HomeMy WebLinkAboutC-3425(A) - Grant Agreement for Public Education Programs Related to Current and Future Air Transportation Needs of Orange CountyCITY OF NEWPORT BEACH
AGENDA ITEM NO. 24
TO: HONORABLE MAYOR AND MEMBEU6.gF THE CITY COUNCIL
FROM: Homer L. Bludau, City Mana sr7Nec17ttoouNCn
Dennis Danner, Administrative ervices Director ceroFNEwvorrreeA
MI
DATE: September 24, 2002
SUBJECT: AIRPORT GRANTS FINANCIAL REVIEW
RECOMMENDATION
Receive, discuss and file the Airport Grants Financial Review Report for the
Airport Working Group (AWG) and Citizens for Jobs and the Economy (CJE)
dated September 16, 2002. Provide staff with any further direction regarding this
matter.
DISCUSSION
At the July 9, 2002 Council Meeting staff was given direction to prepare for a
review of the public information grants awarded to AWG and CJE on May 22,
2001 and October 23, 2001 respectively. Accordingly, on July 16, 2002 letters
(attached Exhibits 1 and 2) were sent to both groups requesting certain financial
information be returned to the City by August 1, 2002. Both organizations
complied with this request for financial information by the specified date.
After this information was received, the City contacted the independent certified
public accounting firm of Vavrinek, Trine, Day & Co., LLP (Vavrinek) to perform
an agreed upon procedures review of this information. The City's initial letter to
Vavrinek, dated August 9, 2002, is attached as Exhibit 3. The final agreed upon
procedures letter between the City and the accounting firm, received from
Vavrinek, dated August 20, 2002, is also attached to this report as Exhibit 4.
After the procedures for the review were agreed upon, staff from Vavrinek
performed field work over an approximate three week period and provided a draft
report to the City on September 12, 2002 that was reviewed with staff on
City Hall . 3300 Newport Boulevard • Post Office Box 1768 • Newport Beach, California 92659 -1768
• Airportfrants Expenditure Review
Page 2
September 13, 2002. The report was finalized on September 16, 2002 and
scheduled for discussion at the Council Meeting of September 24, 2002
The Principal from Vavrinek in charge of this engagement, Joe Aguilar, as well as
the Supervisor, Roger Alfaro (CPA), will be present at the Council Meeting to
report the results of their review as well as to answer any questions the Council
may have about the review or its findings.
In conclusion, the review performed is known as a "compliance review" to
determine whether the grant expenditures conformed to the terms and conditions
expressed in the written grant agreement. The firm of Vavrinek, Trine & Co. has
provided a written document expressing its findings. However, it is up to the City
Council, the party who entered into the grant agreement, to make the final
determination based on the information provided in the compliance review and
based on its understanding of the intent of the agreement.
Attachments
E
0
CITY OF NEWPORT BEACH
July 16, 2002
P.O. BOX 1768, NEWPORT BEACH, CA 92658 -8915
Tom Naughton, President
Airport Working Group
1048 Irvine Avenue #467
Newport Beach, CA 92660
RE: Grant Agreement with the City of Newport Beach Dated May 22, 2001
Dear Mr. Naughton:
Exhibit 1
As you know, the Airport Working Group (AWG) entered into a grant agreement
with the City of Newport Beach dated May 22, 2001, in the amount of $3.6
million. As the recipient of this grant, AWG agreed to abide by certain terms and
conditions specified by the grant agreement. To validate that all grant
expenditures have been made consistent with the terms and conditions of the
grant, the Newport Beach City Council has directed City staff to hire an
independent accounting firm to review your financial records and other
documentation related to the activities of this grant.
This review may include inquiries of staff and executive management, inspection
of financial and administrative records, compliance testwork, independent
confirmations, and other substantive testwork procedures. The auditor will then
prepare a letter or opinion detailing their findings and results of testwork
procedures that will be made available to the City Manager and Newport Beach
City Council. You will be notified whom the City has hired for this engagement
and soon thereafter you will be contacted directly by the auditor to schedule this
review.
In preparation for this review, the City would like to secure a listing of grant
expenditures, detailing the date of each individual expenditure item, check
number, vendor, the precise nature of services received, and the amount of the
expenditure. Please send this grant expenditure listing directly to my attention by
August 1, 2002, and certify to its accuracy and completeness, to the best of your
knowledge.
During fieldwork procedures, the following information should be provided directly
to our auditors:
3300 Newport Boulevard, Newport Beach
July 16, 2002
Page 2 of 2
1) The identical grant expenditure listing as requested above
2) Copies of monthly bank statements where all grant proceeds and
expenditures were recorded
3) Where grant expenditures were for a professional or administrative service,
please provide the auditors with the contract, engagement letter, or other
synopsis detailing the cost, scope, and specific services the contractor or
employee provided
4) Where independent contractors were reimbursed for substantial out -of- pocket
costs, the records substantiating the cost and specific nature of product or
service reimbursed should also be made available to the auditors
5) Where grant expenditures were used to produce a product (i.e. letter, mailer,
video, commercial, or other communication form) a sample of the product
should be provided to our auditors
6) Access to all invoices, proposals, cancelled checks, and other financial or
grant activity documentation
7) Other related information as requested
We trust you will extend our auditors the same courtesy and cooperation you
have extended to City staff during past grant inquiries. If you have any questions,
please contact Accounting Manager Dan Matusiewicz at 949.644.3126.
Very truly yours,
Homer Bludau
City Manager
cc: City Council
City Attorney
Administrative Services Director
[A
CITY OF NEWPORT BEACH
July 16, 2002
P.O. BOX 1768, NEWPORT BEACH, CA 92658 -8915
Bruce Nestande, President
Citizens for Jobs and the Economy
949 South Coast Drive #600
Costa Mesa, CA 92626
Exhibit 2
RE: Grant Agreement with the City of Newport Beach Dated October 23, 2001
Dear Mr. Nestande:
As you know, Citizens for Jobs and the Economy (CJE) entered into a grant
agreement with the City of Newport Beach dated October 23, 2001, in the
amount of $300,000. As the recipient of this grant, CJE agreed to abide by
certain terms and conditions specified by the grant agreement. To validate that
all grant expenditures have been made consistent with the terms and conditions
of the grant, the Newport Beach City Council has directed City staff to hire an
independent accounting firm to review your financial records and other
documentation related to the activities of this grant.
This review may include inquiries of staff and executive management, inspection
of financial and administrative records, compliance testwork, independent
confirmations, and other substantive testwork procedures. The auditor will then
prepare a letter or opinion detailing their findings and results of testwork
procedures that will be made available to the City Manager and Newport Beach
City Council. You will be notified whom the City has hired for this engagement
and soon thereafter you will be contacted directly by the auditor to schedule this
review.
In preparation for this review, the City would like to secure a listing of grant
expenditures, detailing the date of each individual expenditure item, check
number, vendor, the precise nature of services received and the amount of the
expenditure. Please send this grant expenditure listing directly to my attention by
August 1, 2002, and certify to its accuracy and completeness, to the best of your
knowledge.
During fieldwork procedures, the following information should be provided directly
to our auditors:
3300 Newport Boulevard, Newport Beach
1
July 16, 2002
Page 2 of 2
1) The identical grant expenditure listing as requested above
2) Copies of monthly bank statements where all grant proceeds and
expenditures were recorded
3) Where grant expenditures were for a professional or administrative service,
please provide the auditors with the contract, engagement letter, or other
synopsis detailing the cost, scope, and specific services the contractor or
employee provided
4) Where independent contractors were reimbursed for substantial out -of- pocket
costs, the records substantiating the cost and specific nature of product or
service reimbursed should also be made available to the auditors
5) Where grant expenditures were used to produce a product (i.e. letter, mailer,
video, commercial, or other communication form) a sample of the product
should be provided to our auditors
6) Access to all invoices, proposals, cancelled checks, and other financial or
grant activity documentation
7) Other related information as requested
We trust you will extend our auditors the same courtesy and cooperation you
have extended to City staff during past grant inquiries. If you have any questions,
please contact Accounting Manager Dan Matusiewicz at 949.644.3126.
Very truly yours,
9vo_)_�XZ14wl�
Homer Bludau
City Manager
cc: City Council
City Attorney
Administrative Services Director
August 9, 2002
♦ •
CI'TY OF NEWPORT BEACH Exhibit 3
ADMINISTRATIVE SERVICES
3300 NEWPORT BLVD.
P.O. BOX 1768, NEWPORT BEACH, CA 92658 -8915
(949)6443121
Mr. Joe Aguilar, Principal
Vavrinek Trine Day & Co. LLP
P.O. Box 4407
Rancho Cucamonga, CA 91729
RE: Airport Grant Agreed Upon Procedures Engagement
Dear Mr. Aguilar:
The City of Newport Beach entered into grant agreements with two California non - profit public
corporations, the Airport Working Group (AWG) and Citizens for Jobs and the Economy (CJE).
AWG was granted and received $3.6 million from the City to conduct public outreach activities
related to the manner and means of accommodating the current and future air travel and air
cargo needs of Orange County including a commercial aviation reuse of the former El Toro air
base. WE was granted $300,000 and received $160,000 to engage in lobbying and legislative
activities related to, and in furtherance of, policies of the City concerning the means and
methods of meeting Orange County's future air transportation demand. Both parties
acknowledged and agreed to certain terms, conditions, and restrictions on the use of these
grants.
As directed by the City Council, we are requesting an independent accounting firm review the
grant agreements and determine if the grantees have complied in all material respects with the
terms, conditions, and restrictions of use of the grant funds. On August 1, 2002, and as
requested by the City, both grantees reported to the City a listing of all grant expenditures
incurred to date, detailing the date, check number, payee, amount, and nature of the
expenditure. It is contemplated that this engagement would include both quantitative and
qualitative test -work procedures that would substantiate the expenditures reported, validate that
the expenditures are fairly represented by their reported description, and test the grantees'
compliance with the provisions of the grants. Where it is either not feasible or it is beyond the
professional scope of an accounting firm to determine whether certain expenditures meet the
terms, conditions, and restrictions on the use of the grant funds, it is contemplated that your firm
simply report back to the Gay the specific expenditures in sufficient detail for the C ,y's legal staff
to determine whether said expenditures complied with the provisions and or spirit and intent of
the grant.
In preparation for this engagement, the City requested the following information be provided
directly to the engagement auditors during fieldwork.
0
August 9, 2002
Page 2 of 2
•
1) The identical grant expenditure listing remitted to the City on August 1, 2002.
2) Copies of monthly bank statements where all grant proceeds and expenditures were
recorded.
3) Where grant expenditure was for a professional or administrative service, the contract,
engagement letter, or other synopsis detailing the cost, scope, and specific services the
contractor or employee provided.
4) Where independent contractors were reimbursed for substantial out -of- pocket costs, the
records substantiating the cost and specific nature of product or service
5) Where grant expenditures were used to produce a product (i.e., letter, mailer, video,
commercial, or other communication form) a sample of the product.
6) Access to all invoices, proposals, cancelled checks, and other financial or grant activity
documentation.
7) Other related information as requested.
You are encouraged to request any and all further documents you deem necessary to complete
this engagement. We trust that our grantees will extend to you the utmost professional courtesy
and cooperation to perform this engagement.
It is understood that this engagement would be billed on a time and materials basis at rates to
be approved and accepted by the City prior to its start. It is requested that a good faith estimate
of the total cost of this engagement be submitted to the City prior to its start as well. It is
contemplated that this engagement would not extend beyond 30 days from the first day of
fieldwork to the date a final report is delivered to the City. If necessary, your firm may also be
requested to meet with the City Council to explain or further expound upon your engagement
findings. It is understood that this engagement would conform to AICPA standards of
independence, proficiency, due care, fieldwork, professional conduct, and other industry
standards relevant to engagements of this nature.
If you have any questions, please contact Dan Matusiewicz of my staff at (949) 644 -3126.
Very truly yours,
Homer B�luddau
cc: City Council
City Attorney
Administrative Services Director
0
Exhibit 4
August 20, 2002
Mr. Homer Bludau
City of Newport Beach
3300 Newport Blvd.
P.O. Box 1768
Newport Beach, CA 92658 -8915
Dear Homer:
We are pleased to have the opportunity to provide professional services to the City of Newport
Beach ( "the City"). This engagement letter is in response to our recent discussions concerning
the educational grants provided to the Airport Working Group ( "AR'G ") and Citizens for Jobs &
the Economy ( "CJ &E "). The following sections discuss our understanding of the engagement,
timing, our professional fees and the nature and limitations of the services we will provide.
Our Understanding of the Engagement
As discussed in our meeting on August 9, 2002, the City requests an independent analysis of
expenditures incurred by the AWG and CJ &E on educational grants provided by the City.
Specifically, the City requests that expenditures are analyzed for validity, consistency and
compliance with the authorized grant agreements. At the City's request, we will perform the
agreed upon procedures outlined in the attached Exhibit A in accordance with standards
established by the A1CPA.
Timing
We performed preliminary reconnaissance work on August 15, 2002 to ascertain the existence
and condition of AWG's and CJ &E's financial records and supporting documentation. As a
result, we believe that the engagement requested by the City is feasible and accordingly, we will
begin our fieldwork on August 21, 2002. We anticipate that the engagement will require
approximately 82 hours including the preliminary work already conducted.
We would expect to have our draft report available in approximately 3 to 4 weeks.
Deliverable
We will present our findings to the City in an agreed upon procedures report.
•
Homer Bludau
City of Newport Beach
August 20, 2002
Page 2
0
Professional Fees
Our professional fees for this engagement are based on the skills required and the estimated time
required to perform the agreed scope of work. Such fees will be based on the actual time and
materials at our hourly rates. A summary of our hourly billing rates is as follows:
Based on our understanding of the agreed upon procedures engagement and our anticipated work
plans, we estimate that our professional fees will approximate $9.950.
We look forward to working with the City on this important engagement. If you have any
questions, please do not hesitate to call me at (909) 466 -4410.
Sincerely,
VAVRINEK TRINE DAY & CO., LLP
Joe Aguilar
Principal
Approx.
Hourly Rate
Hours
Cost
Principal/Partner $170
16
S 2,720
Supervisor $115
48
5,520
Senior $95
18
1,710
82
S 9,950
Based on our understanding of the agreed upon procedures engagement and our anticipated work
plans, we estimate that our professional fees will approximate $9.950.
We look forward to working with the City on this important engagement. If you have any
questions, please do not hesitate to call me at (909) 466 -4410.
Sincerely,
VAVRINEK TRINE DAY & CO., LLP
Joe Aguilar
Principal
City of Newport Beach
Agreed Upon Procedures
In completing our engagement, Vavrinek, Trine, Day & Co., LLP will perform the following to
assist the City:
For AWG and CME ( "grant recipients "):
1) Review the City's authorized grant agreements identifying authorized and prohibited uses of
grant proceeds.
2) Identify the deposit/receipt of the City's proceeds in the grant recipients' bank accounts.
3) Identify the nature of any operating transfers between bank accounts and ascertain the impact
on the grant expenditures.
,4) Summarize the projects (publication, research and media productions) and approximate costs
benefiting from the grant proceeds.
5) Prepare a summary of expenditures by vendor noting the dollar magnitude and percentages
expended.
6) Identify the dollar magnitude of commissions earned by consultants or vendors on
expenditures with grant proceeds.
