Former San Bernardino County Supervisor and current West Valley Water District Board Member Dr. Clifford Young in conjunction with West Valley Water District’s chief financial officer and its assistant board secretary have filed a whistleblower lawsuit in Los Angeles Superior Court alleging the district has traded lucrative employment opportunities at the district in return for bribes and the delivery of campaign contributions intended to perpetuate the hold that two of the district’s board members have on their elected positions.
The legal action is bringing into sharp relief the common practice within a wide cross section of governmental entities in San Bernardino County in which criminal conflicts of interest abound while elected officials with one agency or municipality are employed with other agencies and municipalities, which in turn are governed by office holders who themselves hold high paying positions with other public agencies. Many consider the focus this lawsuit is bringing on this this circular tangle of incestuous relationships between public agencies as long overdue. Critics of local government in San Bernardino County believe such arrangements have created a multiplicity of make-work assignments in which the holders perform tasks or occupy positions that contribute little or nothing to the public benefit or the underlying purpose of the agencies involved, increase personnel costs and detract from the pool of money that otherwise might be available to be budgeted for legitimate operations related to municipal or agency responsibilities. Moreover, the inflated salaries provided to these office holders in one jurisdiction who are given sinecures with other jurisdictions result in across-the-board inflation in the compensation provided to public employees in general, analyses of public employee remunerations demonstrate.
The lawsuit in which Young and West Valley Water District Chief Financial Officer Naisha Davis and West Valley Water District Assistant Board Secretary Patricia Romero are plaintiffs names as defendants West Valley Water District General Counsel Robert Tafoya, who serves as the city attorney in Baldwin Park, and his law firm, Tafoya & Garcia;  West Valley Water District Special Counsel Clifton Albright and his law firm, Albright Yee & Schmit; West Valley Water District Special Counsel Martin Kaufman, and his law firm Kaufman Law Firm; and West Valley Water District consultant Robert Katherman.
Named as co-conspirators in the suit are Michael Taylor, president of the West Valley Water District Board of Directors and the former Baldwin Park police chief; current Baldwin Park City Councilman Ricardo Pacheco, who acts as the West Valley Water District’s assistant general manager, West Valley Water District Board Vice President and Fontana School District Police Officer Kyle Crowther and West Valley Water District General Manager Clarence Mansell.
Young, Davis and Romero are represented by attorneys Rachel Fiset and Erin Coleman of the law firm Zweibach, Fiset & Coleman.
The lawsuit alleges that Taylor, who was chief of the Baldwin Park Police Department from 2013 to 2016, had been terminated by the Baldwin Park City Council. He was subsequently re-hired to a one-year contract to again serve as Baldwin Park police chief on December 1, 2017. That contract, drafted by Tafoya, raised Taylor’s pension by $25,000, and further barred him from being fired unless he committed a felony, and dispensed with the requirement that Taylor be subject to performance evaluations.
Six days after Taylor was reinstated as police chief under the deal Tafoya drafted, Taylor on December 7, 2017 acted as a newly-elected member of the West Valley Water District Board of Directors to effectuate hiring Tafoya as the district’s general counsel on a contract with no end date, according to the lawsuit. Tafoya’s firm has billed the West Valley Water District approximately $395,000 since being hired in December 2017.
Less than four months later, Baldwin Park City Councilman Pacheco, who had voted for Taylor’s reinstatement as police chief, was hired by the West Valley Water District as the “assistant general manager of external affairs.” He was later moved without board approval to the newly created position of “assistant general manager,” earning a salary of $192,000 per year. Since his hiring, Pacheco and the California Education Coalition PAC he controls have donated a total of $8,000 to Taylor’s campaign and $1,000 to West Valley Water District Board Vice President Kyle Crowther’s campaign.
According to the suit, in 2018, Taylor spearheaded the effort to hire his associate, Mansell, as the West Valley Water District’s interim general manager and subsequently as the permanent general manager, at an annual salary of $225,000. Mansell was hired by a 3-to-2 board vote without a recruitment effort, background checks, or other standard hiring reviews.
In 2017 and 2018, Tafoya paid for Taylor to travel and stay in Mexico and Las Vegas, trips that Taylor did not disclose on economic interest disclosure forms he was required to fill out as an elected official. In September 2018, Tafoya paid for Taylor, Crowther and Young to attend an Arizona Cardinal’s football game in Arizona. Tafoya paid for airfare, hotels, game tickets and meals on the trip. Taylor and Crowther did not disclose the trip on required filings, according to the suit. Tafoya paid for Crowther’s airfare to Miami and for football tickets to Miami Dolphins football games on at least two occasions in 2018. Crowther did not disclose the tickets or airfare on required filings. Tafoya contributed $500 to Taylor’s campaign and $1,500 to Crowther’s political action committee, Kyle Nelson Crowther for West Valley Water District 2017, and he hosted an August 2018 fundraiser at the Los Angeles Athletic Club for Crowther.
In September 2018, Tafoya told West Valley Water District Director Clifford Young that Clifton Albright of Albright, Yee & Schmit should be hired to handle new litigation against the West Valley Water District, and, in exchange, Albright would donate $2,000 to Young’s campaign. Although Young declined, the district ultimately engaged Albright, whose firm had worked for the City of Baldwin Park. Albright made $1,000 in campaign contributions to both Taylor and Crowther. His firm has invoiced West Valley Water District approximately $222,000 for its services.
