highest ranking scores based on their flexible pricing, customer service-oriented approach, quality of electronic publishing and internet services, and legal publishing expertise.

. . .

Recodification and the regular distribution of supplement materials is a necessary undertaking to maintain transparency of the City’s Code. It is the City’s responsibility to maintain its laws in a current and comprehensive format. When the Code contains conflicts or discrepancies and outdated or incorrect references it cannot be an effective tool for residents and enforcement officials to follow and enforce the laws with consistency and accuracy. Moreover, the public, including property and business owners and developers, are poorly served by not having access to updated codes in order to assess information necessary when, for example, applying for business registrations, building permits, or planning new development options.

Outsourcing codification services is a standard practiced by most California cities. A recent survey conducted by staff shows that 91 percent of California cities outsource codification services. Of the 362 cities governed by general law, 332 or 92 percent of cities outsource codification services. Of the 120 charter cities in California, 105 or 88 percent of cities outsource codification services. Within the group of charter cities, 9 or 82 percent of the 11 charter cities that elect a city attorney outsource codification services. [Emphasis added]

By outsourcing services, the City will be able to promptly provide subscribers with quarterly supplements while reducing the time the City Attorney’s and Clerk’s offices and the Planning Division devote to codifying, indexing, proofreading, publishing, and distributing activities. While the City Attorney’s Office is responsible for drafting proposed ordinances and resolutions, the Planning Division is responsible for updating changes to the Development Code (Title 19). Title 19 is one of the most dynamic sections of the Code with the largest number of annual amendments (20 amendments in three years).

The mostly unexecuted version of the resolution says “decline to sign” and the initials “JFP.” City Attorney James F. Penman has declined to approve the resolution as to form.  From time to time, the City Attorney does not sign resolutions or agreements.  The reasons he declined to do might be found by examining the minutes and video of the November 7, 2011 Council Meeting.

Video on the discussion surrounding the item is available on the City’s website, and the item is about at the 3:37:00 mark. For context, the meeting was the day before the Primary Municipal Election. City Attorney Penman said that the first he heard about it was when it appeared on the agenda.  He said the situation was low priority and created by Council not fully funding the City Attorney’s Office, because the Legal Secretary II responsible has been taken off codification and placed on litigation.  He took issue with the cost of $40,000, and said it could be done for $10,000 using a part-time legal secretary without benefits.

Council member McCammack said that City Manager McNeely’s staff had politicized the issue.  She also said that it was more important to pay the $40,000 in defending the liability cases.

Council member Marquez asked about other cities contract with vendors, and City Clerk Rachel Clark said that the Clerk’s Office did a survey but that she didn’t have the numbers with her at the Council Meeting.

Council Member Jenkins said that the money could be better used on potholes, trimming trees or broken street lights.

Council member Kelley had concerns that sending out the RFP would start an unavoidable path to paying for outside codification.

City Attorney Penman said that the biggest request was to annotate the code and Charter with case law, and the codification company would charge extra. City Attorney Penman said that they were ahead of schedule a year before, but that staff had been taken off of it, and that it was not high priority.

Mayor Morris said that the City Attorney’s Office would be part of the RFP process.

Council member McCammack asked which staff would be involved with the codifier to make sure the codifier was making accurate changes to the code.  City Manager McNeely said that the City Attorney and City Manager and City Clerk’s Office would be involved, and that mostly the City Clerk’s Office would be involved.

City Clerk Clark highlighted the times that the City Attorney’s Office was late in the quarterly updates, but when confronted said that it had been on time before the highlighted period.  She also said that it was during Tom Minor’s administration that it came in-house.  Council member McCammack said the item was a political ploy to embarrass the City Attorney’s Office.
The first public speaker said that it was difficult to find the code online, particularly related to code enforcement.  The second speaker was then-City Clerk candidate Esther Jimenez discussed an issue regarding a proposed tobacco ordinance in the past which wasn’t really related to the discussion (and City Attorney Penman disputed her view of the events).
City Attorney Penman disputed the part of the RFP that there was a need to make corrective measures to the existing code, and he said that Council had blocked some moves already proposed by the City Attorney’s Office, and that his Office didn’t have the resources to make the needed changes.  City Attorney Penman said that all hands were defending lawsuits so that no one could participate in the selection process.

