Judge’s comments suggest he will keep arena measure off Sacramento ballot

02/21/2014 3:00 PM

04/16/2014 7:16 PM

A judge all but slammed the door Friday on the efforts of two taxpayer groups to mount a ballot-box challenge to the public subsidy for the new Sacramento Kings arena, saying the groups made significant errors in the initiative petitions they circulated among the city’s voters.

Sacramento Superior Court Judge Timothy Frawley stopped short of ruling on the taxpayers’ lawsuit against the city, but his comments from the bench suggested he is strongly leaning toward keeping the arena subsidy off the ballot.

“These petitions are defective in a multitude of ways,” Frawley told a packed courtroom during a hearing that lasted about 90 minutes. While it could be argued that each individual error wasn’t enough to scrap the petitions, he said, “collectively there are so many errors” that they added up to a “fatal flaw.”

The judge said he would issue a ruling sometime next week.

Lawyer Brad Hertz, representing Sacramento Taxpayers Opposed to Pork and Voters for a Fair Arena Deal, argued that the flaws were “extremely minor” and don’t justify tossing out petitions signed by 22,938 voters, more than enough to qualify the issue for the June ballot.

After the hearing, Hertz acknowledged that his chances of winning the lawsuit appear to have diminished.

“It’s never over till it’s over, but we were disappointed with some of the preliminary findings,” Hertz told reporters. “Certainly there were no conclusive rulings. There were preliminary adverse rulings on some of the mistakes.” He said it’s likely the two taxpayer groups would appeal if Frawley rules against them. The appeals court would need to issue a ruling by March 3 for the City Council to have enough time to place the measure on the ballot for June.

The city’s lawyers weren’t ready to declare victory Friday. “We appreciated (Frawley’s) thoughtfulness and that gives us a measure of confidence,” said City Attorney James Sanchez.

City officials have said their plan to begin construction on the arena this year has not been altered by the petition process.

The city plans to seek City Council approval on April 1 of the arena’s environmental impact report and development agreement. City finance officials then plan to issue bonds to fund the construction of the project in May.

STOP and the Fair Arena group sued after City Clerk Shirley Concolino rejected their petitions because of various wording problems. The judge said he was tilting toward the city’s arguments because of two flaws in particular. First, the campaign’s leaders left their names off a required legal notice, published last summer in the Sacramento Observer newspaper, declaring that petitions were about to be circulated. Second, the petitions omitted a so-called “enacting clause” making clear that the initiative would become law if approved by voters.

Hertz said those flaws didn’t mislead any voters or hinder their ability to make an informed choice on signing the petitions.

STOP’s leaders “got it pretty close to being right,” the lawyer argued. “The integrity of the process was not so negatively affected. ... You err on the side of democracy.”

He said the authors of the petitions had achieved “substantial compliance” with the law.

Hertz added that STOP co-founder James Cathcart, a retired legislative employee who oversaw the signature-gathering effort, made a “good faith effort” to get the wording right. “Democracy is sometimes a little messy and a little imperfect,” he said. “We can only apologize so many times.”

But a lawyer for The4000, a political action committee funded by the Kings, said the errors were “glaring” and not deserving of any wiggle room.

“There’s no ‘oops’ exception to the legal code,” attorney Sean Welch told the judge. “It’s not rocket science to put these petitions together.”

The Kings’ political group was allowed to intervene in the case after pointing out the team had spent $36 million buying the arena site at Downtown Plaza and millions more in development costs. If the arena doesn’t open by 2017, the NBA has the right to buy the Kings and move them out of town.

The city’s arguments against STOP went beyond wording in the petitions. In court papers, Assistant City Attorney Matthew Ruyak said the entire ballot initiative represented an unconstitutional attempt to amend the city charter because it would strip the City Council of some of its powers over Sacramento’s finances.

Frawley said he was leaning toward the city’s view on that issue, too, but gave Hertz until next Tuesday to file legal briefs in opposition. A ruling on the lawsuit itself would soon follow.

The hearing brought many of the key players in the arena drama into the courtroom. Cathcart and the other leaders of STOP and the Fair Arena group sat in the audience, as did Kunal Merchant, the former chief of staff to Mayor Kevin Johnson who now works for the Kings. Several members of Crown Downtown, a pro-arena fan group, also attended.

If the issue does qualify for the June ballot, as STOP hopes, Sacramentans would first vote on the general principle of whether the city can commit public money to sports facilities without approval of the voters. If that passed, then a second vote would be held, presumably in November, on the proposed $258 million subsidy for the Kings arena.

The Kings’ political committee, in court papers, tried to broaden the issues in the lawsuit by comparing the flawed petitions to the secret $100,000 donation to the anti-arena effort by Chris Hansen, the investor who tried to wrestle the Kings away from Sacramento last year and move the team to his native Seattle. But Hansen’s financial involvement was raised only briefly by the judge and never became a main topic at the hearing.

Leaders of STOP have said they didn’t know until much later that Hansen was backing their effort. Hansen was fined by the state last August for violating campaign finance disclosure laws. He begged STOP to tear up the thousands of petitions gathered with his money, but the group refused.

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