Personal Legal Bills Mount for City Officials

Thursday, September 15, 2005 | The city of San Diego has spent almost $2 million on attorneys representing individual elected officials and city staff in connection with ongoing federal investigations into City Hall finances and politics, according to invoices released Wednesday.

For example, $199,316 in city funds had gone to lawyers representing former Mayor Dick Murphy in connection with the investigations through the end of July, and City Manager Lamont Ewell’s legal representation has cost taxpayers more than $114,934 in that time.

In total, more than 35 city officials are receiving publicly-funded legal assistance, including the city’s top current and former elected officials, their staff members and city attorneys, accountants, managers and other staff, according to documents released by the City Attorney’s Office.

After taking office in December, City Attorney Mike Aguirre said his separate investigations into City Hall prevented the City Attorney’s Office from representing city officials who had been called to testify before the investigating agencies.

Aguirre said such representation would amount to a conflict of interest and advised council and staff to obtain their own outside counsel. He also emphasized his belief that he is the attorney for the entire city of San Diego, not individual council members.

City Councilman Scott Peters, whose legal bills total $85,011 to date, said Aguirre’s December decision is to be blamed for the extra expenses.

“It was my view then and it still is my view that he can and should have defended us through the City Attorney’s Office until it became clear that the council members were something other than witnesses, which is not the case,” Peters said.

Under California law, government employees are to receive paid legal help if it is necessary because of actions they performed within the scope of their official duties. Legal assistance can be withheld or the costs retrieved if the employee is found to have acted in a fraudulent, corrupt or malicious manner.

A number of other current council members submitted invoices for attorney’s fees, including Councilman Jim Madaffer, $171,547; Deputy Mayor Toni Atkins, $118,791; and Councilman Brian Maienschein, $80,528. Staff members for Atkins and Maienschein also required city-funded legal help.

Other current and former city officials have submitted invoices for attorneys, including former Deputy City Manager Pat Frazier, $60,729; Assistant City Attorney Les Girard, $96,664; former Deputy City Manager Bruce Herring, $24,303; former City Manager Michael Uberuaga, $104,826; and former Auditor Ed Ryan, $83,664.

The legal bill of Murphy’s former chief of staff, John Kern, totals $13,640 to date.

Responding to criticism from Peters and others, Aguirre said that he wasn’t in office when the actions under investigation occurred. Officials have their own actions to blame for what has followed, Aguirre said.

The tally for individual legal representation is the latest addition to the mounting legal and consulting bills that have accompanied the city’s descent into legal and fiscal troubles. It has spent more than $15 million to date on consultants and lawyers in connection with ongoing self-investigations and the stalled attempt to release audited financial statements for fiscal years 2003 and 2004.

The bills come due at a time when tight budgets have forced the city to curtail its basic services. Everyday maintenance of roads and trees, for example, has been cut back. The city has trimmed nearly 400 positions from its organization. Library hours have been shortened and swimming pools closed.

The individual figures released Thursday related specifically to the Securities and Exchange Commission investigation into errors and omissions in the city’s financial disclosures to investors and the U.S. Attorney’s Office and FBI investigation into possible political corruption. The city as an entity also has its own outside legal representation in relation to the investigations.

The federal investigations began focused on the pension system, its estimated $1.37 billion deficit and the city’s failure to accurately disclose the fund’s problems to Wall Street. The scope of the probes has since spread beyond the pension system, as recent subpoenas point to interest in the Metropolitan Wastewater Department.

On Tuesday night, the City Council voted in closed session to move ahead with possible settlement talks with the SEC. Aguirre seeks to separate the city as an entity from individuals under investigation through a settlement in which the city would admit to releasing fraudulent financial statements and create a remediation plan.

Such an action could spare the city hefty fines and speed up its return to fiscal credibility, Aguirre said. He sent a proposed settlement to the SEC last week without the council’s blessing. On Tuesday, the council allowed Aguirre to team with the city’s new outside counsel and work on a settlement.

“They didn’t give us a green light, but they gave us a blinking yellow light,” said the city attorney.

The decision of when – and when not – to pick up the legal tab for politicians and city employees in connection with investigations and lawsuits has recently been a common topic at City Hall. Indeed, with the pending investigations, it could certainly resurface again.

In August, the council voted not to provide legal coverage for six current and former city officials who had been sued by Aguirre for allegedly violating conflict-of-interest laws for their actions related to the pension system.

Former Councilmen Michael Zucchet and Ralph Inzunza, convicted in July on federal corruption charges, paid for their expenses out of committees that collected funds in a manner similar to campaign contributions. However, former City Attorney Casey Gwinn had released an opinion weeks before leaving office saying the city could cover the councilmen’s bills.

Please contact Andrew Donohue at