HomeMy WebLinkAboutAGENDA REPORT 1997 0604 CC REG ITEM 09CAGENDA REPORT
CITY OF MOORPARK
ITEM 9.C.
CITY OF MOORPAM CALIFORNIA
City it Mating
Af CO / _ _ _ 199
TO: The Honorable City Council A ON:
FROM: Lillian E. Hare, City Clerk BY
DATE: May 28, 1997 (CC Meeting of 6/4/97)
SUBJECT: Consider Budget Amendment to Appropriate Funds for Residential Appraisals to
Determine Conflict of Interest Relative to the Political Reform Act Regarding
Pacific Communities Builder Project (Tentative Tract 505 -3, GPA 96 -2, RPD 96 -1
Zone Change 96 -2); Security Capitol Trust Project (pre- application requesting
filing of a GPA and Zone Change); and Iskan Liberty Development (Gas Station/
Car Wash at Liberty Bell and Los Angeles Avenue)
The Political Reform Act was enacted by the people of the State of California. Under the
conflicts of interest provisions of the Act, an official has a financial interest in a decision if it is
reasonably foreseeable that the decision will have a material financial effect on the official that is
distinguishable from its effect on the public generally.
The Act provides that the effect of a decision is material as to real property in which an official
has an interest if the location/distance from a subject property and the increase/decrease in the
fair market value of the off'icial's property is as set forth in the Act. The January 9, 1995 letter
from the City Attorney titled "Conflicts of Interest Ownership Interest in Real Property" is
attached as exhibit A as a reference on the specifics of distance and the increases/decreases in fair
market value in the Act.
The only objective method of determining the possible increase/decrease in property value of an
official's property situated within the 2500 feet distance threshold of a subject property is to have
an appraisal prepared by a qualified real estate appraiser. With an appraisal, an official can
determine if the $10,000 property value threshold has been reached and he/she must abstain from
participation in the decision making process relative to a subject property.
The City Attorney has opined that the "City Council can reasonably determine that the
expenditure of public funds for conflict of interest appraisals constitute a public purpose, given
that the expenditure will enable councilmembers to perform their official duties, irrespective of
their own financial resources." (See exhibit B )
000z4a
Council Report
May 28, 1997
Page 2
The Pacific Communities Builder project, Security Capital Trust proposed GPA, and Iskan
Liberty Development project will be considered by the Council in the upcoming months.
Councilmember Evans' home is within 2500 feet of all three projects and Councilmember
Teasley's home is within 2500 feet of the Security Capital Trust site — both will, therefore,
require a conflict of interest appraisal. David Kimura is presently working on a residential conflict
of interest appraisal for the home of Councilmember Wozniak relative to Specific Plan 2 for
$1250. Although a specific bid request has not yet been made, Mr. Kimura estimates that he can
do the additional appraisals for the same cost of approximately $1250 each. The appraisal for
Councilmember Evans would encompass all 3 affected sites. Mr. Kimura is a resident of the City
with a current Business Registration and Home Occupation Permit.
The Council has previously referred the development of a conflict of interest appraisal policy to
the Council Ad Hoc Committee on the Rules of Procedure. The Committee has not yet met.
Staff Recommendation: (ROLL CALL VOTE REQUIRED)
Adopt Resolution 97 -_ Appropriating $3,000 from General Fund Reserves to
100.100.0000.000.9116 for residential appraisals for Councilmember Evans and Teasley's homes.
Attachments:
Exhibit A: City Attorney's memo dated January 9, 1995
Exhibit B: City Attorney's memo dated January 19, 1996
Resolution
ow;444
a,W OFFICES
BTTRK };, `VII.LIAMS & SORENSE\
LE NTURA COUNTY OFFICE .. - S —E F_ —
2310 PONDEROSA DRIVE
SUITE S A 413E. .. r._S, d�,A l_F,::JRNIA 900'?