At Tafoya’s request, the West Valley Water District Board hired Martin Kaufman and the Kaufman Law Firm of Ontario as special counsel to the district in March 2018. Kaufman regularly provided some board members and Tafoya with trips, event tickets and expensive meals and gifts, and paid for Taylor, Tafoya and Crowther to attend the Los Angeles Rams vs. Los Angeles Chargers football game in 2018, according to the suit. Kaufman contributed $2,500 to Taylor’s campaign after his firm’s contract was approved. The firm has invoiced at least $97,945 to the West Valley Water District since March 2018.
In February 2018, Robert Katherman began consulting for the West Valley Water District on water issues without a contract or board approval. Katherman paid for gifts and entertainment for Taylor, including bottles of wine valued at $500, boxes of cigars, and meals which Taylor did not disclose on required forms, according to the lawsuit. “Katherman has contributed $500 each to Taylor’s and Crowther’s campaigns since being hired, and the West Valley Water District has paid him at least $40,000,” the suit states. “Over the past year, defendants and their co-conspirators named in this complaint – including, but not limited to Board of Director Michael Taylor, the district’ s general counsel, Robert Tafoya, the district’s assistant general manager, Robert Pacheco, Board of Director Kyle Crowther, the district’s general manager, Clarence Mansell, the district’s human resources and risk manager, Deborah Martinez, and other law firms and consultants connected to Taylor and Tafoya – have engaged in illegal kickbacks and bribes to ensure contracts with the district and subsequent approval of invoices for payment. These illegal kickbacks were in the form of payments for personal travel, expensive meals, campaign contributions, and entertainment for board members and staff. Defendants and their co-conspirators also engaged in unlawful bribes as these expenditures were also made in exchange for continued business to be directed to defendants and for the board to approve their invoices.”
According to the lawsuit, “Mansell has improperly contracted with vendors (who are friends, former coworkers, or affiliates at Baldwin Park and or the named defendants (particularly Tafoya and co-conspirators) based on kickbacks or bribes to Taylor or a co-conspirator within the district. Specifically, (1) Monsell and Tafoya routinely identified a contractor, wrote a contract and issued a purchase order; (2) the contractor would allegedly perform the work and invoice the district; (3) Mansell received the invoice and signed the invoice to approve payment; and (4) Taylor and Crowther would co-sign the checks for payment.”
The lawsuit continues, “Mansell would approve purchase orders up to $25.000 even if the contract was for a lower amount. Further, the payment of the invoices on these contracts has come from district funds not allocated for payment on the contracts resulting in a misappropriation of district funds. Mansell also failed to procure at least three requests for qualifications/proposals for these contracts in violation of the district’s procurement policies and procedures. The district’s professional services purchase orders have increased since Mansell’s appointment as general manager. For example, in September 2018, Mansell approved seven professional service purchase orders totaling $80,900. compared to no professional service purchase orders approved in September 2017 prior to his tenure. Tafoya has signed-off on these contracts and Taylor and Crowther subsequently signed checks for payment since October 2018. In doing so, Tafoya has violated his contract with the district, stating that “Tafoya & Garcia will not …retain the services of any outside investigators, consultants, or experts to be hired only after consultation with the district.”
Also, according to the lawsuit “on December 12, 2017 Martinez was appointed human resources manager of the district at the recommendation or Tafoya and Taylor. Prior to her appointment, Martinez and her husband contributed to Taylor’s campaign, and since her appointment, Martinez and her husband have contributed to Taylor’s campaign. Taylor did not recuse himself in voting for Martinez’s appointment as required by district policy. Since her appointment, Martinez and her husband have also paid for trips and meals for Taylor, including, but not limited to, trips to Mexico, Laughlin, Las Vegas, and Florida on numerous occasions.”
The suit further alleges that “Pacheco, a councilman at Baldwin Park, was hired in a newly created position as assistant manager of public affairs… at a salary in the amount of approximately $192,000 (which is more than the prior assistant general manager) plus a car paid by the district … to acquire state and federal grants for the district but to date no grants have been awarded to the district. Pacheco does not actually perform work on behalf  of the district but instead manages Baldwin Park matters on the district’s time and resources.”
Further, according to the suit, “Pacheco has maxed out his credit cards paid by the district for non-district entertainment expenses including, but not limited to hotels, casinos, and expensive meals. Furthermore, Pacheco patronizes strip clubs during working hours unrelated to district business. Pacheco has asked other District staff members for use of their credit cards to pay for expenses.”
Fiset said, “In a web of corruption reminiscent of the City of Bell scandal, the players in this conspiracy employed kickbacks, bribes and fraud, swapping lucrative contracts that generated over $1 million in fees and salaries in return for campaign contributions, free trips, gifts and NFL tickets. Our clients are shining the light on this conspiracy to hold those involved accountable to the public. A pattern of illegal kickbacks in the form of free travel, expensive meals, campaign contributions, entertainment and gifts shows how these defendants and their co-conspirators acted unlawfully to enrich themselves at the public’s expense,” Fiset said. “Our clients’ goal is to bring this rampant fraud, misappropriation of public funds and violation of the public’s trust to an end.”
Naseem Farooqi, the public affairs manager for the West Valley Water District, in response to a request for a response to the issues raised in the suit told the Sentinel, “The District will not be commenting further on pending litigation.”
-Mark Gutglueck

A herd of goats has been unleashed on the fire threat represented by the still green but rapidly desicating vegetation in the foothills above San Bernardino.
Some 600 goats are devouring virtually all of the plant life in their temporary grazing areas,  which are changed out every week or so as the vegetation they are feasting on  – grass, weeds and indigenous plants of all descriptions – disappears under the onslaught of the animals’ perpetual appetites.