The Common Council voted on strictly partisan lines.  According to the minutes of November 7, 2011, Resolution 2011-299 was passed on a 4 to 3 vote with Council members Virginia Marquez (1st Ward), Tobin Brinker (2nd Ward), Fred Shorett (4th Ward) and Rikke Van Johnson (6th Ward) in favor; Robert Jenkins (2nd Ward), Chas Kelley (5th Ward) and Wendy McCammack (7th Ward) opposed.
Update:  The Common Council voted 5-2 (Shorett and Johnson opposed) to continue the item to March 19, 2012, where, given the new majority will most likely be defeated, if it even comes to a vote.

The information you obtain at this blog is not, nor is it intended to be, legal advice. No attorney-client relationship is established by reading or commenting on this blog. You should consult an attorney for advice regarding your individual situation.

Milligan, Beswick, Levine & Knox, LLP
A: 1447 Ford St. #201
      Redlands, CA 92374
T: (909) 296-6708

City Attorneys of San Bernardino County Cities and Towns

By Michael Reiter, Attorney at Law

People are searching the Internet for a definitive list of City Attorneys in San Bernardino County and the Inland Empire.   Here is the information, which is current as of today (2/1/2012)  to the best of my knowledge.  Please note that I am not the City Attorney nor the Assistant City Attorney for any of these cities.

City of Adelanto:

 

Todd Litfin

Rutan & Tucker LLP

611 Anton Blvd. #1400

Costa Mesa, CA  92626

 

Town of Apple Valley:

 

John E. Brown

Best Best & Krieger LLP

3500 Porsche Way, Suite 200

Ontario, CA 91764

 

City of Barstow:

 

Teresa Highsmith (Interim City Attorney)

Colantuono & Levin

300 S. Grand Ave. Ste 2700

Los Angeles CA 90071

 

City of Big Bear Lake:

 

Stephen Dietsch

Best Best & Krieger LLP

3500 Porsche Way, Suite 200

Ontario CA 91764

 

City of Chino:

 

Jimmy L. Gutierrez

12616 Central Ave
Chino, CA 91710

 

City of Chino Hills:

 

Mark D. Hensley

Jenkins & Hogin LLP
Manhattan Towers
1230 Rosecrans Ave #110
Manhattan Beach, CA 90266

 

City of Colton:

 

Dean Derleth

Best Best & Krieger LLP
300 S Grand Ave 25th FL
Los Angeles, CA 90071

 

City of Fontana:

 

Clark Alsop

Best Best & Krieger LLP

3500 Porsche Way, Suite 200

Ontario, CA 91764

 

City of Grand Terrace:

 

Richard L. Adams, II

Jones & Mayer

3777 N. Harbor Blvd.

Fullerton CA 92835

 

City of Hesperia:

 

Eric Dunn

Aleshire & Wynder LLP
18881 Von Karman Ave #400
Irvine, CA 92612

 

City of Highland:

 

Craig Steele

Richards Watson & Gershon

355 S. Grand Ave., 40th Floor

Los Angeles, CA 90071-3101

 

City of Loma Linda:

 

Richard E.  Holdaway

Robbins & Holdaway
201 W “F” St
Ontario, CA 91762

 

City of Montclair:

 

Diane E. Robbins

Robbins & Holdaway
201 W “F” St
Ontario, CA 91762

 

City of Needles:

 

John Pinkney

Slovak, Baron & Empey LLP
1800 E. Tahquitz Canyon Way
Palm Springs, California 92262

 

City of Ontario:

 

John E. Brown

Best Best & Krieger LLP

3500 Porsche Way, Suite 200

Ontario, CA 91764

 

City of Rancho Cucamonga:

James L. Markman

Richards Watson & Gershon
P O Box 1059
Brea, CA 92822-1059

 

City of Redlands:

Daniel J. McHugh

P.O. Box 3005

Redlands, CA 92373

 

City of Rialto:

Jimmy L. Gutierrez

12616 Central Ave
Chino, CA 91710

 

City of San Bernardino:

James F. Penman

300 North D Street

Sixth Floor

San Bernardino, CA 92418

 

