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HomeMy WebLinkAbout09-10-1991 (2) City Council Minutes MINUTES SARATOGA CITY COUNCIL TIME: Tuesday, September 10, 1991 - 6:30 p.m. TYPE: Adjourned Regular Meeting/Joint Meeting with Hakone Foundation ' Board and Tract 7770 Task Force Joint Meetinq with Hakone Foundation cultural Center Building, Hakone Gardens, 21000 Big Basin Way 1, Roll Call The meeting was called to order at 6:30 p.m. Councilmembers Anderson, Clevenger, Monia, Stutzman and Mayor Kohler were present. Hakone Foundation Board members present were Ann Marie Burger, Don and Frances Miller, Gladys Armstrong, Helen and Ralph Metcalf, Henry Yamate, Kay Duffy, Sue and Jack Mallory, Fred Peterson, and Charles Escott. 2. Report of City Clerk on Posting of Agenda The City Clerk reported that pursuant to Government Code 54954.2, the agenda for this meeting was properly posted on September 6. The notice of adjournment from the September 4 Council meeting was properly posted on September 5. 3, MONIA/STUTZMANMOVED TO PLACE CLOSED SESSION ITEM ON THE AGENDA RELATING TO THE CURRENT LITIGATION ON THE VILLA MONTALVO CASE, .. Passed 5-0, 4, Discussion of Annual Financial Report Don Miller, President of the Foundation, presented the annual report from the Foundation. The Cultural Center is essentially complete, and money is on hand to finish the remaining interior of the building. Henry Yamate presented the annual financial report. Vice Mayor Monia asked about shortcutting the presentation of the cash flow report. Mr. Yamate replied that at present it is not necessary even though it should be included according to certain accounting standards. As the Foundation becomes more operationally oriented such a report would be more appropriate and can be included in the report next year. Mr. Monia also asked about the reported sale of stock. Mr. Yamate indicated this was a gift which the Foundation has turned into cash. Discussion ensued regarding the rental of facilities after closing being no later than 9:00 p.m. Should the City allow a later closing time? The Cultural Center is open to 10:00 p.m. One of the historical limits is no dancing and no amplified music. Foundation intends to experiment with these changes in operation. Don Miller asked approval 'for four new trustees, Paul Bowlin, Reiko Iwanaga, Jack Hickling, and Jeff Held as shown on page four of the annual report. CLEVENGER/MONIA MOVED TO APPOINT BOWLIN, IWANAGA, HICKLING AND HEID. Passed 5-0. Parkinq or Entrance Charqes to Hakone Garden - The Board is proposing a $3 parking charge for all visitors. Council agreed to have the Foundation continue to pursue this idea. Need for Paid Staff - As organization grows and parking, etc. becomes a reality, paid staff will be required. Need to explore options for handling same, including having the City staff on behalf of the Foundation. Vice Mayor Monia suggested that a staff needs analysis based on future activity levels could help the Foundation look at this issue into the future. Other issues needing attention include handicapped access and facilities, walk for women in high heels so they don't have to walk on City Council Minutes 2 September 10, 1991 gravel. The meeting was adjourned at 7:56 p.m. to the Community Center, 19655 Allendale Avenue. Joint Meetina with Tract 7770 Task Force The meeting was reconvened at 8:15 p.m. Councilmembers Anderson, Clevenger, Monia, Stutzman and Mayor Kohler were present. Committee members present were Harris, Kalb, Macrae, Schwartz, and ex officio member Caldwell. Staff members present were City Manager Peacock, City Attorney Riback, City Engineer Perlin, and Planning Director Emslie. 5. Disoussion Of items of Mutual Interest - Staff Responses to Recommendations by Task Force (Clerk's Note: At the Council's request, a verbatim transcript of Item 5 follows.) Kohler: For the benefit of the public and the record, we are again recording this meeting and we have a lot of requests at the last meeting for the tapes so what we did--we made some extra tapes and we will do that again. So, we will make sure that everything is recorded at the meeting. Welcome back to the meeting, and I got a letter from Don Macrae who is part of the committee and... Don Macrae: Thank you Mr. Mayor. I don't know if my voice will carry for the nice recording but I'm one that doesn't say too much in these meetings and these people are probably better equipped than I; however, at the last meeting, I had some reflections and I hope you'll bear with me. I want to read it to make a (inaudible) and I'm saying here tonight. Dear Mayor and City Council Members: After attending the Council Meeting of Wednesday/September 4, I found myself wondering why I had spent those many nights and days on the citizen's investigative committee for Tract 7770. I had thought that the charge given the conunittee was to investigate and study the circumstances that led to the destruction of the natural environment on Tract 7770 and the neighboring area and to make recommendations on procedural improvements, control, and actions so the City Council and the City Administration might take action to prevent similar occurrences. As I understand the current philosophy and organization of local municipal government, the City Council is elected by the voter citizens to reflect the wishes of the electorate in managing the affairs of the community for the general welfare of its citizens. To this end, the City Council determines policy, passes ordinances and resolutions, appoints commissions and boards, and administrative personnel to carry out these policies and otherwise assist City Council by means of staff work and recommendations. In attempting to carry out our charge and within the limits of our authority and staf~ assistance, we spent many hours studying. documents available to us and interviewing as many persons who would talk to us. We were somewhat limited by lacking subpoena and oath requiring powers and the natural reluctance of some persons to be willing to present information which had helped in conducting this study. At the culmination of our work, we presented a much-detailed report with recommendations which we thought would help the City Council strengthen and improve City policies and procedures and would hopefully prevent the situation similar to that which occurred on Tract 7770 and other areas. When I heard City Council persons strongly defending their actions, City Administration apparently satisfied with its stewardship and the developer through his attorney stating he'd done nothing wrong and would welcome a grand jury investigation. If everything that happened relating to Tract 7770 and other similar areas was quite all right and according to accepted practices, why were citizens outraged and disgusted and the City suing the developer in court? Surely the Council wants to take positive and vigorous action to remedy things that should be corrected and to assure citizens of Saratoga that good City Council Minutes 3 September 10, 1991 policies and safeguards are in place. The reason I put that together Mr. Mayor, was that hopefully we wouldn't get sidetracked with the good guys and the bad guys but look at what's before us--something to improve things in the City of Saratoga and as an additional aside I did some inquiries about the grand jury. I have a friend who just served. And if you hope the grand jury are going to rush out and grab your project without some action on your part...you might be disappointed. They don't have a lot of people, they don't have a lot of staff, and they have some priorities. So, I offer that just in case you're relying on the grand juryto do your work for you. You might just find it may not work. So, that's what I...I wanted to bring that up too. Other than that, I am neutral on this. We did our work. We're going to present our information. Kohler: Thank you, Don, for that information. Mrs. Anderson? Anderson: I would like to respone in part to what you said, Don. Um, I don't know whether it's a misunderstanding or whether it just--we just got into the heat of things and you got an impression that we were defending the actions of the City or the City Council in what happened on this Tract. I think the position of the staff was indeed that there had been a lot of errors and fairly quickly after it occurred we had a list of recommendations from the City Manager's office in conjunction with other staff members of ways to tighten up the process so that it wouldn't happen again. So, I don't think it would be fair to characterize the response of the City that it was okay and that everything was all right. I think that what we are saying now is that these new procedures, we hope, are sufficient and if it's not we'll be looking at the ones you recommend. But many of the ones you recommended were ones that we also considered a year ago when our staff came back to us with something like 21 suggestions, most of which we took and some of which also were hashed out with developers in terms of what was practical to do too. Because some of the suggestions that came out even from our own office were difficult from the standpoint of the developers and lenders. Don Macrae: I wanted to do that because as I listened that's how I heard it and that's how a number of other people in the audience heard it. And I thought it would clarify it and really I wanted to force the Council to clarify what they were going to do in our discussion (inaudible) arrangement but we found things in making recommendations (inaudible) and with that I'll turn it over to the Chairman who's much more adept than I in doing this. Kohler: Yeah, I will outline the way we are going tonight and there are leftover items from the previous meeting but first, Dr. Stutzman? Stutzman: Just one question, Don, did your friend on the grand jury have any comments or suggestions as to what might be an approach that which perhaps induce the grand jury to accept this? Don Macrae: Well, it'd have to be specific maybe Mr. Riback's had some experience in this, but he won't take generalities and it has to be something serious, and they have a lot of indictments coming up and they have just so much time. You want to be productive and as I understand it, you have to do homework and be willing to take (inaudible) then my friend told me of a situation in Morgan Hill where people