Goats graze on hills too steep to be mowed, as well as in gullies that are otherwise unreachable.
A bonus in using goats to eradicate the proliferation of vegetation in places where its presence is unwanted because of its potential to dry out and break out into a conflagration with a mere spark is that these ruminants eat right down past the surface of the ground to feast on the roots of the plants, as they find those structures every bit as, if not more, tasty than the leafage. In eating the flowers of plants, goats consume the flora’s seeds. Poisonous plants present no problem to them. Over a period of two to three days, a fair-sized herd of goats confined to an area of roughly ten acres will eradicate the fire danger in that spot for the rest of the season.
Another key advantage to employing goats to do what they do naturally is that it eliminates the need to use pesticides or engage in mowing or harrow disking. Using mechanical means of disking or mowing brings with it the danger of creating sparks, which can ignite dry vegetation
Early this week, in the area around the Arrowhead Springs Hotel a sizable herd of goats was seen contentedly chomping away, with a few having migrated to the adjacent meadow and sparsely forested hillside.

Less than a week after garnering the attention of government officials and public employees up and down the Golden State, San Bernardino Mayor John Valdivia and the council majority he controls receded from what was widely anticipated to be the first major step in effectuating public employee salary reform.

Indications last week were that Valdivia and his council allies were on the verge of initiating an across-the-board effort to reduce by close to half the inflated salaries of the entire workforce at San Bernardino City Hall in an effort to stave off a second looming bankruptcy in less than a decade.

In 2012, the City of San Bernardino was forced to take refuge in Chapter Nine bankruptcy protection after years of overly generous salaries and benefits provided to city workers had created a $49 million annual operating deficit. The city emerged from bankruptcy in 2017, but now, two years later, expenditures in the soon-to-conclude 2018-19 fiscal year are on a trajectory to eclipse revenues in the same period by more than $11 million. If current trends continue, that deficit will zoom to over $16 million by the end of upcoming 2019-20.

Since 2012, San Bernardino has seen two mayoral turnovers. Patrick Morris, a former Superior Court judge, was at the city’s helm when the bankruptcy filing was made. In 2014, the city turned to Carey Davis, a certified public accountant, who had been endorsed by Morris in his mayoral bid. It was widely hoped that Davis might infuse the city with the fiscal discipline needed to stanch the city’s inveterate hemorrhaging of red ink. While some cutbacks were made and a small reduction in the level of overspending was realized by the city under Davis, the city in the five years that the bankruptcy hung over the city balanced its books in largest measure by simply skipping out on the mounting debt it had accumulated and continued to accrue. In the four years and ten months between the time it entered into bankruptcy in August 2012 and its emergence in June 2017, the city stiffed a combination of 109 creditors, vendors and partners for just over $350 million. Left largely unscathed by that devastation were the city’s employees, who continued to draw paychecks throughout the ordeal. They have seen no reductions in pay and their benefits remain intact, including the pensions they were promised by past mayors and city councils, though going forward the employees are now being called upon to make a slightly increased contribution toward their retirement benefits. The employees’ pension plan remains intact, which is administered by the California Public Employees Retirement System, contributions to which constitute the city’s third largest current expense, behind salaries paid out to the city’s police officers and salaries to the city’s general employees. In order to convince Federal Bankruptcy Court Judge Meredith Jury that the city should be allowed to walk away from the debt it owed, the city utilized the services of the law firm of Straddling Yocca Carlson and Rauth, it particular its bankruptcy law attorney Paul Glassman, which has been paid $25 million in legal fees over the last six years and eleven months.

In November 2018, Davis was turned out of office by the city’s voters, who replaced him with John Valdivia, who since 2012 had been serving in the capacity of Third Ward Councilman a, and who in the last three years of Davis’ term in office, which was extended by close to another year when the city adopted a new charter that changed the city’s election cycle from odd-numbered to even-numbered years, had emerged as Davis’ main rival on the council.

Since coming into office, Valdivia has had to deal with the legacy of the city’s spendthrift past which includes the unsustainable commitments it has made in terms of the pay level of city employees and the looming prospect that the city will once again fall so far into deficit spending that the only solution will be another bankruptcy or ending its run as going concern and disincorporating.

Two weeks ago Valdivia and five of the council’s seven members who are generally considered to be allied with him fired Straddling Yocca Carlson and Rauth, which as continued since the city’s 2017 emergence from bankrupty

Despite intensely concerted efforts over the last sixth weeks, authorities have yet to find the body of six-year-old Duke Flores, who was believed to have died at the hands, or as the result of the depraved and indifferent negligence, of his mother.

Black sedge or black bog rush, which is scientifically known as schoenus nigricans, is a species of sedge which grows in the San Bernardino Mountains and the eastern portion of the San Gabriel Mountains as well as a few other isolated areas in San Bernardino County where there are marshes.
Sedges are flowering plants, which superficially resemble the closely related rushes and the more distantly related grasses.
In addition to its presence locally, black sedge is native to Eurasia, parts of Africa, Australia, and other places in southern North America, including Mexico and the southernmost United States. It occurs nearly exclusively, with an estimated probability of 99 percent, under natural conditions in wetlands and other moist and alkaline habitat, primarily including marshes, calcareous bogs, and wet flatwoods, springs, seeps, peat bogs, heath, and alkali flats.
