San Diegans for Open Government v. City of Oceanside
4 Cal. App. 5th 637
| Cal. Ct. App. | 2016Background
- City of Oceanside entered a Disposition Agreement selling city-owned land to S.D. Malkin Properties to develop a 360-room luxury hotel; a separate TOT Agreement committed the city to subsidize the project by remitting up to $11,335,250 in transient occupancy tax (TOT) payments (discounted to present value).
- City council agenda for the September 10, 2014 meeting described multiple related actions, including (1) an agreement to guarantee the property be developed as a full-service resort; (2) an agreement to provide a mechanism to share TOT generated by the project; and (3) a subsidy report prepared under AB 562 documenting amount, start/end dates, and public purpose of the subsidy.
- San Diegans for Open Government (SDOG) sued, alleging (a) Brown Act violations for inadequate agenda notice and (b) noncompliance with Gov. Code § 53083 (economic development subsidy disclosure/reporting). Trial court ruled for the city; SDOG appealed.
- The appellate court reviewed Brown Act compliance de novo and applied a substantial-compliance standard for both the Brown Act agenda requirements and § 53083 disclosure/reporting.
- The court concluded the agenda gave fair notice of the essential nature of the council’s consideration (including that a substantial subsidy was at issue) and that the city’s subsidy report substantially complied with § 53083 (including present-value subsidy estimate and job categories).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the council agenda violated the Brown Act by failing to give adequate notice of a substantial TOT subsidy | Agenda was inadequate and merely gave a “clue,” failing to disclose the subsidy magnitude/duration and thus prevented public participation | Agenda expressly notified the public the council would consider sharing TOT and included reference to the AB 562 subsidy report; this provided fair notice of the essential nature of the matter | Affirmed: substantial compliance — agenda fairly notified public of the essential nature (subsidy/sharing of TOT); more detail would be helpful but not required by statute |
| Whether the subsidy report complied with Gov. Code § 53083 (required disclosure of recipient, amount, duration, public purpose, projected revenue, jobs) | Report was inadequate: unclear present-value calculation, misstated/unclear job-attribution to subsidy vs. project, omitted certain job subcategories and competitive-loss analysis | Report provided a good-faith reasonable estimate (present-value calculation of subsidy), included estimated full-/part-/temporary jobs; statute requires substantial not strict compliance and does not require competitive-loss offsets or additional temporary-job breakdowns | Affirmed: report substantially complied with § 53083; present-value subsidy estimate and project-job estimates were reasonable proxies for jobs attributable to the subsidy |
Key Cases Cited
- Moreno v. City of King, 127 Cal.App.4th 17 (explaining agenda must give more than a mere "clue" about the subject to be considered)
- Castaic Lake Water Agency v. Newhall County Water Dist., 238 Cal.App.4th 1196 (substantial compliance standard for Brown Act agenda; de novo review when facts undisputed)
- North Pacifica LLC v. California Coastal Com., 166 Cal.App.4th 1416 (substantial compliance doctrine and test for agenda adequacy)
- Carlson v. Paradise Unified Sch. Dist., 18 Cal.App.3d 196 (agenda must provide detail so public can ascertain nature of business; inadequate notice can be misleading)