PG Confidential City official explains why it is keeping a report secret

By Joe Livernois

If the intent of an investigation commissioned by the city of Pacific Grove into allegations of conflicts was to reassure the public with transparency, it may have missed the mark.

The city earlier rejected a request by Voices of Monterey Bay to make public the full investigative report into complaints by city residents about alleged questionable activities over the doomed Project Bella resort hotel development.

And last week the city, through its city clerk, elaborated on why the City Council only released selected parts of the report during a public presentation in 2017. “The Council felt it was important to withhold the entirety of the report as there are privacy interests involved,” according to Sandra Kandell, the city clerk, in an email to Voices.

Voices had asked for an explanation of the city’s refusal to make public a report by the Jackson Lewis law firm of San Francisco. The city had commissioned the investigation after Pacific Grove residents questioned the propriety of the City Manager’s relationship with a representative of the Project Bella developer.

But the full report was never made public, and instead an attorney with Jackson Lewis delivered a PowerPoint presentation to the City Council that summarized findings in the report. The investigation concluded that no laws were broken, according to Jackson Lewis.

Initially, the city rejected Voices’ request to see the full report, citing “attorney-client privilege.” But Voices argued that because the public PowerPoint presentation was based on that report, the report ought to be exempt from the attorney-client privilege.

In her response, Kandell said the City Council “holds the privilege, and authorized a limited disclosure of key point for purposes of the presentation.” She then cited the “privacy interests.”

The Jackson Lewis report cost the city more than $31,000 and came in the midst of public concern over Project Bella, which would have been a 160-suite luxury hotel at what is now the American Tin Cannery building at 125 Ocean View Blvd. The developer, Domaine Pacific Grove, pulled out of the project in September 2016.

The county grand jury did its own investigation, and it criticized city officials last year for its lack of transparency, for pushing the project through the process without much explanation to residents and for withholding information.

The grand jury also noted that Jackson Lewis was given a “narrow focus”  of investigation by the city council. “What was not addressed in the Jackson Lewis report were the causes that gave rise to the allegations,” according to the grand jury, “such as the sloppiness in the City’s systems and procedures, its mishandling of documents and checks, the lack of transparency on the part of City staff, and the cost that resulted from those shortcomings.”

While the developer was working with the city, several Pacific Grove residents had questioned a confusing series of “reimbursement agreements.” between the city and Domaine. The idea was that Domaine was supposed to reimburse the city for its costs of the government approval process, including the cost of a special election to approve zoning changes required for the property and the cost of completing a coastal plan the city needed to finish.

The reimbursement agreement for the coastal plan apparently never got approved and critics suspected that it was a willful act to benefit the developer. During the PowerPoint presentation, a representative for Jackson Lewis acknowledged that the coastal-plan reimbursement agreement did not get signed, but attributed it to “human error” and not intentional wrongdoing.

Pacific Grove attorney Jane Haines, who has actively been trying to learn more about the issues surrounding the Project Bella, said she agrees that “important privacy issues are involved, because non-transparency in P.G. government is an important issue. Public funds paid for the investigation into why the city failed to collect tens of thousands of dollars as reimbursement for Project Bella expenses, and the public has an important interest in learning why the city keeps that investigation private.”

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Joe Livernois

About Joe Livernois

Joe Livernois has been a reporter, editor and columnist in Monterey County for 35 years.

4 thoughts on “PG Confidential City official explains why it is keeping a report secret

  1. So PG won’t disclose the Jackson Lewis investigation into Project Bella because of “privacy interests”?

    There are lots of “privacy interests” in PG. For example:

    ~one got exposed by the Civil Grand Jury Report about Project Bella when it explained to the public that the City Manager shared “an exclusive and discounted group membership” in a private airline service with the Project Bella developer during the period the Bella project application was pending before the City –,

    ~ in fact, that “discounted group membership” was so private it wasn’t even disclosed on the City Manager’s legally-required Statements of Economic Interests,

    ~ and perhaps it was a “privacy interest” that prevented staff from informing the City Council that the Project Bella developer had not signed a reimbursement agreement as of 3/26/16 when the City Council approved $433,613 for Project Bella environmental studies;

    ~ and it’s still secret why a $32,000 reimbursement required in the reimbursement agreement drafted in January 2016 by the assistant city attorney and Bella’s attorney was removed before it was presented to the City Council on Feb. 17, 2016, a secret which caused one of the drafting attorneys to write the other in May, 2016: “that is not the final Reimbursement Agreement that we negotiated in January;”

    ~ and one of the most puzzling secrets to me is whether the Jackson Lewis investigator actually called the City’s former finance director to discuss the missing $50,000 check, or whether she relied solely on what the director’s successor stated, because I understood something quite different when I discussed it with the former finance director;

    ~ and what “privacy interests” or “attorney-client” privilege allows the City to redact and withhold so many public records, because my copy of the Public Records Act and Evidence Code doesn’t jive with the City’s explanations, especially because my copy says only “confidential” attorney-client communications are exempted, and I don’t understand how so very many City documents can be “confidential.”

    It’s disturbing, because I trust all Pacific Grove Council members so I cannot imagine what advice they were following when they decided to withhold from the public the Jackson Lewis investigation into Project Bella because of “privacy interests.”

  2. Sadly the council often looks to the city attorney for guidance. They are often given the wrong information as to what they should be acting on. Having been on the council for six years I can tell you that this was mishandled by staff from start to finish. Recently I criticized the performance of a city employee and their lack of qualifications to which the city manager replied “I only have a degree in political science and French.” That may be the problem. This is a CM that when he applied for the job emphasized his belief in transparency. He is anything but that.

  3. The City’s handling of Project Bella has been investigated twice: first by an investigator hired by the City who found human error, but no wrongdoing. That investigation did reveal the City Manager’s private, ethically questionable travel benefit, but the investigator, and presumably the Council, were untroubled by it. The Council expressed satisfaction with that report, but chose not to make the entire report public. The public was allowed to know its conclusions, not how the investigator arrived at them.

    The Grand Jury investigated and came to different, less sanguine conclusions. Among other findings, it wrote that the City Manager had shown “a remarkable lack of sensitivity to ethical standards expected of all members of public employment..” That entire report is available to the public along with the City’s defensive response. The video of the Council discussion is also available on the City web site.

    The City agrees with the Jackson Lewis report and disagrees with the Grand Jury. How does the public decide what to believe? The City’s response to that question is: “Trust us. Take our word for it. The investigation that exonerated us got it right and you’d see that if you could read it yourself, which, unfortunately, you can’t.”

  4. If the city is using the “attorney-client” privilege, then we as the citizens of PG are the clients. Whenever elected official hide behind such privileges, one must become suspect as to their reasoning.

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