A perennial plant, schoenus nigricans grows in low, tight clumps eight to 30 inches high, the clumps formed by stems, threadlike leaves bearing wide and dark brown ligules, which are thin outgrowth at the junction of leaf and leafstalk. The stems are squarish, smooth and wiry. The leaf blades are erect, wiry, thin, triangular, and channeled. Their sheaths are dark reddish brown to black.
This plant’s flower cluster consists of a small, flattened set of very dark brown spikelets. The fruit is an achene. Achenes are singularly formed carpels, which contain a single seed inside a hardened seed coat to which the seed does not fully adhere. A carpel is the female reproductive part of the flower, which exists as a modified leave-bearing structure. In the case of black sedge, the coated seed, or nutlet, is a hard, glossy white shell.
It blooms from spring to summer.
Black sedge might first be encountered as clumps of wiry stems and leaves, having blackish long-tipped clusters at the stem tips. Each cluster of blackish spikelets has one very long, stiff, pointed bract, jutting out from below.
From Wikipedia; https://plants.ifas.ufl.edu; the National Biodiversity Network’s website:   https://nbn.org.uk/   and https://howlingpixel.com.

Within days of one another toward the end of last month, two further indications of the brutalization and/or malignant neglect of inmates in the care of the San Bernardino County Sheriff’s Department publicly surfaced.
On Wednesday May 22, the San Bernardino County District Attorney’s Office criminally charged former sheriff’s deputy Luke Van Ginkel, 22, with assaulting and threatening an inmate in December 2018. Also charged in the matter was inmate Alex Garcia, 40. Also criminally charged in the incident relating to Van Ginkel and Garcia was Deputy Arthur Enriquez, 33,
The sheriff’s department acknowledges having received credible accounts to indicate that on at least two separate occasions since he Van Ginkel began working as a guard at West Valley Detention Center, he engaged in action that crossed the line into criminal conduct.
On December 31, 2018, an inmate assaulted by Garcia lodged a grievance alleging maltreatment and staff misconduct relating to his beating.
According to the department, “During that same shift, a sergeant received the grievance and began the initial investigation. This initial investigation revealed alleged criminal misconduct involving deputies facilitating an assault on an inmate by another inmate.”
The department maintains that as of January 2, 2019, “the specialized investigations division began a criminal investigation, which involved interviewing more than 100 witnesses, reviewing extensive video and audio recordings, as well as collecting other evidence.”
Ultimately, according to the department, sheriff’s deputies Van Ginkel and Enriquez “were identified as the involved suspects. Van Ginkel was placed on administrative leave on January 3, 2019. He was hired on July 8, 2017 and started at the West Valley Detention Center on December 16, 2017. As of April 1, 2019, Van Ginkel no longer works for the sheriff’s department. Enriquez was also placed on administrative leave on January 5, 2019. He was hired on January 7, 2017 and started at the West Valley Detentions Center on July 22, 2017.”
There is yet no word as whether the union representing sheriff’s department personnel, the San Bernardino County’s Safety Employees Benefit Association, will intervene in an effort to reverse Van Ginkel’s firing. Van Ginkel attended Upland High School and graduated in 2015.
It is unclear whether Enriquez is yet employed with the department.
In the action taken by the district attorney’s office on May 22, Van Ginkel is charged with a violation of Penal Code Sections 422(a) – engaging in criminal threats and 245(a)(4) – assault by means of force likely to result in great bodily injury.
On December 24, according to the district attorney’s office, Van Ginkel told an inmate, Jose Angel Carillo, he was going to kill him.
The district attorney’s office further alleges that Van Ginkel subsequently set up a fight between Garcia, who is jailed on a murder charge, and Richard Freeman, who is likewise in custody on suspicion of murder. The fight took place on December 31.
Enriquez is charged with Penal Code 32 – accessory to a crime. Enriquez allegedly sought to deter the investigation in Van Ginkel’s action by filing a false report and making misrepresentations to investigators. Garcia, who assisted Van Ginkel in perpetrating the assault, according to the district attorney’s office, was charged with Penal Code 245(a)(4) – assault by means of force likely to result in great bodily injury.
Van Ginkel has his defenders, who say he is really a nice guy who only gets mean if he has a little too much sugar. He is scheduled for arraignment on June 17 before Judge Dan Detienne.
Enriquez is scheduled for arraignment on June 17 before Judge Dan Detienne.
Perry Belden, who was formerly an inmate at the San Bernardino County Sheriff’s Department jail in Joshua Tree, has filed a federal lawsuit alleging the neglect of his jailers while he was in custody led to the loss of both of his legs and his hand.
Belden’s ordeal began shortly after he was was taken into custody on March 27, 2018, in the aftermath of a March 16, 2018 incident at the Twentynine Palms home of his mother and stepfather. On the earlier day, Belden’s mother, Robin Olds, summoned the sheriff’s department when a fight broke out between Belden and his stepfather. Before officers arrived, Belden, who had previous convictions for obstructing a police office and grand theft, and was addicted to heroin, left the scene.
According to documents filed with the court, the sheriff’s department obtained a bench warrant for Belden’s arrest and deputies instituted a search for him, including returning to Olds’ home on no fewer than eight occasions to see if they could effectuate his arrest. Belden’s status as a known drug addict with previous arrests and convictions for theft and resisting arrest prompted a concerted effort to bring him into custody. Belden, who was lying low at an associate’s home, became aware of the warrant for his arrest and resigned himself to surrendering to authorities on March 27, 2018, having his mother tell the sheriff’s department where he was. Instead of responding as Olds and Belden believed was their understanding by coming to the residence where Belden was in order to take him into custody without incident, the deputies arrived en masse and armed with assault weapons. Belden took refuge in the attic of the home, whereupon the deputies fired a pepper spray bomb into the attic, at which point Belden plunged through the ceiling, injuring himself in the fall. According to court papers, the deputies then twice employed a stun gun on Belden when he was sprawled on the floor.
