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By Shawn Raymundo
Before councilors convened for their regular meeting on Tuesday, Feb. 18, they held a public workshop to review and discuss the city’s legal services budget and costs associated with ongoing litigation, laying the groundwork for a potential RFP for legal services.
The purpose of the workshop, the city explained, was to give the public an opportunity to review the city’s legal expenses in the current fiscal year while also allowing the council to identify cost-savings opportunities.
The move to have the council review the legal services budget came at the request of Mayor Pro Tem Laura Ferguson, who had proposed bringing the topic up for discussion this past December. Ferguson has repeatedly advocated for an RFP ahead of the upcoming fiscal-year budget process to review alternative legal teams other than Best, Best & Krieger.
During the meeting, Ferguson was critical of the report, stating that it didn’t adequately explain the city’s litigation-related costs and left out the total legal costs for Fiscal Year 2018-19.
Based on San Clemente Times’ review of the staff report for the budget, the city spent nearly $2.46 million in total legal-related costs last fiscal year. General services work made up 18% of the total bill, while 27% accounted for litigation and legal services. Another 7% went toward Public Record Act requests and 27% paid for experts related to the Transportation Corridor Agencies and hospitals.
According to the report, the city has spent an average of $442,000 a year on general services work under its legal services contract with BB&K, which the city retained in 2015.
The general services costs, which don’t cover litigation, comprise departmental work with the exception of PRA requests. At the midway point of the current fiscal year, the city is currently on track to meet that $442,000 average, according to the staff report.
Since 2016, the city has initiated several legal challenges against the TCA, including the lawsuit challenging the agencies’ settlement agreement that prevents them from extending the 241 Toll Road south of San Clemente.
As of this fiscal year, the city’s legal costs for all open TCA cases have amounted to roughly $1.33 million—more than a $1 million of which has been spent on hiring TCA experts, according to the city.
City Attorney Scott Smith explained the experts have provided information on a regular basis about traffic engineering and the history and interplay of the TCA. The goal of contracting those experts, Smith added, was to have them engage with the city rather than publish findings and opinions elsewhere.
“So, it was to keep those discussions and analyses confidential,” he said.
Smith also noted that council did have the option to drop those cases and pursue other non-legal methods, therefore avoiding the litigation costs. Councilors, along with members of the public, voiced strong opposition to such an action.
The city is also currently the defendant in separate lawsuits against the Coastal Access Alliance, Anthem Sales Management (Shikli), and Housing is a Human Right Orange County. The cost to defend the city in those three cases, according to the report, has accumulated to $335,515 since they were initiated.
More than $75,500 has been spent on the case against Coastal Access Alliance, which challenges the city’s ordinance to regulate Short Term Lodging Units. The city’s legal fees to dispute Anthem’s case, challenging the city’s decision to revoke an STLU permit, has cost $60,000.
Housing is a Human Right, along with Emergency Shelter Coalition, have filed a handful of homelessness-related lawsuits against the city, costing San Clemente $200,000, according to the report.
The city notes that work related to public records requests is billed separately from its retainer with BB&K and has been a “significant and growing legal and staff expense,” calling it the “biggest disappointment in controlling general services legal fees.”
According to the city, San Clemente’s PRA expenses are much higher compared to other cities with which BB&K contracts. Since FY 2015-16, when BB&K was contracted, the city has spent $471,860 on PRA work.
In the first two fiscal years of the BB&K contract combined, the city’s PRA expenses amounted to $125,682. In FY 2017-18 alone, the cost was $121,178, and in FY 2018-19, the cost was $172,000. As of the release of the report, the city’s PRA cost for FY 2019-20 was $53,000.
The city stated that the influx of PRA costs was a result of a few individuals filing “an extraordinary number of requests.” To rein in those costs, the city recommended the council consider two options—limiting the city’s monthly budget for PRA requests and setting a monthly cap on a citizens’ requests.
Under the first option, the city would cease any public records review after staff had met its monthly legal budget of $5,000. The second option would put a cap on the number of PRA hours available to each individual requesting documents.
Ferguson asked Smith how many other cities that BB&K contracts with budget $5,000 a month for PRA requests. Smith said San Clemente was the only one, as others have it included in their retainer.
Smith’s response prompted Mayor Dan Bane to ask whether it would be cost-effective for the city to do that as well. Smith said that while that could be discussed, he noted that the fixed cost would be based on the city’s track record, likely inflating the amount to cover the down years.
Near the conclusion of the discussion, Ferguson again floated the idea of initiating a request for proposals for alternative litigation services during a future meeting, “to see if we can get more bang for our buck.”
That motion failed to garner enough support from the rest of the council.
Bane ended the workshop by stating that he’d be open to looking at RFPs at a later date.
This story was updated Wednesday, Feb. 19, to include the council’s comments.
Shawn Raymundo is the city editor for the San Clemente Times. He graduated from Arizona State University with a bachelor’s degree in Global Studies. Before joining Picket Fence Media, he worked as the government accountability reporter for the Pacific Daily News in the U.S. territory of Guam. Follow him on Twitter @ShawnzyTsunami and follow San Clemente Times @SCTimesNews.