-.r MARILLO (- ALIFORNIA 93010
B
19873468
ORANGE COUNTY OFFICE
3200 BRISTOL STREET
SUITE 640
COSTA MESA, CALIFORNIA 92626
17141 545 -5559
January 9, 1995
The Honorable Mayor Paul W. Lawrason
and Members of the City Council
City of Moorpark
799 Moorpark Avenue
Moorpark, California 93021
Re: Conflicts of Interest
Ownership Interest in Real Property
Dear Mr. Mayor and Councilmembers:
'� RECEIVED — c
in jqq�
0 +tY of Moorpark
BURKE. WILLIAMS. 50RENSEN 6 GAAR
L. GHTON PLAZA
7300 COLLEGE BOULEVARD
SUITE 220
�vERLAND PARK. KANSAS 66210
(913) 339 -6200
WRITER'S DIRECT DIAL
213 - 236 -2721
OUR FILE NO. 01359 -001
It has recently come to my attention that there may be
some misunderstanding by councilmembers and staff members
regarding when an interest in real property is cause for
disqualification from participation in the decision making
process pursuant to the Political Reform Act (Gov't Code § 81000
et sea.) I have therefore prepared the enclosure, which is an
outline of the regulations regarding this matter.
If you have any questions regarding the outline or its
application, please do not hesitate to contact me.
r truly ours,
CHE L J. KANE
CITY RNEY, MOORPARK; and
BURKE, WILLIAMS & SORENSEN
Enclosure
cc: Steven Kueny, City Manager
02:117400.1
♦ I
.c2: uniT1
MATERIAL FINANCIAL EFFECT:
OWNERSHIP INTEREST IN REAL PROPERTY
(Cal.Code Regs., tit 2, § 18702.3)
An official has a financial interest in a decision if it is
reasonably foreseeable that the decision will have a material
financial effect on the official (or an immediate family member)
that is distinguishable from its effect on the public generally.
(Gov't Code § 87103.)
The effect of a decision is material as to real property in which
the official (or an immediate family member) has a direct, indirect
or benefit interest if:
A. The official's property is located:
1. Within 300 feet of the subject property unless the
decision will have no financial effect on the official's property.
2. More than 300 feet but not more than 2500 feet from the
subject property and it is reasonably foreseeable that the decision
will:
a. increase /decrease the fair market value of the
official's property by $10,000 or more or
b. increase/ decrease the rental value of the official's
property by $1,000 or more per 12 month period
3. More than 2500 feet from the subject property only if:
a. there are specific circumstances which make it
reasonably foreseeable the fair market value /rental value of the
officials property will. increase /decrease by $10,000 /$1,000 and
b. the effect will not be substantially the same as the
effect upon at least 25% of the properties within 2500 feet of the
official's property or
C. there are less than 10 properties under separate
ownership within 2500 feet of the official's property.
B. The decision involves the construction of, improvements to,
infrastructure (e.g. streets, sewers) and the official's property
will receive new or substantially improved services.
NOTES
1. Factors to be considered in determining whether a
$10,000 /$1,000 increase/ decrease is reasonably foreseeable include,
but are not limited to:
000246
a. proximity of the subject property and the magnitude of
the proposal in relationship to the official's property;
b. whether it is reasonably foreseeable that the decision
will affect the development or income producing potential of the
official's property; and
C. if the official's property is residential, whether it is
reasonably foreseeable that the decision will change the character
of the neighborhood (i.e., traffic, view, privacy, intensity of use,
noise, air emissions).
2. If the decision may affect the official's property but does not
involve a subject property, the standards set forth in A.2 apply.
3. Whenever the decision involves the establishment or
modification of a redevelopment project area or the adoption or
Amendment of a redevelopment plan, the boundaries of the subject
property are the boundaries of the redevelopment project area.
.,(2:117217.1 -2-
1000247.
