STATE OF CALIFORNIA

FAIR POLITICAL PRACTICES COMMISSION

1102 Q Street • Suite 3000 • Sacramento, CA 95811
(916) 322-5660 • Fax (916) 322-0886

February 27,2018

Carolyn Hardy
P.O. Box 824
Carmel, CA 93921-0824

RE: Advisory Letter: In the Matter of Carolyn Hardy, FPPC Case No. 17/551

Dear Ms. Hardy,

The Enforcement Division of the Fair Political Practices Commission ("Commission")

enforces the provisions of the Political Reform Act. 1 This letter arises from a sworn complaint
alleging that you-in your capacity as a Carmel City Council member-had a conflict of interest
regarding your participation in governmental decisions related to the Forest Theater. After a review
of the available evidence, the Enforcement Division is closing its file on this matter with this letter
as discussed below.

No public official at any level of state or local government may make, participate in making,
or in any way attempt to use her official position to influence a governmental decision in which she
knows or has reason to know she has a financial interest. 2 A public official has a financial interest in
a decision if it is reasonably foreseeable the decision will have a material financial effect on any
real property in which the public official has an interest worth at least $2,000. 3 You own property in
Carmel that is located 50 feet from a city-owned site that includes parkland and a theater (hereafter,
the city owned property will be referred to as the "Forest Theater.")

The City has recently taken discussion, created an ad hoc committee, and voted on proposals
and contracts relating to the Forest Theater. You participated in an ad hoc committee to negotiate
contracts between the City and the Sunset Cultural Center, a nonprofit ("SCC,") for the
management and leasing ofthe Sunset Cultural Center and the Forest Theater. You recused yourself
from a vote on the final lease for the Forest Theater.

The adopted lease agreement between the City and SCC provides for the management of
theater assets and theater operations. The Forest Theater was previously leased to the Pacific
Repertory Theater. The new lease agreement is largely consistent with previous use agreements,
including terms and conditions regarding use and consideration for the surrounding neighborhood.

1 The Political Reform Act is contained in Government Code sections 81000 through 91014, and all statutory references
are to this code. The regulations of the Fair Political Practices Commission are contained in sections 18109 through
18997 ofTitle 2 of the California Code of Regulations.
2
Section 87100.
3 Section 87103 ; and Regulation 18700, subdivision (c)(6)(B).
 Since you own real property within 50 feet of the Forest Theater, we considered whether the
lease agreement would have a reasonably foreseeable material financial effect on your property's
value. A financial effect need not be likely to be considered reasonably foreseeable. One
consideration is: "[ w]hether the public official has the type of financial interest that would cause a
similarly situated person to weigh the advantages and disadvantages of the governmental decision
on his or her financial interest in formulating a position." 4 A financial effect would be material if
the decision would "change the character of the parcel of real property by substantially altering
traffic levels or intensity of use, including parking, of property surrounding the official's real
property parcel, the view, privacy, noise levels, or air quality, including odors, or any other factors
that would affect the market value of the real property parcel in which the official has a financial
interest. " 5 (emphasis added)

Given that the Forest Theater has been operating as an outdoor theater venue and will
continue to operate as an outdoor theater venue under the new lease agreement, which is
substantially similar to the prior lease agreement, it is not reasonably foreseeable that the new lease
agreement will have any material impact on the value of your real property interest. Therefore,
under the circumstances in this case, it's unlikely that any action you may have taken related to the
new lease of the Forest Theater would result in a conflict of interest violation under Section 87100.

You may wish to request advice before participating in any future governmental decisions
related to the Forest Theater. The information gathered in this case and will be retained and may be
considered in the future should an enforcement action become necessary due to newly discovered
information or failure to comply with the Act in the future. Failure to comply with the Act in the
future may result in the imposition of administrative or civil penalties against you by the
Commission-and certain violations of the Act may be prosecuted by law enforcement agencies as
criminal offenses.

Thank you for your attention to this matter. Please do not hesitate to call if you have any
questions.

Commission Counsel
Enforcement Division
tgilbertson@fppc.ca.gov

cc: Mr. Ian Martin, Sworn Complainant

4
Regulation 1870l{b)(3).
5
Regulation 18702.2{a)(l0).