Because of his injuries, Belden was initially transported by deputies to the Hi-Desert Medical Center. Disclosure that Belden was a  heroin addict was made at that point to both Hi-Desert Medical Center personnel and the sheriff’s department. Belden was prescribed Klonopin to prevent withdrawal-induced seizures. According to the lawsuit, the department was on notice that Belden’s vital signs were to be monitored. Without regard to what they had been told, the deputies transported Belden to the Morongo Basin jail, which lacked even rudimentary medical facilities and had no trained medical personnel on staff. No medication was provided to Belden while he was incarcerated in the Morongo Basin jail.
During his arraignment at the Joshua Tree Courthouse on April 2, Olds said Belden “looked like death.” When Belden told the escorting deputies that he was feeling weak and ill, they responded that was what happened to “crackheads” who were out of crack and he would just have to “suck it up.” When he was unable to walk on his own power, they dragged him into the courtroom. Judge Bert L. Swift made no note of the circumstance either on or off the record, and took no action to ensure that Belden’s medical condition was looked into. Belden entered a plea to assault and vandalism, the vandalism being that related to his having fallen through the ceiling of the home where he was taken into custody.
“Perry took the first plea deal offered to him because he wanted to get out of local custody,” according to Belden’s suit.
On April 3, Belden was transferred to the West Valley Detention Center, where on the following morning his condition had grown to such a critical state that personnel there recognized his life was in danger. He was transported to the Arrowhead Medical Center, where it was in short order determined that Belden was suffering from septic shock brought on by unattended infections and was experiencing renal failure. To prevent the gangrene in his limbs from spreading further, doctors were obliged to amputate both his legs and left hand. His right hand was saved, but is now seriously deformed.
The county was served with the lawsuit on May 24. Neither the county nor Judge Swift, who is an employee of the State of California, were willing to comment on the litigation.

By clicking on the blue portal below, you can download a PDF of the June 7 edition of the San Bernardino County Sentinel.

Sentinel 06-07-19

By Mark Gutglueck
In a solid majority vote, the San Bernardino City Council this week ended its contract with Straddling Yocca Carlson & Rauth, the law firm to which it turned in 2012 to assist it in its entrance into, and then nearly five years later the penultimate exit from, Chapter 9 bankruptcy. It was Straddling Yocca Carlson & Rauth, and in particular one of the firm’s attorneys, Paul Glassman, who structured the manner in which the city went about stiffing scores of its creditors and vendors, paying some of the more lucky ones 80 percent of what they were owed, with far more receiving half of what they were due from the city, and many others less than that. In 2017, when the city made its official exit from bankruptcy, it had succeeded in stepping out from under slightly more than $350 million in debt, leaving in its wake dozens of those who had in good faith provided it with goods and services and had never been paid and were thus themselves driven right up to or over the precipice of bankruptcy and financial ruin.
The law firm of Straddling Yocca Carlson & Rauth including Glassman, however, was not among those who had nothing – or next to nothing – to show for its association with the city. Indeed, for assisting the city in skipping out on its debts, the firm was paid $25 million.
San Bernardino made the Chapter 9 filing in August 2012 after years of dwindling revenues, expenditures drastically exceeding income, and deteriorating financial numbers that resulted in $80 million in unfunded liabilities and a $49 million annual operating deficit. Chapter 9 of the United States Bankruptcy Code provides a financially distressed entity such as a municipality protection from its creditors while it develops and negotiates a plan for adjusting its debts.
Perhaps predictably, under the terms presented by Glassman to the bankruptcy court and Federal Bankruptcy Judge Meredith Jury, city employees and retirees did relatively well, and the lion’s share of generous pension benefits for then-current and former workers offered through the California Public Employees Retirement System were preserved, though current employees were called upon to make a greater contribution toward those pension plans, and some benefits were marginally reduced or modified. The city’s commitment to the California Public Employees Retirement System, which had been a major factor in breaking the city’s bank, was not erased, though the same level of benefits given to employees in the past through that system were discontinued for new employees.
Virtually every other entity, with only a handful of exceptions, that had made the mistake of dealing with the city both immediately prior to the bankruptcy and during it was treated far more shabbily by the city, as Straddling Yocca Carlson & Rauth and Glassman guided it through bankruptcy court.
Among the city’s creditors that did not fare as well were Luxembourg-based EEPK, holders of the city’s pension bonds, and Ambac Assurance Corp, which indemnified some of those bonds. When the city failed to provide them with the same terms of repayment as the California Public Employees Retirement System, they sued, asserting the bonds and whatever fees are associated with them fall under the same pension obligation as the payments to the pension system. That lawsuit was settled in March 2016 on the basis of an agreement by which the city agreed to pay not 100 percent but rather 40 percent of what is owed to EEPK and Ambac.
One class of creditors who were really burned were litigants and claimants against the city, including ones who had prevailed in certain lawsuits, among them those alleging they had endured civil rights violations relating to excessive use of force by the police department. Those entities and the lawyers representing them were provided with just a penny on the dollar for the first $1 million in judgments against the city.