°,ANGE COUNTY OFFICE I E C ".P FR 1 3) 236-2700
'200 PARK CENTER DRIVE
SUITE 750
COSTA MESA, CALIFORNIA 92626
(714) 645 -6669
LAX2:145550.1
January 19, 1996
The Honorable Mayor and Members
of the City Council
City of Moorpark
799 Moorpark Avenue
Moorpark, California 93021
i v � �ocvrp
FRESNO OFFICE
7108 NORTH FRESNO STREET
SUITE 401
FRESNO, CALIFORNIA 93720.2938
(209) 261 -0163
BURKE, WILLIAMS, SORENSEN & GAAR
LIGHTON PLAZA
7300 COLLEGE BOULEVARD
SUITE 220
OVERLAND PARK, KANSAS 66210
19131 339 -6200
WRITER'S DIRECT DIAL:
213 - 236.2721
OUR FILE NO. 01369-001
Re: California Constitution, Article 16, Section 6
Expenditure of Public Funds for Real Estate Appraisals
Dear Mr. Mayor and Councilmembers:
Pursuant to the Political Reform Act, members of your
City Council, as well as commission and staff members, are
prohibited from participating in any decision that may increase
or decrease the value of their residences or other real estate
holdings by $10,000 or more. (Gov't Code S 87100; Cal. Code
Regs., tit. 2, S 18702.3.) As a matter of course, the Fair
Political Practices Commission suggests that this determination
be made by a real estate appraiser. Because an appraisal can
cost several thousand dollars at a minimum, you have asked if the
appraisal can be paid for from public funds.
Discussion
In a 1993 informal advise letter, staff to the Fair
Political Practices Commission concluded that use of public funds
to pay for such an appraisal is not prohibited by the Political
Reform Act and that the expenditure does not result in a gift
that must be reported pursuant to the Act. (FPPC File No. 1 -93-
200.) Because the jurisdiction of the Commission is limited to
the Political Reform Act, the advise letter did not address the
issue as it relates to the California Constitution.
The California Constitution, at section 6 of article
16, prohibits public funds from being expended or loaned for a
private purpose. (City of Downey v. Board of Administration
00OZ 48
...AW OFFICES
BURKE, WILLIANIS & SORENSEN
VENTURA COUNTY OFFICE
611 NEST 'SIXTH STREET. SUITE 2500
2310 PONDEROSA DRIVE
LO AN(4I =S, CALIFORNIA 900 7
SUITE 1
C�'!FRILLO, CALIFORNIA 93010
(805) 987 -3468
°,ANGE COUNTY OFFICE I E C ".P FR 1 3) 236-2700
'200 PARK CENTER DRIVE
SUITE 750
COSTA MESA, CALIFORNIA 92626
(714) 645 -6669
LAX2:145550.1
January 19, 1996
The Honorable Mayor and Members
of the City Council
City of Moorpark
799 Moorpark Avenue
Moorpark, California 93021
i v � �ocvrp
FRESNO OFFICE
7108 NORTH FRESNO STREET
SUITE 401
FRESNO, CALIFORNIA 93720.2938
(209) 261 -0163
BURKE, WILLIAMS, SORENSEN & GAAR
LIGHTON PLAZA
7300 COLLEGE BOULEVARD
SUITE 220
OVERLAND PARK, KANSAS 66210
19131 339 -6200
WRITER'S DIRECT DIAL:
213 - 236.2721
OUR FILE NO. 01369-001
Re: California Constitution, Article 16, Section 6
Expenditure of Public Funds for Real Estate Appraisals
Dear Mr. Mayor and Councilmembers:
Pursuant to the Political Reform Act, members of your
City Council, as well as commission and staff members, are
prohibited from participating in any decision that may increase
or decrease the value of their residences or other real estate
holdings by $10,000 or more. (Gov't Code S 87100; Cal. Code
Regs., tit. 2, S 18702.3.) As a matter of course, the Fair
Political Practices Commission suggests that this determination
be made by a real estate appraiser. Because an appraisal can
cost several thousand dollars at a minimum, you have asked if the
appraisal can be paid for from public funds.