City of Twentynine Palms:

Patrick Munoz

Rutan & Tucker

P.O. Box 1950

Costa Mesa, CA 92628-9990

 

City of Upland:

William P. Curley III

Richards Watson & Gershon
P O Box 1059
Brea, CA 92822-1059

 

City of Victorville:

Andre de Bortnowsky

Green, de Bortnowsky & Quintanilla

23801 Calabasas Rd. #1015

Calabasas, CA 91302-1595

 

City of Yucaipa:

 

David Snow (Interim City Attorney)

Richards Watson & Gershon

355 S. Grand Ave., 40th Floor

Los Angeles, CA 90071-3101

 

Town of Yucca Valley:

 

Lona Laymon

Aleshire & Wynder LLP
18881 Von Karman Ave #400
Irvine, CA 92612

 

Copyright 2012 Michael Reiter, Attorney at Law

Gophers Can Cause Trip and Falls

By Michael Reiter, Attorney at Law.

I went out for another walk today, in the late afternoon.  I love to see California native wildlife, like a California Pocket Gopher

I am a big fan of California wildlife, particularly Pocket Gophers, though not as much as my late friend Emma.  I had never seen a living pocket gopher before, but this individual poked his head up a few times, and I was able to get a picture of his head.  Unfortunately, I only had an iPhone to take a picture, and it was from about six feet away.

Gophers can cause damage to lawns.  They can also damage parks.  When I was a Deputy City Attorney for the City of San Bernardino, I defended a lawsuit involving an AYSO coach who allegedly tripped and fell in a field in Wildwood Park.  Because the case involved a public entity, the plaintiff had to plead and prove a dangerous condition of  public property cause of action, but with a private landowner, the standard is typically negligence.  The case also involved cross-complaints against the City’s pest controller contractor and the American Youth Soccer Organization.  If I recall correctly, the American Youth Soccer Organization, Inc. picked up the City’s defense under an express indemnification clause in a field use agreement.

The information you obtain at this blog is not, nor is it intended to be, legal advice. No attorney-client relationship is established by reading or commenting on this blog. You should consult an attorney for advice regarding your individual situation.

Michael Reiter, Attorney at Law

A: 300 E. State St. Suite 517
Redlands CA 92373-5235
T: (909) 296-6708

W: http://michaelreiterlaw.com

What is a “dangerous condition of public property?”

By Michael Reiter, Attorney at Law.

A public entity may only be held liable for a dangerous condition of its property, not for simple negligence or premises liability.   Before I was in private practice helping plaintiffs, I received a good education in a variety of dangerous condition of public property cases when I was Deputy City Attorney for the City of San Bernardino and as Assistant City Attorney for the City of Redlands.

A “dangerous condition” is “a condition of property that creates a substantial (as distinguished from a minor, trivial, or insignificant) risk of injury when such property . . . is used with due care in a manner in which it is foreseeable that it will be used.”  Government Code § 830(a).  A public entity is liable for injury caused by a dangerous condition of property it owns or controls if the plaintiff establishes that (1) the property was in a dangerous condition at the time of injury; (2) that the injury was proximately caused by the dangerous condition; (3) the dangerous condition created a reasonably foreseeable risk of the kind of injury incurred; and either (i) a public employee, within the scope of his or her employment, negligent or wrongly committed an act or omission that created the condition or (ii) the entity had actual or constructive notice of the dangerous condition in sufficient time before the injury to take protective measures against the dangerous condition. California Government Code §§ 830, 835.

What are the kinds of scenarios that might involve two public entities, or a mix of public entities and private entities?  The scenarios I have seen as an attorney have included:

1. A city, a water district, and a private land owner, where a sidewalk panel was removed to replace a meter box, and the sidewalk panel was never replaced.  The plaintiff tripped and fell.

2. A city, a school district, and an adjoining land owner, and a nonprofit youth organization, where the plaintiff tripped over a utility cover, wherein the surrounding compacted dirt had eroded over the years, but no sidewalk ever existed.

3. A city, a county, and a private land owner, and a private party, where a motorcyclist died at an intersection jointly controlled by the city and county, when the motorcyclist was struck by the private party’s automobile.