7) Select a sample of expenditures from the grant recipients' accounting records and perform
the following:
a. Validate the existence of the expenditure by tracing it from the source ledger to an
approved invoice, cancelled check and bank statement
b. Compare the nature of the expenditure to the authorized uses in the grant agreement.
Note any obvious or potential discrepancies.
8) Summarize expenditures incurred by the grant recipients after February 12, 2002.
9) Review a sample of publications and media spots and ascertain compliance with the grant
agreement provisions.
10) Obtain confirmation from the City's oversight attorneys regarding the approval of
publications and media spots prior to their dissemination to the public.
11) Select a sample of vendors utilized by the grant recipients and confirm the dollar magnitude
and nature of services provided.
12) Prepare a schedule of unexpended grant proceeds remaining as of August 20, 2002.
13) Perform limited inquiry to ascertain the nature or existence of related party transactions.
Summarize the dollar magnitude of such transactions.
The scope of our engagement is limited to the above procedures and as a result, we will not
ascertain the cost - effectiveness or efficiencies of the expenditures incurred by the grant.
Because the above procedures do not constitute an audit conducted in accordance with generally
accepted auditing standards, we will not express an opinion on any of the information referred to
above. If we perform additional procedures, other matters may come to our attention that will be
reported to you. The terms of our engagement are such that we have no obligation to update the
report because of events and transactions occurring after the computation period.
Agreed to by:
YO NEWPORT BEACU
Authorized Signatulre
Printed Name
Za 2002
Date
Vavrinek, Trine, Day & Co., LLP
Partner
Printed Name
Date
I Exhibit 5
Vavrin rine, Day & Co., LLP • �
Certified Public Accountants & Consultants 1
September 16, 2002
City Council
City of Newport Beach
Newport Beach, California
Independent Accountant's Report
on Applvine Aereed -Upon Procedures
We have performed the procedures enumerated below, which were agreed to by the
Management of the City of Newport Beach, California ( "the City "), solely to assist you in
ascertaining the existence and nature of expenditures incurred by the Airport Working
Group ( "AWG ") and the Citizens for Jobs & the Economy ( "CJ &E'), in connection with
the City's educational grant agreements dated May 22, 2001 and October 23, 2001,
respectively. This agreed -upon procedures engagement was conducted in accordance
with attestation standards established by the American Institute of Certified Public
Accountants. The sufficiency of these procedures is solely the responsibility of the City.
Consequently, we make no representation regarding the sufficiency of the procedures
described below either for the purpose for which this report has been requested or for any
other purpose.
Our procedures and associated findings are as follows:
1) Review the City's authorized grant agreements identifying authorized and prohibited
uses of grant proceeds.
For the AWG grant agreement dated May 22, 2001, it was noted that grant proceeds
were intended for the purpose of " informing the public of issues and engaging in
other activity relevant to the manner and means of accommodating the current and
future air transportation demand in Orange County. " It was also noted that
expenditures directly or indirectly to support or oppose a candidate(s) for public
office or qualification, passage or defeat of a ballot measure were prohibited. Refer
to the excerpt of the AWG grant agreement included at Exhibit A.
For the CJdE grant agreement dated October 23, 2001, it was noted that the funds
were intended for the purpose including the engaging in or retaining persons for
lobbying and legislative activities related to, and in furtherance of City policies
concerning the means and methods of serving current and future air transportation
demand in Orange County. We noted that expenditures directly or indirectly to
support or oppose a candidate(s) for public office or qualification, passage or defeat
of a ballot measure were prohibited. Refer to the excerpt of the CJ &E grant
agreement included at Exhibit B.
8270 Aspen Street Rancho Cucamonga, CA 91730 Tel: 909.466.4410 Fax: 909.466.4431 www.vldcpa.com
FRESNO • LAGUNA HILLS • PLEASANTON • RANCHO CUCAMONGA • SACRAMENTO • SAN 105E
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City of Newport Beach
September 16, 2002
Page 2
2) Identify the deposit/receipt of the City's proceeds in the grant recipients' bank
accounts.
For AWG, we noted that the grant proceeds in the amount of $3,600,000 were
received in two separate and distinct bank accounts. We further noted that the
proceeds were not commingled with other AWG funds.
For CJ&& we noted that proceeds in the amount of $150, 000 were deposited into a
bank account that was separate and distinct from other CJ&E funds.
3) Identify the nature of any operating transfers between bank accounts and ascertain the
impact on the grant expenditures.
For AWG, we noted operating transfers from the organization's money market
account to the checking account to cover disbursements. Further, we noted no
compliance related impact of these transfers on the grant expenditures.
For CJ&E, we noted no operating transfers, as there was only one bank account.
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City of Newport Beach
September 16, 2002
Page 3
4) Summarize the projects (publication, research and media productions) and
approximate costs benefiting from the grant proceeds.
For AWG, the detailed projects and related expenditures by project are shown at
Exhibit C. The following represents summarized grant expenditures by project
category incurred by AWG:
Summary of Expenditures by Project Category
Publication/Mailing
786,448
TV/Media
1,066,149
Consulting
523,768
Lobbying
85,000
Public Meetings
68,527
Research
289,181
Legal
395,761
Consultant Commissions
379,293
3,594,126
Percentage of
Expenditures by Project Category
Consultant
11%
iliL.1
22%
Research
8%
Public Meetings
2%
Lobbying TV/Media
2% 29%
Consulting
15%
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City of Newport Beach
September 16, 2002
Page 4
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For CME, there was a total of $120,034 in expenditures. Of this amount $120,000
was used to contract a law firm for lobbying in Washington D.0 and the remaining
$34 was incurred for bank charges.
5) Prepare a summary of expenditures by vendor noting the dollar magnitude and
percentages expended.
For AWG, expenditures by individual vendors are shown at Exhibit D. In summary,
expenditures for the top ten vendors are presented below:
Vendor Service Provided
Greenstripe Media Acquisition of TV Airtime
MTA Inc. Publication Products
Bruce Nestande (Retainer & Commissions)
Cheveliar, Allen & Lichman
David Ellis & Assoc., LLC (Retainer & Commissions)
Postmaster
Petrone Productions, Inc.
BBC Research & Consulting
David Ellis (Reimbursements/Pass- Through)
Kutak Rock, LLP
All Other Vendors
Total Expenditures
Consulting Services
Legal and Research Services
Consulting Services
Postage
Media Production
Great Park Feasibility Study
Consulting Pass Through Costs
Legal and Research Services
Various
Amount Percentage
Expended Expended
931,168 25.91%
493,874 13.74°/,
346,622 9.640%
330,134 9.19°/,
329,647
9.170%
246,309
6.85%
133,903
3.73%
131,224
3.65%
128,415
3.570/.
112,215
3.12%
410,615
11.42%
3,594,126 100.00%
For CJ&E, 99% of the expenditures were incurred for the law firm of Hecht, Spencer
& Associates, Inc for lobbying expenses. The remainder related to Wells Fargo bank
charges.
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City of Newport Beach
September 16, 2002
Page 5
6) Identify the dollar magnitude of commissions earned by consultants or vendors on
expenditures with grant proceeds.
For AWG, commissions earned by consultants in connection with specific projects
are shown at Exhibit A. Total commissions paid to vendors and consultants are
summarized below.
S 449,083 12.5%
For CJ&E, it was noted that there were no agreements or arrangements for
commissions. Accordingly, no amounts were paid for commissions.
7) Select a sample of expenditures from the grant recipients' accounting records and
perform the following:
a. Validate the existence of the expenditure by tracing it from the source ledger
to an approved invoice, cancelled check and bank statement
For AWG, an invoice, cancelled check and corresponding debit in the
organization's bank statements supported the expenditures sampled. It was
also noted that of the $3,594,126 in expenditures incurred, approximately
74% of the dollar volume was sampled.
For CJ&E, an invoice cancelled check and corresponding debit in the
organization's bank statements supported the expenditure sampled. It was
noted that CME had only one disbursement totaling $120,000 to Hecht,
Spencer & Associates, Inc.
Commission
Commission
as a Percentage
Vendor
Basis
Amount
of Total Expenditures
David Ellis & Associates, LLC
90% of Goss Deliverable Cost
$ 189,647
5.3%
Bruce Nestande
9%ofGross Deliverable Cost
189,647
5.3%
Greenstripe Media
7.5% of Airtime Cost
69,789
1.9%
S 449,083 12.5%
For CJ&E, it was noted that there were no agreements or arrangements for
commissions. Accordingly, no amounts were paid for commissions.
7) Select a sample of expenditures from the grant recipients' accounting records and
perform the following:
a. Validate the existence of the expenditure by tracing it from the source ledger
to an approved invoice, cancelled check and bank statement
For AWG, an invoice, cancelled check and corresponding debit in the
organization's bank statements supported the expenditures sampled. It was
also noted that of the $3,594,126 in expenditures incurred, approximately
74% of the dollar volume was sampled.
For CJ&E, an invoice cancelled check and corresponding debit in the
organization's bank statements supported the expenditure sampled. It was
noted that CME had only one disbursement totaling $120,000 to Hecht,
Spencer & Associates, Inc.
• •
City of Newport Beach
September 16, 2002
Page 6
b. Compare the nature of the expenditure to the authorized uses in the grant
agreement. Note any obvious or potential discrepancies.
For AWG, it was noted that the sample expenditures tested were incurred for
purposes consistent with the scope and broad terms of the grant agreement
dated May 22, 2001 except as stated below:
i) It was noted that a disbursement in the amount of $250,000 was paid
to Cheveliar, Allen & Lichman for anticipated litigation. We were
unable to ascertain the nature or magnitude of the anticipated
litigation and therefore cannot conclude on consistency with the grant
agreement. Further, we were informed, that as of August 20, 2002
approximately $207,000 was remaining in the legal trust.
ii) It was noted for certain professional services vendors (i.e. lobbying or
consulting) that tangible and measurable outputs or deliverables were
not produced. Therefore, verification of the actual activities
performed by these vendors could not be performed. However, it was
noted that professional services agreements were maintained by AWG
documenting the consultant's scope of work Such agreements and
related invoices were for purposes consistent with the scope of the City
grant. Vendors and total expenditures for which the above
information applied, included the following:
• Wilson Research & Strategy - $10,000
• Platinum Advisors- $50,000
• Laura Davies /Saunders - $22,584
iii) We noted that approximately $14,555 in commissions to David Ellis &
Associates, LLC and Bruce Nestande were paid on a project that was
cancelled by attorneys. The expected costs of the project were never
invoiced by the vendor nor paid by AWG and therefore, the
commission payments are deemed as potential discrepancies with the
grant agreement.
For CME, it was noted that $120,000 in payments to Hecht, Spencer &
Associates, Inc. pertained to lobbying efforts in Washington D.C. We noted
that CME maintained a professional services agreement with the law firm
documenting a scope of services that was consistent with the scope of the
CME grant agreement dated October 23, 2001. However, it was noted that
written summaries of actual activities performed were not provided with
monthly invoices. Further, we noted that invoices did not indicate any detail
other than "Monthly Service Fee ". Therefore, actual activities performed by
the vendor could not be verified.
P
City of Newport Beach
September 16, 2002
Page 7
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8) Summarize expenditures incurred by the grant recipients after February 12, 2002.
For AWG, it was noted that approximately $482,192 of expenditures were incurred
subsequent to February 12, 2002. Components of these expenditures include
Cheveliar Allen & Lichman — legal trust ($250,000), David Ellis & Associates —
consulting ($65,119), Bruce Nestande — consulting ($53,330), MTA Inc. -Get Out the
Vote ($47,405), Kutak Rock — legal research ($18,616), Consulting Experts —
consulting ($16,444), Lara Sanders — consulting ($8,834) and Other vendors —
miscellaneous expenses ($22,444).
For CJ&E, it was noted that approximately $31,428 of expenditures were incurred
for Hecht, Spencer & Associates, Inc. subsequent to February 12, 2002.
9) Review a sample of publications and media spots and ascertain compliance with the
grant agreement provisions.
For AWG, we reviewed twenty -one publications /media spots or research items noting
that each was educational in nature as required by the grant agreement provisions.
In accordance with the grant provisions, it was noted that none of the publications
sampled were either in favor or opposed to a specific political candidate or ballot
measure.
For CJ&E, we noted no publications or media spot deliverables as all costs were
incurred for lobbying efforts.
10) Obtain confirmation from the City's oversight attorneys regarding the approval of
publications and media spots prior to their dissemination to the public.
Confirmations were submitted to the City's oversight attorneys of Reed & Davidson
and Strumwasser & Woocher, LLP to obtain representation regarding the approval
of media and publications prior to public dissemination. Specifically for Reed &
Davidson, it was noted that their response was limited because of the absence of the
final physical publications and media spots. Such representation could only be
provided upon re- reviewing the final products.
It was noted however, that AWG maintained approval representation in the form of
faxed sign -offs from both of the City's oversight attorneys for each publication and
0 0
City of Newport Beach
September 16, 2002
Page 8
media spot that was disseminated. These faxed sign -offs indicated that each
publication mailer or media spot that was disseminated, had also been approved.
For CJ&E, the requirement of attorney oversight was not imposed given the nature of
the services and expenditures incurred (i.e. lobbying).
11)Select a sample of vendors utilized by the grant recipients and confirm the dollar
magnitude and nature of services provided.
For AWG, confirmations were submitted to third party vendors covering $1,785,993
or 50% in total expenditures. As of September 10, 2002, two confirmations were
outstanding. As a result, $1,600,769 or 45% of expenditures were confirmed with
third party vendors without material discrepancies.
For CJ&E, a confirmation was submitted to Hecht, Spencer & Associates for
expenditures of $120,000 or 99% of total expenditures incurred. As of September 10,
2002, the confirmation is outstanding.
12) Prepare a schedule of unexpended grant proceeds remaining as of August 20, 2002.
For remaining grant proceeds as of August 20, 2002, refer to Exhibits E & F for
AWG and CJ&E, respectively.
13)Perform limited inquiry to ascertain the nature or existence of related party
transactions. Summarize the dollar magnitude of such transactions.
For AWG, we noted that the organization had approximately $330,134 in
transactions to Cheveliar, Allen & Lichman. It was noted that Barbara Lichman,
Executive Director, is also a partner in this law firm.
For CI&E, we were informed that no related party transactions occurred.
City of Newport Beach
September 16, 2002
Page 9
I*
We were not engaged to and did not conduct an audit, the objective of which would be
the expression of an opinion on the financial records and compliance of the Airport
Working Group or Citizens for Jobs & the Economy. Accordingly, we do not express
such an opinion. Had we performed additional procedures, other matters might have
come to our attention that would have been reported to you.
This report is intended solely for the information and use of the City Council and
management of the City of Newport Beach, California and is not intended to be and
should not be used by anyone other than the City.
Sincerely,
1
VAVRINEK TRINE DAY & CO., LLP
Rancho Cucamonga, California
0
City of Newport Beach
September 16, 2002
Page 10
Exhibits
0
A Excerpt from AWG Grant Agreement Dated May 22, 2001
B Excerpt from CJ &E Grant Agreement Dated October 23, 2001
C Schedule of Projects Funded with Grant Proceeds
D Schedule of Expenditures by Vendor
E Schedule of Unspent Grant Proceeds as of August 20, 2002 - AWG
F Schedule of Unspent Grant Proceeds as of August 20, 2002 — CJ &E
City of Newport Beach Exhibit A
Excerpt from AWG Grant Agreement
Dated May 22, 2001
public of issues, and engaging in other activity, relevant to the manner and means of
accommodating the current and future air transportation demand in Orange County;
and
WHEREAS, the CITY has approved this Grant subject to GRANTEE'S
commitment, and appropriate safeguards to ensure, that the Grant funds will not be
spent to support or oppose the qualification, passage or defeat of any ballot measure or
the election or defeat of any candidate for political office; and
WHEREAS, the CITY has also approved this Grant subject to GRANTEE'S
commitment that the Grant funds will not be used for any activity that would violate
state or federal statutory or decisional law such as regulations affecting non - profit or tax
is exempt organizations.
NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:
1. GRANT
CITY agrees to Grant to GRANTEE the sum of three million six hundred
thousand dollars ($3,600,000.00). This Grant (Grant Funds) shall be paid in one
lump sum of one million eight hundred thousand dollars ($1,800,000.00) and
twelve equal monthly installments of one hundred fifty thousand dollars
($150,000.00). The lump sum shall be paid on or before June 1, 2001. The first
installment shall be paid on or before June 1, 2001 and the remaining
installments shall be paid on or before the first of each of the following eleven
(11) months. The Grant Funds shall be used for the purpose of informing the
Ll
FROM
public of issues, and engaging in other activity, relevant to the manner and
means of accommodating the current and future air transportation demand in
Orange County.
2. TERM
The term of this Agreement shall commence on May 22, 2001 (the Effective
Date) and shall continue in full force and effect until the final installment has
been paid and GRANTEE has spent all of the Grant Funds.
3. RESTRICTIONS ON USE OF FUNDS
(a) GRANTEE acknowledges that municipal corporations are
prohibited from spending, directly or indirectly, public funds to support or
oppose candidates for public office. GRANTEE also acknowledges that
public funds may not be spent, directly or indirectly, to support or oppose Q
the qualification, passage or defeat of a ballot measure. Accordingly,
GRANTEE warrants that the Grant Funds will not be spent, directly or
indirectly, to support or oppose a candidate or candidates for public office.
GRANTEE further warrants that the Grant Funds will not be spent, directly
or indirectly, to support or oppose the qualification, passage or defeat of
any ballot measure. Finally, GRANTEE warrants that the Grant Funds will
not be spent to prepare or distribute material, or to disseminate
information, if it is clear from the surrounding circumstances that the
material or information supports or opposes the election of any candidate
or the qualification, passage or defeat of any ballot measure.
(b) In addition to the commitments in Subsection 3(a), GRANTEE
warrants that the Grant Funds will not be spent in a manner that violates p
any State or Federal statutory or decisional law applicable to non - profit
AWG GRANT AGREEMENT
organizations exempt from taxation pursuant to Section 501(c)(3) of the
Internal Revenue Code.
(c) GRANTEE shall retain legal counsel with at least five years
experience in the fields of election law and political law to ensure
compliance with the warranties in Subsections 3(a) and 3(b). Legal
counsel retained by Grantee shall review all material or information
prepared, in whole or in part, through the expenditure of Grant Funds and
prior to duplication or dissemination to the public to ensure compliance
with all statutory and decisional law governing the conduct of political
campaigns and the other restrictions and warranties in this Agreement.
GRANTEE may use Grant Funds to compensate special counsel for this
specific and limited purpose.
(d) To further ensure compliance with the provisions of Subsection
3(a), GRANTEE shall not duplicate or disseminate to the public any
material prepared, in whole or in part, through an expenditure of Grant
funds unless and until the material has been reviewed, and determined to
comply with Section 3(a), by special counsel retained by the City Council.
CITY shall notify GRANTEE in writing, on or before May 25, 2001, of the
name or names of the special counsel retained by the CITY to review
material pursuant to this Subsection. The review by special counsel
retained by the CITY shall be conducted, and the determination
communicated to GRANTEE, by the end of the next business day
following receipt of the material by special cburisel:
4. INDEMNIFICATION
GRANTEE shall hold harmless, defend and indemnify the CITY, and its officers
L
and employees, from any claim, loss, litigation, or liability arising out of or in any
wCity of Newport Beach N
Excerpt from Grant Agreement Exhibit B
Dated October 23, 2001
r i NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:
1. GRANT
City will grant CJE the sum of three hundred thousand dollars ($300,000) subject
to the terms, restrictions, covenants and conditions of this Agreement (Grant).
The Grant shall be paid in twelve (12) equal monthly installments, with the first
installment due on November 1, 2001 and the remaining eleven installments due
on or before the first of the next eleven months. The City Manager shall have the
authority to pay the balance of the Grant at any time during the Term of this
Agreement.
2. AUTHORIZED ACTIVITIES
\ The Grant shall be used exclusively to fund Authorized Activities. For the
purposes of this Grant, the following shall be considered to be Authorized
Activities:
(a) To engage in, or retain persons to engage in, lobbying and legislative
activities related to, and in furtherance of, City policies concerning the
means and methods of serving current and future air transportation
demand in Orange County;
(b) To give direction to, and supervise the work of, any individual or entity -;
retained to perform the work described in Subsection (a); and
(c) To ensure that Grantee has strictly complied with the terms and conditions
of this Grant and to perform Grantee's duties such as maintaining
3. TERM
L
necessary records and providing period reports to the City Manager.
r
FROM
The term of this Agreement shall commence on October 23, 2001 (the Effective
Date) and shall continue in full force and effect until terminated by the City or until
October 31, 2002, whichever occurs first. The provisions of this Agreement that
require Grantee to defend and indemnify the City and to maintain records shall
survive the expiration or termination of this Agreement.
4. RESTRICTIONS ON USE OF GRANT FUNDS
(a) Grantee acknowledges that statutory and decisional law prohibits
governmental entities from spending, directly or indirectly, public funds to
support or oppose candidates for public office. Grantee acknowledges
that statutory and decisional law prohibits the expenditure of public funds
to, directly or indirectly, support or oppose the qualification, passage or
defeat of a ballot measure absent express legislative authority. Finally,
Grantee understands and acknowledges that certain state and /or federal
laws may apply to the expenditure of the Grant or the extent to which
Grantee may engage in Authorized Activities.
(b) Grantee expressly agrees that the Grant will not be spent, directly or
indirectly, to support or oppose a candidate or candidates for public office
or to support or oppose the qualification or passage of any ballot measure.
Grantee also expressly agrees that the Grant shall be used in a manner
consistent with applicable state and /or federal law.
5. AVAILABILITY OF GRANT
Grantee acknowledges and agrees that the City is prohibited from incurring
indebtedness in other than the current fiscal year except under certain
circumstances that are not present in this case. Grantee agrees that City is not
in breacb _ of.this_Agreement,- and- that.Grantee -is_ not - entitled .toany - portion of the ----}—
Grant due and payable in fiscal year 2002 -03, unless that City Council has
allocated funds for purposes of the Grant in the budget for that fiscal year.
0 0
Exhibit C
City of Newport Beach
Schedule of Projects Funded with Grant Proceeds
For the Airport Working Group ("AWG ")
3,214,832 379,293 3594,126
Source: Listing of Expenditure Transactions provided by AWG
Summarized by Vavrinek, Trine, Day & Co., LLP
Refer to the Agreed Upon Procedures Report
Project
Total Direct
Approximate
Total
Project
Type
Date
Costs
Commissions
Project Costs
"Sucker" Brochure
Publication/Mailing
524 /201
91,477
10,776
102,252
"Bunny & the Papers"
TV /Media
5/242001
103,000
18,540
121,540
'Bunny & the Weasel"
TV /Media
6/152001
102,968
18,534
121,502
"3WA Expansion- Do the Math" Brochure
Publication/Mailing
6/262001
41,621
5,580
47,201
'Weasel Words' Brochure
Publication/Mailing
6/26/2001
99,932
10,498
100,430
'ET Airport Plan' Brochure
Publication/Mailing
626/2001
92,770
10,499
103,267
'Bunny & the Dream'
TV /Media
7/52001
123,000
22,140
145,140
"You Decide'POink, Oink"
Publication/Mailing
8/92001
126,341
14,074
140,415
'Get on Board'
TV/Media
gn3n001
119,578
21,524
141,102
"Everybody's Talking'
TV/Media
9/6/2001
127,300
22,914
150.214
'Just the Facts'
TV/Media
9202001
124,300
22,374
146,674
"Great Park, Great Cost"
TV/Media
10/162001
123,850
22,293
146,143
'Point, Counter Point'
Publication/Mailing
11/1012001
123,649
14 ,373
138,022
'Point, Counter Point'
TV/Media
11/19/2001
124,870
22,477
147,347
' Point, Counter Point' replaced'Toxice
TV /Media
lnnoo2
110,078
22,473
132 ,351
"Toxics'(Never materialized)
TV/Media
216/2002
7,205
-
7,205
"Great Park" Invitation & Luncheon
Publication/Mailing
925/2001
34,457
4,985
39,442
Get Out To Vow ( "GOTV') Program
Publication/Mailing
2/26/2002
47,405
8,533
55,938
.JWA Corridor Handout
Publication/Mailing
6115/2001
10,798
-
10,798
"News' Brochure
Publication/Mailing
10 /912001
127,998
14,373
142,371
Toxics Mailer (Never materialized)
1/22002
14,555
14,555
Lobbying
Lobbying
Various
85,000
15,300
100,300
Community Meetings, Invitations and Other
Public Meetings
Various
68,527
8,782
77,308
Legal Review and Services
Legal
Various
145,761
-
145,761
Consultant Costs (excluding commission)
Consulting
Various
523,768
-
523,768
Legal Reserve or Contingency
Legal
8 /9/01 & 225/02
250,000
-
250,000
Great Park Analysis
Research
62112001
164,403
32,644
197,047
Toxic Study
Research
1220/2001
88,778
14,575
103,353
Tides Foundation Research
Research
2/132002
6,500
1,170
7,670
Contributions to Irvine Taxpayers
Research
Various
25,000
4,500
29,500
Reason Foundation
Research
1/13 /2002
1,000
180
1,180
GEO Syntech Maps
Research
3/512002
3,500
630
4,130
3,214,832 379,293 3594,126
Source: Listing of Expenditure Transactions provided by AWG
Summarized by Vavrinek, Trine, Day & Co., LLP
Refer to the Agreed Upon Procedures Report
Exhibit D
City of Newport Beach
Schedule of Expenditures by Vendor
For the Airport Working Group ( "AWG")
Source: Listing of Expenditure Transaction provided by AWG
Summarized by Vavrinek, Trine, Day & Co., LLP Refer to the Agreed Upon Procedures Report
Amount
Percentage
Vendor
Expended
Expended
A America Signs
271
0.01%
Advertising & Supply
2,838
0.08%
American Association of Airport Executives
6,000
0.17%
Amies Communications
200
0.01%
Arrowhead Computer Service
2,233
0.06%
BBC Research & Consulting
131,224
3.65%
Bell, McAndrews, Hiltachk & Davidian, LLP
65,568
1.82%
Bruce Nestande (Retainer & Commissions)
346,622
9.64%
Bruce Nestande (Reimbursements/Pass- Through)
7,793
0.22%
Capitol Strategies Group
25,000
0.70%
Cheveliar, Allen & Lichman
330,134
9.19%
Coach USA Sightseeing Anaheim
2,796
0.08%
Consulting Experts, Inc.
53,000
1.47%
Copy Stop
9,305
0.26%
Comer Bakery
1,961
0.05%
Costa Mesa Parks & Recreation
300
0.01%
David Ellis & Assoc., LLC (Retainer & Commissions)
329,647
9.17%
David Ellis (Reimbursements/Pass- Through)
128,415
3.57%
Davis Murray
535
0.01%
Designed to Win
41,824
1.16%
Greenstripe Media
931,168
25.91%
Irvine Taxpayers
25,000
0.70%
James Gregg
2,000
0.06%
Kutak Rock, LLP
112,215
3.12%
Lara Saunders
22,584
0.63%
Litho Graphics
408
0.01%
MTA Inc.
493,874
13.74%
Source: Listing of Expenditure Transaction provided by AWG
Summarized by Vavrinek, Trine, Day & Co., LLP Refer to the Agreed Upon Procedures Report
0
City of Newport Beach
Schedule of Expenditures by Vendor
For the Airport Working Group ( "AWG")
Vendor
Newport Dunes Resort
Norman Ewers
Orange County Business Council
Pacific Media & Research
PCR
Petrone Productions, Inc.
Platinum Advisors, LLC
Postmaster
Reason Foundation
Sasso
Sjoberg Evashenk Consulting, LLC
Urban Design Camp
Urban Dimensions
URS
William A Bloomer
Wilson Research & Strategy
Source: Listing of Expenditure Transaction provided by AWG
0
Exhibit D
Amount
Percentage
Expended
Expended
2,563
0.07%
235
0.01%
7,592
0.21%
6,500
0.18%
905
0.03%
133,903
3.73%
50,000
1.39%
246,309
6.85%
1,000
0.03%
9,900
0.28%
30,000
0.83%
3,000
0.08%
2,608
0.07%
15,000
0.42%
1,697
0.05%
10,000
0.28%
3,594,126 100.00%
Summarized by Vavrinek, Trine, Day & Co., LLP Refer to the Agreed Upon Procedures Report
0
9
City of Newport Beach
Schedule of Unspent Grant Proceeds as of August 20, 2002
For the Airport Working Group ( "AWG")
Grant Receipts from Newport Beach 3,600,000
Add: Interest Earned') 10,331
Total Receipts 3,610,331
Less Expenditures (3,594,126)
Refunds 35,682
Adjusted Expenditures (3,558,444)
Remaining Cash on Hand 51,887
Exhibit E
t'i The Grant dated May 22, 2001 is silent with respect to the treatment of interest income.
Source: Bank statements for 5101 through 8/02 and the Listing of Expenditure Transactions provided by AWG
Summarized by Vavrinek, Trine, Day Co., LLP Refer to the Agreed Upon Procedures Report
0 0
City of Newport Beach
Schedule of Unspent Grant Proceeds as of August 20, 2002
For Citizens for Jobs & the Economy ('rCJ &Err)
Grant Receipts from Newport Beach
Add: Interest Earned
Total Receipts
Less Expenditures
Refunds
Adjusted Expenditures
Remaining Cash on Hand
Source: Bank statements from 10/01 to 8/02
150,000
150,000
(120,035)
(120,035)
29,965
Exhibit F
Summarized by Vavrinek, Trine, Day & Co., LLP Refer to the Agreed Upon Procedures Report
C -392-5
CITY OF NEWPORT BEACH
AGENDA ITEM NO. s25
TO: HONORABLE MAYOR AND MEMBER F THE UNCIL
t
FROM: Homer L. Bludau, City Manager
DATE: October 19, 2001 3
SUBJECT: AWG Grant A'P'PROVED
DISCUSSION:
On May 22, 2001 the City Council approved a $3.6 million grant to AWG to provide
educational services regarding air transportation demand in Orange County. The
grant provides for payment of fifty percent (50 %) of the grant on June 1, 2001 and
the remainder of the grant in twelve equal monthly installments. AWG has
requested an amendment to the grant that would allow the remaining balance to be
paid as work is done and invoices are presented. We have sufficient funds on hand
to fund the remainder of the grant and this will eliminate the administrative task of
issuing checks on a monthly basis. The amount of funds remaining in this account
is $1,200,000.
RECOMMENDATION:
That the Mayor be authorized to execute an amendment to the AWG grant that
would authorize the City Manager to make payments to the full extent of the grant
whenever invoices for work are submitted.
