I

STATE OF CALIFORNIA
FAIR POLITICAL PRACTICES COMMISSION
428 J Street • Suite 620 • Sacramento, CA 95814-2329
(916) 322-5660 • Fax (916) 322-0886

December 22, 2016

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

Re: Your Request for Advice

Our File No. A-16-257

Dear Ms. Hardy:

This letter responds to your request for advice regarding the conflict of interest provisions of
the Political Refonn Act (the "Act"). 1

Please note that we are only providing advice under the conflict of interest provisions of the
Act and not under other general conflict of interest prohibitions such as common law conflict of
interest or Section I 090.

QUESTION

May you participate in City Council decisions regarding a user fee and rate structure for use
of the Forest Theater, where the residence you own is located 50 feet from the parkland/theater site?

CONCLUSION

You may participate in user fee decisions for the Forest Theater, as the decisions do not
affect your financial interest in your residence.

FACTS

You were recently appointed to the Carmel-by-the-Sea City Council to fill a vacant seat.
You and your spouse are retired and receive income from a pension account. You currently own
and reside in a home located directly across the street, and less than 50 feet, from the Forest Theater
and its parkland boundary. Your residence is part of"the park overlay district." The Forest Theater
is a community-based outdoor theater in operation for over 100 years, located in the public
parkland, and is owned and operated by the City of Carmel. The Forest Theater also contains an
indoor theater that is rented year-round to a performing arts school for community youth. Two

1
The Political Reform Act is contamed in Government Code Sections 81000 through 91014. All statutory
references are to the Government Code, unless otherwise indicated. The regulations of the Fair Political Practices
Commission are contained in Sections 18110 through 18997 ofTitle 2 of the California Code of Regulations. All
regulatory references are to Title 2, Division 6 of the California Code of Regulations, unless otherwise indicated.
 Fil e No. A -16-257
Page No. 2

historic presenting groups have use agreements with the City to produce plays in the outdoor theater
and occupy that space for a total of six months out of each year.

As a result of a recent city-wide cost of services study, the City Coundl has been approving
adjustments to existing fees across the board for City services. In the next round of adjustments, the
Council will establish user fees and rate structure for use of the recently renovated Forest Theater
by any community b'Toups. Neither you nor your spouse arc connected with any of these community
user groups. The City Council will be considering this issue in early January, 2017.

ANALYSIS

Section 87100 prohibits any public official from making, participating in making, or
otherwise using his or her official position to influence a governmental decision in which the
official has an interest. A public official has a financial interest in a decision within the meaning of
the Act if it is reasonably foreseeable that the decision will have a material financial effect on one
or more of the public official's interests, including an interest in real property. (Section 87103.)

You hnvc a financial interest in real property, worth $2,000 or more, that is located 50 feet
from the theater/ parkland site. (Section 87 103(b).)

Foreseeability and Matel'iality

Particular standards apply to dctennine foreseeability and materiality, depending on

whether your real property interest is "explicitly" or "not explicitly" involved in a decision.
(Regulation 1870l(a) and (b).)

Under the facts presented, the fee decisions do not explicitly involve your real property.
Therefore, the foreseeability standard is whether the financial effect can be recognized as a realistic
possibility. (Regulation 1870 l(b).) The factors to consider include :

(I) The extent to which the occurrence of the financial effect is contingent upon
intervening events, not including future governmental decisions by the official's
agency, or any other agency appointed by or subject to the budgetary control of
the official's agency.

(2) Whether the public official should anticipate a financial effect on his or her
financial interest as a potential outcome under normal circumstances when using
appropriate due diligence and care.

(3) Whether the public official has a financial interest that is of the type that
would typically be affected by the terms of the governmental decision or whether
the governmental decision is of the type that would be expected to have a
financial effect on businesses and individuals similarly situated to those
businesses and individuals in which the public official has a financial interest.

(4) Whether a reasonable inference can be made that the financial effects of the
governmental decision on the public official's financial interest might compromise
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File No. A -16-257

Page No. 3

a public official's ability to act in a manner consistent with his or her duty to act in
the best interests of the public.

(5) Whether the governmental decision will provide or deny an opportunity, or

create an advantage or disadvantage for one of the official's financial interests,
including whether the financial interest may be entitled to compete or be eligible
for a benefit resulting from the decision.

(6) Whether 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.

(Regulation 18701 (b).)

It appears that the establishment of a fee and rate structure for usc of the theater will not
impact the value of your real property. The fees are part of a city-wide cost of services study and
adjustment of fees. It appears unlikely that one would anticipate any effect on the value or
marketability of your real property related to fee increases for usc of the theater.

You raised additional questions regarding future Phase 2 master planning of the Forest
Theater's parkland site; however, no particular decisions on these issues are before the City Council
at this time. Mr. Freeman, the City Attorney, indicated in a recent email that the City is in the
process of putting together a list of projects. You are also in the process of acquiring information.
such as the possible location of these projects, so that we may analyze these questions. Please
contact our office for additional advice when this information is available.

If you have other questions on this matter, please contact me at (916) 322-5660.

Sincerely,

Hyla P. Wagner
General Counsel

By: L. Karen Harrison

Counsel, Legal Division

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