Government Cover-up of $687,500 Mistake

A City that can’t openly admit mistakes to citizens is doomed to repeat them, as the mounting evidence from the City of Lake Elsinore demonstrates. At the November 10, 2015 City Council meeting the Councilmembers took action to approve a Communications Site Lease Agreement (Item #8). Shortly thereafter, a substantial error in the content of the agreement was made known to City Manager Grant Yates through a published news article (see weblink below).

http://patch.com/california/lakeelsinore-wildomar/city-manager-yates-approves-687500-giveaway-verizon

The apparent errors occurred in stating the wrong “Annual Rent” amount under section 4.(a). The Annual Rent should’ve been $30,000 instead of $2,500 per year. Pictured above is the excerpt from section 4 and the full agreement is available at the weblink below.

http://lake-elsinore.legistar.com/gateway.aspx?M=F&ID=1da45d0d-fbf1-4127-87ae-b0fc5480aeef.pdf

This error represents a substantial difference in the Annual Rent amount, which equals $687,500 over the life of the agreement. This error was not a typographical error, as evident by the dollar figure being written in both words and numerals. Furthermore, under section 4.(b) future increases in the Annual Rent are calculated twice more based upon the $2,500 per year figure. Given the multiple locations of the errors it’s obvious that this wasn’t a typo caused by fat fingers. Given the wrong Annual Rent amount was clearly written into the document, it looks more like the City Attorney’s office butt dialed in the agreement to City Hall.

To err is human, so a single error by an individual is forgivable. One of the most troubling aspects of this situation is the failure of the checks & balances that are supposed to be in place at City Hall to prevent such costly errors from ever being approved by our elected City Councilmembers at a public meeting. City Attorney Barbara Liebold, Finance Director Jason Simpson and finally, City Manager Grant Yates are all responsible for reading and approving this flawed agreement prior to posting on the City Council’s agenda. Evidently, all three Officers of the City were asleep at the switch and this it isn’t the first or second or third time in recent history.

City Manager Grant Yates and City Attorney Barbara Leibold are ultimately responsible for this costly mistake; therefore they’re also responsible for correcting the error. The proper governmental process to correct the error after the City Council approved the flawed agreement is to re-agendize a new corrected agreement for reconsideration by the City Council at an open public meeting.

In a recent letter from City Clerk Domen, she writes…in consultation with the City Attorney’s office, the mistake was a result of a “typographical error”. Ha! That explanation doesn’t even pass the giggle test, let alone a legal test. Doesn’t anyone at City Hall own a dictionary? If so, lookup the definition of a typographical error and apply it to the clearly written text and numerals regarding the Annual Rent in the agreement. The problem with the Annual Rent figure isn’t the typing, it’s the content.

Based on the twisted legal logic of a “typo”, the City Attorney, City Clerk and City Manager intend to re-write the most important deal point in the agreement and execute the agreement without the City Council’s approval at an open public meeting. If City Management doesn’t think it needs the City Council’s approval on the most crucial deal point (Annual Rent) in the lease, then why did they present this agreement to the Council in the first place? Perhaps it’s because the power to approve such an agreement is vested solely in the City Council per the California Government Code. So, it follows that any substantive changes to the agreement must also be considered by the City Council.

The “City Attorney is authorized to make minor modifications to agreements as to form” and this legal stipulation is routinely written into most City Staff Report (this applies to all cities) in the recommendations section to the City Council, but City Staff failed to include this stipulation in the Staff Report. As further evidence of the City Attorney’s limited powers to change an agreement after the City Council has approved it, the City Attorney’s signature line in the agreement states “APPROVED AS TO FORM”. Substantive changes to an agreement after the City Council has taken action at a public meeting are unethical and likely illegal.

I strongly support correcting this costly error that was written into the agreement to reflect the higher annual rent of $30,000 per year. The proper remedy to correct this error is simple, just re-agendize this item at the next City Council meeting. If City Manager Grant Yates would’ve done this in the first place, we’d already have a valid agreement.

I understand the embarrassment that certainly will befall City Management and City Councilmembers at a public meeting for making repetitive foolish errors in the processing of this flawed agreement, but it’s better to accept fault and show a little humility rather than compound the error with potential illegality.

When City Management usurps the authority of the City Council it robs all of us of liberty and the deliberative process of open public meetings. It’s critical that substantial errors made by government be exposed and examined by the public. How else are citizens to judge competency of government, if substantive changes to documents occur in the back rooms of City Hall after our elected officials have taken action at an open public meeting?

I think the City Council is heading down a slippery slope to condone substantive changes to agreements being made by City Staff after the Council has taken action, regardless of whether such changes are in favor or against the City’s interest. The legal remedy to correct the flawed agreement at a public City Council meeting is simple, timely and legally proper.

Pat Kilroy (23 year resident)