City Hall • 3300 Newport Boulevard • Post Office Box 1768 . Newport Beach, California 92659 -1768
GRANT AGREEMENT
AN
This Agreement, entered into this 22nd day of May, 2001 by and between City of
Newport Beach, a municipal corporation and charter city (CITY) and Airport Working
Group of Orange County, Inc., a California non - profit corporation (GRANTEE), is made
with reference to the following:
WHEREAS, the CITY is a municipal corporation and charter city committed to
preserving the health, welfare and safety of its citizens; and
WHEREAS, GRANTEE is a California non - profit public benefit corporation
exempt from federal taxation pursuant to Section 501(c)(3) of the Internal Revenue
Code;and
WHEREAS, GRANTEE has requested a Grant from the CITY to engage in public
education and outreach activities related to the manner and means of accommodating
the current and future air travel and air cargo needs of Orange County; and
WHEREAS, the public education and outreach program proposed by GRANTEE
is consistent with long- standing CITY policy related to the solution to the current and
future air transportation needs of Orange County; and
WHEREAS, the CITY has approved this Grant to GRANTEE with the
understanding and GRANTEE'S agreement that the Grant funds will: (a) be expended
solely for the purpose of informing the public of issues, and engaging in other activity,
1
relevant to the manner and means of accommodating the current and future air
transportation demand in Orange County; (b) not be spent to support or oppose the
qualification, passage or defeat of any ballot measure or the election or defeat of any
candidate for political office; and (c) not be used for any activity that would violate state
or federal statutory or decisional law such as regulations affecting non - profit or tax
exempt organizations (these GRANTEE expenditure conditions in (a) through (c) are
collectively defined as the "Approved Use ").
NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:
1. GRANT
CITY agrees to Grant to GRANTEE the sum of three million six hundred
thousand dollars ($3,600,000.00). This Grant (Grant Funds) shall be paid in one
lump sum of one million eight hundred thousand dollars ($1,800,000.00) and
twelve equal monthly installments of one hundred fifty thousand dollars
($150,000.00). The lump sum shall be paid on or before June 1, 2001. The first
installment shall be paid on or before June 1, 2001 and the remaining
installments shall be paid on or before the first of each of the following eleven
(11) months. The Grant Funds shall be used solely by GRANTEE for the
Approved Use and for no other use and the balance of the Grant Funds shall be
returned to the CITY on written demand served no less than sixty (60) days after
expiration of this Agreement.
2. TERM
The term of this Agreement shall commence on May 22, 2001 (the Effective
Date) and shall continue in full force and effect until the final installment has
2
been paid and GRANTEE has refunded any unspent Grant Funds, provided,
however, the indemnity provisions of this Agreement shall expire five (5) years
after the Effective Date.
3. RESTRICTIONS ON USE OF FUNDS
(a) GRANTEE acknowledges that municipal corporations are
prohibited from spending, directly or indirectly, public funds to
support or oppose candidates for public office. GRANTEE also
acknowledges that public funds may not be spent, directly or
indirectly, to support or oppose the qualification, passage or defeat
of a ballot measure. Accordingly, GRANTEE warrants to CITY that
the Grant Funds will not be spent, directly or indirectly, to support
or oppose a candidate or candidates for public office. GRANTEE
further warrants to CITY that the Grant Funds will not be spent,
directly or indirectly, to support or oppose the qualification, passage
or defeat of any ballot measure. Finally, GRANTEE warrants to
CITY that the Grant Funds will not be spent to prepare or distribute
material, or to disseminate information, if it is clear from the
surrounding circumstances that the material or information supports
or opposes the election of any candidate or the qualification,
passage or defeat of any ballot measure.
(b) In addition to the commitments in Subsection 3(a), GRANTEE
warrants to CITY that the Grant Funds will not be spent in a
manner that violates any State or Federal statutory or decisional
law applicable to non - profit organizations exempt from taxation
pursuant to Section 501(c)(3) of the Internal Revenue Code.
3
(c) GRANTEE shall retain legal counsel with at least five (5) years
experience in the fields of election law and political law to ensure
compliance with the warranties in Subsections 3(a) and 3(b). Legal
counsel retained by Grantee shall review all material or information
prepared, in whole or in part, through the expenditure of Grant
Funds and prior to duplication or dissemination. Legal counsel
shall approve duplication and dissemination of the material or
information to the public only upon a determination that the
information or material is in full compliance with all statutory and
decisional law governing the conduct of political campaigns and the
express warranties made in Subsections 3(a) and 3(b) of this
Agreement. GRANTEE may use Grant Funds to compensate
special counsel for this specific and limited purpose.
(d) To further ensure compliance with the provisions of Subsection
3(a), GRANTEE shall not duplicate or disseminate to the public any
material prepared, in whole or in part, through an expenditure of
Grant Funds unless and until the material has first been reviewed,
and determined to comply with Subsection 3(a), by special counsel
retained by the City Council. CITY shall notify GRANTEE in
writing, on or before May 25, 2001, of the name or names of the
special counsel retained by the CITY to review material pursuant to
this Subsection. The review by special counsel retained by the
CITY shall be conducted, and the determination communicated to
GRANTEE, by the end of the next business day following receipt of
the material by special counsel.
El
4. INDEMNIFICATION
GRANTEE shall protect, hold harmless, defend and indemnify the CITY, and its
elected officials, employees or representatives, from any claim, loss, litigation, or
liability arising out of or in any way related to this Agreement regardless of the
cause, except for any liability arising from the sole negligence, fraud or willful
misconduct of the CITY or its officers, agents or employees. GRANTEE agrees
that City has the legal right, and that all necessary conditions have been
satisfied, to specifically enforce GRANTEE obligations pursuant to this
Agreement.
S. AUDIT
GRANTEE agrees to account for all Grant funds received from the CITY,
maintain detailed financial records using generally accepted accounting
principals, and allow CITY to conduct an audit of the financial records upon
reasonable notice and at any time within four (4) years after expiration or
termination of this Agreement.
6. THIRD PARTY BENEFICIARY
This Agreement does not create, and the parties do not intend to create, any
claim, cause of action or legal right for or on behalf of any other person or entity.
7. ENTIRE AGREEMENT
This Agreement represents the entire understanding of the Parties and may be
amended only by a document signed by both parties.
5
�iT, rii?i= PPIEY "S OFFICE 949 54.1 71 79 P.01 01
8. PRIOR AGREEMENTS
The Parties agree that this Agreement supersedes and terminates the force and
effect of the Grant Agreement approved and executed by the Parties on or about
March 28, 2001. This Agreement does not affect any funds granted to
GRANTEE pursuant to an agreement approved and executed by the Parties on
or about April 1, 1999.
AGREED:
CITY OF NEWPORT BEACH
By:
Title:
Date:
as to Form
City Attorney
Attest:
City Clerk
rhb1048
1:lueentatyharedtbumharn\"g\ ibawggran10S2201find.doc
GRANTEE
A.
-i
Title: 11%,"folode✓T
Date: Z 9 M70Y Zoo/
6
TOTAL P.01
GRANT AGREEMENT
This Agreement, entered into this 22n° day of May, 2001 by and between City of
Newport Beach, a municipal corporation and charter city (CITY) and Airport Working
Group of Orange County, Inc., a California non - profit corporation (GRANTEE), is made
with reference to the following:
WHEREAS, the CITY is a municipal corporation and charter city committed to
preserving the health, welfare and safety of its citizens; and
WHEREAS, GRANTEE is a California non - profit public benefit corporation
exempt from federal taxation pursuant to Section 501(c)(3) of the Internal Revenue
Code; and
WHEREAS, GRANTEE has requested a Grant from the CITY to engage in public
education and outreach activities related to the manner and means of accommodating
the current and future air travel and air cargo needs of Orange County; and
WHEREAS, the public education and outreach program proposed by GRANTEE
is consistent with long- standing CITY policy related to the solution to the current and
future air transportation needs of Orange County; and
WHEREAS, the CITY has approved this Grant to GRANTEE with the
understanding and GRANTEE'S agreement that the Grant funds will: (a) be expended
solely for the purpose of informing the public of issues, and engaging in other activity,
relevant to the manner and means of accommodating the current and future air
transportation demand in Orange County; (b) not be spent to support or oppose the
qualification, passage or defeat of any ballot measure or the election or defeat of any
candidate for political office; and (c) not be used for any activity that would violate state
or federal statutory or decisional law such as regulations affecting non - profit or tax
exempt organizations (these GRANTEE expenditure conditions in (a) through (c) are
collectively defined as the "Approved Use ").
NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:
1. GRANT
CITY agrees to Grant to GRANTEE the sum of three million six hundred
thousand dollars ($3,600,000.00). This Grant (Grant Funds) shall be paid in one
lump sum of one million eight hundred thousand dollars ($1,800,000.00) and
twelve equal monthly installments of one hundred fifty thousand dollars
($150,000.00). The lump sum shall be paid on or before June 1, 2001. The first
installment shall be paid on or before June 1, 2001 and the remaining
installments shall be paid on or before the first of each of the following eleven
(11) months. The Grant Funds shall be used solely by GRANTEE for the
Approved Use and for no other use and the balance of the Grant Funds shall be
returned to the CITY on written demand served no less than sixty (60) days after
expiration of this Agreement.
2. TERM
The term of this Agreement shall commence on May 22, 2001 (the Effective
Date) and shall continue in full force and effect until the final installment has
4
been paid and GRANTEE has refunded any unspent Grant Funds, provided,
however, the indemnity provisions of this Agreement shall expire five (5) years
after the Effective Date.
3. RESTRICTIONS ON USE OF FUNDS
(a) GRANTEE acknowledges that municipal corporations are
prohibited from spending, directly or indirectly, public funds to
support or oppose candidates for public office. GRANTEE also
acknowledges that public funds may not be spent, directly or
indirectly, to support or oppose the qualification, passage or defeat
of a ballot measure. Accordingly, GRANTEE warrants to CITY that
the Grant Funds will not be spent, directly or indirectly, to support
or oppose a candidate or candidates for public office. GRANTEE
further warrants to CITY that the Grant Funds will not be spent,
directly or indirectly, to support or oppose the qualification, passage
or defeat of any ballot measure. Finally, GRANTEE warrants to
CITY that the Grant Funds will not be spent to prepare or distribute
material, or to disseminate information, if it is clear from the
surrounding circumstances that the material or information supports
or opposes the election of any candidate or the qualification,
passage or defeat of any ballot measure.
(b) In addition to the commitments in Subsection 3(a), GRANTEE
warrants to CITY that the Grant Funds will not be spent in a
manner that violates any State or Federal statutory or decisional
law applicable to non - profit organizations exempt from taxation
pursuant to Section 501(c)(3) of the Internal Revenue Code.
3
(c) GRANTEE shall retain legal counsel with at least five (5) years
experience in the fields of election law and political law to ensure
compliance with the warranties in Subsections 3(a) and 3(b). Legal
counsel retained by Grantee shall review all material or information
prepared, in whole or in part, through the expenditure of Grant
Funds and prior to duplication or dissemination. Legal counsel
shall approve duplication and dissemination of the material or
information to the public only upon a determination that the
information or material is in full compliance with all statutory and
decisional law governing the conduct of political campaigns and the
express warranties made in Subsections 3(a) and 3(b) of this
Agreement. GRANTEE may use Grant Funds to compensate
special counsel for this specific and limited purpose.
(d) To further ensure compliance with the provisions of Subsection
3(a), GRANTEE shall not duplicate or disseminate to the public any
material prepared, in whole or in part, through an expenditure of
Grant Funds unless and until the material has first been reviewed,
and determined to comply with Subsection 3(a), by special counsel
retained by the City Council. CITY shall notify GRANTEE in
writing, on or before May 25, 2001, of the name or names of the
special counsel retained by the CITY to review material pursuant to
this Subsection. The review by special counsel retained by the
CITY shall be conducted, and the determination communicated to
GRANTEE, by the end of the next business day following receipt of
the material by special counsel.
4
4. INDEMNIFICATION
GRANTEE shall protect, hold harmless, defend and indemnify the CITY, and its
elected officials, employees or representatives, from any claim, loss, litigation, or
liability arising out of or in any way related to this Agreement regardless of the
cause, except for any liability arising from the sole negligence, fraud or willful
misconduct of the CITY or its officers, agents or employees. GRANTEE agrees
that City has the legal right, and that all necessary conditions have been
satisfied, to specifically enforce GRANTEE obligations pursuant to this
Agreement.
5. AUDIT
GRANTEE agrees to account for all Grant funds received from the CITY,
maintain detailed financial records using generally accepted accounting
principals, and allow CITY to conduct an audit of the financial records upon
reasonable notice and at any time within four (4) years after expiration or
termination of this Agreement.
6. THIRD PARTY BENEFICIARY
This Agreement does not create, and the parties do not intend to create, any
claim, cause of action or legal right for or on behalf of any other person or entity.
7. ENTIRE AGREEMENT
This Agreement represents the entire understanding of the Parties and may be
amended only by a document signed by both parties.
5
IT', IT'r ATTOP'NE •OF I :F 644 71--
•.01/01
8. PRIOR AGREEMENTS
The Parties agree that this Agreement supersedes and terminates the force and
effect of the Grant Agreement approved and executed by the Parties on or about
March 28, 2001 This Agreement does not affect any funds granted to
GRANTEE pursuant to an agreement approved and executed by the Parties on
or about April 1, 1999.
AGREED:
CITY OF NEWPORT BEACH
By�. .. - -------- ----
Title:
Approved as to Form
City Attorney
Attest
City Clerk
rhbl 048
a ntOS2201
GRANTEE
I
R
Title:, 0/ o�7—
Date: PZ 9 /M"Yoy
6
TOTAL P.01
8. PRIOR AGREEMENTS
The Parties agree that this Agreement supersedes and terminates the force and
effect of the Grant Agreement approved and executed by the Parties on or about
March 28, 2001. This Agreement does not affect any funds granted to
GRANTEE pursuant to an agreement approved and executed by the Parties on
or about April 1, 1999.
AGREED:
CITY OF NEWPORT BEACH
GRANTEE
By: � Nk, I By:
Date:
as to Form
City Attorney
Attest:
L^ fir' ✓�- �,��C/�J
City Clerk
rhb1048
Title:
tk usem\ cat�sharedlbumham %awgtnbawggrant052201 final. doc
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REED & DAV10SON
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DANA W. REED, ES
DANA W. REED has been involved in California state politics and government all of his adult
life and has practiced political, initiative, referendum and election law since 1975. Mr. Reed
has served in senior government positions including Chairman of the California Transportation
Commission; Undersecretary of Business, Transportation and Housing; and Deputy State
Controller. Mr. Reed also served as a member of the Orange County Transportation Authority
and chairman of its predecessor agency, the Orange County Transportation Commission.
Mr. Reed is a recognized expert in political and election law and served as a member of the
California Secretary of State's Electronic Filing Task Force.
Mr. Reed, a graduate of Loyola Law School, represents governmental agencies, corporations,
trade associations, political action committees, ballot measure committees, lobbyists and
candidates in a wide range of political and election law matters. Mr. Reed is regularly called
upon to provide guidance in complying with the Federal Election Campaign Act, the Internal
Revenue Code, California's Political Reform Act and various local ordinances. Mr. Reed has
served as treasurer of, and legal counsel to, scores of large political committees.