4. A trip and fall that happened only in one city, but the plaintiff sued two cities because it was not clear which entity owned or controlled the sidewalk.

5. An injury to a person who was waiting at a bus stop from a city tree in a city park, but at a bus stop owned and controlled by a joint-powers authority transit system.

6. A flooding case wherein the flood control channel was owned by a county flood control agency, but the culvert and bridge were owned by a city.

California Government Code section 830(c) states “‘Property of a public entity’ and “public property” means real or personal property owned or controlled by the public entity, but do not include easements, encroachments and other property that are located on the property of the public entity but are not owned or controlled by the entity.”

“Where the public entity’s relationship to the dangerous property is not clear, aid may be sought by inquiring whether the particular defendant had control, in the sense of power to prevent, remedy or guard against the dangerous condition; whether his ownership is a naked title or whether it is coupled with control; and whether a private defendant, having a similar relationship to the property, would be responsible for its safe condition.”  Low v. City of Sacramento (1970) 7 Cal.App.3d 826, 833-834.

Obviously, ownership is a key fact to prove.  Control can be more difficult.  In the case of a jointly controlled intersection, there is typically an agreement between the two public entities. Obtain and examine that agreement (either through discovery or by using the California Public Records Act).  Control can be established by deposing maintenance workers who have personal knowledge of the maintenance work done at the property, and to a limited extent, with written discovery.

In Bonanno v. Central Contra Costa Transit Authority, the California Supreme Court ruled that  “the location of public property, by which users are subjected to hazards on adjacent property, may constitute a dangerous condition” under Government Code sections 830 and 835.  Bonanno v. Central Contra Costa Transit Authority (2003) 30 Cal.4th 139, 815-816.

Therefore, there are factual scenarios where more than one public entity can be responsible for one injury by pleading and proving a dangerous condition of public property cause of action.  In the flooding scenario noted above, the plaintiff also pled an inverse condemnation cause of action.

The information you obtain at this blog is not, nor is it intended to be, legal advice. No attorney-client relationship is established by reading or commenting on this blog. You should consult an attorney for advice regarding your individual situation.

A: 300 E. State St. Suite 517
      Redlands, CA 92373-5235
T: (909) 296-6708

W: http://michaelreiterlaw.com

SBDPolitics: City Attorney Penman to Mayor and Common Council: the voters heard the arguments, the voters said no, “go ahead and defy them.”

By Michael Reiter, Attorney at Law.

Over on sbdpolitics.com, there is a discussion of what transpired at yesterday’s Mayor and Common Council Meeting regarding the request for an additional appropriation on today’s San Bernardino City Council Meeting.  Click on the link in the previous sentence to go directly to the article.

The legal background is that the City of San Bernardino enters into professional services agreements with outside counsel.  For this fiscal year, which began on July 1, 2011, the City Attorney’s Office has already gone through the budgeted amount.   City Attorney James F. Penman says that if the City does not pay the bills, the outside counsel will withdraw, they may sue the City for the services incurred, and the City will have to pay whether they are budgeted in the City Attorney’s departmental budget or not.

To his challenge, the City Council voted on partisan lines to deny the additional appropriation to pay for the contracts approved by the Mayor and Common Council.  Read more by clicking on the link.

The information you obtain at this blog is not, nor is it intended to be, legal advice. No attorney-client relationship is established by reading or commenting on this blog. You should consult an attorney for advice regarding your individual situation.

Michael Reiter, Attorney at Law.

A: 300 E. State St. Suite 517
      Redlands, CA 92373-5235
T: (909) 296-6708

Over on sbdpolitics.com: The San Bernardino City Attorney’s Office Budget: Additional Appropriation On City of San Bernardino Council Agenda 11/21/2011

By Michael Reiter, Attorney at Law.

Over on sbdpolitics.com, there is a brief discussion of an additional appropriation on today’s San Bernardino City Council Meeting.  Click on the link in the previous sentence to go directly to the article.

The information you obtain at this blog is not, nor is it intended to be, legal advice. No attorney-client relationship is established by reading or commenting on this blog. You should consult an attorney for advice regarding your individual situation.

Address : 300 E. State St. Suite 517

Redlands CA 92373-5235

Telephone: (909) 296-6708