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HomeMy WebLinkAboutMinutes 1990-12-19Mayor Jack Drago Council: Richard A. Haffey Gus Nicolopulos John R. Penna Roberta Cerri Teglia AGENDA ADJOURNED REGULAR MEETING CALL TO ORDER: (Cassette No. 1) ROLL CALL: e Closed Session for the purpose of the discussion of personnel matters, labor relations, property negotiations and litigation. Councilman Penna Arrived: RECALL TO ORDER: ~1. Conflicts of Interest. MINUTES City Council City Council Conference Room City Hall December 19, 1990 ACTION TAKEN ADJOURNED REGULAR MEETING 6:53 p.m. Mayor Drago presiding. Council present: Haffey, Nicolopulos, Teglia, and Drago. Uouncil absent: Penna. Council adjourned to a Closed Session at 6:53 p.m. to discuss the items noticed. Councilman Penna arrived at 7:15 p.m. Mayor Drago recalled the meeting to order 7:44 p.m., all Councilmembers present, and no action was taken. City Attorney Armento stated that this would be a discussion on revisions to the Council Handbook concerning conflicts of interest which had been brought up a number of times by the Council. She stated that attached to the staff report were two pages of material provided for Council consideration in what they would like to select for policy. Councilwoman Teglia stated that she had brought this subject up originally, and felt that the document fit the bill for herself, although members of Council may have some differences of opinion. She related some of her thoughts on the subject: the appearance of conflict that might cause citizens to question the integrity of a Councilmember, however she felt it was more a question of the Council sharing whatever is thought of one Councilperson was shared by all; she was proud of the avoidance of conflict over the last 13 years on the Council; when Councilman Addiego had stepped down 12/19/90 Page I AGENDA Conflicts of Interest - Continued. ACTION TAKEN from the Council he had related that in his experience the people he had served with had asked far less and taken far less from the system than they had given. Mayor Drago felt that provisions such as these should also apply to all Boards and Commissions, as well as to employees because he saw nothing offensive in the provisions. He felt that there was more City employee contact with the public where some of their actions could be questioned. He questioned if prior to imposing such a policy there was a need to contact each of the employee groups for a meet and confer. City Attorney Armento thought it would be appropriate to meet and confer with the various employee groups in order to avoid any kind of labor relations problems. Councilwoman Teglia stated that it was a matter of simply meeting with them, but in fact it was not necessary to have their concurrence. She stated that there were employee situations that were sen- sitive, and agreed that it should apply to the Planning Commission, as well as some other Commissions. Councilman Penna questioned if it was necessary to confer also with the Boards and Commissions. Mayor Drago thought that because they were appointed officials they should be included. Councilman Penna expressed his questions: which items were and were not part of the Handbook; he had problems with the language, "Councilmembers shall not make investments nor maintain any interest in enterprises, activities or entities which they have or ought to have reason to believe may be involved in decisions to be made by them." City Attorney Armento stated that if there is something that a Councilmember 12/19/90 Page 2 AGENDA Conflicts of Interest - Continued. ACTION TAKEN did not have an investment or an interest in, and it is known that that activity or that development is going to be coming before the Council and is going to need to have decisions made or recommendations made, then the statement is saying that the Councilmember should not make an investment in - get involved in something that the Councilmember knows is going to be coming before the City Council and is going to need to have decisions made or recommendations made, then this statement is saying that Councilmember should not make an investment in something or get involved in something that the Councilmember knows is going to be coming before the Council. Councilman Haffey referred to it as something like insider information. Councilman Penna questioned how this was different from what was already in the Political Reform Act for all Councilmembers to follow. City Attorney Armento stated that it was presumed that people have various invest- ments and are involved in various activi- ties to the extent that you have an existing investment and there was occa- sion for that to come before the Council. She stated that the FPPC requires that you disclose that, and that you not par- ticipate and this document was saying that if there is something out there that you are not currently involved in and there is a clear indication that matter is going to come before the Council it is saying you should not at that point go out and become involved, invest in it or develop an entanglement you did not have previously. She stated that the FPPC rulings would preclude someone from participating if in fact they have made an investment or are involved - what this is saying is if you don't have a previous entanglement you should not when there is a clear indica- tion that the item is going to be coming 12/19/90 Page 3 Conflicts of Interest - Continued. before the Council - go ahead and create an entanglement that didn't previously exist. Councilman Penna felt there was not a distinction, and was trying to legally understand the framework this was working under. Discussion followed: penalties for violations; whether it was provided for in the Government Code; if it was in the Handbook then the Council could hold a hearing and impose