Mr. Reed has also managed a wide range of litigation and administrative matters in State and
Federal courts and before various administrative agencies, such as the Federal Election
Commission, the Fair Political Practices Commission and the Los Angeles City Ethics
Commission. Mr. Reed has successfully managed litigation matters at the trial and appellate
court levels concerning the Federal and State constitutional rights of free speech and petition, the
California Elections Code, the Political Reform Act, the Public Records Act and the Anti -SLAPP
statute. .
Mr. Reed has managed litigation matters which have led to reported appellate decisions in Paul
for Council v. Hanyecz (2001) 85 Cal.AppAth 1356 (regarding Code of Civil Procedure Section
425.16, the Anti•SLAPP statute), Dean v. Superior Court (1998) 62 Cal.App.4th 638 (regarding
candidate statements under the California Elections Code); Yes on Nfeasure A v. City of Lake
Forest (1997) 60 Cal.App.4th 620 (regarding municipal expenditures under California's Political
Reform Act); Browne v. Russell (1994) 27 Cal.AppAth 1116 (regarding petition signature
gathering rules under the Los Angeles City Election Code); Griset v. Fair Political Practices
Commission (1994) 8 Cal.4th 851 (regarding sender identification requirements under
California's Political Reform Act); and Hale v. Farrell (198 1) 115 Cal.App.3d 164.
Among the governmental entities and political figures Mr. Reed has represented are the cities of
Newport Beach, Simi Valley, Ventura and Thousand Oaks, as well as county registrars, city
council members and Federal and State legislators. In addition, Mr. Reed has been widely cited
in the local, state and national media as an expert in political and election law,
STRUlsffASSER & WOOCHER LLP
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PPMMC D. WOOL 100 WILYHal8BOULRVARa, 9U17E 1900 TRLR wm: (310) 576 -1233
MicR 1. SCRUMw.weR SANTA MONICA, CALa mm 90401 FACUMX: x!]0)319.0156
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HARRIMN M. POLLAK
The Firm
STRUMWASSER & WoocxER LLP was founded in 1991 by Fredric D. Woocher and Michael J.
Strumwasser to bring their extensive experience in the public sector to a broad range of public and
private clients. Since then, Strumwasser & Woocher LLP has become one of the most respected law
firms in Southern Califomia, known for its successful resolution of major public policy matters. The
firm's trial and appellate civil litigation practice focuses on complex litigation involving economic
regulation, consumer and worker protection, antitrust, constitutional law, environmental protection,
administrative law, and government ethics and electoral law. Despite its small size, the firm has
collected an impressive array of trial and appellate victories in path - making litigation in the public
interest. The firm's work touches on a wide array of civil litigation_ matters, with some of its most
notable successes occurring in the areas of election law and insurance rate regulation.
The firm has developed an active political and elections law practice, representing candidates, political
committees, citizen groups, and public agencies in compliance matters and in litigation on ballot
access issues, campaign finance and ethics regulations, initiative and referendum law, and contested
elections. For example, the firm currently represents the Agua Caliente Band of Cahuilla Indians in
the defense and implementation of Proposition 1A, the recent Native American gaming initiative
passed by California voters. Over the years, the firm has represented numerous political committees
and organizations in drafting state and local ballot measures and in litigation over the qualification
of initiative and referendum petitions for the ballot. Each election cycle, Strumwasser & Woocher
LLP's attorneys are also called upon to assist in the canvassing and recounting of votes in close
elections, and they have both prosecuted and defended a number of landmark election contests,
including the successful defense of Congresswoman Loretta Sanchez Is narrow victory over former
Representative Robert Doman in the 46th Congressional District in Orange County.
Among its most high - profile work, Strumwasser & Woocher LLP has served for the past eight years
as Special Counsel to California Insurance Commissioners John Garamendi Chuck Quackenbush,
and Harry Low, whom the firm has advised and represented in all phases of the implementation of
Proposition 103, the insurance - reform initiative. Strumwasser & Woocher LLP developed the
Commissioner's regulatory program, prosecuted the administrative cases on the insurance companies'
rebate liability, and has successfully defended the Commissioner's program in scores of state- and
federal -court lawsuits.
In addition, the firm represents an array of public agencies and private parties in selected matters
involving environmental, constitutional, and regulatory issues, as well as other issues of public
interest. For example, we currently represent the Los Angeles Unified School District in major
litigation to revamp the State of California's system for allocating billions of dollars in new school -
construction funds in a manner that does not discriminate against urban and minority districts. Some
other significant cases handled by the firm include: defending citizens who participated in a public
STRUMWASSER & WOOCHER
ATI Ws AT lAw
environmental review process from retaliatory "SLAPP" defamation suits filed by project proponents;
representing dozens of Native Americans challenging California State University's plans to build a
mini -mall on a sacred burial site on the Long Beach campus; defending the City of Los Angeles
against constitutional challenges to its landmark Ethics -in- Government Ordinance; defending the City
of Huntington Beach in a federal court lawsuit seeking to invalidate city- imposed campaign finance
limitations; representing citizen organizations in preventing development in designated Significant
Ecological Areas in Los Angeles County and in the Mulholland Parkway Scenic Corridor; prosecuting
a plumbing fixtures manufacturer for failure to comply with environmental laws regulating the
handling and disposal of toxic wastes; defending the City of San Diego in federal Superfund litigation
over its disposal of municipal solid waste; representing the California State Senate in administrative
and judicial proceedings on the proposed licensing of the state's first permanent nuclear waste facility;
serving as Special Counsel to the U.S. Department of Housing and Urban Development in its
investigation and formulation of a regulation prohibiting discrimination in property insurance; serving
as counsel for the California Earthquake Authority in rate litigation; and representing a class of
garment workers seeking redress for violations of wage- and -hour laws by a major garment
manufacturer and its sewing contractors. The firm also was counsel to two plaintiff classes alleging
discrimination in the allocation of probation department resources to the detriment of Latino and
African- American inner -city communities and African- American probation officers.
In representing and advising a broad range of public agencies and officials, private individuals and
corporations, and citizen groups, Strumwasser & Woocher LLP takes pride in providing its clients
the highest quality representation efficiently and in achieving consistently favorable results against
numerically superior opposition.
The Lawyers
FREDRic D. WOOCHER entered private practice after serving two years as Special Counsel to
California Attorney General John Van de Kamp, whom he represented and advised on government
ethics, environmental law, and consumer - protection issues, including implementation of
Proposition 103. Prior to his government service, Mr. Woocher spent seven years with the Center
for law in the Public Interest, Litigating 'a broad range of public interest issues involving land -use,
environmental law, hazardous substances regulation, First Amendment protection, and civil rights
cases. He is an acknowledged authority on the initiative and referendum process and on campaign
financing issues. Mr. Woocher has successfully argued before both the U.S. and California
Supreme Courts as well as other appellate and trial courts. He served as Chas of the State Bar's
Committee on Human Rights, as a member of the State Bar Committee on the Environment, and
as a member of the Los Angeles County Judicial Evaluations Committee. He is a graduate of Yale
University (A.B.) and Stanford (Ph.D., J.D.), and was President of the Stanford Law Review.
Mr. Woocher was law clerk to U.S. Supreme Court Justice William J. Brennan, Jr., and Chief
Judge David L. Bazelon of the U.S. Court of Appeals for the D.C. Circuit.
IM
STRUMWASSER & WOOCHER
AiT Ws AT LAW
MICHAEL J. STRUMWASSER co- founded Strumwasser & Woocher LLP after seventeen years with
the California Department of Justice, the last eight years as Special Assistant Attorney General.
He litigated some of the state's largest antitrust, consumer - protection, and environmental cases,
including California's challenges to major supermarket and oil- company mergers, defended
consumer interests in the Diablo Canyon Nuclear Power Plant rate case, and represented the
Governor in the Nuclear Regulatory Commission's health- and -safety review of Diablo Canyon.
Mr. Strumwasser conducted major litigation against the state's electric utilities, leading to a
favorable restructuring of the contracts providing electric power to the State Water Project. He
has defended numerous public agencies and officials in litigation under the California Tort Claims
Act. He has appeared in the U.S. and California Supreme Courts and has extensive trial
experience representing California energy and natural resource agencies before state and federal
courts and regulatory commissions, where he is recognized both for his trial skills and for his
command of technical issues. Mr. Strumwasser developed Attorney General Van de Kamp's
insurance - regulation program, including, with Mr. Woocher, the defense of Proposition 103 in
the California Supreme Court, and was the Attorney General's principal advisor on antitrust
policy. He represented the Attorney General on antitrust and utility matters before the California
Legislature and Congress. He holds A.B., M.S., and J.D. degrees from U.C.L.A.
KEVIN S. REED joined Strumwasser & Woocher LLP in 1996 after six years with the NAACP Legal
Defense & Education Fund, where he served as Managing Attorney for the Western Regional Office.
At Strumwasser & Woocher LLP, Mr. Reed has played a leading role in the firm's regulatory-law
and civil - litigation practice. He has served as counsel to a class of garment workers on whose behalf
a $1.5 million settlement of wage -and -hour claims was recently achieved, and has obtained another
successful settlement of a civil -rights class action on behalf of African- American probation officers.
At the NAACP Legal Defense & Educational Fund, Inc., Mr. Reed conducted major trial and
appellate litigation in the areas of housing discrimination, police misconduct, health care, and criminal
justice reform. He helped develop the Legal Defense Fund's successful strategy for challenging the
Los Angeles Metropolitan Transit Authority's distribution of transportation resources and CalTrans'
provision of mitigation measures in low - income minority communities impacted by the 710 freeway
expansion. Before joining the Fund, Mr. Reed served as law clerk to Michigan Supreme Court
Justice Dennis W. Archer. He is a frequent teacher and lecturer on civil rights, redevelopment and
housing law, and lawyer training. In 1996 he was a visiting professor of law at Florida State
University where he taught a course on police misconduct law. In 1995 he taught workshops on
Constitutional Litigation to the Black Lawyers Association in Johannesburg, South Africa, and he
currently serves as Deputy General Counsel on the Rampart Independent Review Panel, established
by the Los Angeles Police Commission to review corruption within the LAPD. He has served as
Warden and Vestry Member of St. Augustine by- the -Sea Episcopal Church. He is a Director of the
Federal Bar Association's Los Angeles Chapter and Co -Chair of its Civil Rights Section, and he is
President of the Los Angeles Chapter of Trout Unlimited and a member of the Southern California
Beekeepers Association. Mr. Reed is a graduate of the .University of Virginia (B.A. 1986) and
Harvard Law School (J.D. 1989).
3
STRUMWASSER & WOOCHER
ATlWIn'1 AT 4w
HAMSON M. POLLAK came to Strumwasser & Woocher LLP in 1999 following a one -year clerkship
with United States District Judge Helen G. Berrigan in the Eastern District of Louisiana. Mr. Pollak
graduated from the University of California at Berkeley School of Law ( Boalt Hall) in 1998 with a
Certificate in Environmental Law. In law school, Mr. Pollak was an Articles Editor of Ecology Law
Quarterly and a member of the East Bay Workers' Rights Clinic and the East Bay Refugee Project.
He won awards in the Boalt Hall Moot Court and the Jessup International Law Moot Court
competitions. Prior to law school, Mr. Pollak was a research fellow at the Amazon Institute of
Humans and the Environment and Academic Director of a college semester abroad program in the
Brazilian Amazon. Mr. Pollak graduated from Yale University in 1991 with a B.A. in history and
environmental studies.
FREDRIC D. W OOCFIER
Partner
Strumwasser & Woocher LLP
PROFESSIONAL EXPERIENCE
STRUMWASSER& WOOCHERLLP
0
Partner, January 1991 to present. Specializing in complex civil litigation on public policy issues.
Practice emphasizes constitutional law, election law, environmental protection, and administrative
regulation. Counsel to numerous state, local, and special agencies and elected and appointed
officials in environmental law, elections, and political reform. Represents California's Insurance
Commissioner and Controller, Counties of Santa Barbara and Ventura, and numerous cities.
Counsel to citizen environmental and public - interest groups. Handles litigation in federal and
state trial and appellate courts and administrative agencies, and has handled two election contests
in the House of Representatives.
OFFICE OF Tm ATTORNEY CT24ERAL OF CALIFORNIA
Special Counsel to the Attorney General, September 1988 to January 1991. Legal and policy
advisor on Attorney General's executive staff. Responsible for handling a variety of special
projects and sensitive issues, including high- priority civil litigation, legislative proposals, and
policy programs. Principal activities included advising the Attorney General on political reform
and ethics issues, supervising all judicial and administrative proceedings regarding implementation
of Proposition 103, and assisting on selected environmental and consumer matters. Author, for
gubernatorial candidate John K. Van de Kamp, of Proposition 131, the campaign and ethics
reform initiative on the June 1990 ballot.
CENTER FOR LAW IN THE PUBLIC INTEREST
Staff Attorney, July 1981 to September 1988. Handled complex civil litigation on broad range
of high- impact public interest issues. Specialized in environmental, land use, election law, First
Amendment, and civil rights issues. Argued before United States and California Supreme Courts,
federal and state courts of appeal, and trial courts. 'Helped draft City of Los Angeles campaign
finance reform charter amendments and city ordinance prohibiting discrimination by private
business clubs.
DEPARTMENT OF DEFENSE
Staff Assistant to Secretary of Defense Harold Brown, 1980 to 1981.
UN= STATES SUPREME COURT
Law Clerk to Justice William J. Brennan, Jr., 1979 to 1980.
Resum€ of FREDRIC D. WOOCHER
(Continued)
UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA
Law Clerk to Chief Judge David L. Bazelon, 1978 to 1979. .
REPRESENTATIVE MATTERS HANDLED
UNITED STATES SUPREME COURT
Stringfellow v. Concerned Neighbors in Action, 480 U.S. 370 (1987). Counsel for respondent
citizens' group, which intervened in Superfund litigation involving cleanup of hazardous waste
dumpsite in their community. Supreme Court held that district court order denying intervention
of right but granting permissive intervention with conditions is not appealable on interlocutory
basis.
Federal Communications Commission v. League of Women Voters, 468 U.S. 364 (1984).
Represented and presented oral argument on behalf of respondents public radio station and public
interest organization in landmark First Amendment decision establishing right of noncommercial
broadcasters to editorialize.
Pacific Gas & Electric Co. v. Public Utilities Comm 'n of California, 475 U.S. 1 (1986).
Counsel for respondent Toward Utility Rate Normalization, consumer advocacy group seeking to
have its informational and membership material distributed to utility's ratepayers with their
monthly bills; Supreme Court held that PUC order dedicating "extra space" in billing envelopes
for that purpose violated utility's First Amendment tight not to associate with consumer group's
message.
Nollan v. California Coastal Commission, 483 U.S. 825 (1987), Authored amicus brief on behalf
of 12 national and state environmental organizations supporting Coastal Commission's permit
condition requiring landowner to dedicate easement for public access to beach under public trust
doctrine; Supreme Court held that the access condition did not adequately serve the public
purposes related to the permit requirement.
Board of Directors of Rotary International v. Rotary Club of Duarte, 481 U.S, 537 (1987).
Authored amicus brief for women's rights groups seeking to uphold application of California's
Unruh Civil Rights Act to international service organization that refused to permit women as full
members; Supreme Court upheld enforcement of state's anti- discrimination law and rejected
Rotary International's claim to First Amendment immunity.