The heavy legal work with regard to the bankruptcy ended with the city’s official exit from Chapter 9 protection in June 2017 in accordance with Judge Jury having signed four months previously on February 7, 2017 the city’s confirmation order and requested third party injunction preventing any remaining disputed claims from interrupting the bankruptcy exit. While at that point a majority of the city’s creditors had agreed to the plan, some stragglers refused to compromise or were otherwise insisting that the pittance the city had offered did not truly qualify as a compromise.  Straddling Yocca Carlson & Rauth and Glassman since June 2017 continued to represent the city with regard to those claims. Coming into Wednesday evening’s council meeting, it was the contention of Mayor John Valdivia and his chief of staff, Bilial Essayli, that Straddling Yocca Carlson & Rauth and Glassman since June 2017 continued to bill the city at a rate of $200,000 per month for what Valdivia and Essayli contend is minor legal mop-up work that should not cost that much.
Accordingly, Valdivia placed on the agenda for the Wednesday, June 5 city council meeting an item that called upon the city council to “review and consider termination of professional services agreement with Stradling Yocca Carlson & Rauth, P.C. for reorganization and financial restructuring advice.”
At the meeting, Valdivia said that as he was emerging from his vehicle in his allotted space in the parking structure at the civic center to come into the meeting, he was approached by “Mr. Clark [Thomas P. Clark, a Straddling Yocca Carlson & Rauth attorney], who was waiting for me.” Valdivia said that while “I respect his [Clark’s] eagerness and passion” with regard to Clark’s firm potentially losing some very lucrative work, he was intent on proceeding with the item before the council. “The point is we met with Mr. Clark,” the mayor said. Valdivia then gave the floor to his chief staff to “allow the public to know what exactly are the issues with the billing.”
“Mr. Glassman has been billing the city at about $200,000 per month in legal services,” Essayli said. “The mayor’s office has done an analysis of his bills along with representatives of the city attorney’s office. We are in agreement that those bills are excessive and frankly unreasonable. The city really can’t afford to wait to move on this item. We spent $2 million last year on legal fees from Mr. Glassman. The city did not have money budgeted for that. They had to dip into reserves in order to cover his legal services. We have budgeted for this upcoming year about $700,000 for legal bills related to the bankruptcy. At the current rate that Mr. Glassman is billing the city, he’s going to blow through that budget in about four months. We believe this work is just about wrapped up. The bankruptcy is done. This stuff is really not complicated. We believe BB&K [Best Best & Krieger, which provides contract city attorney services to San Bernardino] can transition. They are professionals. They can take on this work and do it at a rate that is much more efficient than what Mr. Glassman is charging us. So, if we wait another month, it’s going to be another month of $200,000 in legal services, and then you have to give him 30 days notice, so that is another $200,000, so the cost of waiting is $400,000, money we believe the city doesn’t have. So, if the council votes to terminate tonight, Best, Best & Krieger will work with him over the next month to transition, and if they believe they need Mr. Glassman to advise or consult, they can make that request to the city council. So, we strongly urge that this get heard tonight.”
Essayli went on, “The city still has some bankruptcy cases that are open. We have asked Mr. Glassman for a summary of the pending cases. He has not provided them after numerous requests. We believe the motion work is straightforward. We do not believe it should cost anywhere around $200,000 in monthly legal fees. We believe that should be closer to $50,000, at most. We’ve consulted with our assistant city attorney, and I believe she has a similar viewpoint on that. You can ask her. We think that, frankly, the bills are excessive. We’ve worked with him for the last four months to try to get his bills down, and I believe his statement was, ‘Well, the bills are what they are.’ So at this point, he’s not shown any willingness to rein in his legal bills, and that’s very concerning for us.”
Councilman Fred Shorett made a motion that the item be continued until the city council’s June 19 meeting. Councilman Jim Mulvihill seconded the motion.
Valdivia said, “This is a policy discussion that now goes back to the council, and the floor motion is to terminate the contract tonight. And so…”
“I believe the floor motion was to continue,” City Attorney Gary Saenz broke in.
Saenz disputed Essayli’s suggestion that it would take two months longer to disengage from Straddling Yocca Carlson & Rauth if the action was not taken that night. Essayli stated that what would normally be the council’s first meeting in July has been canceled. Saenz, who was advocating for a continuation of the item, pointed out that the matter could be taken up at the council’s second June meeting.  “There’s a meeting on the 19th,” Saenz said. “So, the indication that it is going to take two months longer is incorrect. It’s going to take two weeks longer, at worst, for this item to move forward. Now, this firm has been engaged with the city for seven years. To say that two weeks now is not acceptable after being in the relationship with them for seven years in my mind does not make sense. In the backup material there is an indication that says staff anticipates there will have to be replacement counsel. It has not been determined yet that there will be cost savings. If there will be cost savings, great. I understand that and perhaps Glassman, if he understands that, he might change whatever his attitude has been. But I think he should have an opportunity to be heard by this council as to those issues. And also remember this is an ongoing legal proceeding that is still open and is still in the bankruptcy court. There may be legal ramifications to this that are unknown at this time to this council. We heard Councilman Sanchez tonight and I agree with him wholeheartedly that an uninformed decision should not be made by this council. This council needs information from Glassman. I informed him yesterday. He was surprised that this item was on the agenda. He had not heard that it was on the agenda tonight and he suggested that a closed session at the very least to inform council of the legal ramifications, the legal consequences, perhaps, of removing him at this time, what those might be, so the council is informed. I’m only asking for two weeks. So, the delay will only be, ultimately, two weeks. If the council decides in two weeks they want to terminate the relationship, they can do that. They give him a 30-day notice, and there has been a two week-delay, which after a seven-year contract is not significantly consequential.”
