Process for Appointing Interim Councilmembers.

The City of Sunnyvale lacks a written process that is open and transparent for appointing an interim councilmember. City Response Partially agree and partially disagree with the finding. At the time the Sunnyvale City Council considered on December 16,2008, whether to appoint an interim councilmember while one of its members was on active duty in Iraq, the City agrees that there was no permanent written process in place for making the appointment. That being so, there was no legal requirement to have a permanent written policy for the appointment of interim councilmembers in place. However, the Report to Council on December 16, 2008, included as an attachment from the City Attorney, a December 9,2008, memo providing three procedural options, in writing, for appointing an interim councilmember and stated that the Council could also develop and approve other procedural options at its discretion. In January 2009, prior to the Grand Jury's release of the report that the City is now responding to, the City Council selected as a 2010 Study Issue the "Process for Appointing Interim Councilmembers." On July 20, 2010, the Council reviewed and discussed the study issue report on the selection of interim councilmembers, including selection options and the pros and cons of each option. W. Olive Avenue. P.O. Box 3707 • Sunnyvale. CA • 94088 TEL: (408) 730-7464 [email protected] FAX: (408) 730-7468 HonorableJamieA.Jacobs-May,PresidingJudge SantaClaraCounty SuperiorCourt Re: Sunnyvale City Council Response to June 18,2010 Civil Grand Jury Report Titled: Sunnyvale City Council Actions Lack Transparency September20,2010 Page2 After public comment, discussion and debate, the City Council adopted the following process by a 7-0 vote for future interim Council appointments: • Council will publicly announce the interim seat. • The City will receive applications from any interested applicants during an open application period. • Council will interview all candidates subject to the Brown Act. • Council will make an appointment at apublic meeting with opportunity for public comment prior to any appointment. It follows that as of July 20, 2010, the City of Sunnyvale has a written process that is open and transparent for appointing an interim councilmember.

Council's December 16, 2008, agenda item #9, RTC 08-377, failed to reasonably inform interested members of the public that a predetermined interim councilmember would be appointed at the meeting. City Response Disagree with the finding. As the Grand Jury acknowledges, the Brown Act requires that 72 hours prior to a legislative meeting, an agenda must be posted with a brief general description of items to be discussed. The posted agenda description for the December 16,2008, meeting included as a topic of discussion "Options for Appointment ofInterim Councilmember." Accordingly, a citizen reading the agenda was advised that the Council would be considering how an interim councilmember would be appointed. The December 16,2008, Report to Council stated that several procedural options for selecting a councilmember were attached to the Report, and Council had the option of selecting one of the proposed options or "another procedure or method suggested by the Council." At the December 16, 2008, Council meeting there was extensive discussion of Councilmember Lee's military deployment, whether an interim councilmember should be appointed, and discussion of the procedure for appointing the interim councilmember. The Council decided to not adopt one of the three options listed in the attachment to the Report to Council and instead Re: Sunnyvale City Council Response to June 18,2010 Civil Grand Jury Report Titled: Sunnyvale City Council Actions Lack Transparency September 20,2010 selected a process where the highest vote getter in the last election would be appointed at the January 6, 2009, Council meeting. This procedure was within the "another procedure or method suggested by the Council" language in the agenda posting. The Grand Jury's finding that a predetermined interim councilmember was appointed at the December 16, 2008, meeting is factually incorrect. Although supplied with the minutes of the meeting showing that the City Manager was directed to provide the official election results to the Mayor and to bring a subsequent Report to Council on January 6,2009, for any actual appointment, the Grand Jury erroneously concluded that an appointment was made on December 16,2008.

The City's fiscal impact report was incomplete, in that it did not provide the Councilor the public with the complete cost of the interim appointment to the Council. City Response: The City agrees with Finding 3. The fiscal impact discussed in the January 6, 2009, Report to Council was the cost to the City of an interim councilmember during the period of time that Councilmember Lee was on military deployment. The fiscal analysis was not specific to an individual and provided the fiscal impact for anyone appointed as an interim councilmember during the period of Councilmember Lee's military deployment. The January 6 Report to Council accurately stated that there would be no fiscal impact to the City from an interim councilmember's salary because Councilmember Lee would not be receiving his City salary while deployed. The January 6 Report to Council also accurately stated the additional fiscal impact to the City for payment of premiums for medical, dental and vision benefits for an interim councilmember. Because the person appointed as an interim councilmember on January 6, 2009, had previously served a full 4-year term as a City of Sunnyvale Councilmember, an additional fiscal impact based on PERS vesting rules after 5years of service was incurred. After 5years of service, any City employee or Councilmember is vested under PERS and is entitled to retirement medical benefits and pay based on length of service and compensation. The fiscal impact from the retirement medical and pay benefits in the event a former councilmember served atotal of 5 years or more was not included in the January 6, 2009, Report to Council.

The Council gave a benefit option to a councilmember that is not available to other City employees. City Response Disagree with the finding. Unfortunately, the Grand Jury finding demonstrates a misunderstanding of how the continuation of benefits was provided to Councilmember Lee during his active military service. As the Grand Jury acknowledges, the City of Sunnyvale provides for a continuation of City salary and benefits for City employees who are called to active military duty in recognition of their sacrifices on behalf of the City and country. In almost all cases of employees called to active duty, the City salary exceeds the salary the employee will receive from the military. The City provides continuation of the full City salary, but requires the employee to reimburse the City for the amount of military pay and housing allowance, sothe City is only responsible for the difference between the military salary and regular City salary. Because the City is paying more than the military salary, it requires the employee to sign an agreement that it will reimburse the City with the amount of military pay, which is less than the City salary. There is no requirement to reimburse for medical and dental benefits, but there is an obligation to continue to pay the employee's portion, if any, of the premiums. Because Councilmember Lee's military active duty pay exceeded his Council salary, he did not request a continuation of his Council salary while on active duty. Therefore, the City did not need to require a reimbursement agreement from Councilmember Lee for his military salary, as he was not receiving any City salary during his active military duty. Councilmember Lee did request and receive a continuation of medical benefits for his family while he was on active leave, consistent with the continuation of medical benefits available to all other City employees. Councilmember Lee was responsible, as all other employees, for the portion of the medical and dental premium that exceeds the City's maximum contribution, and Councilmember Lee is reimbursing the City for the portion of the medical premium that exceeded the maximum contribution. Councilmember Lee continued on the health benefits plan, as at the premium rate for family coverage there was no difference in premium amount. It follows that the benefits package that Councilmember Lee had while on active military service was exactly the same as other City employees on military service. Furthermore, while the City pays a salary supplement for City employees on active military duty to continue their City salary while on active duty, it did not do so for Councilmember Lee. HonorableJamieA.Jacobs-May,PresidingJudge SantaClaraCountySuperiorCourt Re: Sunnyvale City Council Response to June 18,2010 Civil Grand Jury Report Titled: Sunnyvale City Council Actions Lack Transparency September20,2010 Page6 It is regrettable that the Grand Jury erroneously made a finding that a councilmember serving the City and country through active military duty received a benefit option not available to other City employees, when in fact the benefits received did not include a City salary supplement and were less than the benefits received by other City employees on active military duty.