Is Council Moving Into a Gray Area by Closing Doors? : Some Believe Its Private Meetings Violate the Law

San Diego City Council members, meeting in closed session to discuss strategy for upcoming legal battles, have in the past four months made several major decisions in private.

According to several legal experts contacted by The Times, those actions raise troubling questions about the degree to which the council is formulating public policy out of view of the public.

In some cases, those meetings may not have been legal under strict state laws written to ensure that almost all public policy questions are debated before the public, according to some of the experts.

In recent secret sessions attributed to the need for attorney-client deliberations, the council has canceled the Air/Space America show and reviewed cost estimates for its multibillion-dollar sewage-treatment project.

The council also refuses to reveal how it will spend $500,000 in public funds appropriated--in closed session--to thwart the merger of San Diego Gas & Electric and Southern California Edison companies. That closed session was one of seven held on the merger during the past four months.

Assistant City Atty. Ron Johnson, who approves the council’s closed-session agendas, defended the discussions on the grounds that each one was directly related to council strategy sessions regarding “pending” or “potential” litigation--an exemption to open meeting laws authorized in state law.

‘Raises Our Eyebrows’

Johnson and others also noted that in some instances the results of the private discussions were quickly released to the public or were leaked to a newspaper.

But Mark Nelson, executive director of the San Diego Taxpayers Assn., said that “it concerns me if the interpretation (of the law) errs on the side of closing the door instead of opening the door. That’s where it raises our eyebrows.”

Nelson, who attended an April 12 public session of council’s Rules Committee devoted to the merger, said that he believes the council owes the public an explanation of why so much of the discussion was postponed for later, private deliberation.

“I never really got a sense of what was going to be discussed and why it should be protected by pending or potential litigation,” he said.

Three open-meeting experts contacted by the Times said that some or all of the council actions may have exceeded limits on closed sessions imposed by 1987 amendments to the state’s open-meeting laws and pending litigation exemptions in the state’s public records act. The open-meeting laws allow private attorney-client deliberations only if public debate would hurt the council’s position in an upcoming legal battle.

In addition, the experts said, the law requires a strict separation of legal strategizing and public policy making. While the council may discuss legal maneuvers in private, it must halt its deliberations and return to an open forum to discuss public policy, they said.

“The pending litigation exception is probably the single most used way that organizations generally try to get around the Brown Act,” which is the state’s freedom of information legislation, said John Allcock, a San Diego attorney who frequently represents newspapers in right-to-know cases.

“You’re not allowed to go into closed session simply because your attorney wants to discuss a legal matter with you,” said Robert Fellmeth, director of the Center for Public Interest Law at the University of San Diego Law School, who helped author the 1987 open-meeting law amendments.

Because the new amendments took effect just last year, they have not been directly tested in court and are open to interpretation by attorneys advising municipalities. Nevertheless, at least one city council member is concerned that the council has on occasion exceeded its authority and believes some of the decisions should have been made in public.

“The conversation starts in legitimate fashion and then it crosses over (the line) almost without anybody’s consciousness,” said the council member, who insisted on anonymity in discussing closed-session items. “I think the lawyers ought to jump in there.”

Council Careful, Mayor Says

But Mayor Maureen O’Connor said that in private sessions the council is “very careful” not to stray into policy questions that should be discussed publicly. “The attorneys sit in there and they advise us. We’re very careful about what we say,” O’Connor said.

Johnson explained that much of the discussion of the items in question centers on frank legal advice that he and other attorneys offer the council, including the weaknesses of the city’s own arguments and the strengths of their opponents’ cases. To debate such subjects in public would put the city at a distinct disadvantage, he said.

Councilman Ron Roberts said that the closed sessions are necessary because large sums of taxpayer money could be jeopardized if the council follows a losing legal strategy.

“The implications for the taxpayers of this city are tremendous,” Roberts said.

The council has been accused of running afoul of the Brown Act more than once in the past decade. In 1979, a Superior Court judge ruled that six council members had reached an illegal collective decision in private when they signed a memo urging City Manager Ray Blair to reverse a council decision.

In 1986, the Tribune newspaper sued the council alleging that it had reached a consensus on the 1986-87 budget in private and then held a “sham” public meeting to approve the $644-million spending blueprint.

This year, the council may have strayed over the open-meeting boundaries in its Feb. 7 closed session vote to revoke Air/Space America’s permit to host a 1990 aerial extravaganza at Brown Field and to withdraw $300,000 in city support for the show. The council went into closed session to discuss legal claims against the city from contractors who were not paid when the 1988 Air/Space America show ran more than $4.2 million in debt.

Pressured for a decision on the 1990 show but lacking confidence in Air/Space America’s management, the council voted to cancel the show. Councilman Bruce Henderson announced the decision at a council committee meeting the next day.

Johnson, the city’s attorney, noted that the discussion concerned the possibility that the subcontractors might try to obtain some of the $300,000 payment. He said the cancellation was an outgrowth of those talks.

Step Over the Line?

The council “could have stopped . . . and gone back into open session and, without discussing the other aspects of the other decision, made a decision to cancel the whole thing,” Johnson conceded.