Valdivia said, “My growing concern, Mr. Saenz, is that we have attempted patiently, we have done our due diligence to address the issue with Straddling Yocca since on or about the beginning of February. And we have waited patiently. Staff has worked with Mr. Glassman. We have attempted to reconstruct priorities and scopes of services, and the idea that he is somehow surprised is alarming. We have asked him to provide the bills and the invoices and to redirect priorities on expediting some of these cases. I don’t know where this is coming from that he needs another two weeks; we have a seven-year relationship. In fairness, the taxpayers of this community have already paid $25 million to Straddling Yocca, so as the Book of Ecclesiastes says “There is a time for everything.”
Saenz retorted, “Well, I understand that there has been $25 million expended. At the same time, his performance in the bankruptcy court has resulted in the saving of over $300 million. I think that’s pretty good bang for the buck, if you ask me. All I’m suggesting is he should have an opportunity to inform this council as to what the ramifications, the impact and consequences of that might be. And if he’s not able to do that, then of course this council is certainly justified in terminating the relationship, but not, I think, until they have that information, until he has the opportunity to respond to this council and in a closed session as well to discuss the legal issues as they pertain to the bankruptcy.”
“Why wouldn’t our city attorney advise us of that?” Essayli said, his reference to the city attorney being to the law firm of Best Best & Krieger.
Councilman Fred Shorett leapt into the breach.  “Excuse me,” Shorett said. “Thank you, Mr. Essayli. You are staff, not our city attorney. I tend to follow the experts or the people we pay to do that. I can’t see that after seven years and this horrible thing that we’ve gone through called bankruptcy that we can’t wait two more weeks, particularly at the request of our own city attorney. This is a legal matter. I am particularly interested in your characterization of ‘we,’” Shorett said, referring to Valdivia. “We, who have been working diligently and waiting patiently and talking to Straddling Yocca and these people to resolve some of the concerns that ‘we’ have?” he said. “’We,’ meaning who? Not I. I’m really concerned about it. I would like to hear from them before we pull the ripcord and cut him lose and I cannot imagine that two weeks is going to make a difference, not in this case, not to end something that is so important. And if he’s just saying, ‘I’m billing,’ and we’re not getting bang for our buck, we’re getting billed $200,000 a month and not getting service, I’ll be the first one to end that contract, the very first one, I’ll lead the charge, and I’ll sue them to get it back for lack of service or for malpractice.”
“I concur with that,” said Saenz. “If the bills are excessive relative to what the city is receiving for those services, then I agree that it should be terminated. But I think we need the specifics on that before we take this action.”
Shorett moved to continue the action on firing Straddling Yocca Carlson & Rauth and Glassman until the June 19 council meeting. Mulvihill again seconded the motion.
Councilwoman Sandra Ibarra then weighed in. She referenced the payment registry on that evening’s agenda, specifying, “In case no one saw it, Straddling Yocca, the total payout for the financial restructuring period ending 2/28/2019, a hundred and three, almost one hundred and four thousand [dollars]. Again, for the month of March, the financial restructuring period ending 3/31, they charged us an additional $128,622. That’s a total of $232,600, just about, for those two months. Do we have information on this restructuring? I know this came before us in February, that we were trying to transfer over to BBK [Best Best & Krieger]. That was the understanding. Can they provide us an update at the Tuesday meeting [June 11] during closed session instead of waiting until the 19th, since they already billed us for those two months?”
“If that’s council’s wish, they can make that request,” said Saenz. “My suggestion would be agendizing it for that meeting [June 11] and also for the closed session of that meeting. If council is that anxious, rather than having it at the regular meeting, I have no problem with that. But I think they should be given an opportunity to inform this council, before this council makes such a vital decision.”
Essayli said, “Mr. Glassman was here in February in both closed session and open session. If you remember his report, frankly, it wasn’t a very good report and it was hard to get a clear answer from him. That’s the trouble with him. So, we’ve tried for four months. He’s not acting in good faith, in our belief. So, we don’t believe two weeks is going to do anything other than incur the city more legal expenses.”
Councilwoman Bessine Richard asked for Sonia Carvalho, an employee with the firm of Best Best & Krieger, which has been hired to augment Saenz in his function as city attorney as his final year as elected city attorney winds down in accordance with the charter amendment approved by the city’s voters in 2016, which eliminated the elected city clerk’s and elected city attorney’s position as of Spring 2020. Best Best & Krieger is then scheduled to move in as the city attorney. By eliminating Straddling Yocca Carlson & Rauth as the city’s legal representative with regard to the remaining issues pertaining to its August 2012 filing for Chapter 9 bankruptcy protection, the city will very likely increase the workload Best Best & Krieger will undertake, and thus the amount of remuneration it will receive.