were--in the community--unhappy with actions by the Planning Commission and they felt that improper action...so they did quite a study on that and turned it back to Morgan Hill and Morgan Hill responded with, "We're quite happy with what we're doing." So, with that kind of a background, you've got to be specific about what you want to do and how you want to accomplish it. Kohler: Anybody else with questions? Okay, uh in the last meeting we yes...oh, I'm sorry. Madelaine Chiavetta: Hi, I'm sorry. My name is Madelaine Chiavetta. Mr. Mayor and Council Members, I'd like to make a request that the Council change September 18th's Council meeting to either the 17th or 19th due to the 18th be a Jewish holiday. It's the largest Jewish holiday. City Council Minutes 4 September 10, 1991 Kohler: ¥eah, if you want an answer on that, it's very hard because we have very many (inaudible). We don't discriminate against any holiday whether it be Columbus Day or religious holiday but we still would have it on that Wednesday so... Heber Teerlink: Excuse me, I understand also that it's being also added to the agenda. We've met before. Kohler: ...and we will meet again... Teerlink: I'm sure of that and after all these years it's always a pleasure to come before you. In any event, the 18th also happens to be not only, I guess it's a Jewish holiday mainly Mr. Riback can't be here. He was busy on one last week. I don't know where the (inaudible) fit in but I don't know if it has anything to do with it, but I'm going~to be in Montana. They just scheduled my meeting--my matter--for the same night. Now,-I'm out on a holiday to go fishing so that's a fishing (inaudible) and I trust that (inaudible) going to give proper notice why this (inaudible) to the Council no written surprises from anyone and all of a sudden I find out I'm going to be out of (inaudible) for the 18th. The same procedure that the committee found out this afternoon...just go ahead and do whatever you want to and then tell people later...that's what's going to happen now. And so, I'm going to join the little lady and say the eighteenth is not appropriate for my (inaudible) not with Mr. Cocciardi (inaudible) yoU've all got a copy of (inaudible). Unknown (male): Mr. Mayor, is this like an oral input (laughing and inaudible) ...7770 over. (inaudible) Kohler: We will get to the subject. We will talk about Tract 7770... Inaudible. (Everybody talking at once) Bert Martel: We will review the (inaudible) in closed session. Please don't forget lies, broken promises, missing documents, the gross misconduct, and the cover up. Of course, I'm referring to the (inaudible) I realize it's much easier to attack the victim when they're down than to confront the violator. As they say, that's not the way to run an airline. Please don't do that. Kohler: Thank you for that. Okay, well let's get to the issue here. There are two items we left off with last meeting. One was the report; the answer from them...ah from City staff and I know there are some questions about that and also in the last Council meeting we talked about the Quarry Creek letter and uh I'd like to start off with that; Quarry Creek. Unknown (male): Wait a minute, I think there was two items left and we were going to come back and discuss them (inaudible) Kalb: Well, on the 7770 I think that there were ~some things that were said last meeting that we wanted to discuss which is the general environment or attitude toward the citizens (inaudible) and you want to get to that afterwards? Kohler: I would like to get afterwards because we had a request to (inaudible) a dateline on the Quarry Creek.uh event. Schwartz: There were uh actually two things brought up by Council members. Mrs. Clevenger asked about the uh grading permits on "Borrow Hill" and I went back and checked and I think I have enough of these to go around and maybe a couple for the audience and staff. I've got...this is the uh... Monia: He's probably in Cuba. Is Peter in Cuba? Schwartz: That's what I understand. Unknown (male): Yeah, (inaudible) for some period of time on a water project or something like that. (inaudible) city Council Minutes 5 September 10, 1991 Schwartz: As soon as perest[oika...Anyway, what I just passed out...this is the original stop work violation. This is the stop work order that was placed on "Borrow Hill" on 19..in early 1989. And it was placed on "Borrow Hill" specifically because of no Planning Commission approval of grading and no uh permits for the grading and no plahs for the grading. No proof plans or permits and no Planning Commission review of the grading. There is then attached a memo from uh Mr. Oncay to the uh, it's to nobody, to the file that it went to the building inspector listing the stop work order because there was an EIR accepted for that subdivision but in fact the EIR did not contain either building permits, review of...I'm sorry...excavation permits, grading permits, or review of the grading that wo~ld go in front of the Planning Commission. The Public Works Inspector was...I called himon this...and did not understand why one thing was listed for the...the EIR did not seem to solvethe problem (inaudible) no plans or permits for the grading from with which to inspect. That's the Oncay answer. (inaudible) Schwartz: Yes, both of these are from Quarry Creek. Kohler: Okay, so we add this to the letter as part of the acts we have to look into. (Inaudible) Schwartz: Before one other.(inaudible) which was Mrs. Anderson asked if we could prepare a timeline on "Borrow Hill" really on the events that are in the letter. And we did that and uh Jeff Kalb was the last...with him trying to put this together turned out to be more of a task than we thought. We have some bad news for you actually in putting this together we realized that the recap that you were given...the Council recap of the expenditure trust is wrong...so the recap you have that you were given in this book.. that financial recap is off in a few ways that are fairly serious. One, the dates are off by a year with regard to 86 an 87. So, expenditures were made in 86 were shown in your recap in as 87, 87 shows as 88, 89 is'mixed between what's really 89 and what's really 88. Your recap, apparently the trust account was only maintained into 1988 and, I mean apparently, because'it's impossible to track. There are now three recaps of that trust account. There is one the committee received perhaps oh 5 to 6 weeks ago, from the Finance Department, there's one you got a week or so ago, and then there is the page which is a reproduction, it appears, of the ledger which is also in here. The ledger from the account does not agree with the recap you got and that does not..oneither of those agree with the recap we got. Um...if you turn also to the notes, we came across something else that turned out to be quite serious. Apparently, the second payment to Harbor Builders was not ...interrupted...January of 1988..uh if you look at note'number 6 on the second page of this it appears there was no documentation for that payment ($80,000) Harbor Builders and that ~.xas sort of a surprise. It was also listed as a bond release. It appears... and I'm not at all certain that...it appears that it was a repayment of the cash fund that has been required on Mt. Eden Estates and probably the cash fund was paid into the general fund but then was repaid to Harbor Builders out of the trust account creating $80,000 accounting error in the trust account is the best we can figure and I'm in no position to say for certain that there's no mention of $80,000 going in..$80,000 goes out as a bond release and what that creates...interrupted...(inaudible) Kalb: That's part of what you might want to understand more clearly. Schwartz: Absolutely. The interest in the trust account does not seem to square with normal expectations of interest and it appears the trust account and general account were commingled. I've one suggestion and then you can leave this because you've got a plan for this evening. Maybe it's a request rather than a suggestion. After the discussion of this letter, the letter that was presented last week, I was somewhat concerned that the discussion of the difficult position that the Council was in and a lot of things about the accounting. Can we account for where the money went should in no way obscure what we have regarded as the central two problems, and they were not do we know where the money went. The two central problems in this whole affair, to the Committee's way--four of the five members'--way of thinking, was that the City set up--the City went out of its way to solve the problem by putting itself in a fiduciaryresponsibility--fiduciary duties, to city Counoll Minutes 6 september 10, 1991 fifteen homeowners and got them to enter--to pay a good deal of money to enter into the trust account and set of agreements. And there were misrepresentations or non-representations made to those fifteen homeowners. Then, once the City had entered into that trust account and agreements, all of the agreements which the homeowners had, almost withou~ exception, were broken. There was no communication with the homeowners. Their money was not handled as a,bank would typically handle it in a trust account, and the City really violated the trust it had set up with those fifteen people, who were probably noosed into the agreement wrongfully in the first place. I think those are the two central issues that go well beyond (inaudible). Kohler: Yes, Mrs. Anderson. Anderson: I'm concerned because we haven't had anyone appear before us that's one of those homeowners to tell us what the representations were, so I'm wondering you're basing this statement on that the people were mis... Schwartz: We're basing it on two things. One, a very careful review of every document we could find that was sent to them, and we do have two detailed letters that were sent from the City Attorney to that group of homeowners prior to their entering into the agreements. Anderson: And their insurance companies, and the insurance companies' attorneys, right? So we're not talking about just homeowners. Most of them had insurance companies behind them. Schwartz: Most, but not all. And most--and in some cases--insurance indemnified partially rather than fully. However, as with everything else this co~unittee has done, someone may show up, as has happened to