In 2003, $25 million was misappropriated from the tobacco settlement
revenue (TSR) account that was dedicated by the Board of Supervisors
and the then Mayor to use for replacing Laguna Honda
Hospital. The $25 million was used to balance the City budget,
which was an improper use of the TSR funds. A citizens public-interest
lawsuit was filed to require the City to repay the misappropriated
$25 million, with interest.
Following a probable improper ruling by the Superior (trial) Court, the case has moved to the appeals process in the Court of Appeal, 1st Appellate District. The following documents are related to the matter before the Court of Appeal.
Petition for Writ
of Mandamus
June 8, 2005
Approval by the Court of Appeal of this Respondents claim
would put the judicial seal of approval on what is essentially
a bait-and-switch, in which municipalities would be given the
judicial go-ahead to first enact a bond ordinance which places
a bond measure on the ballot; then draft a ballot proposal which
has salutary language to persuade the voters to pass the measure;
but which bond ordinance has completely contradictory wording
which would nullify the salutary provisions of the ballot proposal.
Appellants Opening Brief
July 25, 2005
The case at bar is plainly one of those cases, where justice
and right require that equitable estoppel be applied against
the City, to prevent it from taking a $99-plus million unfair
advantage over the voters, by (1) promising up front to offset taxpayers
costs by using all of the TSRs [tobacco settlement revenues] to
construct the replacement Laguna Honda Hospital and service
Proposition A bond debt, and (2) representing to voters, by its
official Ballot Simplification Committee, that this is the meaning
of Proposition A, but (3) sticking in a contrary clause at the
back of the Voters Pamphlet, 22 pages later, so as to enable the
City, if allowed to do so by the courts, to use
tens of millions of the TSRs for other purposes of the City, (including
misappropriating $25 million in fiscal 20032004 for uses
not related to the Proposition A project).
Citys Opposition Brief
September 13, 2005
On April 19, 1999, the Laguna Honda Hospital Replacement Planning
Committee (a blue-ribbon style committee charged with making recommendations
to the Health Commission, the Board of Supervisors and the then
Mayor on how to rebuild Laguna Honda Hospital) voted to recommend
to the San Francisco Health Commission that Laguna Honda be re-built
with 1,200 beds. Two weeks later, on May 4, 1999, the Health
Commission adopted Resolution Number 16-99 noting that the Replacement
Planning Committee had adopted a recommendation to place 1,200
skilled nursing facility
beds on the existing Forest Hill location
[emphasis added]. Health Commission Resolution 16-99 RESOLVED
that the Health Commission supported the Replacement Planning
Committees proposal to build 1,200 skilled nursing beds,
and also RESOLVED that the Health Commission supported use of
the entire tobacco
settlement revenue funds (now estimated to be $820 million). The
Health Commission resolution was forwarded to the Board of Supervisors,
and the Board of Supervisors had the City Attorney draft the Proposition
A language that was placed before the voters.
The City now contends, in its Opposition Brief, that the Board wrote an intentionally broad Proposition, which presented only in general terms to the voters language that was quite different from the Replacement Planning Committees recommendations and different from the Health Commission Resolution. The Citys Brief argues that as a routine matter, municipalities frequently write intentionally vague, broad language on purpose, so as not to limit their future responsibilities to build what was promised. The City also blames the victim (the voters) by stating that Had the ... voters wanted to specify the type and size of the [LHH replacement facility] they [the voters] could have have done so by expressly including such specifications (i.e., 1,200 skilled nursing beds] in the Proposition A language. What the City Brief ignores is that it was not voters who wrote vague language; the City Brief also ignores that most voters do not realize that municipalities consciously choose to play the blame-the-voters/blame-the-victim game.
Finally, the City Brief asserts that a ... person may replace her car with a bicycle in an effort to claim that the City can replace LHH with anything it wants, even presumably with a bike, rather than with a hospital.
Appellants Reply Brief
October 3, 2005
The City [Respondents] brief also inexcusably mis-states
the contents of an appellate decision, and disregards case law
concerning the relevance of the Digest of ballot measures by the
Citys ballot committee, in a futile effort to argue that
the ballot committees statement in the Voters Pamphlet of
the meaning of Proposition A is neither binding upon the City,
nor relevant.
The Appellants Reply Brief also notes that the Citys Opposition Brief deliberately elided (to leave out, or suppress intentionally) the fifth element contained in a California Appellate decision in the Associated Students of North Peralta Community College v. Board of Trustees case concerning bond measure contracts. The Citys Opposition brief noted only four of the five elements of bond contracts, eliding the fifth element to be considered by the Courts: Extrinsic evidence, in this case the very extrinsic documents by which the City obtained passage of Proposition A in 1999, including the 1999 Ballot Digest, and the paid arguments for and against Proposition A that were included in the voter guide.
Judicial Notice Order and Appellant's
Request for Judicial Notice
October 24, 2005 and October 4, 2005,
Respectively
A Court of Appeals order taking judicial notice that the City
is engaged in reducing the 1,200-bed LHH replacement facility
without considering or using all tobacco settlement
revenues to offset the LHH replacement project cost overruns.
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