Stockton’s leaders recently gave a controversial activist $750,000 to settle a dubious lawsuit that, as best I can tell, the city would have won. They won’t say much about it.
The Council on Feb. 7 voted 6-0 in closed session, with Council member Kimberly Warmsley absent, to settle a lawsuit brought by former councilman Ralph Lee White over a 2008 property deal.
“It’s awful. I don’t know how else to say it,” District 4 Council member Susan Lenz said of the resolution. Awful, but necessary, she said.
“They reneged on their promise,” White said of the city. “When they renege on their promise, they gotta pay the price.”
In 2008, the city paid over $2 million to buy a 0.7-acre parcel of land at Airport Way and 8th Street from White, a successful businessman and civil rights activist who served on the Council 1971-83 and 1984-87.
As a councilman, White was a staunch advocate for his district but notorious for cursing out fellow council members and other bare-knuckled behavior that made a mockery of council meetings. His last election was decertified in 1987 over election code violations.
As part of the property deal, White donated a second parcel, about 0.9 acres, to the city. According to White’s complaint, city officials pledged to build a fire station on the donated parcels.
They even showed White a rendering, the complaint says.
White says he agreed because a fire station would appreciate his surrounding properties; because the station would include facilities which could train disadvantaged African-American residents for careers as firefighters; and because the city would name the firehouse after him.
Presumably, he enjoyed a tax write-off, too.
This city’s pledge, however — to build a firehouse — was never put in writing.
Strangely, I could not find any official who remembers why the city changed its mind about the firehouse — the Great Recession, perhaps, and Stockton’s bankruptcy — but it did.
The city decided instead to green-light a project by the nonprofit group STAND to build affordable housing, a health clinic, and retail for the low-income minority community.
When White learned of this, he demanded his land back — so obstreperously at a 2018 Council meeting that the mayor asked police to give White the bum’s rush unless White toned it down.
“Give me that back,” he demanded. “I’ll give you a half-million for it tonight. I guarantee you, you won’t beat me in court.”
White’s attorney filed something called a lis pendens, legal notice that a suit is pending, which clouded the property title. Consequently, no lender would back STAND’s project.
“We had the financing lined up and ready to go,” said Fred Sheil, STAND’s administrator. “Ralph’s lawsuit stopped all of that. We were dead in the water.” (Editor’s note: Fred Sheil is the husband of Stocktonia Board of Trustee member Paula Sheil)
What was White’s problem with the new project? It seems beneficial, even perfectly suited for its disadvantaged neighborhood.
The clinic, for example, was requested by neighborhood moms tired of driving sick kids across town to urgent care at 3 a.m., said Sheil.
No one requested a fire station, Sheil said. “No, that never came up once.”
Why didn’t the city fight White in court? The contract did not promise a fire station.
And it included an “integration clause” saying that the contract covered the entire agreement between all parties and anything not in the contract was not part of the deal.
Council people are somewhat restricted by closed-session confidentiality. But they can, and should, explain their vote. All contacted did, except the mayor.
White’s suit threatened to tie up the project for years to come. The city likely would have won in court; but likely is not definitely. Had the city lost, White would win back the land plus court costs. Dealt such a hand, many City Attorneys would advise their clients to settle.
Especially when the cost of litigation may exceed the settlement offer.
So the Council paid White to go away, or so it looks.
Three-quarters of a million dollars.
“It’s a bitter pill, but it seemed in the best interest of the city,” said District 3 Councilman Michael Blower.
As for White’s opposition to STAND’s project — monkey-wrenching a project wanted by people White purports to champion — I see more explanations than the broken-promise complaint, though that is not entirely without merit.
White opposes the housing because Stockton’s affordable housing is disproportionally located on the south side, he said.
“There’s already affordable housing down there, not even a block away, Sierra Vista,” White said. “Build it out north.”
The other explanation is White saw a payday. Shrewd operators with good attorneys and half a leg to stand on know suing the government can lead to settlements. Happens all the time.
District 2 Council member Dan Wright is for moving on. “Let’s put this behind us and do what’s right for the neighborhood,” he said.
Let’s hope the city draws appropriate lessons about who to do business with and about making promises outside of contracts.
Christine Noguera, the CEO of Community Medical Center, said in a statement CMC still wants to open a clinic. “CMC remains committed to improving access to healthcare in south Stockton, specifically the Airport Way area.”
Sheil of STAND hoped to pick up the pieces and build. “We’re hoping we can go forward.”
White vowed to fight the housing.
“I’ll block it, yeah. Even though I agreed to take the money. But you don’t go on no false promises.”
Michael Fitzgerald’s column runs on Wednesdays. Phone (209) 687-9585. On Twitter and Instagram as Stocktonopolis. Email: mfitzgeraldstockton@gmail.com.
I remember when the land was donated, there was a promise of a fire station at the time.
A promised fire station (even though there’s one not five minutes from that area) or no, this is yet another fine example of the intersection of politics and personal interest. And by politics and personal interest, I mean political expediency and personal greed.
No party on either side of this issue should feel good about this. At all.
Well said.
As a mayoral candidate I remember his proposal for the homeless crisis. If given $5 million, he pledge to turn the fair ground stables into a homeless center. Sounded good, but in the end you know those people would be sleeping on hay piles.
The comment about building affordable housing somewhere else. We did just that not only in north Stockton but thru-out the San Joaquin County. Our goal has always been and is still to provide clean safe affordable housing to low-income and moderate income families thru-out San Joaquin County.
Ralph Lee White is like the sun. . .goes down at night, but always seems to come back the next day. A gift that keeps on giving.
SO typical – par for the course – whatever… This is what Stockton politicians ASPIRE to… Ralph Lee White is the inspiration of EACH and EVERY current & former City Council Member…