us now twice. Someone may show up with some documents that although we should have been given, or we asked for, were not forthcoming. But from everything we've reviewed in files, exhaustively, and from interviewing two of the involved homeowner families--two members from one family, one from another--and talking to some other residents in the area--that's what we base this on. So I do think that we have a handle-- Kalb: It doesn't represent the same level of detail or investigation that the rest of the report was done. I think you ought to understand that. And not all of the committee participated in that. It was partly outside our charter, as we noted originally, but it was additional follow-up, additional reading of the documents--but it does not represent the kind of level of effort that was put into the others. It should be accepted in that sense. Anderson: Do we have in here who these homeowners were? Is there any problem with our knowing who these homeowners are? Monia: There are supposed to be in the report. Kalb: I don't think there isn't a problem with their knowing, but I don't think they are in the report. Monia: You mean the signings of the agreement? Kalb: It's actually three. I would prefer to get back to them to make sure, at least the three, that I talked to that they don't mind, because those are the procedures we used for the main report. I think we should do that again. From what you said I don't think there is any problem. - Anderson: I'm a little concerned about our not having that as a part of the documentation and accepting it as being true. Kalb: I think we should take Jeff Callen's suggestion. This was outside most of what we did. We did not devote the kind of effort to detail and we are bringing it up because it seemed to us to be so bad. Not because we were completed with the investigation. It would have taken us months to go into it the way ~.!e did the rest of this. This was as big as the rest of what we did. So the Council can pursue it or not pursue it but we weren't prepared to ... We had eight or nine City Councll Minutes ? September 10, 1991 months in at this point. We weren't prepared to put in another eight or nine months in following this. Kohler: I think this brings up again a few serious questions here. What concerns certain violations. We have started in this last Council meetin~ to tell the Committee together and I merely want to talk about that. To maybe expand that Committee is .. member of the public. Right now in the Committee we have Mrs. Clevenger, Mr. Monia. We have the Accountant's Office, right? If he accepts? Peacock: No. Kohler: It won't? and Mr. Riback? Riback: They've turned us down. Peacock: I have the letter from Mrs. Shriver and she's spoken to Scott Maze. He's made a proposal, but the assignment as he understood it from the minutes-of the meeting, he has indicated it is inappropriate for his firm as independent auditors. I'd be happy to pass this out to you. Monia: Maybe you might want to consider asking the Chairman of our audit committee. Maybe that might be worthwhile. Clevenger: That would be good. Monia: Maybe that might be worthwhile or at least taking a representative from. Clevenger: That's a good idea. Monia: I like your suggestion. I think one of the things that is missing, and I know it will be a big help after going through the original 7770 program, I think that one of the committee members that's done this ground work, that would be on the committee would save us probably weeks if not months. If we jus~ start from zero again, we are going to have to do a lot of this exploratory work. There is a body of knowledge and to keep the continuity within this committee and since we are expanding on their recommendation -- I don't think the full committee needs to read their papers. I think the rest of the assigned committee will be substantial and give us enough flexibility to discover it. I think it would be worth it to get one of the committee members to join this other committee for continuity, and it will also help us, because otherwise we're going to have to take these particular issues and study the whole thing. I know I've spent a couple of hours already studying the one document. It takes a long time to dig all this information out. Kohler: I would propose, if it is acceptable to the Council, that one person who has already a lot of work done on this is Mr. Schwartz, so if that's o.k. with the Council, I would propose to put him on the committee. Clevenger: I would like to suggest we have someone who could meet in the daytime, because I don't have. anymore nights left. Schwartz: Daytime is better for me. Kohler: Is better for you? Schwartz: It's actually better for me. I'm in town basically. Clevenger: Another thing, I'm wondering if maybe Vic and I and the City Attorney shouldn't get. together and lay it out first to see before we talk about expanding the committee. Monia: I don't -- what's the problem with expanding the committee? I don't even know if we're going to vote on it. We haven't decided if we're going to vote on it. I'm not sure what it is that we want to lay out, outside of what we've already described. Clevenger: Well, here's the problem I have. The issues have been City Council Minutes 8 September 10, 1991 raised. Now I think the Council needs to look into the issues that have been raised. I think that the committee has done a good job, but I don't necessarily see that we need a committee member on us. I think that the Council ... Monia:' We don't have a citizen. Clavenger: Well, I'm a citizen. Monia: I meant to say, an independent citizen. Clevenger: I think that the Council needs to respond to that. I don't want to see the committee just going on and on and on. Monia: No, I wouldn't suggest that. I'm not suggesting that either. I would have brought this up if I had thought about it. I just think that the continuity, and this waF my experience on the first part of this, we spent three months. There were seven of us, eight of us, trying to figure out where to start. Once we finally got it started, once we finally get all the pieces and then we finally sit down and say o.k., this is where we think we should get going with this, you've got a few months behind you. I'm just looking at we've got a resource and we've got someone who can help us. Clevenger: Mr. Monia, I have a problem with Mr. Schwartz. Did he serve on the Odd Fellows, the Senior Committee? Monia: (inaudible) ... nothing there. Clevenger: Well, I have a problem with that because I feel like Mr. Schwartz ought to be on the Council. ~He's served on so many committees, I think it would be a good idea to give someone else on the committee an opportunity to serve. I really have a problem with him serving on another committee right now. Schwartz: I would like to endorse Mrs. Clevenger's suggestion. Teerlink: How about Mr. Kalb? He doesn't have anything to do. Clevenger: I'd be happy -- I think Mr. Kalb as chairman is the appropriate person to serve, if you can. Kalb: I can try to help as much as I can. I can tell you that I'm going to be doing a lot of travelling in the next two or three months, but let's see what we can do. I can't make it during the days usually unless you can meet a noon. Anderson: I can meet a noontime. Kohler: Would it be acceptable to maybe have Mr. Schwartz as an alternate to Mr. Kalb? Clevenger: No ... Monia: Wait a minute Marty, I think your personal attitude disturbs Mr. Schwartz. Clevenger: I'm sorry, but ... Monia: Well, that's an unfortunate circumstance but in reality it's Mr. Schwartz who brought this issue. Clevenger: I think he's going to have kind of a, keep wanting to promote ... I'd rather have someone a little more dispassionate. Monia: I was just hoping to offset the balance of your influence. Clevenger: You could appoint another Council member then. Anderson: You can't do that, then you'd have a ... Monia: No, we can do that, but I am concerned about the size. If you really want to get down to the nitty gritty, I think that the City Council Minutes 9 September 10, 1991 opposition to Mr. Schwartz is the same thing I feel is the opposition which you would bring. I don't think you have a clear, or let's say an unassigned agenda, about trying to shuffle this as quickly as you can to an area strictly as to whether or not the finance committee or the finances of this were direct; I think Mr. Schwartz brings a good point.' There was really, lif the accusations are correct, mismanagement, and the issue is mismanagement. The issue isn't really whether or not the dollars and cents all add up. I mean, any finance person will be able to do that quickly. We can either hire or (inaudible) from that. But what we want to tackle the issue of, whether or not we as a Council oversaw this trust properly and whether or not the administration oversaw the trust properly. I think someone like Jeff would be an asset because he's going to be the s.o.b. whose going to say, "I'm sorry, this is the real issue and this is ..." Clevenger: No Vic, we have you on that committee. Monia: You're right. Clevenger: And I'll be happy to step aside if Mr. Schwartz steps aside. Maybe that's the best compromise, because I have heard from previous committees that Jeff tends to dominate the committee, and I don't think we need somebody on there whose going to be dominating. I'd like to have some listeners. Kohler: I think, Mrs. Clevenger, we need a balanced committee because we have to go after the facts here. The facts, you know, are just the facts. Anderson: The proposal here, the letter we have from Patricia Shriver, suggests that Scott Maze of Maze & Associates is willing to do an audit of the Quarry Creek Trust Fund from inception to present. It says that right here. Now, I guess I missed something in understanding why it is, if the numbers add up correctly, that it doesn't mean that it's been managed properly. Monia: That's what it says. I didn't say that. Anderson: You just said that's not the point. I think that's the point. Monia: No, that isn't the major point. What happened at the last meeting was, let's set up this audit committee for purposes of seeing how this money was distributed and that was sort of the end of it. That was sort of what the committee was charged to do, and I think Jack brought us back into clear focus tonight by saying, "Look, while that's an important