Discussion
In a 1993 informal advise letter, staff to the Fair
Political Practices Commission concluded that use of public funds
to pay for such an appraisal is not prohibited by the Political
Reform Act and that the expenditure does not result in a gift
that must be reported pursuant to the Act. (FPPC File No. 1 -93-
200.) Because the jurisdiction of the Commission is limited to
the Political Reform Act, the advise letter did not address the
issue as it relates to the California Constitution.
The California Constitution, at section 6 of article
16, prohibits public funds from being expended or loaned for a
private purpose. (City of Downey v. Board of Administration
00OZ 48
LAX2:145550. i
The Honorable Mayor and Members
of the City Council
January 19, 1996
Page 2
(1975) 47 Cal.App.3d 621, 629.) If a public purpose is served,
the constitution is not violated even though individuals may
incidentally benefit from the expenditure or loan. (Patrick v.
Riley (1930) 209 Cal. 350.) In a long line of case, the courts
have held that the determination of what constitutes a public
purpose is primarily a matter for the legislative body (i.e. your
City Council) to determine. (Shean v. Edmonds (1949) 89
Cal.App.2d 315.) That determination will not be disturbed by the
courts if it has a reasonable basis. (Id.)
Several cities, including Dana Point and Oxnard, use
public funds to pay for appraisals that arise from the Political
Reform Act. And in a 1994 formal advise letter, staff to the
Fair Political Practice Commission ruled that the expenditure of
campaign funds for such an appraisal serves a "governmental
purpose ". (FPPC File No. A- 94- 320.)1/
Although the courts have not yet been asked to review
the issue, they have held that a councilmember not only has "a
right but an obligation . . . to state his views on matters of
public importance." (City of Fairfield v. Superior Court (1975)
14 Cal.3d 768, 780.) In the absence of an appraisal, a
councilmember with a potential conflict of interest runs the risk
of violating either that obligation by non - participation or the
Political Reform Act by participation. If the appraisal must be
paid for from personal funds, only those councilmembers with
substantial financial. resources could reasonably afford to participate.?f
1' The FPPC staff addressed the issue in terms of the expenditure
of campaign funds. Unddr the Political Reform Act, campaign
funds may be used in assocation with the holding of office if the
expenditure serves "a political, legislative or governmental
purpose ". (Gov't Code § 89512.)
?' In a number of related situations, the expenditure of public
funds has been upheld as serving a public purpose. For example,
paying to insure public officials against tort liability was
upheld on the ground that "any decrease in the potential
liability of an official will increase the willingness of
competent people to assume the risk of office." (People v.
Standard Accident Ins. Co. (1941) 42 Cal.App.2d 409, 412.)
(continued...)
000248
The Honorable Mayor and Members
of the City Council
January 19, 1996
Page 3
Conclusion
Your City Council can reasonably determine that the
expenditure of public funds for conflict of interest appraisals
constitutes a public purpose, given that the expenditure will
enable councilmembers to perform their official duties,
irrespective of their own financial resources. In order to ensure
that councilmembers are only incidentally benefitted, I recommend
that the appraiser be retained by the City and the scope of the
appraisals extend no further than is necessary to evaluate the
potential conflict of interest under the Political Reform Act.
Finally, you could consider extending such expenditures to
commission and staff members.
Ve 2J. ours,
CHENE CIT Y, MO RPARK; and
BURKE, WILLIAMS & SORENSEN
*11.9,
cc: Steven Kueny, City Manager
z'( ... continued)
Paying for the physical examination of
ground that the examination was not for
but was to aid them in complying with a
anybody with a contagious disease from
Atty.Gen. 288.) Paying the expenses of
physically handicapped councilmember w
that the member needed the assistant i n
duties. (65 Cal.Ops.Atty.Gen. 517.)
LAX2:145550.1
teachers was upheld on the
their personal benefit
state law that prohibits
teaching. (18 Cal.Ops.
an assistant to a
as upheld on the ground
order to perform official
000250