CITY OF LAKE ELSINORE RESPONSE TO GRAND JURY FINDINGS AND RECOMMENDATIONS

ELSINORE MAGAZINE 2

October 22, 2005

The First of City's Response to GRAND JURY'S Findings

Finding # 1 Grand jury

1) The City Attorney's contract is renewed annually without the open bid process. The City of Lake Elsinore has continually contracted with one legal firm for the last seven (7) years, without competitive bid. For the year 2004 the legal firm required a $7,000 per month retainer in addition to $155 per hourly fee for other non-specific legal services. The amount of legal services for 2004 exceeded $500,000.

EM2 Response: If the City Council was competent they would know that an attorney hired under contract should not have both a retainer fee and a hourly. A retainer depict on call as needed. City Attorney Leibold and her firm is contracted as a full city attorney paid by PUBLIC FUNDS. Obviously the Grand Jury is very wise to the fact in pointing that out.

Citiy's Response: As an initial point of clarification, the City Attorney's contract is not "renwewd annually" but is rather an at will agreement that may be terminated by the City Council at any time . (See City Attorney Legal Services Agreement Section 5 and 6 -- Exhibit "A" .) Note: any interested party will need to go to city hall to review any Exhibits noted in theses responses.

The city Council Council conducts annual performance evaluations ( see City Council Agendas -- Exhibit "B") to monitor the City Attorney's performance. Those evaluations have unanimous Council support . Where need for improvement has been identified, the City Council has responded favorably to those requests. As to the selection of the City Attorney, it is our experience , that attorney's providing legal services to the vast majority of municipalities are not selected by annual "bidding". Instead, the selection process is more keenly based on legal expertise, experience and the ability to quickly and efficiently provide high quality legal services.

EM2 Response: The PUBLIC is not aware that the City Council made request to the City Attorney on identified improvements. And that the City Attorney responded favorably. City Council where are those favorably reports? Are they public records? We would think so inview of the fact the City Attorney is hired by a public agency paid by public funds.

Paragraph 2 City Response: The City of Lake Elsinore benefits by virtue of its long-term relationship with the current City Attorney. Her familiarity with existing City codes, contracts and the myriad of legal issues facing the City allows her firm to quickly and efficiently respond to questions that arise on a daily basis. The firm expertise and negotiating skills have translated into millions of dollars in savings for the City. For example, the City Attorney successfully negotiated a full settlement with First Financial Group releasing the City from obligations to construct millions of dollars in public infrastructure under a pre-existing Settlement and Development Agreement. Similarly, she negotiated an Amended Development Agreement that saved the City millions of dollars in interest payments in connection with an infrastructure reimbursement obligation. The City Attorney has instituted a cost recovery system by imposing administrative fees in connection with economic and development agreements, which fees are paid directly to the City's General Funds, and has sucessfully negotiated with developers to provide affordable housing obligation.

EM2 Response: Yeah Right!!!!! it took the City Treasurer to light a fire to the Attorney's feet in order for affordable housing obligations to be borne. EM2 dare they give credit to the attorney. If Peter Weber had not been elected to the office of Treasurer affordable housing would still be in waiting. The City Attorney is very good at submitting very large billings which she does not want the public to know all about what she is billing for. Go request to see her billings. Have patience though. There will be a waiting period for certain lines to get blackened. As far as the other claims that suppose to have saved the City millions EM2 stll needs to check the accuracy of those claims. And we will. No one we talk to knows what First Financial and the million dollar savings is all about it is news to us. What we do know is that the Attorney failed to advise putting up of WARNING signs at the State Park's 9 foot drop off that resulted in 5 little souls who needlessly lost their lives in about a six(6) month period. A settlement of $ 800,000 on one and $500,000 on another. Others are pending. A settlement of $1.5 million on a wrongfully ousted Concessionaire Jess Watkins from State Park where he for over 30 years Managed the State Park and never ever lost any souls life. Also Mr. Watkins was so distraught over the impact on how he was ousted as concessionaire his health has been down hill since. Another settlement Bob Williams $3 million plus which constituted an Enchrochment on his property. The Theatre $3.5 million was a Bank Default. The Attorney caused a proposed stadium deal to be dragged out and billed the City about a year without doing due diligence on the applicants. Charging the City hundreds of thousands of dollars basically for nothing. Again after the City Treasurer reviewed the proposal and found it was a bad deal. The City Attorney finally had to agree the applicant did not qualify. W hat a lost of public funds paid to the attorney and her firm. Further, yet the Treasurer called for the City Council to have the City Attorney pay back some of those public funds. Nada! nada! Again this Council has demonstrated its WEAK and Incompetence. Until recently, the City Attorney has been signing off contracts without giving attention to a thorough review of the contracts blatantly taking momey. An Attorney not giving full mastery to contracts?

Paragraph 3 City's Response: While the City strives to reduce its legal cost, we note that the City Attorney's hourly rates compare favorably to the hourly rates of contract city attorney departments in neighboring communities. For example, (i) the City of Corona pays $180 per hour for "Basic Services" and $195 for "Special Legal Services"; (ii) the City of Temecula pays between $160 and $245 for legal services depending on the nature of the service provided; (iii) the City of Hemet pays its City Attorney $235 per hour, and (iv) the City of Banning pays $225 per hour for its City Attorney.

EM2 Response: EM2 could hardly compose itself on paragraph 3 What a joke!!!!! First of all while the Ctiy's Response was on its way to the Grand Jury September 21, City Attorney Barbara Leibold was on her way in through the back door submitting a new contract for an increase of $1,500 per month retainer fee from $ 7,000 to 8,500 and from $155 to $170 per hourly, approved by the Council September 27. Is this an example of how the good Attorney STRIVES to reduce its legal costs????????!!!!!. Secondly the City failed to note the neighboring Cities did not charge a RETAINER FEE. and Third how many hours it take the neighboring Cities to do the job Leibold does? Could you have provided us with at least one billing each on the other four cities as an Exhibit?

Overall EM2 intends to show the big picture in "FUTURE CITY RESPONSES "that this Attorney is not all that the City would have us to believe.

The next City response will be "Findings" #2 on "The State Attorney General Opinion".