issue, these really are more paramount." I think that's really what we need to look into. You can get any hired gun to go through an audit and tell you whether or not by terms of that stipulated agreement that (inaudible). Anderson: Is that all we need to know? Monia: No. You just missed this point. Why was it that we didn't, if in fact it's true, and I've read the report and my basic concurrence is this, that when I look at the ~,~ay the funds were supposed to be distributed, there were three criteria. Don't ask me to mention them right now because I read this a ~l?eek and a half ago, but anyway there are three basic criteria. One was percentage of completion, one was there was supposed to be 10% withheld on payment as a contingency fee, and the third one escapes me at the moment. But anyway, when I look at the check that issued for the bank and then I look for the backup information, I find those three safeguards are missing in all payments. Anderson: Wouldn't that be uncovered by an auditor? Clevenger: Yes. Monia: It should be. In order to uncover that, the point is ... Teerlink: Excuse me for just a moment. Aren't you again getting two things mixed up here? These two gentlemen here are partially (inaudible) because they were sent to c3o after Tract 7770 and related City Council Minutes 10 September 10, 1991 matters. Now the issues about this bookkeeping on Quarry Road, that was a separate contract and that transpired unfortunately before some of you folks were even on the Commission. I can't even blame the Mayor; I'd like to but I can't. He wasn't even here at the time the City lost the ... Clevenger: Oh, blame him anyway. Teerlink: It wouldn't be correct. The same with Dr. Stutzman. He wasn't here either. What's happened is, you've got the Quarry Road which has never been investigated. They've investigated 7770, and incidentally, Quarry Road slopped in. If you go to Quarry Road, that's the accounting you're talking about. That involves I can assure you, I think I've written it down to you t~ice and had no response from you, that involves not nine hundred eighty-some odd thousand dollars, that involves $3,552,000 from the builders, Mr. cocciardi, Tom Burke, that's what they put in there on the input. Plus what the~homeowners did. Plus what the City did. And that~s a separate issue. O.K. In a sense. They have not yet reached a conclusion because they didn't know about how the two tied together. You're walking in the dark here right now. You don't know what's really been spent out there. How did it come about? Because of parties who put it together, namely our former City Attorney -- Harry was here, he knows about it. That's the whole key to the issue, you are enlightened as to what happened to that $4,500,000. I'm talking about $8,000. Kohler: We discussed in the last Council meeting that we would take it up, and I appreciate your point. Mrs. Clevenger was part of the Council then, that's why I would appreciate it if you would be part of that committee, Marty, so that would be a good thing to be. On the other hand, I also feel if any of the members of the committee are willing to do that, it's very hard to find people who want to spend the time. Clevenger: Mr. Kalb said he could meet a lunchtime. Kalb: Right. I could probably meet at lunch and if I can get some, perhaps, help from other members of the committee at alternate times because I do travel probably about a third of the time and quite a number of ... Monia: How about Marty, as a compromise, Mr. Schwartz can be the alternate since he's volunteered. Clevenger: How about Mrs. Harris? Harris: I'm not available during.the day. Clevenger: Well let's not have an alternate; we'll just try and meet when you can because ... Kalb: I can try, most often try to meet at lunchtimes and see if we can work it out. Kohler: It's O.K.? Kalb: Yes, I'll give it a shot. Schwartz: Some of the direction of the meeting is a little strange. If Mrs. Clevenger is going to use the meeting to voice either her dislike for me or her distaste for ~xhat I've done with certain committee, I--it's delightful for me if Jeff Kalb could handle the time commitment. I would be delighted to not participate in this as it goes forward, because I've just gotten done with two committees and have taken a huge amount of time over most of the last year. I'm very pleased with that. Let me argue, if Marty's got a problem with what I'm doing on committee, I am unaware that any members of this committee had a problem with anything I was doing. If you have a problem, either come to the committee meeting and say something or deal with the problem, but I don't really expect it to get aired out in public as my reward for being involved and giving a lot of my time to the City. If you have some personal problems with people, including me, either handle them professionally or don't deal with them in public. City Council Minutes il September 10, 1991 Clevenger: I believe I did handle this professionally. You were appointed by one of the Council members, and it wasn't my job to make a comment on who a Council member wanted to appoint. But now we are talking about another committee. I believe it is appropriate to make a comment about who served on the committee, and it seems to me that the chairman of the committee is more important to represent your 'group. Schwartz: My understanding is that it is the chair's prerogative to appoint so that when you're saying this isn't 0.K., this is, that's probably inappropriate as far as the rules of the Council go. Second, if you've got some problems I suggest you just deal with them at a public meeting. I've gone out of my way to not do what you just did with you with various reactions you've had here, but if you want to deal with things in public, if you'd like a little theatre, we could do it that way too. Kohler: Well, I just want to make a blanket statement; I think the dedication of the committee is without any approach--reproach--and I think (inaudible) a good job. Anderson: I would like to make sure we understand the charter of this committee, because I really don't want to have the committee spending time looking into whether the deals were appropriate or not because they were done deals. I think it's really important that we just focus on the accounting and the care of the trust fund and stay out of whether the deals that were passed by the City were appropriate or not under the circumstances. It's very easy to have hindsight and say this was a good deal or not a good deal for the City, but at the time I am certain that the City Council members involved were trying to do the best possible thing for the City in the face of what appeared to be an emergency situation on the road. Monia: I agree with Karen, and I think when you put it in context, we should really be dealing with the administration of the trust account, the payments and backup information and the like. I think those are the critical elements. That's right. Any deal between two parties can always be second-guessed, but I think whether or not it was fair for the amount of funds that each party paid for looks to me that everybody agreed to it. You've got a stipulated agreement. My concern more is living up to the agreement made with all parties. Anderson: I don't think that should take us a lot of time to get an audit on that and to find out whether that money was spent properly or at least understand how it was spent. Kohler: 0.K., so this is all the (inaudible) we get. Mr. Carpenter and we will ask the finance committee chair to join us. Monia: 0.K., do you want a chairman of this committee to call a meeting or do you want to have the committee itself to form its own chair? What's the pleasure of the chair? Anderson: Why don't you guys work it out? Monia: Fine. Sometimes we appofnt a chair, and sometimes we don't. Clevenger: I'm wondering, since it, I think you can talk about that. I don't think that's too important. Monia: All right, I will take the responsibility then to at least form the first meeting and get everybody together so that you can get a common calendar and at least get together and we can decide what the structure will be. Teerlink: Who's going to be on the committee yet? Do we know that yet? Three? Four? Kohler: Mr. Kalb, Mr. Monia, Mrs. Clevenger, Mr. Riback, and ... Teerlink: How about somebody that isn't involved with it? Mr. Riback, well, how about having some other independent person. Mr. Riback is City Council Minutes 12 Septeanber 10~ 1991 the City Attorney. Clevenger: The chairman of the finance committee. Monia: We're going to have either the chairman of the finance committee or somebody that he might recommend or she might recommend to the financial purposes. Clevenger: Is Christie still ... Monia: Yes, Christie Jameson is. Kohler: O.K., let's move on. Let's go back to the item on Tract 7770. There are two items there. Kalb: The items we haven't addressed were in fact the items that came under the heading first of all the attitude, the environment that we referenced in the report, and the second item, we were going .to have some additional discussion about the missing documents, so wherever you would like to start (inaudible). Go ahead. Kohler: (Inaudible) the attitude, and... Kalb: I think I can speak accurately for the committee saying that we felt that there was in our own dealings with the staff when we first got started a general air of, shall we say, lack of cooperation. Maybe Mr. Peacock said it as well as anybody at the last meeting when he was commenting about some of the lack of information, and it came down to well maybe we didn't ask the right questions. I made reference to that the other night at the Council meetings. Some of them are tongue in cheek. I think when we approach this thing, we look (inaudible) at the behest of Council and at direction of the Council to staff and so on to support it. We didn't approach this initially as though we were having to look for an adversarial position. We were having to declare our witnesses to be hostile or whatever, and I don't mean to overstress that word, but the general concept; we had to be smart enough or smarter to be able to get the right information. So we felt early on, and I believe the words we used in the report were somewhat stonewalled, not able to get the information we were looking for. The second thing that I think I would