“Once in a while, it gets a little close (to the line),” he added. “This may be one example when it did get a little close. But I don’t think it stepped over it.”

However, Terry Francke, counsel to the California Newspaper Publishers Assn., believes that the council overstepped its bounds by allowing its discussion to continue to the point of a decision to cancel the show.

“The issue is not what might be relevant to some kind of existing or threatened litigation, but what, if discussed publicly, would be prejudicial to the agency’s position,” he said. “I don’t see why (the cancellation discussion) would be (prejudicial).”

Fellmeth, noting that the council publicly decided to schedule the air show, said that “a public matter decided in public should not then be reversed by a private meeting simply because there may be litigation involved.”

A reconsideration of the cancellation, held April 10, was conducted publicly. Another public session is scheduled for today.

On Feb 21, and again on March 20, the council received presentations from city staff members on the estimated cost of its massive project to upgrade its sewage treatment system. The price of the upgrade, estimated at $2.4 billion to $4.2 billion, makes the plan the biggest single public works project in city history. Sewer bills are expected to double as a result.

The cost estimates were published by The Times on Feb. 23, but they were not formally released to the public until March 23.

Discussion Called Valid

Johnson, Roberts and O’Connor said that the discussion was justified as part of the council’s settlement negotiations with the U.S. Environmental Protection Agency, the U.S. Justice Department and the Regional Water Quality Control Board, all of which sued the city last July to force the sewage treatment upgrade.

The major issues in the legal battle are the EPA’s insistence that the city install the system earlier than the city believes is possible and how the project will be funded. Johnson said that the council could not discuss construction timing without discussing prices.

“We are negotiating with the federal government,” Roberts said. “We’re negotiating over the costs and we’re negotiating over the timing.”

Fellmeth said that the key question in this issue is the focus of the council discussions--how much time was devoted to prices instead of legal tactics. Of course, the public and media have no access to that information because the sessions were held privately.

“I think they might have a problem if (price) is the focus of the discussion,” he said. “The focus of the discussion has to be legal tactics, offers--something that if disclosed would prejudice their position.”

Fellmeth also said that the subsequent public disclosure of the prices weakens the city argument that it was necessary to initially hold a closed-door meeting.

Johnson, the city’s attorney, also defended the closed-door discussions on the grounds that no final decisions were made and that the price estimates were in “draft” form. But Francke said that the Brown and Public Records acts offer no protections on those grounds.

SDG&E; Discussions

Since Dec. 12, the council has held seven closed-door discussions on its strategy for thwarting the SDG&E-SCE; merger. The council and its private attorneys will be active in regulatory proceedings before the state Public Utilities Commission, the federal Securities and Exchange Commission and the Federal Energy Regulatory Commission.

In a March 7 private session, the council voted to spend $500,000 “for the purpose of defraying expenses in matters related to the SCE-SDG&E; proposed merger.” Though it immediately disclosed the vote, the council refuses to itemize how the money will be spent, on the grounds that such information would give SDG&E; an advantage in the legal proceedings.

“If SDG&E; knows my budget for outside help on this is $100,000, then by sitting down and looking at the case, they know whether I can do a Cadillac job, or a Chevy job or a pushcart job,” said Johnson.

Michael Shames, executive director of the Utility Consumers Action Network and an ally of the city’s in the merger battle, agreed with Johnson.

“Frankly, I think at this point they’d be ill-advised to do it because they’d tip their hand to SDG&E;,” Shames said.

Even Fellmeth said that the city may be justified in concealing the details of the spending because revealing them might have a “tactical consequence,” but added that the city must reveal the precise expenditures once the money is spent.

But Francke was highly critical of the decision, which he said violates the public’s right to know how its tax dollars are being spent.

‘Information-Control Mentality’

“That’s an example of the kind of information-control mentality that can take over when you have people who are persuaded that secrecy is the answer to everything,” Francke said.

“The adversary assumes that you will spend what it takes to win in a case that you can’t afford to lose,” he said. “It’s just absurd to keep the wraps on that kind of expenditure commitment.”

And Nelson, of the taxpayers’ association, said that “to the extent they’re pulling money from the General Fund for an issue that is as visible as the merger and municipalization is, all efforts should be made to explain where this money is being spent.”

Johnson said that he would disclose how the funds are being spent when payments are made to lawyers, expert witnesses or others.

SDG&E; officials declined to comment on the city decision. Steve Wall, a private attorney hired by SDG&E; to oppose the County Water Authority’s plan to study a government takeover of the utility, said that the city decision leaves him with less information than he would like.

“All you’ve got is a number. You don’t know what it’s for. I don’t know if . . . it’s going to be paid over to the water authority for the municipalization. There’s no agenda item documents. There’s no staff report. There’s nothing.”

O’Connor, who has become increasingly antagonistic toward the two utilities, had little sympathy for that line of argument.

“The taxpayers know a lot more of what we’re doing than the ratepayers know about what (SCEcorp chairman) Howard Allen is doing with their money,” she said. “They can make their decisions in private and threaten lawsuits all over the place.”