measures; if the Handbook did not go beyond State Law, then just use the FPPC; that this docu- ment was to go beyond the technicality of law; concern over whose interpretation it would be left up to; when one had reasonable knowledge that something was going to come before the Council, then that person should not go out and invest in that activity; whereas with the FPPC it presumes that you have that investment and when the item comes before you, you disqualify yourself and step aside; Councilman Penna felt that this document allows a situation to become a political football and it would have finger point- ing; there should be some very clear understandings on what was being adopted - otherwise the subject was mute; he felt a subcommittee and the Attorney should deal with the matter; Vice Mayor Nicolopulos felt that the FPPC covered the items within the document, and this document responded to Council concerns over other conflicts of interest and ethical questions for which there are no statutes - then Council ethics could be established and she had gleaned provi- sions from the League of Calif. Cities to complete the document; in prior conver- sations with the Council they had indi- cated they were concerned about situations with the appearance of a conflict and how citizens would react to the integrity of the Council and indivi- dual Councilmembers; there had been con- cern about Councilmembers obtaining information in an official capacity and 12/19/90 Page 4 AGENDA Conflicts of Interest - Continued. ACTION TAKEN using it for personal gain; Vice Mayor Nicolopulos felt that in reading the FPPC advice letters on potential conflicts there were gray areas that they were not even sure of answering, and they could be contested; that the document was going beyond the Political Reform Act into true ethnics because politicians were in the lowest esteem in the public's mind; the Council could set any rules as long as they did not conflict with existing law; Vice Mayor Nicolopulos felt the document was open to debate and was an assumption; Mayor Drago stated that was correct, and if three members of Council felt someone was doing something unethical - the Council had a right to do what they wan- ted; Councilman Penna felt that the docu- ment should be clearly understood before it was adopted; he was also concerned that if someone was involved in an enterprise, that would come before this Council and they must devoid themselves of that enterprise or the Council could start to play political games and start pointing fingers at that person for being involved in private enterprise and cen- sure him -- which he did not feel was right; that the words "remove any interest" was a good start, but needed definition; if this were to come in he would not be able to serve on this Council - he would have to resign, as would anyone else in his position in private industry; the phrase could be removed, "nor maintain any interest", etc. Councilwoman Teglia related that if a person had property or an investment, and something came forward to Council - the member would step down and not vote, but no one expected the Councilmember to divest himself of the investment. She was concerned over its being deep sixed after she had brought it up in August when she had wanted it discussed in public, and it had been put off to a study session list. She stated that she wanted dropped, "nor maintain any interests." 12/19/90 Page 5 AGENDA ACTION TAKEN Conflicts of Interest - Continued. Vice Mayor Nicolopulos felt that the sta- tement, "which they have or ought to have reason," was very arbitrary for whom- ever wanted to interpret the words. He stated that the City Attorney had said that phrase was used in the Political Reform Act. Councilman Haffey did not have problems with the language proposed, and felt that it was something the Council had been proposing for quite some time. He stated that he did not mind the fact that Council was more restrictive as long as we are not in conflict with the FPPC or the Political Reform Act, because it was important for the City to have a strong code of ethics and a strong statement about conflict of interests and the language was totally appropriate. He stated that recently, only in closed session, his own conflict of interest had been brought to the Council's attention, and the current code of ethics in the handbook indicated that Councilmembers unsure of potential conflicts were encouraged to discuss such issues with the City Attorney. He stated that he had done so because he had had a Councilmember indicate to the rest of the Council that maybe he might have a conflict of interest because he was employed by another Agency. He stated that a written opinion had been rendered by the City Attorney, and he wanted that submitted to the City Clerk to be incor- porated into the record (a copy is attached and a permanent part of the minutes of this meeting). Discussion continued: whether the Council wanted to extend this document to Boards, Commissions, and employees, then another document would need to be written in that this document only addressed the Council Handbook; City Attorney suggested revising the ought language to read, "Councilmembers should not make invest- ments in enterprises, activities or enti- ties which they know or have reason to believe may be involved in decisions or 12/19/90 Page 6 DATE: TO: SUBJECT: FROM: CITY OF SOUTH SAN FRANCISCO INTER-OFFICE MEMORANDUM December 18, 1990 Councilmember Haffey Conflict of Interest Inquiry City Attorney You have asked for an opinion on the recurring question as to whether or not your employment by the City of Belmont, normally as its Assistant City Manager and currently as its Acting Police Chief, results in a conflict of interest requiring you to abstain from various matters which come before the South San