CALIFORNIA SUPREME COURT
C.O.S. T. v. Superior Court of Orange County, 45 Cal.3d 491 (1988). Represented and presented
oral argument for petitioner citizens' group seeking to have initiative securing public vote on local
development fee placed on City of Irvine ballot; Supreme Court held that initiative was beyond
Resumd of FREDRIC D. WOOCHER
(Continued)
the authority of the local electorate because its subject matter was of statewide concern.
Ca(farm Insurance Company v. Deukmejian, 48 Cal.3d 805 (1989). Co- counsel for respondent
Attorney General John Van de Kamp in insurers' multi-prong challenge to constitutionality of
Proposition 103; Supreme Court invalidated and modified a portion of the initiative but upheld the
bulk of the measure as severable from the invalid sections.
Press v. Lucky Stores, Inc., 34 Cal.3d 311 (1983). Counsel for petitioner, proponent of statewide
ballot measure seeking award of attorneys fees for lawsuit brought to obtain access to shopping
center for purpose of collecting signatures an initiative petitions; Supreme Court ordered award
of attorneys' fees under Code of Civil Procedure section 1021.5, finding that lawsuit was
necessary to vindicate fundamental First Amendment rights of signature gatherers.
Kopp v. Fair Political Practices Com., 11 Cal. 4th 607, 905 P.2d 1248, 47 Cal.Rptr.2d 198
(1995). Represented Common Cause in extraordinary writ proceeding to save by reformation
constitutionality of Proposition 73.
Gerken v. Fair Political Practices Com., 6 CalAth 707, 863 P.2d 694, 25 Cal.Rptr.2d 449
(1993). Co- counsel for Common Cause in petition seeking to establish the effectiveness of
Proposition 68.
OTHER MAJOR CASES
Doman v. Sanchez, House Oversight Committee; In re Sanchez, 978 F.Supp. 1315 (C.D. Cal.
1997); In re Sanchez, 955 F. Supp. 1210 (C.D. Cal. 1997). Successfully defended Hon. Loretta
Sanchez before House Oversight Committee, and in related judicial litigation, in election- contest
challenge by former Rep. Robert Doman.
American Lung Assn of Cal. v. South Coast Air Quality Mgmt. Dist., No. C573130 (L.A. Super.
1985). Represented clean-air coalition in successful challenge to first attempt by company to
"bank" pollution reduction "credits" for future sale to other companies needing to decrease
emissions; settlement resulted in rescinding of credits.
United States v. Stringfellow, No. CV 83 -2501 JMI (C.D. Cal. 1983). Represented intervening
residents in multi -party Superfund toxic waste site clean-up action; case still pending, but trial
court found private waste generators, dumpsite owners, and State of California strictly liable for
cleanup costs under CERCLA, RCRA, and Clean Water Act.
Friends of Ballona Wetlands v. California Coastal Commission, No. C525826 (L.A. Super.
1984). Represented environmental organizations in administrative and court challenges to L.A.
city, county, and Coastal Commission approvals ofEIR and land use plans for massive Playa
Vista development project; settlement resulted in scaled -down project and
preservation/restoration of additional wetlands acreage.
0 0
Resumd of FREDRIC D. WOOCHER
(Continued)
Federation of Hillside & Canyon Associations v. City of Los Angeles, No. C526616 (L.A. Super.
1986). Co- counsel in challenge to City of Los Angeles' failure to bring zoning ordinances into
conformity with city's general plans; injunction against issuance of further building permits for
inconsistently zoned parcels led to settlement with court- monitored schedule for city -wide
rezoning program.
Coalition For L.A. County Planning in the Public Interest v. Bd of Supervisors, 76 Cal.App.3d
241 (1977). Co- counsel in successful challenge to inadequacy ofE1R and open -space element of
L,A. County's general plan amendments under state Planning and Zoning law.
Sierra Club v. Board of Supervisors, No. C319067 (L.A. Super. 1981). Co- counsel in successful
challenge to L.A. County approval of Sunnyglen development project in Santa Monica
Mountains; innovative settlement resulted in project re -design with additional on -site mitigation
measures and establishment of monetary off -site mitigation fund for purchase of development
rights in other environmentally sensitive canyon areas.
Browne v. Russell, 27 Cal.AppAth 1116, 33 Cal.Rptr.2d 29 (1994). Represented a coalition of
public - health organizations, successfully upheld Los Angeles City ordinance prohibiting smoking
in restaurants against a challenge by the tobacco and restaurant industries.
Schweisinger v. Jones, 68 Cal.App.4th 1320, 81 Cal.Rptr.2d 183 (1998); Challenge to Secretary
of State's interpretation of the term - limits initiative.
Americans Y. State, 58 Cal.AppAth 724, 59 Cal.Rptr.2d 416 (1997). Challenge to State
Legislature's failure to appropriate funds for anti- tobacco advertising pursuant to Proposition 99.
Rilshire Ins. Co. v. Garamendi, 5 Cal, AppAth 1573, 8 Ca1.Rptr.2d 55 (1992). Successful
defense of application of Proposition 103 to insurers not ordered by former Insurance
Commissioner to roll back rates.
California Auto. v. Garamendi, 234 Cal.App.3d 1486, 286 Cal.Rptr. 257 (1991). Successful
defense of Insurance Commissioner's rate order for assigned -risk insurance,
California Auto. Y. Garamendi, 232 Cal.App.3d 904, 283 Cal.Rptr. 562 (1991). Upheld
Insurance Commissioner's rulings on procedures for setting assigned -risk rates.
Hardeman v. Thomas, 208 Cal.App.3d 153 (1989). Co- counsel in election contest challenging
outcome of Inglewood City Council run -o$' election; after five -day trial, Superior Court annulled
election results and ordered new election to be held, finding that numerous violations of state
absentee ballot laws had occurred.
Jonathan Club v. California Coastal Commission, 197 Cal.App.3d 884 (1988) (decertified for
publication). Represented amici civil rights organizations in trial and appellate courts in support
0 !
Resume of FREDRIC D. WOOCHER
(Continued)
of Coastal Commission's imposition of permit condition requiring Jonathan Club to certify that it
does not discriminate in its membership policies on account of race, religion, or sex in order to
expand its facility on state - leased beachfront land in Santa Monica.
ACADEbIIC
J.D., Stanford Law School, 1978. President, Stanford Law Review. Order of the Coif
Ph.D. (Cognitive Psychology), Stanford University, 1977. National Science Foundation Graduate
Fellowship
AB., Yale University, 1972. Phi Beta Kappa, Magna Cum Laude.
PROFESSIONAL AFFILIATIONS
Adjunct Professor of Law, University of Southern California (Pre -trial Advocacy, 1987 -88).
Adjunct Professor of Law, Loyola Law School (Law of Politics, 1992 -93)
Lecturer, U.C.L.A_ Hazardous Materials Liability Program (1986, 1987)
American Bar Association, ALI -ABA Conunittee on Continuing Professional Education
(Lecturer, Hazardous Wastes, Superfund, and Toxic Substances)
California State Bar Association Committee on Human Rights (1983 -86: Chair, 1984 -85)
California State Bar Association Committee on Environment (1986 -88)
Los Angeles County Bar Association Committee on Judicial Evaluations (1985 -90)
California League of Conservation Voters, Treasurer; Member of Executive Committee (1991 -
present)
Stanford Law School Board of Visitors (1988 -90)
California Common Cause, Board of Directors (1992 - present), Advisory Board (1986 -90)
Agenda Item No. S29
*CITY OF NEWP(9KT BEACH ��B)
Office of the City Attorney
TO: Mayor & Members of the City Council
FROM: Homer Bludau
Robert Burnham
RE: AWG Grant Request 4y
Revised Grant Agreement
DATE: May 22, 2001 APPROVED
On March 28, 2001, the City Council approved grant agreements with WE and AWG.
These two agreements granted funds to AWG and WE to conduct a public education
program related to the current and future air transportation needs of Orange County.
These agreements authorize both AWG and WE to submit requests for the grant funds
and create the potential for duplicate payments and confusion. The Airport Issues
Committee has asked staff to prepare a revised Grant Agreement (Exhibit A) to eliminate
confusion and to ensure that grant funds are used in a manner consistent with statutory
and decisional law. The revised Agreement allocates grant funds only to AWG, contains
assurances regarding the use of the funds, and incorporates provisions that require
review of material by special counsel retained by AWG. The revised also prohibits the
use of Grant funds for the duplication or dissemination of any material unless and until the
material is review and approved by special counsel retained by the City Council. In that
regard we are recommending the City Council retain Dana Reed and Fred Woocher, two
attorneys with extensive experience in matter relating to election law and political law.
(See Exhibits B and C).
RECOMMENDATIONS
The Airport Issues Committee is recommending the City Council take the following action:
1. Authorize the Mayor to execute the proposed grant agreement
between AWG and the City of Newport Beach (Exhibit A);
2. Terminate the Grant Agreement between WE and the City of
Newport Beach that is dated March 28, 2001;
3. Retain Dana Reed of Reed and Davidson (Exhibit B) and Fred
Woocher of Strumwasser and Woocher (Exhibit C) to act as special
counsel pursuant to the grant agreement and direct staff to notify
AWG that special counsel has been retained.
Homer Blu au ` Robert Burnham
GRANT AGREEMENT
This Agreement, entered into this 221 day of May, 2001 by and between City of
Newport Beach, a municipal corporation and charter city (CITY) and Airport Working
Group of Orange County, Inc., a California non -profit corporation (GRANTEE), is made
with reference to the following:
WHEREAS; the CITY is a municipal corporation and charter city committed to
preserving the health, welfare and safety of its citizens; and
WHEREAS, GRANTEE is a California non - profit public benefit corporation
exempt from federal taxation pursuant to Section 501(c)(3) of the Internal Revenue
Code; and
WHEREAS, GRANTEE has requested a Grant from the CITY to engage in public
outreach activities related to the manner and means of accommodating the current and
future air travel and air cargo needs of Orange County including a commercial aviation
reuse of El Toro; and
WHEREAS, the public outreach program proposed by GRANTEE is consistent
with long- standing CITY policy related to the solution to the current and future air
transportation needs of Orange County; and
WHEREAS, the CITY has approved this Grant to GRANTEE with the
understanding that the Grant funds will be expended for the purpose of informing the
FXHTBIT A
! •
public of issues, and engaging in other activity, relevant to the manner and means of
accommodating the current and future air transportation demand in Orange County;
and
WHEREAS, the CITY has approved this Grant subject to GRANTEE'S
commitment, and appropriate safeguards to ensure, that the Grant funds will not be
spent to support or oppose the qualification, passage or defeat of any ballot measure or
the election or defeat of any candidate for political office; and
WHEREAS, the CITY has also approved this Grant subject to GRANTEE'S
commitment that the Grant funds will not be used for any activity that would violate
state or federal statutory or decisional law such as regulations affecting non -profit or tax
exempt organizations.
NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:
GRANT
CITY agrees to Grant to GRANTEE the sum of three million six hundred
thousand dollars ($3,600,000.00). This Grant (Grant Funds) shall be paid in one
lump sum of one million eight hundred thousand dollars ($1,800,000.00) and
twelve equal monthly installments of one hundred fifty thousand dollars
($150,000.00). The lump sum shall be paid on or before June 1, 2001. The first
installment shall be paid on or before June 1, 2001 and the remaining
installments shall be paid on or before the first of each of the following eleven
(11) months. The Grant Funds shall be used for the purpose of informing the
0 0
public of issues, and engaging in other activity, relevant to the manner and
means of accommodating the current and future air transportation demand in
Orange County.
2. TERM
The term of this Agreement shall commence on May 22, 2001 (the Effective
Date) and shall continue in full force and effect until the final installment has
been paid and GRANTEE has spent all of the Grant Funds.
3. RESTRICTIONS ON USE OF FUNDS
(a) GRANTEE acknowledges that municipal corporations are
prohibited from spending, directly or indirectly, public funds to support or
oppose candidates for public office. GRANTEE also acknowledges that
public funds may not be spent, directly or indirectly, to support or oppose
the qualification, passage or defeat of a ballot measure. Accordingly,
GRANTEE warrants that the Grant Funds will not be spent, directly or
indirectly, to support or oppose a candidate or candidates for public office.
GRANTEE further warrants that the Grant Funds will not be spent, directly
or indirectly, to support or oppose the qualification, passage or defeat of
any ballot measure. Finally, GRANTEE warrants that the Grant Funds will
not be spent to prepare or distribute material, or to disseminate
information, if it is clear from the surrounding circumstances that the
material or information supports or opposes the election of any candidate
or the qualification, passage or defeat of any ballot measure.
(b) In addition to the commitments in Subsection 3(a), GRANTEE
warrants that the Grant Funds will not be spent in a manner that violates
any State or Federal statutory or decisional law applicable to non -profit
• •
organizations exempt from taxation pursuant to Section 501(c)(3) of the
Internal Revenue Code.
(c) GRANTEE shall retain legal counsel with at least five years
experience in the fields of election law and political law to ensure
compliance with the warranties in Subsections 3(a) and 3(b). Legal
counsel retained by Grantee shall review all material or information
prepared, in whole or in part, through the expenditure of Grant Funds and
prior to duplication or dissemination to the public to ensure compliance
with all statutory and decisional law governing the conduct of political
campaigns and the other restrictions and warranties in this Agreement.
GRANTEE may use Grant Funds to compensate special counsel for this
specific and limited purpose.
(d) To further ensure compliance with the provisions of Subsection
3(a), GRANTEE shall not duplicate or disseminate to the public any
material prepared, in whole or in part, through an expenditure of Grant
funds unless and until the material has been reviewed, and determined to
comply with Section 3(a), by special counsel retained by the City Council.
CITY shall notify GRANTEE in writing, on or before May 25, 2001, of the
name or names of the special counsel retained by the CITY to review
material pursuant to this Subsection. The review by special counsel
retained by the CITY shall be conducted, and the determination
communicated to GRANTEE, by the end of the next business day
following receipt of the material by special counsel.
4. INDEMNIFICATION
GRANTEE shall hold harmless, defend and indemnify the CITY, and its officers
and employees, from any claim, loss, litigation, or liability arising out of or in any
0
way related to this Agreement regardless of the cause, except for any liability
arising from the sole negligence, fraud or willful misconduct of the CITY or its
officers or employees.
5. AUDIT
GRANTEE agrees to account for all Grant funds received from the CITY,
maintain detailed financial records using generally accepted accounting
principals, and allow CITY to conduct an audit of the financial records upon
reasonable notice and at any time within four (4) years after expiration or
termination of this Agreement.
6. THIRD PARTY BENEFICIARY
This Agreement does not create, and the parties do not intend to create, any
claim, cause of action or legal right for or on behalf of any other person or entity.
7. ENTIRE AGREEMENT
This Agreement represents the entire understanding of the Parties and may be
amended only by a document signed by both parties.
8. PRIOR AGREEMENTS
The Parties agree that this Agreement supersedes and terminates the force and
effect of the Grant Agreement approved and executed by the Parties on or about
March 28, 2001. This Agreement does not affect any funds granted to
GRANTEE pursuant to an agreement approved and executed by the Parties on
or about April 1, 1999.
Agreed:
5
• •
CITY OF NEWPORT BEACH GRANTEE
m
0
Date: Date:
Approved as to Form
City Attorney
Attest:
City Clerk
rhb1048
05/18/2001 08:02 8053833166 NEW WEST REALTY
• •
REED & DAVIDSON
ATTORNEYS AT LAW
PAGE
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DANA W. Waco
3Z0 30 UTn CRANO AVENVE
OTHER OFFICES
CART OAV OSON
3UrTC )00
OeAnp[ Co.."