point out and if we came across this with the number of people who would testify to the committee, and I would not say that this is a new problem that we are talking about, but the general feeling on the part of the citizens of being talked to, of being ignored in their comments, not of the lack of follow up or at least from their perception, the lack of response to their inquiries. The reality of that whether in fact their inquiries were responded to probably doesn't make a lot of difference, and I know that's a funny statement to make, but what we're dealing with is not the facts. Facts you can argue with; its the impression and the perception that is left with the people that has to be dealt with, not argued with, if you know what I'm trying to say. That's the feeling, the belief that the people had. You can argue with them all day and all night about that they're wrong, that the fact did check out on this or that we didn't talk down, etc. That is the belief that they have, and that has to be dealt with, not argued with. I think those are the two major items I would put forward relative to this issue of environment. I think they can be dealt with. I think that we can'in fact open things up and deal more even-handedly with the people, if you will. We can overcome that perception that they have, but it's going to take some work. So, let me leave it at that and then see if there are specific questions that people have. Harris: There were staff members who were very cooperative with us, and certainly Steve Emslie and Larry Perlin are two excellent examples. Anderson: Mr. Mayor, is it appropriate to go through these recommendations and get the committee's reaction to the response? Kohler: Well, I'd like to do that because (inaudible) those two issues and take it one at a time. I think those recommendations we can ... Monia: I know that Ms. Harris had some very strong feelings as part of the overall investigations when we came down to talking about this City Council Minutes 13 September 10, 1991 attitude and this environment. I don't know whether you had any additional comments. I don't want to put you on the spot, but I remember a couple of things in which you were somewhat livid. Perhaps the best description ... Harris~ Well, I don't 'think I can say it any better than how it was stated in the report, but when members came before the Planning Commission and complained about how they had been treated by staff, I had no reason not to believe them and I feel based on what the committee saw of the subject at hand. Kohler: Yes, I agree. The report came off very strong and was very clear about this. Then also we have the report it is (inaudible) from staff, and I am sure there are some issues there too we want to talk about because it is kind of an opposite view of many of these. Kalb: Yes, and that's why I wanted to make the contrast because it's easy or perhaps always the i~unediate reaction, especially in these dealings with the people, to immediately go to the record and look for whatever the facts are. That's why I tried to make the comment that it doesn't make a lot of difference, because at some point in time you have to deem that you're going to solve this issue of the relationship between the staff and the people of the City, and you have to go with the impressions and the beliefs that the people get to. That's a lot harder, I understand that; but it reflects an attitude in total one has to deal with. People pick it up. They just pick it up and it sticks with them. Anderson: Jennifer. Monia: Are you saying from your own personal contacts, either through the committee or personally through the City, that those people came and spoke to the committee? Kalb: Letme tell you where my own personal conclusions come from, and I think it's important to recognize that until this committee had started back up I hadn't had any dealings with the city in the last nine years, having spent a fair amount of that time back in Boston being ostracized from the west coast. But, fundamentally, I felt that when I talked to Mr. Toppel, I felt that when Mr. Peacock came before us, I felt that in the first meeting with Mr. Oncay, maybe less so in the second meeting, the people that came before us expressed those feelings. Those people who had been involved with the City, had been on the Planning Commission, perhaps, or the Planning Commission, reflected the same kind of feelings about their behavior or what they had felt as part of their interaction. So, that's the basis of my judgment. I didn't start this thing with any preconceived ideas one way or the other. I didn't get involved in any of these other things, and started from scratch in terms of worrying about it. That's the impression I get also. Schwartz: The impression having just been sitting in the meetings and listening at earlier meetings to a rather broad range of residents, mostly from the hillside areas, come in front of us and talk about interactions with the City, and then some of us on the phone interviewing people for the committee, was somewhat overwhelming. The amount of distrust, cynicism, anger towards City staff and towards the City government, sometimes more generally, mostly toward staff but sometimes towards sort of a whole gang of them or some such, was somewhat overwhelming. It was deeply disturbing, and we've had testimony from the staff that Larry was fairly new with the City; but he's still fairly new, I guess, by some measures, but then he pointed out that the City does circulate, because that came as a surprise for some, he pointed out that the City circulates things about a service orientation and it's done training, and he pointed out that there's more of that. Steve mentioned someplace that there's more of that sort of thing in this city than in other cities Steve had been in. Steve went to some lengths to explain that to us.' But, that sort of went by the boards as a fair number of the interviews with senior staff reflected exactly what the citizen ... we didn't have to take these people's words; we got to see it first-hand. The combination of antagonistic attitudes and then an ongoing game of what seemed to have been, in my own words and not the rest of the committee, sort of hide City Council Minutes 14 September 10, 1991 the ball. As long as you don't ask the magic question you don't get the good answer. Let me tell you everything I can so you will understand this situation, or let me help you where I have some information which may straighten you out, but approaching our discussions with senior staff as if they were depositions taken by an opposihg attorney would be the way I would characterize them. I can remember one specific, just to give all of you a flavor because you weren't there -- maybe this is hard to see. We asked one of the senior staff members, having talked to a lot of citizens in the hillside first, are there complaint procedures where complaints are tracked. And the staff member said, ."Yes, of course, they're computerized, they're logged in, they're logged off", and stopped. Then somebody else said, I think either Jan or Vic, asked, "How; have you had ... since when were those put in?" And the staff member said, "October." We started to go on thinking, oh, well, they've been there a year, that sort of (inaudible), and then Jan said, "October, which year?" He said, "This year. They've been in-place less than a month." Well, had we not asked two right questions, we would have gotten the impression that of course the City has complaint tracking. I think every member of the committee afterwards was struck with that interaction. It stuck with me however many months. We had lots of those. There's something wrong with that tone. Kohler: O.K., thank you; I'll have (inaudible). Yes, Mrs. Anderson. Anderson: I would like to be blunt about how I feel the staff reaction was with you people. I think the atmosphere at City Hall when the election took place in June of 1990 was such that many of the staff members were very concerned about whether they would be continuing their'employment, and I truly believed that many of them were hesitant to cooperate with the committee because they looked at it as a device for hastening their unemployment. In that context, I can certainly see that you would have an adversarial situation. I honestly can't blame them for feeling adversarial. I think that the atmosphere unfortunately was such that it was going to be very difficult for you to have the kind of cooperation that you must have been expecting, because the Council essentially commissioned you. Kohler: Mrs. Anderson, I cannot really follow that. They would be quite concerned about their employment, but would they be more forward about coming out into the open. Kalb: I would like to accept that that is a possible explanation, but I don't think that would make the people who came forward, who in many cases were reflecting years of what they believed was the same general approach. Being in city government I understand is not a piece of cake, because you take one heck of a lot of crap all the time. Unfortunately, that's what the job is. It's sort of like in some sense I get the same problem with being a manager; I guess maybe what I get paid for is listening to people bitch all the time. But I still have to keep my employees happy. I still have to keep them motivated, I still have to keep a commitment to the City, or my board, or my company, my board takes me out. I know it's not an easy problem; that's what management is all about these days. I just think that sometimes it's easy to forget exactly where you're coming down on these things. What the total responsibilities might be in the face of what I understand is perhaps a lot of ration of crap a lot of times. Kohler: O.K., let's move on. We have another item -- missing documents. Kalb: Yes, that was---there were a couple of things, and obviously we made some fairly strong comments in the report about the fact that the documents, in particular the documents relating to the unapproved plans, had just vaporized; that those documents supposedly had been around the City -- we had numerous people tell us they had been around the City, yet we couldn't find them. We don't know what happened. We had an explanation I guess at the last meeting, a proposed rationale, Mr. Oncay, which I will not go back into because I can't find any logic in it quite frankly. But I think it's important to recognize maybe that's just another piece of data that's missing that just never got brought forward, but I think it goes further than that in that the City has been involved in some pretty significant legal battles. Document City Council Minutes .:. ,-'15.