California council may have violated Sunshine Act
California Borough Council may have violated the state’s Sunshine Act when it asked residents to leave a planning session to discuss “contract negotiations,” according to a spokeswoman for the Pennsylvania Newspaper Association. Last week, during a planning session, borough council asked residents to leave the room to discuss “contract negotiations” particularly dealing with a “payment in lieu of (real estate) taxes” agreement with California University officials for a new dormitory to be constructed near Jefferson at California Complex.
During the private session, they met with several Cal U officials, including Barry Niccolai, dean of student services, to negotiate a figure to be paid by the university to the borough as part of the borough’s PILOT (payment in lieu of taxes) program in regards to a new 336-bed dormitory to be constructed near the university’s football stadium as part of the “Jefferson Project.”
Under the Sunshine Act, “official action and deliberations performed by a quorum of the members of an agency must take place at a meeting open to the public.”
California resident Nick Caruso, a former council member, challenged the board on holding the private meeting.
When Caruso asked why residents were asked to leave the room, President Arthur Harris said the two groups were “negotiating figures for taxes.”
Following the meeting Michael Savona, the borough’s solicitor, said council was authorized to hold the meeting in private because they were discussing contract matters that included legal issues. He said that California University is not a taxing body and the matter was not “subject to public disclosure.”
In a telephone interview, Savona said that the meeting was justified to be closed because the two groups were meeting to “avoid (matters) spilling into litigation by negotiating a settlement in advance.”
He said in 2000 the board was going to contest a request for tax exemption by the university to the Washington County Board of Assessment Appeals for the Jefferson at California property but instead entered into a settlement agreement that included a payment in lieu of taxes.
Savona said the new contract, which has not been written up at this point, will be similar to that agreement in which the borough agreed not to “challenge or contest” a request for tax exemption by the university in exchange of “payments in lieu of taxes.”
But Terri Henning, media legal counsel for the Pennsylvania Newspaper Association, said that although there are exceptions under the act that would permit an agency to close a meeting for litigation consultation, she did not believe the exceptions apply for this type of discussion.
Henning said, in her opinion, negotiating for the purpose of preventing future litigation does not fall under the exceptions of the act.
“A lot of issues and actions that local government takes can lead to litigation. The rule (litigation consultation) applies to a narrow set of circumstances …which I do not believe apply here,” she said.
Under the Sunshine Act an agency can consult privately with an attorney or other professional advisor concerning present litigation or issues on which identifiable complaints are legitimately expected to be filed.
Henning said that the “attorney-client privilege” does not apply here because the borough was not meeting with the solicitor to discuss strategies for present litigation, but meeting with a second party to negotiate a contract. She went on to say that there does not appear to be an identifiable complaint expected to be filed, as specified by the Sunshine Act, for a justified closed meeting.
“It seems they were not meeting to discuss strategy. They were meeting to discuss payment. They were negotiating a price and that needs to be open (to the public). Based on my understanding of the facts, they may have violated the Sunshine Act,” Henning said. “I would say the negotiating of figures (to be paid in lieu of taxes) is clearly an issue of public interest.”
Mayor Galvie Gardner said that if the borough was wrong they were not aware of it.
“I think the solicitor and (Arthur Harris, board president) believed the meeting was appropriate. If we have done something wrong, I know the borough will correct that wrong,” Gardner said.
Beyond that, Gardner said he cannot comment because he is not fully aware of what is appropriate under the Sunshine Act.
According to the 2000 agreement in regards to the Jefferson at California Complex between the borough and the university, the university agreed to pay $100,000 to the borough for the installation and repairing of a sewage lift station and to make payments “in lieu of real estate taxes for the purpose of providing revenue to the borough.
Payments were to start on Sept. 1, 2001, and continue at an annual rate of increase of 3 percent for as long as the dormitory or housing facility is maintained on the property. Savona said the borough plans to enter into a similar agreement for the construction of the new housing facility.
Michelle McCoy, director of public affairs at Cal U, said the agreement between the borough and the university are the first of its kind.
“We are the first public university to try a new partnership of this kind. It’s an innovative new way of funding university housing through a public-private partnership,” she said.
She said negotiations with the borough are not complete, but are expected to be final by the end of this month or the beginning of October.
Niccolai said during the meeting last week, construction for the 336-bed off-campus housing facility may begin in October and completed by the 2003 fall semester.