Encouraged by that prospect, Assistant City Attorney Carvalho said, “I was just looking through some notes here. Following the city council’s closed session in February, the city council had directed me to reach out to Mr. Glassman and have a conversation with him. I sent an email to several members of our administrative staff in March. My email read as follows: ‘As directed by the city council, today City Manager [sic] Gary Saenz, Richard Egger and I had a conference call with Paul Glassman and his staff. Paul provided a thorough update.’ I go on to list the four actions, specific actions, [that] would be taken, that the small property claims, Paul would draft a letter to be sent to all claimants along with checks. We decided this would be an efficient way for him to handle these matters, and that he was to send out the letter no later than March 28. I don’t know from our finance staff whether that occurred, but that was what we had discussed and that was a summary of the email I sent. We were also to receive summaries of proofs of claims and Paul would prepare a letter to resolve four particular matters. I am aware that those four particular matters, that the letters did go out. There was also an issue about Paul speaking with someone at the county and school district to settle a number of the very difficult claims, and in that I had requested that your former city manager, ‘Please give us the contact information,’ as it was my understanding that she had begun to talk to them about those cases. We were also to get a summary of all of the 910 claims,” Carvalho said, without explaining what she meant by the term 910. “Paul was to prepare a brief strategy statement for all of the claims on this list. He was also supposed to identify an action plan, and provide an estimated timeline and budget. And finally, we asked him to prepare a summary of all the lawsuits. He was to prepare a brief strategy statement for each of these, a strategy statement so we could help evaluate whether we could resolve these and how much they would take, rather than just sort of letting them move forward on their own. He also identified cases that previous in-house counsel was managing, and had asked us for a review of these cases, which my partner, Richard Eggar, has been reviewing. So, that is what I did. That is what the council directed me to do, that is the work I did. I communicated that work. Our city attorney was on the phone with us, and he is familiar with the things we asked Paul to do. I don’t have a particular opinion on this. I take ethics very seriously, and I don’t feel that I should have any say in what your decision is. I just wanted to communicate to you that I did what you asked me to do, and I believe we need to continue to monitor this very carefully and be more proactive in making sure we get these cases closed as soon as possible”
“Did he provide the reports you requested, though?” Essayli asked.
“I have not received the reports that we had indicated in this email,” Carvalho said. “He did receive a copy of it.”
Councilman Ted Sanchez asked Carvalho, “You’ve had an opportunity to review their billable hours for the last 12 months, right?”
“Actually, just the last several months, because it wasn’t until you met in closed session that you asked me to specifically work with our city attorney to review those,” Carvalho said.
“Did those bills in your legal opinion seem excessive for the work being done?” Sanchez pressed.
“So, I mean always when you see a six figure bill for a month, you question why that amount is so high,” Carvalho said. “I don’t think that I’m personally qualified to tell you whether in fact any particular bill was wrong or not. Given what our conversation was in February, I would expect them to be more pro-actively managing this. I did not ask him to get his bills at any particular level. What I asked him to do was to explain to me in advance if he was going to send us a bill that exceeded a hundred thousand dollars. Actually, what I said in my email to him was, ‘If you are going to send us a bill that exceeds $67,000,’ because that’s how much we budgeted, ‘I would expect for you to send me in advance an explanation as to why the bill is more than $67,000.’ And I will say he did that the first month. Not in the subsequent months.”
“I think we have our answer,” Sanchez said. “This city is being taken advantage of by this firm, and they’re not acting in good faith as our partners guiding us through this bankruptcy. We need to seek legal services elsewhere. So, I make a substitute motion that we terminate the contract with Straddling Yocca and that we go into negotiations to contract this bankruptcy legal work to Best Best & Krieger.”
Councilwoman Bessine Richard seconded the motion.
Councilman Jim Mulvihill asked if Straddling Yocca could challenge the termination legally.
“In compliance with the contract, we can terminate by giving thirty days notice, and that’s the end of the deal,” Saenz said. “I wouldn’t expect there to be any liability or breach of contract as a result of doing that.”
Carvalho said, “I think the real issue here is whether or how – if you decide to do this, how you would go about doing this in terms of conversations with them in terms of transitioning, getting and files and really I think if you take this action this evening I would ask for the ability to continue to work with Mr. Glassman and in the event if there is something it would seem irresponsible for us to assume, that we would come back to council and have that conversation.“
“From my point of view they’ve been working on this for years, and so, if we were to terminate them, we’d be starting from point zero,” Mulvihill said.
“I don’t believe we would be starting from ground zero,” Saenz said. “There’s been a lot of work done pursuant to the contract to engage in a transition of sorts, to provide us with documents, with all of the work product that they have, and so on. So it’s not a situation where we would be starting from ground zero. There would be transition issues. There may be difficulties in the court that I’m not aware of that only Mr. Glassman could explain to you. I know there are current pending issues in the bankruptcy court itself relative to bankruptcy law that he is engaged in. So, this council should be provided with that information, and once they have the information, then make an informed decision rather than an uninformed decision as to what the full ramifications of those are. If we are not getting enough for our money, than I would applaud the termination myself. I’m not opposed to a termination. What I am suggesting is that without him [Glassman] present or without an opportunity for him to be heard, as I suggested when I told him last night that this is on the agenda, he was not aware that it was and would like the opportunity to be heard and believes that a closed session would be of value to the council in making this decision, a closed session regarding the legal issues currently pending in the bankruptcy court.”
“Paul Glassman was one of the keys to getting us through bankruptcy,” Mulvihill said. “The kind of briefs and presentations that he provided to the bankruptcy court, I think, eased our way through the bankruptcy process. So, I just think, from what the city attorney has said, wait two weeks. Let’s hear from them.”
“We believe it’s inappropriate for Mr. Glassman to advise the city on the legal ramifications or consequences of terminating his own contract,” Essayli said. “It’s a conflict of interest. He did provide a service to the city and he has been handsomely compensated, to the tune of $25 million.”
“This appears to be another one of those contracts that this administration wants to get rid of, and they want to do it their way, and I’m sorry, but the mayor and his chief of staff do not run this city,” Shorett said. “It’s the city council. We make these decisions.”
Sanchez’s substitute motion was voted upon and passed 5-to-2 with Shorett and Mulvihill dissenting.