~'E':"~TM September 10, 1991 to document, evidence is evidence and I don't think those things are just supposed to go away. I consider that to be a pretty serious problem frankly. I just wanted to emphasize that. I do also want to clarify one point. Mr. Oncay made a point about the reference and in fact we had said in our document that had made a subtle reference that we hadn't referred to, that somehow got completely taken into the context that it was a subtle reference about the documents that Mr. Rosh(?) had. The actual comments, if you go back and read the testimony that we recorded was that they were with regards to the unapproved plans that the contractor had had, not the unapproved plans that (inaudible) had. So at least as far as our records confirm from testimony, those references that were made about us not understanding the subtle reference were not as the way they seem to have gotten taken in further writings and further conversations. Please keep that in context. As far as we know, and as far as I have been able to verify with committee members, the first we got wind of these unapproved plans was when Mr. Rosh(?) -- too many-letters in the name -- when he made the reference to them and not before. The other ones were with regard to the contract and document (inaudible). At least that's the way we reported. Whether there were any other references beyond that, they went past all of us, including Larry and everybody else. Suddenly, it was as if this big lightbulb went on that night (inaudible). Schwartz: The suggestion in the staff rebuttal we discussed last time we met is that we should have known from Joe Oncay's reference to that- -is somewhat far-fetched. There was no clear statement that there were unapproved plans on the site, that anyone had taken them from the inspector, that the inspector was on the site with the plans and had them when they went up to look at the damage. There was nothing like that. There was nothing like that. There was nothing that said it was an issue or potential issue, either in litigation or in the City's looking at what happened. Also, the hypothesis that was proposed at the last meeting, also by Joe Oncay, that Neal Rauschhuber took them - this hypothesis that he went through the City files, essentially took, stole, those plans, and sort of sanitized references to them, is particularly troublesome. It begs credulity because why would he then come to this committee a~d go out of his way to tell us about the plans so that we didn't miss finding them? Is that why he sanitized everything, I wonder? Kohler: Yes, it's unfortunate -- I spoke with Mr. Peacock, and Mr. Peacock told me, and we all knew about it. Mr. Oncay is not here, he's at a conference, so he is not here. However, ... (male): He's where? Kohler: In a conference. So anyway, ... Schwartz: The second part of the plans is ... if you go through the rebuttal to the report this committee turned in, there are probably five or six different places where it suggested it would be impossible that those were the plans that were used on site. Without arguing that anything were marked, the reason that the committee reported that those plans were central to our investigation is that while Joe says its impossible they were used because they're so different from what was done there, Steve said, "Could be the same, looks very similar;" Larry said, "Could be the same, looks similar;" Neal said, "These are the plans I used to inspect with up there;" and the contractor said, "These are the plans we used to build with up there." Well, from those four pieces of evidence, we didn't take too seriously someone saying it's impossible. Kohler: I agree there are many questions and, unfortunately, we don't have the time to go into it. Kalb: Well, anyway, those are the two points that we wanted to make. Monia: I would like to make other comment. One of the things that it is unfortunate that Mr. Oncay is not here tonight. I have several questions that need to be answered directly because I think one of the things I was quite concerned about in reading this report is probably the easiest, least offending term I can state, but its probably the most convoluted argument that I've ever seen about the truth. I cannot City Council Minutes 16 September 10, 1991 tell you, I can go through almost paragraph by paragraph, and show where statements such as it is impossible, this evidence never existed, there's no place in the report from the citizen's committee that evidence like this was presented, and I saw this in two or three places. It actually make statements that someone should know anything about this issue, or the committee assumed that, in the one case of Mr. Topple, that Mr. Topple would know this information, and there's no evidence of that. When in fact, Mr. Topple wrote the very document that the committee was referring to. So, I think it's more important that we get Mr. Oncay's input, because I think we need to judge the credibility of this report. I would like to revisit this issue when he returns, at least I would like to have an opportunity to question because I have put a tremendous number of hours in going back through all of this information, and I have, I don't know, probably six questions -- I can't go through every item because we would be here forever and I don't think it's important. I think it's important for me to have an opportunity to question the reliability of these answers and then of course the Council can judge for itself as to the responses given. I think it's important, it's a critical element of what we're going to do with Mr. Oncay's response. Maybe next Wednesday, or whenever we're going to have our next meeting, we can continue this part of the session. I know we'd like to end it, but unfortunately I think we're all surprised. We all should have known because we approved his travel for this week, but I guess it just slipped everybody's mind the fact that he would be out of town, and it's such a crucial element that I would like to be able to revisit this for at least 30 or 45 minutes when he's back in town. Clevenger: Mr. Mayor, if we're going to revisit this, I think we should continue to at public at a study session rather than having it on the agenda, because I don't think that's very conducive to discussions, and I would prefer that we not schedule it at the meeting. We have a hard time getting through by midnight. Kohler: I understand. On the other hand, I did not hear the tape from the last meeting but I heard it was a pretty bad copy of tape. If you had only come to me, we would have gotten the proper technical recording. These things have to come out. I think we owe it to the public to get it out to the citizens of Saratoga. What's happening is that there are too many questions, there are contradictions, and I personally agree with Mr. Monia to do it on a Wednesday night when we have the Council meeting. Monia: Whether we want to start early or we want to do it at another time, I just want to make sure that we don't close this off tonight. I think it's important. I ask the Council's indulgence. I spent hours in preparation to ask Mr. Oncay several questions this evening and I'd like that opportunity. I personally don't care whether we do it on Wednesday night or we do it on another one, but I really don't want to wait another two weeks or three weeks. We should get on with this thing. Otherwise, the wait is going to drag this ... Clevenger: O.K., well maybe we can extend it to tomorrow night's meeting, but I don't think that asking a staff member questions on television is a very good idea. Monia: You do that all the time.' Clevenger: Well, I know, but not in this kind of thing. I would definitely prefer that we have it at the same kind of forum that we have in the past. Anderson: I agree, not because of the television aspect of it, but I think the informality here is much more conducive to the kind of a schedule we have. Plus I agree that I would hate to see an agenda clogged up with this, because whenever we get into these discussions they take longer than we anticipate. I am really concerned about how we would make it through a Wednesday night agenda. Maybe we should schedule a special meeting. I know that the next Tuesday opportunity where we would normally meet I believe is Commissioner dinner ... but we could throw in another Tuesday. Clevenger: How about next Tuesday night? City Council Minutes ,~ 15 September 10, 1991 Monia: How about when? Clevenger: Next Tuesday night. Kohlef: Next Tuesday. Yes, that's Open. The 17th? O.K. That will be fine. Anderson: If Joe could be there ... Monia: Let's find out about Joe ... (Several voices talking over each other discussing availability and starting meeting at 6:30) Teerlink: Excuse me, can't we get back to what we were supposed to discuss, and that's 7770. We're here to discuss whose been hiding what document from whom, the agenda says ... what? Kohler: We talked about 7770. Teerlink: Nobody's accused Mr. Cocciardi of hiding anything. Let's get back to what we're going to do with Mr. Cocciardi and Lot 7770, and if that, what is it, this warming of the ocean, what do they call it, E1 Nino, or whatever the hell it is they are calling it is going to hit, if that hits up there this year, you're going to have half of that mountain down the--Old Oak Way, as I've pointed out to you in a letter before. It seems to me that the issue between the Council members and the committee and this County, no one suggests that Mr. Cocciardi stole anything yet -- Yet. I think we might get around to it if we think about it. But right now that's an inner sqdabble between the members of the Council and the staff. Now, what are we going to do about this Tract 7770? That's what's on the agenda. Let's hear about that. Kohler: O.K. We're talking about the date. Tuesday the 17th, is that an acceptable date? Monia: It's O.K. with me. Kohler: 7:30? Anderson: I don't have a calendar, but I think it's O.K. Caldwell(?): Mr. Mayor? I have a few points that I thought were worth raising that really