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Choice on ballot arguments was by the book, Newport city clerk says in response to lawsuit

Choice on ballot arguments was by the book, Newport city clerk says in response to lawsuit
The Newport Beach Civic Center and park opened in 2013 at a cost of about $140 million, including $123 million in certificates of participation, a funding mechanism that is the subject of a local ballot measure in November. (File Photo)

The Newport Beach city clerk says she closely followed state law when she accepted one argument over another against a local ballot proposition on capital financing, leading to a lawsuit by the rejected group.

In her response to the suit filed in Orange County Superior Court last month by a coalition of former Newport Beach City Council members, City Clerk Leilani Brown said she had no room for discretion in the face of a rigid state elections code outlining how ballot arguments should be prioritized for an informational pamphlet the city and the Orange County registrar of voters office will distribute in advance of the November election.

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Former mayors Keith Curry, Rush Hill and Mike Henn and former mayor pro tem Jean Watt want their argument to run in place of one filed by local activist Bob Rush.

“Petitioners would have City Clerk Brown exercise subjective discretion in selecting between the opposition ballot arguments, something the elections code does not authorize her to do,” Brown’s lawyer, Philip Kohn, wrote Tuesday in a reply to the suit.

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The fight started in early July when the former council members wrote a statement for the pamphlet arguing against an as-yet-unnamed measure that will ask voters to approve an amendment to Newport’s city charter. The proposed rule change would require 55% voter approval whenever the City Council wants to spend at least $50 million on capital projects using a financing method known as certificates of participation, or COP.

But Brown selected Rush’s statement, which he had written on behalf of Newporters for Ethical Government, his city-registered “association of citizens,” or political action committee. She said state code gives citizen associations priority over individual voters such as the former council members.

Mayor Marshall “Duffy” Duffield and Councilmen Scott Peotter and Kevin Muldoon wrote the argument supporting the measure.

Rush’s argument states the proposed charter amendment “is a good first step” but doesn’t go far enough.

The group of former council members claimed his statement contains inaccuracies and that flawed organizational paperwork for Newporters for Ethical Government means it isn’t a “bona fide association of citizens.” They also contended Rush isn’t a true opponent of the ballot measure because he had made some approving statements about it and has previously supported Peotter.

In her reply, Brown said the referenced statutes and the content of Rush’s argument “speak for themselves.”

Kohn added that the group’s claims would require discretion that “exceed the scope” of Brown’s role.

The lawsuit is set for a hearing Aug. 17 in Superior Court in Santa Ana. The hearing had been slated for Friday, but it was rescheduled because of a paperwork error in serving the suit.

In a certificates of participation arrangement, the city creates a revenue stream by essentially leasing its own facilities to itself — technically, as a different public facilities corporation — with the facilities offered as collateral to bondholders. When the debt is repaid, the facilities become the agency’s — unencumbered by a lease.

Certificates of participation do not require voter approval like general obligation bonds, which lead to increased local property taxes.

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