BOARD MEETING DATE: October 3, 2008
AGENDA NO. 14

PROPOSAL:

Appropriate Funds from Designation for Litigation and Enforcement and Authorize Amending/Initiating Contracts with Outside Counsel

SYNOPSIS:

AQMD Legal Office is currently being assisted in several lawsuits by the law firms of Woodruff Spradlin & Smart and Shute Mihaly & Weinberger. These cases consist of the litigation on the Architectural Coatings Rules, the Priority Reserve Rule, cases involving “hot gas” with the California Public Utilities Commission and the FERC, and an ultra-low sulfur diesel project at the ConocoPhillips refinery. This action is to appropriate funds from the Designation for Litigation and Enforcement to the Legal Office Budget, Professional and Special Services account, and to authorize the Executive Officer to amend or initiate contracts to expend these funds with Woodruff Spradlin & Smart and Shute Mihaly & Weinberger as well as firms on the pre-qualified list for outside counsel or other counsel approved by the Board.

COMMITTEE:

Administrative, September 12, 2008, Recommended for Approval

RECOMMENDED ACTIONS:

1. Appropriate $500,000 from the Designation for Litigation and Enforcement to Legal’s FY 2008-09 Budget, Professional and Special Services account.

2. Authorize the Executive Officer to amend or initiate contracts with Woodruff Spradlin & Smart and Shute Mihaly & Weinberger as well as firms on the pre-qualified list for outside counsel or other counsel approved by the Board with monies to be appropriated as the need arises.
 

Barry R. Wallerstein, D.Env.
Executive Officer

Background

The FY 2008-09 Budget for Legal included $250,000 for litigation expenses. This amount has been spent on litigation for matters consisting of the litigation on the Architectural Coatings Rules, the Priority Reserve Rule (1309.1 credits for power plants), cases involving “hot gas” with the California Public Utilities Commission and the FERC, and an ultra-low diesel project at the ConocoPhillips refinery. The law firms of Woodruff Spradlin & Smart and Shute Mihaly & Weinberger have been assisting Legal with these lawsuits. It is expected that fees in those ongoing matters, and in new matters that may arise, will total approximately $750,000 between now and the end of the current fiscal year in June 2009. Accordingly, the Legal Office is recommending the appropriation of additional funds in the amount of $500,000, for a total expected expenditure of $750,000 this fiscal year.
 

Proposal

In order to defend on-going and threatened litigation, it is necessary to appropriate additional funds for expenditure by outside counsel. It is expected that on-going lawsuits, and new litigation that is possible, will require an additional $500,000 to be appropriated to Woodruff Spradlin & Smart and Shute Mihaly & Weinberger or other counsel approved by the Board.
 

Resource Impacts

Sufficient funds are available in the Designation for Litigation and Enforcement