don't require Mr. Oncay's presence tonight. Kohler: O.K., please do. Caldwell: In response to the rebuttal. Are we going to be talking about the rebuttal tonight at all? Is it appropriate to raise the issue? Kohler: Why don't you bring up what you want to bring up? Caldwell: O.K., I just wanted to say I also reviewed the rebuttal (inaudible) and have ... I'd just like to say speaking as a Commissioner who's really accustomed to the caliber of the reports that I typically get in the Planning Department, I was really quite amazed that this report came out and was submitted to you under the City Manager's approval. I was puzzled, was dismayed, and I was also frankly embarrassed as a volunteer member of this government. My general observation was that the report was really an unprofessional product. It includes misstatements, it includes fabricatedquotations, it includes quotations out of context, which I really think can be none other than certain intent to discredit the report. I found that very disturbing in going through the report and I just would trust that at the end of the day no one at these tables and for that matter no one in this room would really be able to take this rebuttal seriously. I have just five embarrassing examples which I would like to review with you tonight if I may. There are many more, trust me, but I thought that these were worth raising. The first one has to do with the statements in the committee report regarding the water system and the Tax Reform Act. On page 9, item B of the rebuttal, Mr. Oncay ... City Council Minutes 18 September 10, 1991 Kohler: Excuse me ... Caldwell: It's O.K., if you'll trust me to try to paraphrase and quote accurately I will do so. Page 9, item B. The rebuttal indicates that there 'is "no evidence to support" (and now I'm paraphrasing) 'the committee report's statement that the Tax Reform Act of 1986 increase the cost of funding the water district that was to serve the upper lots of the tract so that the formation of the district became uneconomical. Again, the rebuttal is stating that there is no evidence for this statement that was made in our report. There are two documents that were submitted as exhibits with our report, and they serve a solid basis for this statement. There is Mr. Peacock's November 15, 1989 memo to the Council, and there's Mr. Toppel's February 11, 1988 letter to Mrs. Grand. In Mr. Peacock's memo to the Council, I'm quoting, he writes as part of a larger sentence that's rather involved, "The question of whether and when the-Garrod water system would be built because of the changes in the 1986 Tax Reform Act." Then in Mr. Topple's letter to Mrs. Grand, he says, "With respect to water surface, at the time the tenant maps were approved, it was anticipated that these subdivisions along with many other properties in the area would be serviced by a new water assessment district. The district was in the final stages of being formed when Congress.adopted new tax laws which virtually doubled the costof the water facilities. As a result, the water district was no longer economically viable." This is just really straightforward example of the kind of absolute statement or error that's contained in the rebuttal, but I just find it personally objectionable. The second item that I wanted to bring to .your attention is the issue of what I refer to as fabricated quotations and paraphrases. I just have two examples that fall into this category. I'd be happy to share others with you, 'including assumptions of references and all sorts of things that are contained in the rebuttal. Basically, what these fabricated quotations and fabricated paraphrases seem to do or serve the function as sort of a literary straw man in this rebuttal just for the author to knock down, for the heck of it. My first example is from page 5, item 4, part A. Mr. Oncay writes, "I know of no City staff that 'dislike' or 'struggle against' a 'large, indefinite number of residents."' These quotations do not exist in our report. I don't know where they come from. They appear to be a fabrication of Mr. Oncay's or Mr. Peacock's and perhaps reflective of their attitude toward residents. I don't know where they come from. On page 12, item H, the report reads, and this is referring to the work that was done on the Williamson(?) property, Mr. Oncay -- page 12, item H -- he delves into a fairly detailed account as to why he believes the work, a substantial amount of work that was done on the Williamson property had to be done in the course of a few days. He says, and I quote, "It surely did not take from 9/19/89 to 11/6/89 to fill the Williamson (inaudible)." Well, nowhere in our report do we say that this was a continuous effort. The point that we were making in our report, and if you'll look at the report it's on page 38, was that work started as early as September 19, 1989, long before it was acknowledged by the City. This. is the kind of thing that I refer to as erection of these literary strawmen just for the purpose of trying to discredit a report. My third point is really red-flagged that I'd like to raise, and it's something that's really close to my heart because I am a Planning Commissioner. It's with respect to Lots 3 and 9. On page 1 of the rebuttal, and elsewhere inthe remaining, pages 4 and 17 of the rebuttal, also refer to "illegal work that was done on Lots 3 and 9." I found these statements really disturbing, and the reason why I found them disturbing is because the City has taken action with'respect to Lots 3 and 9, and that action has been to basically let these owners of these lots off the hook and to let them proceed in the development process and in fact, we at the Planning Commission are processing design review, have locations, at least for one of these parties involved. We know for a fact, because we looked at the County records, that escrow closed on the Kahn and Williams lots, which are Lots 3 and 9. Relatively early on, in August and July of 1989, and we also know from the contractor's logs that "unapproved work continued to occur on these properties or did occur on these properties" after the close of escrow. So my question for City Council is, if that is all true, and I believe it to be because the documentation reflects that, whyhas the City taken action to exculpate these parties and to allow them to proceed. in the development process? I don't know the answer to that City Council Minutes .... ~. 19 .. September 10, 1991 question, but it's also my understanding that that decision was made on staff's recommendation. I frankly don't understand it. My fourth point addresses the whole issue of City procedures. There are several instances in the rebuttal where City procedures are discussed. The first time they are discussed, they're discussed with respect to the issue ~of whether or not the Public Works Inspector received "formal training." I'd like to take the formal issue training first. These may seem petty, but they're just examples of what is contained in this report and how silly it is. The Public Works Inspector testified to the committee that there was no formal training; that all of his training was on the job. On page 6, item 5(b) of the Oncay/Peacock rebuttal, there is a statement "In reality, the formal training was on- the-job training." Well, O.K., either there was formal training or there wasn't formal training. Anderson: You mean formal and on-the-job don't mean ... Caldwell: Well, yeah. And I frankly again, actually this may be an issue which you wish to pursue with Mr. Oncay, but I understand that Mr. Oncay is a former police officer and certainly he would know the difference between a formal training program and what most of us understand is sort of the (inaudible) of training, and that is on-the- job training. Despite numerous inquiries and Larry Perlin's best efforts to locate policies and procedures for the Public Works inspection process, the only piece of documentation that we were able to come up with which reflected or described Public Works policies and procedures was this document here, which the rebuttal so proudly refers to as evidence that the City had policies and procedures in place and presumably during the time of the Tract 7770 work. Well, those statements and that inference which I am making, because the rebuttal doesn't say this was in place, but it certainly leaves the reader with the impression that this document was in place while the work was being done on the Tract, it would be laughable if it weren't the case that this document was actually written by Neal after November 7, 1989, according to his testimony, and that it contained a number of very embarrassing and sarcastic statements which I think that this Council might want to look into. Including, "Keep the natives happy; run down complaints; 75% of complaints are unfounded;" second quote, "If you're lucky the developer will set up a pre-job; otherwise you find out they're working when you do a fly-by;" third quote, "Advise contractor on City procedures and standards. If contractor doesn't like Public Works Inspector's answers, call office to see if Public Works Inspector can be overruled." Four, "Make decisions and variance to plans based on site conditions. If developer doesn't like Public Works Inspector's answer, call office to see if Public Works Inspector can be overruled." Clevenger: Where is this from? Caldwell: This has been known to work without Public Works Inspector input. It's in the exhibit. Monia: It's in your package in your report. Kohler: We had it all the time? Caldwell: Yeah. Monia: It's in the exhibit. Caldwell: My point is this. Later on ... Teerlink: Excuse me, can I ... Kohler: No, let her finish please. Teerlink: I will, but I want to know what she's reading from if you don't mind, Mr. Mayor. Kohler: Go ahead. Teerlink: She's making some serious accusations and I'm entitled to know. City Council Minutes 20 September 10, 1991 Kohler: It's all in the report. Monia: It's one of the documents ... Teerlink: Well I know there's a page. I've got around 50 pages. May I have'what she's referring to? Caldwell: I don't know which page it is in'the larger document. I'm sorry, I wasn't provided a copy. The second point I'd like to make is that the Oncay/Peacock rebuttal goes on and goes really out of its way to say that policies and procedures were in place at the