FEBRUARY 26, 2005 ANALYSIS OF THE CITY ATTORNEY POSITION FEBRUARY 26, 2005 ANALYSIS OF THE CITY ATTORNEY POSITION

TO: HONORABLE MAYOR & CITY COUNCIL

FROM: CITY MANAGER

DATE: FEBRUARY 26, 2005

SUBJECT: ANALYSIS OF THE CITY ATTORNEY POSITION

RECOMMENDATION:

Direct Staff on how to proceed.

BACKGROUND:

The City Council has directed staff to consider the alternative of establishing an in-house City Attorney office. The purpose of this analysis is to review the provision of City Attorney Services under the current contractual agreement and to analyze the fiscal impact of changing to an in-house City Attorney office staffed by City employees.

DISCUSSION:

Since City incorporation in 1973 City Attorney services have been provided under contract by Richards, Watson & Gershon ("RWG"). The current contract for services with RWG was entered into on July 1, 1998 and includes the City, the Redevelopment Agency and the Improvement Authority. The contract designates Carol Lynch as City Attorney and Craig Steel as Assistant City Attorney. The term of the present agreement is indefinite. The City may terminate the agreement by providing thirty days written notice. The entire agreement with "scope of work" and fee schedule is attached to this report.

Basically, RWG provides:

Various billing rates apply to each of these services as described in the Agreement and the attached Rate Schedule. The rate schedule for special Services has increased from time to time, but a 10% discount on these rates has been maintained.

In addition to the services provided by RWG under the current contract the City has contracted with several outside legal firms for specialty legal services such as the recent antenna case that went before the Supreme Court and cases where the City Attorney may have a conflict of interest such as the Indian Ridgecrest Gardens case.

Cost of Services

The demand for legal services has significantly increased in the past four years, primarily as the resolution of complex issues has required the City’s involvement in expensive litigation. The table below summarizes the City’s recent costs for legal services.

 

2000-01

2001-02

2002-03

2003-04

General Services

$225,606

$297,540

$279,791

$254,968

General Prosecution

$13,253

$8,323

$19,341

$25,155

General Labor

$1,947

$9,349

$15,432

$18,512

Special Projects

$84,603

$75,845

$24,285

$32,742

RDA

$24,984

$51,747

$1,653

$2,798

Subtotal

$350,393

$442,804

$340,502

$334,175

Hours Billed

2,235

2849

2221

2117

Code Enforcement Litigation

$55,396

$42,893

$50,176

$57,410

Other Litigation

$424,077

$451,252

$487,143

$429,615

TOTAL

$829,866

$936,949

$877,821

$821,200

Notes: 1. The higher billings for Special Projects in 2000-01 and 2001-02 were due to the PVIC lead contamination issues.

2. The higher billings for RDA in 2001-02 were related to the acquisition of easements for the Abalone Cove Sewer project.

The total legal costs for the four years prior to fiscal year 2000-01 are shown below.

1996-97

1997-98

1998-99

1999-00

$425,466

$483,925

$461,523

$456,041

Billing Hours

The total hours billed over the four-year period beginning in July, 200 were 9,422 or an average of 2,356 per year. The average hourly billing rate for these hours was $155.80

Estimated Cost of an In-House City Attorney

Assuming that an in-house City Attorney would provide all the services now provided by RWG other than litigation, approximately 2300 hours of professional time would be required. For budgeting purposes, a maximum of 1800 hours per year is typically used. In addition to the professional time, a legal secretary would also be necessary. If only one Attorney and a secretary are hired the annual budget would not be less than that described below:

 

Salary

Pension

Insurance

Auto

Total

City Attorney

$150,000

$29,175

$8,400

$4,000

$191,575

Legal Secretary

$50,000

$9,725

$8,400

 

$68,125

TOTAL

       

$259,700

Contract for the 500 hours of remaining attorney time at $200 per hour………$100,000

(Or hiring an Assistant City Attorney at $90,000 or $115,905 with benefits)

Estimated Overhead Associated with the City Attorney office

Training and meetings   $4,500
Memberships and dues $2,500

Supplies and publications (including law library and Westlaw) $20,000

Equipment Replacement Charges $5,000
Total Annual Overhead $32,000

ESTIMATED TOTAL ANNUAL CITY ATTORNEY BUDGET $391,700

Note: The above budget is based on the City Attorney budget for the City of Manhattan Beach, which has in-house Counsel. The Manhattan Beach City Attorney budget for the current fiscal year is $380,341.

Estimated One Time Start up Cost

One of the most difficult start-up issues is where the City Attorney, secretary and law library/conference room would be located. Three alternatives could be considered:

The most practical scenario is converting the storage rooms in the south wing of City Hall into usable offices and library/conference room. Approximately 600 square feet are available. The cost of remodeling these rooms to provide efficient office space would be approximately $20,000. Storage space for records currently stored in this area would have to be leased (this cost is not included in the budget).

The cost of office furniture, computers, printers, telephones and other equipment would be about $15,000. The start-up cost for a legal library is estimated at about $50,000.

Total start-up costs are estimated at a minimum of $85,000 for one attorney and a legal secretary.

Conclusions based on Cost Considerations

The information provided above is based on documented cost information that staff believes provides an objective comparison between the cost of a contract City Attorney and the cost of an in-house City Attorney. The staff conclusion is that there would be no cost savings to be gained by hiring an in-house City Attorney.

Considerations other than Cost

1. Performance of the contract City Attorney. Staff has been satisfied with the performance of RWG over the years. Our current City Attorney, Carol Lynch, has been with us since 1991 and has considerable institutional memory. She has also proven to be accessible, responsive and competent. Staff does not believe that an in-house City Attorney could provide better service.

  • An in-house City Attorney would be asked to provide legal advice on a myriad of issues. The main focus of the attorney has been land use issues, but personnel issues, issues related to financing mechanisms, environmental issues and other specialty issues also need to be addressed from time to time. An in-house City Attorney would probably recommend contracting for assistance on these issues.
  • Some advantages of an in-house City Attorney, as listed by the City Manager of Manhattan Beach, include:
  • Although each of the points made by the Manhattan Beach City Manager could be reasons to move from a contract attorney to an in-house attorney, none seem applicable to our current situation.

    CONCLUSION

    Unless the City Council is dissatisfied with the services of Richards, Watson & Gershon, or the service provided by Carol Lynch, staff can find no justification for making a change to an in-house City Attorney.

    Respectfully Submitted,

    Les Evans

    City Manager

    Attachment: Agreement for Legal Services with Richards, Watson & Gershon