Wow. That was quite an explosion of questions from readers. I’m a bit overwhelmed. That’s already enough questions to fill a week of reporting and I’ve only got the rest of the afternoon.

Let’s make a deal. I’ll get answered what ever I can today, keep working on the other questions that take longer than a day to answer, and then report back the next time I host. (Perhaps I can get Scott Lewis to schedule me again sometime soon if this remains popular.)

So I’m going to deal with the question from reader HBR first and in a following post deal with some budget and affordable housing questions. Here’s HBR:

RE: SEC settlement. IF the council is voting to settle for the City, what presents the conflict? Is there information on the individuals that causes their conflict? This is unclear to me.

That’s a good question. Read this story for a little background on the concerns about the council’s potential conflict of interest.

First: it’s not decided that the five council members do actually have a conflict. There’s just talk that they may or could have a conflict. So that makes it a bit murkier.

But remember, there are two sides to this investigation. One is an investigation into the city as entity. The second is into individual conduct.

This is the way I understand it: the SEC settlement on the table deals with the city as an entity; it does not deal with individual city staff members or elected officials. The individuals will be dealt with at SEC discretion at a later date. But the settlement on the table could in some way impact what happens in the future to individuals. And it could also be politically painful to certain council members if the language of the settlement speaks broadly – but badly – of the actions of “city officials.”

Remember, the settlement talks weren’t always split between the city and the City Council. There was a time when their fates were tied together. Last December we broke the news about a September 2004 vote taken in closed session in which the City Council sought an SEC settlement “for best deal possible, with caveat that City Council be included in deal with City and not be left to deal with separately.”

That basically means: don’t leave us out to dry.

It’s a key distinction because it wrapped the city’s fate in with that of the City Council. City Attorney Mike Aguirre severed that connection last fall, arguing that the city could put the investigation behind it quicker if it was dealt with as an entity, independent from the investigation of the city staffers and elected officials who took part in the 2002 and 2003 disclosure problems now under scrutiny.

So the City Council – absent Toni Atkins and Donna Frye – already made it clear years ago that they wanted to make sure they were tied to whatever settlement came from the SEC.

Now, the settlement on the table reportedly has only broad statements about individuals, referring to them only as “city officials.” That could still be damaging to any council member who took part in these decisions and wants to seek another elected office. And then, after that, there are the individual sanctions that could follow.

I hope this helps. I’ll be back with some budget answers and something on affordable housing as quickly as I can.


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