time. Yet, it also says that those policies and procedures basically were that no documentation should be supplied. "Activity logs were not required;" "Progress reports were not required," so I guess it's not surprising that we didn't find a lot of documentation other than, frankly, the personal log that was kept by the Public Works Inspector. But, also surprisingly on page 6, the rebuttal goes into some detail about this procedure for handling plans and that they're set on a desk, and a note is left on the plans, and all these special procedures done with respect to plans. Well, I'll tell you, Larry and all of us have reviewed as many documents as we could get our hands on and nowhere did we find evidence of these special notes. So again, despite the fact that we tried, we didn't find any, whether they were approved or unapproved plans in this case. I think that you really have to take this rebuttal with a grain of salt because it's misleading and frankly very unprofessional. My final comment is that the comment that is made by Mr. Oncay on page 17, item L, and it discusses the level of knowledge that this committee had. He says, "I find no documentation which indicates the committee has any knowledge about the Building Division, City Manager's Office, Planning Department, Community Services, Maintenance Department, or Recreation Department" -- as if the Recreation Department is really relevant in this case. But, I'm sure we can find a reason that it is. I'd just like you to sit down and think about who you appointed to this committee. Who was on it. Peter Smith was on it. He consults. If he consults regularly with government agencies; he's right now working on a very huge project down in Cuba with the government. It's a construction project. He has detailed knowledge of planning and construction projects, including Public Works projects. Don Macrae, who was a career Personnel Director for San Jose served on other committees in this City. Jan Harris was on the Planning Commission for almost 10 years. Jeff Kalb was a former member of the City Council. Jeff Schwartz, as Marty has stated earlier, has served on several committees, but also was Trustee at West Valley College for a number of years. Vic Monia was on the Planning Commission, he's now on the Council, he served at West Valley as well. I'm a current Planning Commissioner, and Larry Perlin, he's one of your own staff members. If we had no knowledge about City procedures, we shouldn't have been serving on this committee. Schwartz: Once again, what Vic asked ... Kohler: Excuse me, excuse me, ... Several voices having a mostly inaudible conversation. Kalb: No, that is not in the packet, I'm sorry. We did not reference that anywhere in the testimony, sO we did not put it in the packet. Kohler: I'd like to know what part of the ... Monia: What was your--I don't understand your point. Was Mr. Oncay referring to this as their procedure? Caldwell: Yeah, actually he refers to it I think in the, we didn't get, I didn't get a copy of the exhibits to his rebuttal, but I believe it's in here as an exhibit. Anderson: Is it one of his own? Monia: I do remember seeing this in the committee when we were doing our work. Several voices discussing exhibit. City Council Minutes 21 September 10, 1991 Perlin: It's document 53. Caldwell: Thanks for finding it. Monia:' I couldn't find it either. More discussion regarding locating exhibit. Anderson: I'd like to ask a question. Mr. Perlin, is this supposed to be a serious document for Public Works Inspector? Perlin: No. I found that when I was cleaning out the drafting table that Neal used to sit at, and it certainly is not used today. Anderson: To me it looks like something that you might be making up for fun. It doesn't look like a-serious document to me. Do we have any knowledge of whether this document was ever actually used as a serious document, or was this supposed to be a joke that was passed around the Engineering Department? Perlin: I don't think anyone in the Engineering Department ever saw it. It certainly isn't in use today, and I couldn't see why Neal wrote it. Anderson: Or why Joe Oncay referred to it? Monia: Why would he use it as evidence? Perlin: I have no idea, I ... Monia: If it's a laughing matter, why would he use it as an exhibit? Anderson: Was it to discredit Neal? Perlin: We used it as an example of procedure. Kohler: I think as a procedure or a joke, it's totally out of place. Kalb: We put it in because of the reflections we thought it conveyed about just the general attitude, O.K.? It was not our intention to use it as a serious document to justify something. Schwartz: We also, the reference to "Keep the natives happy" is also parallel, a reference actually that we got from Mr. Oncay where we were asking about whose responsibility it was if the developers were doing something that was well outside the guidelines given. His position in one of the two interviews was sort of, well there's nothing we can do. If people don't do what they're supposed to do, it's certainly not the inspector's fault or the City's fault. We were saying, well isn't that the checks and balances and controls, and at that point he sort of affected a Spanish accent, and gave us a rather offensive sort of "not my job" remark. I can't do it quite the way he did. It was in keeping with this sort of "keep the natives happy" that I (inaudible) ... Kalb: That was excised from the. testimony at the recommendations of the attorney. Schwartz: However, once again I think several of us are speaking to a point that may be easy to lose. With the work that's gone into a report that's some 50 pages, there's a.20 page staff rebuttal. I think the number of us, Meg said it very nicely, are really concerned that if you're going to take that the least bit seriously, it's defensive, it's offensively written, it is paragraph by paragraph, full of errors, purposeful misrepresentations, places where the language is purposely changed to lead you to wrong conclusions. If you were to look at that with the least bit of seriousness, it's a very clear effort to discredit our work. I'm not prepared to tell you our work is perfect, mainly because if you'll pardon the expression, we weren't playing with a full deck. That's not a comment about my fellow committee members, I hope, but we just weren't given all the tools we might have been given. So certainly our report ought to be scrutinized and not taken as gospel. But I would hope that you would accept this so that it is City Council Minutes 22 September 10, 1991 part of the City records, I would think it ... (inaudible interruption) excuse me, that you would receive it or not accept the rebuttal at all. If you are even going to consider that we need to go through it paragraph by paragraph, because it's really, in Jonathan Winter's memorable phrase, "garbage" from beginning to end. I want to make one point.' Would you please not lose sight, of what, as with the Quarry Creek repair, there is a bigger issue here. There's a bigger issue of whether or not this City ends of requiring that all off-site improvements be in place before a final map is issued. That's an important technical question. There may be high notions on it, but there's a bigger issue. The kind of attitudes that Jeff Kalb eloquently described, that citizens have problems with, that we have problems with because of our investigation, could nowhere be better represented than in this rebuttal, which is itself living evidence of the kind of defensiveness and the attitude. This' isn't two years ago, this is today. I want to say something else. This is no longer the matter, in my opinion, those of you on the Council who know terribly well bear with me, this is a Council issue. There's a time when you stop saying the staff this and the staff that. If the Council does not correct this kind of stuff; two meetings ago that rebuttal was hand- carried, as many of you remember, to the Council but not to the committee the night before our meeting. I was infuriated, because had Vic, in my case, not called and told me, we would have been out in front of you trying to hold a legitimate discussion with you having a whole bunch of evidence that was not confidential but that we had not been given. It was a set up. I wrote a really strong letter, an angry letter, and distributed it to you, which provoked an emotional mouthful that the (inaudible) from one of the Council members, which I really didn't appreciate. My letter is right. There was no purpose whatsoever for the handling, for the rebuttal to be issued, to handle it that way it set up this committee. The next meeting we had, the public meeting that we had, the same thing happened. Evidence, this was given to the Council but not the committee. And then the committee is supposed to be intelligent in its discussion about the Quarry Creek issues with you. Games, set ups, defensiveness, at this point the Council has a problem, and I hope the Council will begin to address it. Because all of those people out there aren't, it's not just one or two or three people who are somehow anomalies, who are the few people who you could never please, the 10% who this and that. There's lots of talk about that. Every meeting there are people out in the audience who want to say "I wasn't treated well" whether the decision was good or not. It's easy to write them off because they're always a very tiny minority. You've got a very general problem with the nature of this City government, and the Council is part of it. It's your responsibility at this point because we're a year and a half -- we're approaching two years past when this stuff happened, and at this point I ask the Council to change the way this City government reacts to the residents of this City. Amen. Kohler: All right, we have 10 minutes and then we'll have a closed meeting. I want to adjourn the meeting. Teerlink: We still have not resolved 7770. Kohler: The next meeting is on Tuesday, the 17th, at 7:30. We will have a 10 minute break. Anderson: Mayor Kohler, at the 17th meeting, are we going to have ... (inaudible). End of tapes. Closed Session on Personnel (Evaluation of City Manager) and on Litigation on the Villa Montalvo case. 7. Adjournment The meeting was adjourned to September 17 at 7:30 p.m. Respectfully submitted, City Council Minutes 23 September 10, 1991 Harry R. Peacock City Clerk