JAMc9 A. SIVESINO
FLORA S. YIN
LOS ANGELES. CALIFORNIA 90071 -Ze65
I)PI G�I.1660
TELEPHONE 12131 624 -6200
SACRAMENTO
OF COUNSEL
19x61 tee7-1666
o PA RL ar Y. nCRK
FAC3rnrLC 12131 823 -1692
W W W.POLJTICALLAW.COM
DANA W. REED. ES
DANA W. REED has been involved in California state politics and government all of his adult
life and has practiced political, initiative, referendum and election law since 1975. Mr. Reed
has served in senior government positions including Chairman of the California Transportation
Commission; Undersecretary of Business, Transportation and Housing; and Deputy State
Controller. Mr. Reed also served as a member of the Orange County Transportation Authority
and chairman of its predecessor agency, the Orange County Transportation Commission.
Mr. Reed is a recognized expert in political and election law and served as a member of the
California Secretary of State's Electronic Filing Task Force.
Mr. Reed, a graduate of Loyola Law School, represents governmental agencies, corporations,
trade associations, political action committees, ballot measure committees, lobbyists and
candidates in a wide range of political and election law matters. Mr. Reed is regularly called
upon to provide guidance in complying with the Federal Election Campaign Act, the Internal
Revenue Code, California's Political Reform Act and various local ordinances. Mr. Reed has
served as treasurer of, and legal counsel to, scores of large political committees.
Mr. Reed has also managed a wide range of litigation and administrative matters in State and
Federal courts and before various administrative agencies, such as the Federal Election
Commission, the Fair Political Practices Commission and the Los Angeles City Ethics
Commission. Mr. Reed has successfully managed litigation matters at the trial and appellate
court levels concerning the Federal and State constitutional rights of free speech and petition, the
California Elections Code, the Political Reform Act, the Public Records Act and the Anti -SLAPP
statute.
Mr. Reed has managed litigation matters which have led to reported appellate decisions in Paul
for Council v. Hanyecz (2001) 85 Cal.AppAth 1356 (regarding Code of Civil Procedure Section
425.16, the Anti-SLAPP statute), Dean v. Superior Court (1998) 62 Cal.AppAth 638 (regarding
candidate statements under the California Elections Code); Yes on lvfeasure A v. City of Lake
Forest (1997) 60 Cal.App.4th 620 (regarding municipal expenditures under California's Political
Reform Act); Browne v. Russell (1994) 27 Cal.AppAth 1116 (regarding petition signature
gathering rules under the Los Angeles City Election Code); Griset v. Fair Political Practices
Commission (1994) 8 CalAth 851 (regarding sender identification requirements under
California's Political Reform Act); and Hale v. Farrell (1981) 115 Cal.App.3d 164.
Among the governmental entities and political figures Mr. Reed has represented are the cities of
Newport Beach, Simi Valley, Ventura and Thousand Oaks, as well as county registrars, city
council members and Federal and State legislators. In addition, Mr. Reed has been widely cited
in the local, state and national media as an expert in political and election law.
EXHIBIT
MAY -18 -2001 09:10 8053833166 99%
• 0
STRUMWASSER & WOOCHER LLP
AT sAr IAw
Fxmruc D. Wooglsx 100 Wllsmu Bou1EvARD, SurrE 1900 TE[sPxom: (310) 576.1233
MICHAEL J. aTRUMW/ MER SAMA McmcA, CAIJFostm 90401 FArsmm (310) 319-0156
V_-WN S. REED
nuMON M. POULur
The Firm
STRUMWASSER & WoocEER LLP was founded in 1991 by Fredric D. Woocher and Michael J.
Strumwasser to bring their extensive experience in the public sector to a broad range of public and
private clients. Since then, Strumwasser & Woocher LLP has become one of the most respected law
firms in Southern California, known for its successful resolution of major public policy matters. The
firm's trial and appellate civil litigation practice focuses on complex litigation involving economic
regulation, consumer and worker protection, antitrust, constitutional law, environmental protection,
administrative law, and government ethics and electoral law. Despite its small size, the firm has
collected an impressive array of trial and appellate victories in path- making litigation in the public
interest. The firm's work touches on a wide array of civil litigation matters, with some of its most
notable successes occurring in the areas of election law and insurance rate regulation.
The firm has developed an active political and elections law practice, representing candidates, political
committees, citizen groups, and public agencies in compliance matters and in litigation on ballot
access issues, campaign finance and ethics regulations, initiative and referendum law, and contested
elections. For example, the firm currently represents the Agua Caliente Band of Cahuilla Indians in
the defense and implementation of Proposition 1A, the recent Native American gaming initiative
passed by California voters. Over the years, the firm has represented numerous political committees
and organizations in drafting state and local ballot measures and in litigation over the qualification
of initiative and referendum petitions for the ballot. Each election cycle, Strumwasser & Woocher
LLP's attorneys are also called upon to assist in the canvassing and recounting of votes in close
elections, and they have both prosecuted and defended a number of landmark election contests,
including the successful defense of Congresswoman Loretta Sanchez's narrow victory over former
Representative Robert Doman in the 46th Congressional District in Orange County.
Among its most high -profile work, Strumwasser & Woocher LLP has served for the past eight years
as Special Counsel to California Insurance Commissioners John Garamendi, Chuck Quackenbush,
and Harry Low, whom the firm has advised and represented in all phases of the implementation of
Proposition 103, the insurance - reform initiative. Strumwasser & Woocher LLP developed the
Commissioner's regulatory program, prosecuted the administrative cases on the insurance companies'
rebate liability, and has successfully defended the Commissioner's program in scores of state- and
federal -court lawsuits.
In addition, the firm represents an array of public agencies and private parties in selected matters
involving environmental, constitutional, and regulatory issues, as well as other issues of public
interest. For example, we currently represent the Los Angeles Unified School District in major
litigation to revamp the State of California's system for allocating billions of dollars in new school -
construction funds in a manner that does not discriminate against urban and minority districts. Some
other significant cases handled by the firm include: defending citizens who participated in a public
EXHIBIT C
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STRUMWASSER & WOOCHER
ARdWga Ail
environmental review process from retaliatory "SLAPP" defamation suits filed by project proponents;
representing dozens of Native Americans challenging California State University's plans to build a
mini -mall on a sacred burial site on the Long Beach campus; defending the City of Los Angeles
against constitutional challenges to its landmark Ethics -in- Government Ordinance; defending the City
of Huntington Beach in a federal court lawsuit seeking to invalidate city - imposed campaign finance
limitations; representing citizen organizations in preventing development in designated Significant
Ecological Areas in Los Angeles County and in the Mulholland Parkway Scenic Corridor; prosecuting
a plumbing fixtures manufacturer for failure to comply with environmental laws regulating the
handling and disposal of toxic wastes; defending the City of San Diego in federal Superfund litigation
over its disposal of municipal solid waste; representing the California State Senate in administrative
and judicial proceedings on the proposed licensing of the state's first permanent nuclear waste facility;
serving as Special Counsel to the U.S. Department of Housing and Urban Development in its
investigation and formulation of a regulation prohibiting discrimination in property insurance; serving
as counsel for the California Earthquake Authority in rate litigation; and representing a class of
garment workers seeking redress for violations of wige- and -hour laws by a major garment
manufacturer and its sewing contractors. The firm also was counsel to two plaintiff classes alleging
discrimination in the allocation of probation department resources to the detriment of Latino and
African- American inner -city communities and African- American probation officers.
In representing and advising a broad range of public agencies and officials, private individuals and
corporations, and citizen groups, Strumwasser & Woocher LLP takes pride in providing its clients
the highest quality representation efficiently and in achieving consistently favorable results against
numerically superior opposition.
The Lawyers
FREDRIc D. WOOCHER entered private practice after serving two years as Special Counsel to
California Attorney General John Van de Kamp, whom he represented and advised on government
ethics, environmental law, and consumer- protection issues, including implementation of
Proposition 103. Prior to his government service, Mr. Woocher spent seven years with the Center
for Law in the Public Interest, litigating *a broad range of public interest issues involving land -use,
environmental law, hazardous substances regulation, First Amendment protection, and civil rights
cases. He is an acknowledged authority on the initiative and referendum process and on campaign
financing issues. Mr. Woocher has successfully argued before both the U.S. and California
Supreme Courts as well as other appellate and trial courts. He served as Chair of the State Bar's
Committee on Human Rights, as a member of the State Bar Committee on the Environment, and
as a member of the Los Angeles County Judicial Evaluations Committee. He is a graduate of Yale
University (A.B.) and Stanford (Ph.D., J.D.), and was President of the Stanford Law Review.
Mr. Woocher was law clerk to U.S. Supreme Court Justice William J. Brennan, Jr., and Chief
Judge David L. Bazelon of the U.S. Court of Appeals for the D.C. Circuit.
I
• •
STRUMWASSER & WOOCHER
ATIaWtMa AT LAM
MICHAEL J. STRUMWAssER co- founded Strumwasser & Woocher LLP after seventeen years with
the California Department of Justice, the last eight years as Special Assistant Attorney General.
He litigated some of the state's largest antitrust, consumer - protection, and environmental cases,
including. California's challenges to major supermarket and oil- company mergers, defended
consumer interests in the Diablo Canyon Nuclear Power Plant rate case, and represented the
Governor in the Nuclear Regulatory Commission's health- and -safety review of Diablo Canyon.
Mr. Strumwasser conducted major litigation against the state's electric utilities, leading to a
favorable restructuring of the contracts providing electric power to the State Water Project. He
has defended numerous public agencies and officials in litigation under the California Tort Claims
Act. He has appeared in the U.S. and California Supreme Courts and has extensive trial
experience representing California energy and natural resource agencies before state and federal
courts and regulatory commissions, where he is recognized both for his trial skills and for his
command of technical issues. Mr. Strumwasser developed Attorney General Van de Kamp's
insurance - regulation program, including, with Mr. Woocher, the defense of Proposition 103 in
the California Supreme Court, and was the Attorney General's principal advisor on antitrust
policy. He represented the Attorney General on antitrust and utility matters before the California
Legislature and Congress. He holds A.B., M.S., and J.D. degrees from U.C.L. A.
KEVIN S. REED joined Stnrmwasser & Woocher LLP in 1996 after six years with the NAACP Legal
Defense & Education Fund, where he served as Managing Attorney for the Western Regional Office.
At Strumwasser & Woocher LLP, Mr. Reed has played a leading role in the firm's regulatory-law
and civil- litigation practice. He has served as counsel to a class of garment workers on whose behalf
a $1.5 million settlement of wage -and -hour claims was recently achieved, and has obtained another
successful settlement of a civil -rights class action on behalf of African- American probation officers.
At the NAACP Legal Defense & Educational Fund, Inc., Mr. Reed conducted major trial and
appellate litigation in the areas of housing discrimination police misconduct, health care, and criminal
justice reform. He helped develop the Legal Defense Fund's successful strategy for challenging the
Los Angeles Metropolitan Transit Authority's distribution of transportation resources and CalTrans'
provision of mitigation measures in low- income minority communities impacted by the 710 freeway
expansion. Before joining the Fund, Mr. Reed served as law clerk to Michigan Supreme Court
Justice Dennis W. Archer. He is a frequent teacher and lecturer on civil rights, redevelopment and
housing law, and lawyer training. In 1996 he was a visiting professor of law at Florida State
University where he taught a course on police misconduct law. In 1995 he taught workshops on
Constitutional Litigation to the Black Lawyers Association in Johannesburg, South Africa, and he
currently serves as Deputy General Counsel on the Rampart Independent Review Panel, established
by the Los Angeles Police Commission to review corruption within the LAPD. He has served as
Warden and Vestry Member of St. Augustine by- the -Sea Episcopal Church. He is a Director of the
Federal Bar Association's Los Angeles Chapter and Co -Chair of its Civil Rights Section and he is
President of the Los Angeles Chapter of Trout Unlimited and a member of the Southern California
Beekeepers Association. Mr. Reed is a graduate of the University of Virginia (B.A. 1986) and
Harvard Law School (J.D. 1989).
3
•
STRUMWASSER & WOOCHER
A�At 4W
•
HARRIsoN M. PoLLAtc came to Strumwasser & Woocher LLP in 1999 following a one -year clerkship
with United States District Judge Helen G. Berrigan in the Eastern District of Louisiana. Mr. Pollak
graduated from the University of California at Berkeley School of Law (Boalt Hall) in 1998 with a
Certificate in Environmental Law. In law school, Mr. Pollak was an Articles Editor of Ecology Law
Quarterly and a member of the East Bay Workers' Rights Clinic and the East Bay Refugee Project.
He won awards in the Boalt Hall Moot Court and the Jessup International Law Moot Court
competitions. Prior to law school, W. Pollak was a research fellow at the Amazon Institute of
Humans and the Environment and Academic Director of a college semester abroad program in the
Brazilian Amazon. W. Pollak graduated from Yale University in 1991 with a B.A. in history and
environmental studies.
0
Partner
Strumwasser & Woocher LLP
PROFESSIONAL EXPERIENCE
STRumwAssER& WoocHERLLP
0
Partner, January 1991 to present. Specializing in complex civil litigation on public policy issues.
Practice emphasizes constitutional law, election law, environmental protection, and administrative
regulation. Counsel to numerous state, local, and special agencies and elected and appointed
officials in environmental law, elections, and political reform. Represents California's Insurance
Commissioner and Controller, Counties of Santa Barbara and Ventura, and numerous cities.
Counsel to citizen environmental and public - interest groups. Handles litigation in federal and
state trial and appellate courts and administrative agencies, and has handled two election contests
in the House of Representatives.
OFFICE OF THE ATTORNEY GENERAL of CALIFORNIA
Special Counsel to the Attorney General, September 1988 to January 1991. Legal and policy
advisor on Attorney General's executive staff. Responsible for handling a variety of special
projects and sensitive issues, including high -priority civil litigation, legislative proposals, and
policy programs. Principal activities included advising the Attorney General on political reform
and ethics issues, supervising all judicial and administrative proceedings regarding implementation
of Proposition 103, and assisting on selected environmental and consumer matters. Author, for
gubernatorial candidate John K. Van de Kamp, of Proposition 131, the campaign and ethics
reform initiative on the June 1990 ballot.
CENTER FOR LAW iN THE PUBLIC INTEREST
Staff Attorney, July 1981 to September 1988. Handled complex civil litigation on broad range
of high- impact public interest issues. Specialized in environmental, land use, election law, First
Amendment, and civil rights issues. Argued before United States and California Supreme Courts,
federal and state courts of appeal, and trial courts. Helped draft City of Los Angeles campaign
finance reform charter amendments and city ordinance prohibiting discrimination by private
business clubs.
DEPARTMENT of DEFENSE
Staff Assistant to Secretary of Defense Harold Brown, 1980 to 1981.
UNrrED STATES SUPREME COURT
Law Clerk to Justice William J. Brennan, Jr., 1979 to 1980.
0
Resumd of FREDRIC D. WOOCHER
(Continued)
UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA
Law Clerk to Chief Judge David L. Bazelon, 1978 to 1979.
