1 STAFF REPORT
DATE: July 12, 2022
TO: Honorable Mayor and Members of the City Council
FROM: Joseph McDougall, City Attorney
Betsy McClinton, Management Services Director
BY: Hazel Turrubiartes, S enior Administrative Analyst
SUBJECT: Approval of a Budget Amendment of the Fiscal Year (FY) 2022-2023 Budget to Appropriate Funds for the Legal Fees and Costs Related to Housing Lawsuits and Enforcement Actions
RECOMMENDATION
Approve a Budget Amendment of the Fiscal Year (FY) 2022-2023 Budget to Appropriate Funds for the Legal Fees and Costs Related to Housing Lawsuits and Enforcement Actions Stemming from the Denial of Pickwick Gardens Housing Project.
BACKGROUND
On April 18, 2022, City Council denied the Pi ckwick Gardens Housing Project (Project), a 96-unit townhome style condominium devel opment at 921-1001 W. Riverside Drive proposed by Pickwick Investments, LLC.
On May 10, 2022, the City and the collective City Council were served with a lawsuit filed as a Petition for Writ of Mandate, Pickwick In vestment, LLC v. City of Burbank, et al., Case No. 22STCP01756, which challenges Council’s denial of its proposed project.
On May 24, 2022, the City received a Notice of Violation (NOV) fr om the California Department of Housing and Community Deve lopment (HCD). The NOV details HCD’s analysis of the Project eligibility and also challenges the Council’s denial of the Project.
On June 27, 2022, the City and the collective City Council were served with a lawsuit filed as a Petition for Writ of Mandate, YIMBY Law v. City of Burbank, et al., Case No. 22STCP02341, which challenges Council’s denial of its proposed project.
CITY ATTORNEY’S
OFFICE
2 DISCUSSION
The nature of the allegations and defenses in these hous ing lawsuits and enforcement action are highly specialized and require s pecific, current expertise of State housing litigators. In addition, it is likely that extensive discov ery and/or Public Records Act material requested will exceed current resources of the City Attorney’s Office (CAO). CAO has retained the firm Goldfarb & Lipman, LLC to defend the City in all three adversarial proceedings arising from the same project denial.
Staff has separately assessed potential liabi lity for legal costs/fees for the pending enforcement of the legal actions and is requesting a budget amendment in the amount of $1,000,000, of which $500,000 to $600, 000 is estimated solely for attorney’s fees and costs of the existing housing enforcement actions. The costs for the City’s legal defense of the HCD NOV, the Pickwic k Investments lawsuit, and the YIMBY Law lawsuit are specifically excluded from the City’s liability insurance policy and are not included in the Fund 530 Liability Fund budget for Fiscal Year (FY) 2022-23. Ther efore, a separate appropriation is required.
FISCAL IMPACT
Staff is requesting Council authority to amend the Fiscal Year (FY) 2022-23 Budget by appropriating $1,000,000 for legal cost s and fees from account number 530.ND000.30011.0000.000000.00000 (General Liabilit y Insurance Fund, Non- Departmental, Assigned Fund Balance) to expenditure account number 530.MS04A.62055.0000.000000.00000 (G eneral Liability Insurance Fund, Risk Management, Outside Legal Services) for the l egal actions arising from the HCD NOV, the Pickwick Investments and YIMBY Law lawsuits.
CONCLUSION
Staff recommends a budget amendment of $1,000,000 to appropriate funds for the defense of current and future potential housing and land use lawsuits and/or enforcement actions related to the Pickwick Gardens Housing Project denial.
ATTACHMENTS
None.