Downey to Foot Stiff Bill for Losing Redevelopment Suit

A judge has decided that a City Council member’s conflict of interest will cost taxpayers $218,221.

Los Angeles Superior Court Judge Norman Dowds has awarded that sum to a group of property owners who successfully sued the city over plans to create a 380-acre redevelopment district along Firestone Boulevard.

In September, the judge invalidated the proposed district, ruling that Councilman James Santangelo, who cast the deciding vote in adopting the plan, had a conflict of interest because he owned property in the proposed district. The judge also found that the city did not follow state law that calls for selecting a committee of residents to review redevelopment plans.

Reform Act Cited

In awarding the money late last month, the judge cited a section of the California Political Reform Act of 1974 that allows reasonable attorney fees when an official conflict of interest is found by the courts.

The lawyers’ fees for the residents’ group were actually only $145,481, but the group requested an award of four times their costs, or $581,924, under a state law that allows greater awards for cases that serve a broad political interest. The judge, however, awarded 150% of the resident group’s legal fees without giving any explanation for the ruling, said lawyers for both the city and the residents’ group. The city had said in court that it was willing to pay court costs of only $79,000.

City Council members have not yet decided whether to appeal the invalidation of the redevelopment district or the award of attorneys’ fees.

Of the money, which city officials said would come out of reserve funds in the city’s 1985-86 budget, $170,416 will go to Downey CARES, a group of property owners, and a total of $47,805 to two property owners who joined the suit. The property owners are Jerry Andrews, who will receive $36,930, and Wilbur Logan, who will receive $10,875.

‘Absolutely Amazed’

He (the judge) laid it on a conflict when I don’t have one,” said Santangelo. The council member claimed he did not stand to profit by the creation of a redevelopment district because he planned to develop his land with his own money, rather than use a special fund of property tax money usually set aside for redevelopment.

When the city approved the redevelopment district, Santangelo owned property in the proposed district on South Downey Avenue that was subsequently sold. Santangelo also owns five parcels totaling 1 1/2 acres in a city redevelopment district set up in 1978. According to city ordinances, both the new and old districts would share property tax revenues set aside for redevelopment.

Santangelo, as he has in the past, blamed City Atty. Carl Newton and former City Manager Bud Ovrom for bad legal advice. Santangelo said both men were aware of his property holdings when he cast the deciding vote in a 3-2 vote July 10, 1984, just seven days after he took office as a council member.

Council’s Critical Mistake

Ovrom said previously that it was up to the city attorney to advise Santangelo. He added that the council’s critical mistake was deciding to go ahead with the lawsuit rather than settle out of court, as proposed by the residents’ group.

One council member, Robert Cormack, said he favored appealing the judge’s decisions while Santangelo and Diane Boggs declined comment.

‘Miscarriage of Justice’

“I think it’s a total miscarriage of justice,” Cormack said, adding that the president of Downey CARES, Paul Sarvis, is “an individual who cares nothing whatsoever about Downey.”

“He (Sarvis) has set out to agitate people who we are trying to work with and help, and he was successful because of a couple of little minor hitches.”

Sarvis said that the city lost in court because council members pursued a “personal vendetta at the expense of city interests.”

He added that he would refund some of the money to the 30 members of his group, but that the remainder would be saved in case the city attempts to again redevelop land along Firestone--which the group opposes as unnecessary. The city is studying such a proposal.

Besides paying for Downey CARES’ legal costs, the city also has run up more than $150,000 of its own legal bills in fighting the redevelopment lawsuit, city officials said.