Francisco City Council. Government Code Section 87100 provides 'No public official at any level of state or local government shall make, participate in making or in any way attempt to use his official position to influence a governmental decision in which he knows or has reason to know he has a financial interest.' Section 87103 then goes on to define what constitutes a financial interest. Regulations have been promulgated by the 'Fair Political Practices Commission which expand upon the statutory provisions. Regulation 18702.1 deals with material financial effect when an official's economic interest is directly involved in the decision. The regulation states that the effect of a decision is material if, using certain mandatory thresholds, the decision involves (1) a source of income or gifts, (2) an investment in a business entity, (3) an interest in real property, or {4} the official or the official's immediate family. Importantly, the regulation goes on to identify some exceptions, one of which is: 'An official does not have to disqualify himself or herself from a governmental decision if: {1) The decision only affects the salary, per diem, or reimbursement for expenses the official or his or her spouse receives from a state or local government agency.' The fact that you are employed by another public entity and receive a salary from that entity does not pose a conflict of interest on any matter coming before you as a councilmember in South San Francisco. I am not aware of any dealings between South San Francisco and Belmont which might give rise to a possible conflict of interest. The Political Reform Act prohibits public officials from involvement in governmental decisions which affect their private financial interests. Several advice letters have been issued by the FPPC on this general topic. All of these have concluded the Political Reform Act does not require abstention due to a conflict of interest. A summary of such advice letters follows. 12-19-90 Page 6a Councilmember Haffey December 18, 1990 Page 2 Darcy Advice Letter 1-87-296 An individual who simultaneously holds the position of councilmember and aide to a county supervisor does not have a conflict of interest under the Political Reform Act. Brandt Advice Letter A-87-298 Under the Political Reform Act a councilmember has no conflict of interest because of his employment as the deputy city engineer of a water district which is a public agency. Watson Advice Letter 1-88-222 A councilmember who serves as a deputy sheriff is not prohibited by the Act from participating in decisions affecting the sheriff's department. Boomer Advice Letter 1-88-291 The Political Reform Act does not prohibit a county sheriff from serving simultaneously on a city council in the same county. Salary from a government agency does not create a private economic interest. Kuyper Advice Letter A-88-348 A member of a board of retirement may participate in decisions affecting his or her retirement benefits received upon retirement from a state or local government agency. Singley Advice Letter A-89-083 A councilmember who is also an employee of the sheriff's department may participate in contract negotiations between the city and the sheriff's department for law enforcement services. VALERI£ J. ARMENTO City Attorney VJA/jh cc: City Council City Manager 12-19-90 Page 6b Conflicts of Interest - Continued. recommendations to be made by them;" Vice Mayor Nicolopulos felt allegations should not be construed as a fact, even though there were times where this was true -- which bothered him; City Attorney Armento stated that was why there was a substantial evidence standard; Vice Mayor Nicolopulos stated that was again in the eye of the beholder unless it was brought to some area where it was appealed; Councilman Haffey reiterated that in his opinion the language was more than suffi- cient, and he could support it as it stood; Councilman Penna was concerned that because he was a member of private industry whereas the rest of the Council was from the public sector and their ear- nings were exempt; he felt the statement, "Councilmembers shall not make invest- ments in enterprises, activities or enti- ties which they know or have reason to believe may be involved in decisions or recommendations to be made by them", was prejudicial because it did not consider where everyone in private enterprise or private employment was coming from; he hypothesized that if a Councilmember was a labor negotiator for union contracts for another City and negotiated contracts as a Councilman -- there was not a conflict of interest, yet if they worked for a private enterprise they would have a conflict of interest and would not be able to serve in that position; he felt that the crux of the matter was financial gain, and the FPPC feels there is no pro- fit if you are an employee of a govern- mental agency; he felt it was the same as the problem with redevelopment because he is a realtor, and owned his own office - and he did not agree with the ruling that came in and hoped to do more clarifica- tions on it; he had a problem as a Broker in voting on formation of an agency because it was assumed by the FPPC that the commission that he would earn if he were to bring a client to a redevelopment agency project, which had been formed in order to get a higher evaluation, and either sell or lease the property and because of the higher valuation his com- 12/19/90 Page 7 AGENDA ACTION TAKEN Conflicts of Interest - Continued. mission would exceed the $250 limit they place on an annual basis, and therefor assume he is ineligible to vote because he is going to gain by it -- which he felt was not the case; in his opinion there was a prejudice in the way this entire document had been drawn, and not enough thought on how it affects Boards,. Commissions, and employees that have other