UNITED STATES SUPREME COURT
Stringfellow v. Concerned Neighbors in Action, 480 U.S. 370 (1987). Counsel for respondent
citizens' group, which intervened in Superfund litigation involving cleanup of hazardous waste
dumpsite in their community. Supreme Court held that district court order denying intervention
of right but granting permissive intervention with conditions is not appealable on interlocutory
basis.
Federal Communications Commission v. League of Women Voters, 468 U.S. 364 (1984).
Represented and presented oral argument on behalf of respondents public radio station and public
interest organization in landmark First Amendment decision establishing right of noncommercial
broadcasters to editorialize.
Pacific Gas & Electric Co. v. Public Utilities Comm 'n of California, 475 U.S. 1 (1986).
Counsel for respondent Toward Utility Rate Normalization, consumer advocacy group seeking to
have its informational and membership material distributed to utility's ratepayers with their
monthly bills; Supreme Court held that PUC order dedicating "extra space" in billing envelopes
for that purpose violated utility's First Amendment right not to associate with consumer group's
message.
Nollan v. California Coastal Commission, 483 U.S. 825 (1987), Authored amicus brief on behalf
of 12 national and state environmental organizations supporting Coastal Commission's permit
condition requiring landowner to dedicate easement for public access to beach under public trust
doctrine; Supreme Court held that the access condition did not adequately serve the public
purposes related to the permit requirement.
Board of Directors of Rotary International v. Rotary Club of Duarte, 481 U.S. 537 (1987).
Authored amicus brief for women's rights groups seeking to uphold application of California's
Unruh Civil Rights Act to international service organization that refused to permit women as full
members; Supreme Court upheld enforcement of state's anti- discrimination law and rejected
Rotary International's claim to First Amendment immunity.
CALIFORNIA SUPREME COURT
C.O.S. T. v. Superior Court of Orange County, 45 Cal.3d 491 (1988). Represented and presented
oral argument for petitioner citizens' group seeking to have initiative securing public vote on local
development fee placed on City of Irvine ballot; Supreme Court held that initiative was beyond
0 •
Resume of FREDRIC D. WOOCHER
(Continued)
the authority of the local electorate because its subject matter was of statewide concern.
Calfarm Insurance Company v. Deukmejian, 48 Cal.3d 805 (1989). Co- counsel for respondent
Attorney General John Van de Kamp in insurers' multi-prong challenge to constitutionality of
Proposition 103; Supreme Court invalidated and modified a portion of the initiative but upheld the
bulk of the measure as severable from the invalid sections.
Press v. Lucky Stores, Inc., 34 Cal.3d 311 (1983). Counsel for petitioner, proponent of statewide
ballot measure seeking award of attorneys fees for lawsuit brought to obtain access to shopping
center for purpose of collecting signatures on initiative petitions; Supreme Court ordered award
of attorneys' fees under Code of Civil Procedure section 1021.5, finding that lawsuit was
necessary to vindicate fundamental First Amendment rights of signature gatherers.
Kopp v. Fair Political Practices Com., 11 Cal.4th 607, 905 P.2d 1248, 47 Cal,Rptr.2d 198
(1995). Represented Common Cause in extraordinary writ proceeding to save by reformation
constitutionality of Proposition 73.
Gerken v. Fair Political Practices Com., 6 Cal.4th 707, 863 P.2d 694, 25 Cal.Rptr.2d 449
(1993). Co- counsel for Common Cause in petition seeking to establish the effectiveness of
Proposition 68.
OTHER MAJOR CASES
Doman v. Sanchez, House Oversight Committee; In re Sanchez, 978 F.Supp. 1315 (C.D. Cal.
1997); In re Sanchez, 955 F. Supp. 1210 (C.D. Cal. 1997). Successfully defended Hon. Loretta
Sanchez before House Oversight Committee, and in related judicial litigation, in election- contest
challenge by former Rep. Robert Doman.
American LungAss'n of Cal. v. South Coast Air QualityMgmt Dist., No. C573130 (L.A. Super.
1985). Represented clean-air coalition in successful challenge to first attempt by company to
"bank" pollution reduction "credits" for future sale to other companies needing to decrease
emissions; settlement resulted in rescinding of credits.
United States v. Stringfellow, No. CV 83 -2501 JMI (C.D. Cal. 1983). Represented intervening
residents in multi -party Superfund toxic waste site clean -up action; case still pending, but trial
court found private waste generators, dumpsite owners, and State of California strictly liable for
cleanup costs under CERCLA, RCRA, and Clean Water Act.
Friends of Ballona Wetlands v. California Coastal Commission, No. C525826 (L.A. Super.
1984). Represented environmental organizations in administrative and court challenges to L.A.
city, county, and Coastal Commission approvals of EIR and land use plans for massive Playa
Vista development project; settlement resulted in scaled -down project and
preservation/restoration of additional wetlands acreage.
Resu nd of FREDRIC D. WOOCHER
(Continued)
Federation of Hillside & Canyon Associations v. City of Los Angeles, No. C526616 (L.A. Super.
1986). Co- counsel in challenge to City of Los Angeles' failure to bring zoning ordinances into
conformity with city's general plans; injunction against issuance of further building permits for
inconsistently zoned parcels led to settlement with court- monitored schedule for city-wide
rezoning program.
Coalition For L.A. County Planning in the Public Interest v. Bd of Supervisors, 76 Cal.App.3d
241 (1977). Co- counsel in successful challenge to inadequacy of EIR and open -space element of
L.A. County's general plan amendments under state Planning and Zoning law.
Sierra Club v. Board of Supervisors, No. C319067 (L.A. Super. 1981). Co- counsel in successful
challenge to L.A. County approval of Sunnyglen development project in Santa Monica
Mountains; innovative settlement resulted in project re- design with additional on -site mitigation
measures and establishment of monetary off -site mitigation fund for purchase of development
rights in other environmentally sensitive canyon areas.
Browne Y. Russell, 27 Cal.AppAth 1116, 33 Ca1.Rptr.2d 29 (1994). Represented a coalition of
public - health organizations, successfully upheld Los Angeles City ordinance prohibiting smoking
in restaurants against a challenge by the tobacco and restaurant industries.
Schweisinger v. Jones, 68 Cal.AppAth 1320, 81 Cal.Rptr.2d 183 (1998). Challenge to Secretary
of State's interpretation of the term - limits initiative.
Americans v. State, 58 Cal.App.4th 724, 59 Cal.Rptr.2d 416 (1997). Challenge to State
Legislature's failure to appropriate funds for anti - tobacco advertising pursuant to Proposition 99.
Wilshire Ins. Co, v. Garamendi, 5 Cal.AppAth 1573, 8 Cal.Rptr.2d 55 (1992). Successful
defense of application of Proposition 103 to insurers not ordered by former. Insurance
Commissioner to roll back rates.
California Auto. v. Garamendi, 234 Cal.App.3d 1486, 286 Cal.Rptr. 257 (1991). Successful
defense of Insurance Commissioner's rate order for assigned -risk insurance.
California Auto, v. Garamendi, 232 Cal.App.3d 904,283 Cal.Rptr. 562 (1991). Upheld
Insurance Commissioner's rulings on procedures for setting assigned -risk rates.
Hardeman v. Thomas, 208 Cal.App3d 153 (1989). Co- counsel in election contest challenging
outcome of Inglewood City Council run -off election; after five -day trial, Superior Court annulled
election results and ordered new election to be held, finding that numerous violations of state
absentee ballot laws had occurred.
Jonathan Club v. California Coastal Commission, 197 Cal.App.3d 884 (1988) (decertified for
publication). Represented amici civil rights organizations in trial and appellate courts in support
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Resume of FREDRIC D. WOOCHER
(Continued)
of Coastal Commission's imposition of permit condition requiring Jonathan Club to certify that it
does not discriminate in its membership policies on account of race, religion, or sex in order to
expand its facility on state - leased beachfront land in Santa Monica.
ACADEbuc
J.D., Stanford Law School, 1978. President, Stanford Law Review. Order of the Coif
Ph.D. (Cognitive Psychology), Stanford University, 1977. National Science Foundation Graduate
Fellowship
A.B., Yale University, 1972. Phi Beta Kappa, Magna Cum Laude.
PROFESSIONAL AFFILIATIONS
Adjunct Professor of Law, University of Southern California (Pre-trial Advocacy, 1987 -88).
Adjunct Professor of Law, Loyola Law School (Law of Politics, 1992 -93)
Lecturer, U.C.L.A. Hazardous Materials Liability Program (1986, 1987)
American Bar Association, ALI -ABA Committee on Continuing Professional Education
(Lecturer, Hazardous Wastes, Superfund, and Toxic Substances)
California State Bar Association Committee on Human Rights (1983 -861 Chair, 1984 -85)
California State Bar Association Committee on Environment (1986 -88)
Los Angeles County Bar Association Committee on Judicial Evaluations (1985 -90)
California League of Conservation Voters, Treasurer, Member of Executive Committee (1991 -
present)
Stanford Law School Board of Visitors (1988 -90)
California Common Cause, Board of Directors (1992- present), Advisory Board (1986 -90)
• • ... S\aa�o1 — �kSa�.
GRANT AGREEMENT
This Agreement, entered into this 22n° day of May, 2001 by and between City of
Newport Beach, a municipal corporation and charter city (CITY) and Airport Working
Group of Orange County, Inc., a California non - profit corporation (GRANTEE), is made
with reference to the following:
WHEREAS, the CITY is a municipal corporation and charter city committed to
preserving the health, welfare and safety of its citizens; and
WHEREAS, GRANTEE is a California non - profit public benefit corporation
exempt from federal taxation pursuant to Section 501(c)(3) of the Internal Revenue
Code;and
WHEREAS, GRANTEE has requested a Grant from the CITY to engage in public
outreach activities related to the manner and means of accommodating the current and
future air travel and air cargo needs of Orange County including a commercial aviation
reuse of El Toro; and
WHEREAS, the public outreach program proposed by GRANTEE is consistent
with long- standing CITY policy related to the solution to the current and future air
transportation needs of Orange County; and
WHEREAS, the CITY has approved this Grant to GRANTEE with the
understanding and GRANTEE'S agreement that the Grant funds will (a) be expended
solely for the purpose of informing the public of issues, and engaging in other activity,
relevant to the manner and means of accommodating the current and future air
transportation demand in Orange County; (b) not be spent to support or oppose the
qualification, passage or defeat of any ballot measure or the election or defeat of any
candidate for political office; and (c) not be used for any activity that would violate state
or federal statutory or decisional law such as regulations affecting non - profit or tax
exempt organizations (these GRANTEE expenditure conditions in (a) through (c) are
collectively defined as the "Approve Use ").
NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:
1. GRANT
CITY agrees to Grant to GRANTEE the sum of three million six hundred
thousand dollars ($3,600,000.00). This Grant (Grant Funds) shall be paid in one
lump sum of one million eight hundred thousand dollars ($1,800,000.00) and
twelve equal monthly installments of one hundred fifty thousand dollars
($150,000.00). The lump sum shall be paid on or before June 1, 2001. The first
installment shall be paid on or before June 1, 2001 and the remaining
installments shall be paid on or before the first of each of the following eleven
(11) months. The Grant Funds shall be used solely by GRANTEE for the
Approved Use and for no other use and the balance of the Grant Funds shall be
returned to the City on written demand served no less than sixty (60) days after
expiration of this Agreement.
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2. TERM
The term of this Agreement shall commence on May 22, 2001 (the Effective
Date) and shall continue in full force and effect until the final installment has
been paid and GRANTEE has refunded any unspent Grant Funds, provided,
however, the indemnity provisions of this Agreement shall expire five (5) years
after the Effective Date.
3. RESTRICTIONS ON USE OF FUNDS
(a) GRANTEE acknowledges that municipal corporations are
prohibited from spending, directly or indirectly, public funds to support or
oppose candidates for public office. GRANTEE also acknowledges that
public funds may not be spent, directly or indirectly, to support or oppose
the qualification, passage or defeat of a ballot measure. Accordingly,
GRANTEE warrants to City that the Grant Funds will not be spent, directly
or indirectly, to support or oppose a candidate or candidates for public
office. GRANTEE further warrants to City that the Grant Funds will not be
spent, directly or indirectly, to support or oppose the qualification, passage
or defeat of any ballot measure. Finally, GRANTEE warrants to City that
the Grant Funds will not be spent to prepare or distribute material, or to
disseminate information, if it is clear from the surrounding circumstances
that the material or information supports or opposes the election of any
candidate or the qualification, passage or defeat of any ballot measure.
(b) In addition to the commitments in Subsection 3(a), GRANTEE
warrants to City that the Grant Funds will not be spent in a manner that
violates any State or Federal statutory or decisional law applicable to non-
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profit organizations exempt from taxation pursuant to Section 501(c)(3) of
the Internal Revenue Code.
(c) GRANTEE shall retain legal counsel with at least five years
experience in the fields of election law and political law to ensure
compliance with the warranties in Subsections 3(a) and 3(b). Legal
counsel retained by Grantee shall review all material or information
prepared, in whole or in part, through the expenditure of Grant Funds and
prior to duplication or dissemination. Legal counsel shall approve
duplication and dissemination of the material or information to the public
only upon a determination that the information or material is in full
compliance with all statutory and decisional law governing the conduct of
political campaigns and the express warranties made in Subsections 3(a)
and 3(b) of this Agreement. GRANTEE may use Grant Funds to
compensate special counsel for this specific and limited purpose.
(d) To further ensure compliance with the provisions of Subsection
3(a), GRANTEE shall not duplicate or disseminate to the public any
material prepared, in whole or in part, through an expenditure of Grant
Funds unless and until the material has first been reviewed, and
determined to comply with Subsection 3(a), by special counsel retained by
the City Council. CITY shall notify GRANTEE in writing, on or before May
25, 2001, of the name or names of the special counsel retained by the
CITY to review material pursuant to this Subsection. The review by
special counsel retained by the CITY shall be conducted, and the
determination communicated to GRANTEE, by the end of the next
business day following receipt of the material by special counsel.
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4. INDEMNIFICATION
GRANTEE shall protect, hold harmless, defend and indemnify the CITY, and its
elected officials, employees and representatives, from any claim, loss, litigation,
or liability arising out of or in any way related to this Agreement regardless of the
cause, except for any liability arising from the sole negligence, fraud or willful
misconduct of the CITY or its officers or employees. GRANTEE agrees that City
has the legal right, and that all necessary conditions have been satisfied, to
specifically enforce GRANTEE' obligations pursuant to this Agreement.
5. AUDIT
GRANTEE agrees to account for all Grant funds received from the CITY,
maintain detailed financial records using generally accepted accounting
principals, and allow CITY to conduct an audit of the financial records upon
reasonable notice and at any time within four (4) years after expiration or
termination of this Agreement.
6. THIRD PARTY BENEFICIARY
This Agreement does not create, and the parties do not intend to create, any
claim, cause of action or legal right for or on behalf of any other person or entity.
7. ENTIRE AGREEMENT
This Agreement represents the entire understanding of the Parties and may be
amended only by a document signed by both parties.
8. PRIOR AGREEMENTS
The Parties agree that this Agreement supersedes and terminates the force and
effect of the Grant Agreement approved and executed by the Parties on or about
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9
March 28, 2001. This Agreement does not affect any funds granted to
GRANTEE pursuant to an agreement approved and executed by the Parties on
or about April 1, 1999.
Agreed:
CITY OF NEWPORT BEACH
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Title
Date:
Approved as to Form
City Attorney
Attest:
City Clerk
ra srr-fl
GRANTEE
Title
Date: