One requirement that the Property and Business Improvement District Law places on BIDs, found at §36650, is the submission of annual planning reports (“APRs”) to the City Council:
The owners’ association shall cause to be prepared a report for each fiscal year, except the first year, for which assessments are to be levied and collected to pay the costs of the improvements, maintenance, and activities described in the report. … The report shall be filed with the clerk … The city council may approve the report as filed by the owners’ association or may modify any particular contained in the report and approve it as modified.
And it seems that the BID isn’t allowed to spend money on stuff that’s not discussed in the APR, so it’s not a trivial matter.
The way this piece of code plays out in Los Angeles is that, first, a BID director submits the APR to the Clerk along with a formulaic cover letter. For instance, here is the one submitted by Nicole Shahenian on December 30, 2014 to accompany the East Hollywood BID’s APR for 2015. This is essentially the same letter submitted by all BIDs:
Dear Ms. Wolcott:
As required by the Property and Business Improvement District Law of 1994, California Streets and Highways Code Section 36650, the Board of Directors of the East Hollywood Business Improvement District has caused this East Hollywood Business Improvement District Annual Planning Report to be prepared at its meeting of December 29, 2014.
And don’t forget that state law requires the City Council to adopt the report either with or without modifications. In Los Angeles this part of the process is initiated by the Clerk sending another form letter to City Council, recommending that they adopt the BID’s APR. It’s my impression that the Clerk doesn’t recommend modifications to the report at this stage. These seem to be handled by Miranda Paster before the APR is submitted to Council, as in this example involving the Media District BID. Anyway, take a look at Holly Wolcott’s January 14, 2015 recommendation to City Council with respect to the East Hollywood BID’s APR. Like every such document, this states:
The attached Annual Planning Report, which was approved by the District’s Board at their meeting on December 29, 2014, complies with the requirements of the State Law and reports that programs will continue, as outlined in the Management District Plan adopted by the District property owners.
And it goes on from there to recommend:
That the City Council:
FIND that the attached Annual Planning Report for the East Hollywood Property Business Improvement District’s 2015 fiscal year complies with the requirements of the State Law.
ADOPT the attached Annual Planning Report for the East Hollywood Property Business Improvement District’s 2015 fiscal year, pursuant to the State Law.
News of a settlement in the momentous lawsuit brought by the Legal Aid Foundation of Los Angeles on behalf of the Los Angeles Community Action Network, the LA Catholic Worker, and a number of individuals over the confiscation of homeless people’s property by BID and by City, has been rumbling around PACER for about one year now. Well, yesterday evening, the first concrete details of the ongoing settlement process arrived. The parties filed a joint report indicating that concrete terms had been reached with both CCEA and the City of Los Angeles. The City of LA part still has to be approved by City Council, but according to the document, this is likely to happen within 45 days.
The TL;DR is that I believe that in the course of her consultancy with the Venice Beach BID, Tara Devine qualified as a lobbyist within the meaning of the Los Angeles Municipal Lobbying Ordinance, was therefore required to register with the Ethics Commission, and failed to do so, putting her in violation of the law. If you know what all those terms mean, you may want to go straight to the complaint (Warning: 23MB PDF). For a detailed explanation of the background, though, read on!
The key is found in Section 48.07, which states that “An individual who qualifies as a lobbyist shall register with the City Ethics Commission within 10 days after the end of the calendar month in which the individual qualifies as a lobbyist.” After all, anyone can search the Ethics Commission’s database and see that Tara Devine has never registered as a lobbyist. So the question is whether Tara Devine is “An individual who qualifies as a lobbyist.” This turns out to be a fairly complicated thing to determine.
The first place to start when interpreting any law is with the definitions. In the case of the Municipal Lobbying Ordinance (henceforth “MLO”) they are found at LAMC §48.02. In particular, we will find that the word “lobbyist”:
means any individual who is compensated to spend 30 or more hours in any consecutive three-month period engaged in lobbying activities which include at least one direct communication with a City official or employee, conducted either personally or through agents, for the purpose of attempting to influence municipal legislation on behalf of any person.
And in order to see whether this applies to Tara Devine, we need to understand the following terms:
L.A. voters recently approved Measure HHH, which will fund homeless services via the sale of $1.2 billion in bonds. Last December the City Council approved the creation of a citizens’ oversight committee to monitor the expenditure of this vast sum of money. That committee consists of seven people, three appointed by the Council and four appointed by the Mayor. The Mayor doesn’t seem to have nominated anyone yet, but last Friday the Council, in CF 16-1060-S1, nominated their three. The only weirdo in the bunch is Blair Besten, executive directrix of the Historic Core BID downtown.
Chapter 2 of that law describes the process for establishment and renewal of a BID,2 and it’s remarkable how tentative, how conditional the process is. It’s well-known by this point that in order for a BID to be formed it’s necessary that property owners representing more than 50% of the assessed value be in favor.3 It’s necessary, but it by no means sufficient. Section 36625(a) very clearly leaves the question of formation up to the Council:
If the city council, following the public hearing, decides to establish a proposed property and business improvement district, the city council shall adopt a resolution of formation…
The only mandatory requirement with respect to BID establishment in the whole Chapter is found in Section 36623(b), which says that if owners holding 50% or more of the assessed value are opposed to the BID, not only can it not be formed, but no further attempts can be made to form it for a year.
And the discretionary nature of the process is reflected in the City’s BID Policy and Implementation Guidelines as well. Therein it states:4
The City Council can proceed with the BID if the protest is less than 50%. However, BID proponents are cautioned that they should not expect a favorable vote from the City Council with a significant number of protests.
From the context it’s clear that the policy means that there is some threshold of protest less than 50% with respect to which the Council will not establish the proposed BID even though the Property and BID Act would allow them to do so.
The incomparable Emily Alpert Reyes has the story in this morning’s Times and we have the primary sources, hot off of PACER! As long as I was getting these pleadings, I figured I’d go ahead and get the ones from the case he filed last July as well,2 and all of them are available here:
One of the most contentious issues in the very, very contentious formation of a business improvement district in Venice has been the existence of properties with commercial zoning that are used solely for residential purposes that were included in the BID and therefore assessed. This is the basis of a recently filed lawsuit against the City as well as a significant number of other protests against the BID.
For instance, in May 2016, Venice homeowner1 Louis Traeger wrote to the City protesting the inclusion of his home in the BID. On June 1, 2016 Los Angeles City Clerk Holly Wolcott answered him, stating:
In address of your request to remove said property from the proposed Business Improvement District, the City Clerk does not have the authority to remove or add properties in a Business Improvement District. However, we will forward your request and this information to the Engineer conducting the survey and analysis for the creation of the Venice Beach Business Improvement District.
Further, you requested notice of any hearing concerning the approval of the Venice Beach Business Improvement District in order to submit your written opposition. If your property is ultimately included within the Business Improvement District boundaries, a notice of the City Council hearing date will be mailed to you. At the hearing, an opportunity will be provided to protest the establishment.
As far as I can tell2 what Holly Wolcott says is the truth and it’s nothing but the truth, but it is in absolutely no way at all the whole truth. Her statement that “the City Clerk does not have the authority to remove or add properties in a Business Improvement District” is true. When she follows it up with a statement that she will “forward your request and this information to the Engineer conducting the survey and analysis” she is certainly creating the impression that ONLY the engineer is empowered to remove properties. This is not true. It’s really badly not true, as I will demonstrate below.
In September, local activist group Save Valley Village filed suit against the City of Los Angeles and the City Council alleging in their petition that
The Councilmembers of the Los Angeles City Council operate according to an agreement, i.e. The Vote Trading Pact, not to Vote No on any Council Project in another council district and said agreement by its very terms requires reciprocality, also called mutuality, whereby the agreement not to Vote No by one Councilmember is given in exchange for the other Councilmember’s not to vote No on a Council Project in his/her council district.