interests outside of the City -- it should be fair and across the board; Councilman Haffey restated that his deci- sions as a Councilman did not affect his personal income, but Councilman Penna had a business wherein decisions made by this Body or the Planning Commission could affect his income and was a conflict of interest; Councilman Penna felt that it was true in Councilman Haffey's case also, but he could be setting department head salaries here knowing that the City he worked for used S.S.F. salaries as their benchmark city which would directly affect his salary; Councilman Haffey stated that an allegation was just made which was incorrect, the City he worked for was half the size of S.S.F. and did not have the resources to compare with this City, and felt Councilman Penna was way out of line; Councilman Penna stated that if he was told that he as a real estate agent would be in conflict as a Councilman every time he voted, he would resign from the Council; he again voiced concern over the paragraph in question; City Attorney Armento stated that there was nothing in the paragraph that pre- vented a private citizen investing in a development with the expectation that the development would be coming before the Council, in which case the paragraph says it is improper for him to make the investment knowing that item was coming before the Council; and felt the repeated statements that public employees are exempt was not accurate - the FPPC states that the salary is not considered to be a financial interest; Councilman Penna related that the Political Reform Act does not forbid someone from making investments - but say if you are going to 12/19/90 Page 8 AGENDA ACTION TAKEN ~1. Conflicts of Interest - Continued. 'Councilman Haffey Left the Podium: 2. South San Francisco Local Economy. make an investment, then you should disclose that fact and abstain from the vote, which is the proper way to handle it; Councilwoman Teglia wanted to see the item agendized; Councilman Penna wanted to wait until after a new City Attorney was hired and discuss it at a study session to see what the Council was trying to accomplish; City Attorney Armento wanted direction on any other provisions the Council had problems with; Vice Mayor Nicolopulos also had a problem with the interpretation of allegations as facts; Councilman Haffey again reiterated his support of the proposed language; Mayor Drago stated that it would be agen- dized; Councilman Penna had a problem with each section of the document in relation to the framework which would be dealt with by Government Code Sections 1090 and 87100; Mayor Drago stated that he and Councilman Penna would be inter- viewing for an interim attorney on Friday, and expected to hire by January 2nd; he directed the City Manager to agendize it for 1/23/91. Councilman Haffey left the meeting at 8:48 p.m. City Manager Armas stated that the remainder of the agenda stemmed either from objectives staff outlined in the budget or as a result of inquiries imposed during the budget session. Director of Finance Margolis introduced representatives Alan Charkow and John Austin from Municipal Resources Consultants. She stated that they did the City's sales tax audit and provided analytical information on sales tax. Mr. Alan Charkow explained in detail: where the bulk of sales tax came from the business to business sector; that the top ten firms in the City generated 29% of the sales tax revenue; that the top 50 generated 55%; and the top 100 firms generated 70% of that revenue; the impor- tance of relationships with the top reve- 12/19/90 Page 9 AGENDA ACTION TAKEN South San Francisco Local Economy - Continued. nue generators; business relocation; objective to retain marketing branch of a business to retain the sales tax; a decline in the transportation area, such as in new car and oil sales in the past five years, etc. Mayor Drago questioned if studies had been made on why firms leave a City, and what incentives can be offered to keep the businesses. Mr. John Austin stated that it was a trend happening to urban cities throughout California because of the high cost of land, housing, environmental regulations, traffic congestion, and com- mutes. He stated that through a pro active business retention program - if the City has a dialogue going with these folks to the effect that even with these problems - the business is here. He stated that 80% of the manufacturers had located outside of California, and that today with the technical type of selling that is going on: businesses need support from the corporate level -- meaning they have to be near a major air- port; and 2) they want offices very close to freeway networks. He elaborated on South San Francisco's assets for busi- nesses: airport, highways; not having an onerous business license tax like San Francisco, etc. He stated that since Proposition 13 cities have been battling revenue short- fall, and have been using short term fixes to get through the budget year. He stated that as cities become more depen- dent on their discretionary revenue sour- ces they have come to realize they have to be prepared in the future to fund their services from the revenues generated by their own economic base as opposed to living off what they get from the State or the Feds. He stated that the business community is not adverse to different types of tax 12/19/90 Page 10 AGENDA ACTION TAKEN South San Francisco Local Economy - Continued. -3. Paid and Unpaid Leave/Overtime. structures if they understand the busi- ness plan that underlies this rather than last minute quick fix answers, like doubling business license fees. He stated that there had to be credibility based on a good business plan that is based on a factual understanding of what the local economy is, and the tax revenue system is equitable. Discussion followed: that it