How Specific Must A Local Legislative Body’s Agenda Be In Order To Comply With The Ralph M. Brown Act?

On October 25, 2016, the California Court of Appeal decided San Diegans for Open Government v. City of Oceanside. At issue was whether the City of Oceanside (“City”) had complied with the Ralph M. Brown Act’s requirements regarding the contents of a local legislative body’s published agenda. (See Government Code § 54954.2, subd. (a).) The appellate court determined that the City had complied, providing a summary of what the Brown Act requires in order for an agenda to withstand such a legal challenge.

The Brown Act requires that the agenda of a regular meeting of a local legislative body (including boards of K-12 and community college districts) be posted 72 hours before the start of the meeting and contain “a brief general description of each item of business to be transacted or discussed at the meeting, including items to be discussed in closed session. A brief general description need not exceed 20 words.” (Government Code § 54954.2, subd. (a).)

Relying on several Court of Appeal decisions, the Court explained that an agenda must give the public more than a mere “clue” as to what a local legislative body intends to do at an upcoming meeting. (Moreno v. City of King (2005) 127 Cal.App.4th 17, 27.) However, a challenge to a local legislative body’s agenda cannot be “hypertechnical” or elevate form over substance. (Castaic Lake Water Agency v. Newhall County Water District (2015) 238 Cal.App.4th 1196, 1207.)

The Court further clarified that the fact that an agenda could have been more informative is not enough to amount to a Brown Act violation: “[T]o date, the Legislature has not required such detail or precision in local agency agendas; rather,…the statute only requires a ‘brief general description,’ which the cases in turn have determined only requires a fair notice of the essential nature of what an agency will consider.” (Relying on Carlson v. Paradise Unified School District (1971) 18 Cal.App.3d 196, 200.) It is “an elastic standard,” and the Brown Act is not violated in instances where “an agenda…was not in any sense confusing, misleading or unfairly opaque.”

Should you have any follow-up questions or comments regarding this case, please feel free to contact either our Southern California office at (714) 573-0900 or our Northern California office at (916) 245-8677.

New Law Imposes Additional Requirements On School Districts That Engage In Financings

Under current law, school districts issuing general obligation bonds, certificates of participation (“COPs”), or other forms of debt must submit timely reports to the California Debt and Investment Advisory Commission (“CDlAC”) of the proposed issuance and final sale.  SB 1029 provides that commencing January 1, 2017, a school district must additionally certify that it has adopted local debt policies in the report of final sale for any financing. The local debt policies must include specified provisions concerning the use of debt and that the contemplated debt issuance is consistent with those local debt policies. SB 1029 will also require local agencies to prepare an annual report for any debt issue for which it has filed a CDIAC report of final sale on or after January 21, 2017.

The local debt policies are to include all of the following:

(a)  The purposes for which the debt proceeds may be used.

(b)  The types of debt that may be issued.

(c)  The relationship of the debt to, and integration with, the issuer’s capital improvement program or budget, if applicable, and

(d)  Policy goals related to the issuer’s planning goals and objectives.

While the issuance of debt can be an appropriate method of financing capital projects, more stringent monitoring of such debt issuance is now required under SB 1029 to preserve a school district’s credit strength and budget and financial flexibility. The SB 1029 policies will assist school districts in determining the appropriate uses for debt financing as well as establishing prudent debt management goals.

New Law Revises Lease-Leaseback Procedures For School Districts

September 30, 2016

Assembly Bill 2316

Assembly Bill 2316 (“AB 2316”) has now been signed into law by the Governor in an effort to address uncertainty in the area of lease-leaseback construction projects.  Previously, the Court of Appeal decisions in Davis v. Fresno Unified School District (2015) 237 Cal.App.4th 261 and McGee v. Balfour Beatty Construction, LLC, et al. (2016) 247 Cal.App.4th 235 (unpublished), raised significant, conflicting questions about the use of the Education Code’s lease-leaseback statutes for school construction. Among other limitations, the Davis Court held that the school district’s lease was not a “true lease” and as such, was not eligible for exemption from competitive bidding requirements. The Davis Court also held that a potential for conflict of interest under Government Code Section 1090 existed in regard to the contractor’s role on the project including pre-construction services.  In the non-binding McGee case, the Court rejected the more stringent Davis finding that competitive bidding was required for a lease-leaseback project.  Nevertheless, McGee agreed with Davis on the potential basis for a conflict of interest.home-589068_1920

In light of the uncertainty created by these and other court decisions, AB 2316 represents an effort by the Legislature to provide clarification. The Bill does so by amending, deleting and adding several additional requirements to the lease-leaseback statutes of Education Code Sections 17400 through 17429. Although some of the issues have now been resolved, others remain unclear.

Contractor Review and Approval Requirements

AB 2316’s revisions to the Education Code will continue to permit school districts to lease property to third parties by way of a contract providing for construction of buildings on the property.  However, under the revisions to Section 17400, any such contract may now be awarded only following a “competitive solicitation process” in an effort to provide “best value to a school district.”  In general, the process will require:

  • The initial drafting, publication and school board approval of procedures and guidelines for evaluating the qualifications of proposers seeking to enter into lease-leaseback contracts.  The procedures and guidelines at a minimum must include:
  1. The use of a Request for Proposal (“RFP”) circulated to “qualified proposers.”
  2. The RFP is to be circulated in accordance with Public Contract Code requirements.
  3. In order to be entitled to respond, proposers must be prequalified under the requirements of the Public Contract Code.
  4. The RFP must identify the criteria a school district will consider in evaluating proposals and determining qualifications of proposers.
  5. School districts must identify the rating system applicable to each criteria.
  • Once the above procedures are established, school districts may seek requests for sealed proposals from qualified contractors that will address the requirements outlined in a school district’s RFP process.
  • Following a school district’s review of responses generated from the process described above, scores are to be assigned to each proposal which shall then be ranked from “highest best value to lowest best value.”  A school board may award the contract to the proposer whose proposal is determined to be the “best value” for the school district.  If the school district is unsuccessful in awarding to the best value proposer, the school district may offer the contract to the second proposer, and then to subsequent proposes in descending order until an award is made, or all proposals are rejected.

