With Stanford University owning substantial commercial and residential property within Palo Alto city limits, City Council members with even the most benign affiliations with the university have for years been advised to recuse themselves from participating on any issues that could possibly affect Stanford.
The strict adherence to guidelines and advice from the California Fair Political Practices Commission (FPPC), the agency responsible for enforcing state conflict-of-interest laws, has at times resulted in multiple council members absenting themselves from discussion and not voting on important issues.
Since it is unusual for the council to have close votes on issues, the primary impact of the conservative advice from the FPPC and the city attorney hasn't been a change in the outcome of a vote but in the loss of input and perspective of the excluded council members and the electorate being deprived of the full participation of its elected representatives.
But with the current council closely divided over development issues, the consequences of what most believe are inconsequential technical conflicts of interest could actually change the direction of city policy.
This was demonstrated last month when, based on a written opinion from the FPPC, Councilman Tom DuBois recused himself from participating in discussion and votes on adopting a temporary limit on development in downtown Palo Alto, California Avenue and along El Camino Real. With DuBois not participating, several motions failed on 4-4 votes that would have passed had DuBois not recused himself.
DuBois' wife works for Stanford in an academic department, and therefore he derives income from Stanford. Under the long-standing FPPC interpretation of the law, that means DuBois should not participate on any issue which could have a "foreseeable and material financial impact on Stanford." In this case, the FPPC argues that the marketability of Stanford's properties within the Stanford Research Park could be affected by approval of a development cap, whether or not the research park is actually subject to the proposed development cap (which is not part of the current recommendation.)
Either way, the FPPC says, DuBois may not participate, citing several ways in which its regulations consider an action that could affect the value of a property to create a conflict because "the effect on the council member's source of income is foreseeable and material."
The same reasoning has tripped up many previous council members in similar situations, including Larry Klein, whose wife is an emeritus professor in the School of Education.
The possible conflict is easier to see if one looks at a hypothetical situation in which a council member worked for Hewlett-Packard Co. and the council was considering a requested zoning change for property owned by the company. In that case, disallowing participation of the council member makes sense.
But at some point we think the logic falls apart; Stanford has some similarities to a large company but its education mission and the detachment between its academic and commercial activity create a unique set of circumstances worthy of deeper thought from the FPPC and legislature.
Underscoring the problem, the FPPC recently advised council members Greg Scharff, Marc Berman, Eric Filseth and Liz Kniss that the fact they own property downtown or in the California Avenue area is not a conflict requiring recusal because it is doubtful that the development cap would have any effect on the value of their property. That makes little sense.
Why should participation by council members who actually own property in or near areas subject to the development and could be personally impacted financially be allowed but not by a council member whose only "conflict" comes from having a spouse who is working for Stanford?
The council is right to question the FPPC's advice and to instruct city lobbyists to explore changes to the state law or regulations, as it did on Councilman Pat Burt's urging last month.
The nature of the Stanford-Palo Alto relationship may be unique in California, where a private university owns, develops and leases substantial property within the city limits and is subject to city zoning rules.
Conflict-of-interest laws were intended to prevent public officials from financially benefitting from the decisions they make. While it is logical to also include indirect financial benefits an official might receive from an employer or a company in which they have an ownership interest, greater clarity is needed as to when a conflict becomes of sufficient materiality to warrant a recusal.
After decades of struggling with these Stanford-related conflicts, it's time to establish new standards that reflect this unique situation.