boiled down to an effective dialogue between the City and the business community; getting the business community to take an active interest in the City; incentives; propo- sals for business retention in the staff report; City should indicate a willingness to work with businesses; target when the City's efforts are going to pay off; Vice Mayor Nicolopulos spoke of a Forbes magazine article on Bridgeport, Conn. on the transition from blue collar worker to white collar, and the success story of three family busi- nesses; envisioning an industry row on Harbor Road and the Haskins properties; negotiating with warehouses to bring their marketing operations to the same sites so the City can get a 1% sales tax revenue; lack of land available for Price Club type operations; that our eco- nomy was quite diverse, and it should be promoted, etc. Mayor Drago requested that staff prepare a ten minute presentation for the public at a meeting in January to alert the public on sales tax. He commented on the excellence of the report prepared by staff. Vice Mayor Nicolopulos suggested attracting businesses from Europe. M/S Penna/Nicolopulos - To accept the report. Carried by unanimous voice vote. Vice Mayor Nicolopulos stated that his focus had been to make everyone aware of 12/19/90 Page 11 AGENDA ACTION TAKEN ' Paid and Unpaid Leave/Overtime - Continued. the ramifications, and if there was money to handle the overtime he was all for it if it was justified. Discussion followed: that the average hours of leave used by the Park Dept. had started this; that it was important that the Police and Fire leaves were covered; that the Park people should be better scheduled or more people should be hired; that the Park people were the least productive in time than any depart- ment; Vice Mayor Nicolopulos wanted quality work and felt there wasn't enough manpower or there was too much park work; it needed control and accountability; Mayor Dra9o questioned how much overtime it would take to maintain the number of men; important to know that the men were administered properly; Mayor Drago felt that everyone worked 100%, but there was more work than the amount of people the City has - but he is not satisfied with what is going on in the City; Councilwoman Teglia thought there was a need for better supervision in main- tenance, and the Council had given direc- tion in that regard; and when the Council felt the supervision reached a higher level - then look at a need for addi- tional people and additional money for overtime after the provision problem was solved; Councilman Penna questioned why a productivity schedule had not been done as requested to shed light on the low productivity in the parks which could be compared to private industry; he felt the schedule would show that the City paid their employees better wages than private industry - who produced more than the government level for the salary paid; he felt that gardeners should be put on more than one or two park areas; he wanted to see a higher productivity schedule than he was seeing now; Councilwoman Teglia spoke of a walking tour of areas showing wear and tear with blighted public areas; she stated that one area was well main- tained which she thought was privately maintained, while across the street was City maintained property that looked bad; 12/19/90 Page 12 me Paid and Unpaid Leave/Overtime - Continued. Closed Session for the purpose of the discussion of personnel matters, labor relations and litigation. ACTION TAKEN she had found that both were maintained by the City by different workers, and she questioned the standards used by the parks; she questioned how the good park worker could, be rewarded, and a fire be lit under the other worker; Mayor Drago questioned why the people were off the job - why were certain depts, high in use of certain leaves when others were not; he felt the Police Dept. must be doing something right because their leave hours were low at 0.9; why couldn't depts, have a standard of how much work an employee could do in a particular position in a given period of time; vacations should be better scheduled; leaves were outlined in individual MOUs; Depts. should have sick leave controls, and there should be a citywide policy that should a person go beyond an average of sick days, 5 or 6 days, they would need proof of absence as a means to try and lower the figures; have better vacation scheduling; moni- toring sick leave usage; that some employees feel that they earned the 12 sick days a year, rather than it being a privilege not a right; Director of Parks & Rec. stated that his Dept. had longe- vity of accrued vacation which these people are not taking all of, and there are surpluses which drive the numbers up and makes fewer hours available for productivity; that with the exception of two employees, all the park employees have 4 to 8 sites they currently have to manage, as well as the overload from vacations; he acknowledged that super- vision was another key that needed to be worked on. Council chose not to hold a Closed Session. M/S Teglia/Nicolopulos - To adjourn the meeting to Wednesday, 1/2/91, at 6:00 p.m., City Council Conference Room, City Hall, 400 Grand Ave., for the review and discussion of desirable City Attorney qualifications. Carried by unanimous voice vote. 12/19/90 Page 13 AGENDA ACT]~ON TAKEN --'ADJOURNMENT: Time of adjournment was 9:30 p.m. RESPECTFULLY SUBMITTED, Barbara A. Battaya, City C~k City of South San Francisct~ ~)~a~i agio, ~M~ayor ~ of South San Francisco The entries of this Council meeting show the action taken by the City Council to dispose of an item. Oral communications, arguments, and comments are recorded on tape. The tape and documents related to the items are on file in the Office of the City Clerk and are available for inspection, review and copying. 12/19/90 Page 14