AB 2316 also contains provisions addressing the Division of the State Architect (“DSA”) approval process for lease-leaseback.  School districts may now enter into contracts for preconstruction services as long as DSA review is not applicable to those services. In addition, if DSA approval is required for a project and approval is subsequently obtained following award to a successful proposer, an adjustment to the price for the project may be made to accommodate the additional costs associated with any DSA plan changes that occurred during the approval process.

Subcontractors; Contract Invalidation; Financings; Conflict of Interest

AB 2316 further provides more detailed guidance on several subcontractor issues relating to lease-leaseback.  For example, following award of the contract, the successful proposer must meet certain requirements for the selection of subcontractors not identified in the original contract.

The drafters of AB 2316 also addressed the issue of contract invalidation raised by the Davis Court allowing contractors, under certain circumstances, to recover reasonable costs, “excluding profits” for work arising from any contract dated prior to July 1, 2015.  To be eligible, a determination must be made that the invalidation resulted from a court’s determination that the contract failed to comply with competitive bidding laws.

The Davis and McGee decisions also raised questions regarding the feasibility of financings for lease-leaseback projects.  AB 2316 fails to address these issues.  AB 2316 also does not expressly resolve the conflict of interest issues raised by Davis and other cases.  It can be argued that the more comprehensive prequalification and RFP procedures are intended to address those conflict of interest issues.

School districts that continue to use lease-leaseback as a construction method should familiarize themselves with the extensive new requirements of AB 2316 (effective January 1, 2017) in the area of prequalification and the awarding of contracts.  Although some of these procedures are similar to those already in effect and applicable to design-build contracts, there are also several additional elements contained in the new law.

Should you have any follow-up questions or comments on this information, please feel free to contact either our Southern California office at (714) 573-0900 or our Northern California office at (916) 245-8677 or visit our website at www.parkercovert.com.

 

 

Attorney Meghan Covert Russell to present at ‘Yes on Prop 51’ Event

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On Tuesday, October 4th, 2016, Parker & Covert LLP attorney Meghan Covert Russell will be presenting a roundtable discussion on hot topics surrounding athletic facilities, including health and safety issues.

The informational event, including attorneys and architects discussing issues related to school athletic facilities, will precede a Fiesta Fundraiser presented by CASH and AFE Sports in support of Proposition 51.

School district staff are invited to attend the informational discussion, located in Signal Hill, from 4-5:30, with the Fiesta Fundraiser commencing at 5:30.

More information is available at http://www.cashissuesstateschoolbond.com/documents/TacoTuesday0ct04.pdf

Friends of the College v. San Mateo Community College District: A Major CEQA Victory for Districts

 

September 19, 2016

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The California Supreme Court handed down its latest California Environmental Quality Act (CEQA) decision, Friends of the College v. San Mateo Community College District, on September 19, 2016. The decision is a major victory for agencies, including K-12 and community college districts, considering changes to a previously approved project that required environmental review.

Friends of the College arose from changes in the San Mateo Community College District’s 10-year-old plan to modernize its campuses by renovating some existing buildings, constructing new ones, and demolishing others. The District had determined, years before the case arose, that the environmental impacts of the original modernization plan could be mitigated to insignificance and adopted a declaration to that effect, i.e., a mitigated negative declaration (MND). Because of funding issues arising years after the District’s adoption of the MND, the District decided to demolish a building originally slated for renovation and renovate two other buildings initially slated for demolition.

The District concluded that these changes to the original plan would have no greater environmental impact than the original plan itself and that the changes did not require the preparation of a supplemental environmental impact report (EIR), which calls for a public review and comment period. Therefore, the District approved an addendum to the original MND, a process that does not require a public review and comment period.

The trial court and the Court of Appeal held that the changes to the original plan constituted a new project under CEQA. The Supreme Court unanimously overturned this conclusion. The Supreme Court ruled that an agency that proposes changes to a previously approved project that required CEQA review must determine whether the previous environmental document retains any relevance in light of the proposed changes and, if so, whether the changes are substantial and will require major revisions to the previous environmental document due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects. The agency, and not the courts, makes these determinations. The courts’ job is not to weigh conflicting evidence and determine which party has the better argument. Courts are limited to deciding whether an agency’s determination is supported by substantial evidence.

The California Supreme Court unequivocally stated that it expects occasions when a court finds no substantial evidence to support an agency’s decision to proceed under CEQA’s subsequent review provisions – i.e., occasions when a court finds no substantial evidence to support an agency’s decision that the previous environmental document retains some relevance in light of the proposed changes – will be rare. Finally, the Supreme Court found that CEQA establishes a presumption against requiring supplemental review of a previously approved project, whether that approval is based on an EIR or a negative declaration.

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School Districts’ Enforceable Duty to Protect Students Against Bullying

Click here to access Parker & Covert LLP’s legal guidance on the duty of school districts to protect students against bullying following the case of Hector F. v. El Centro Elementary School District, et al.