HomeMy WebLinkAboutCity Council - 6665 RESOLUTION NO. 6665
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HUNTINGTON BEACH
DEMANDING THAT THE COUNTY OF ORANGE RETURN 100 PERCENT
OF THE CITY OF HUNTINGTON BEACH TRUST MONIES FORTHWITH
WHEREAS, the County of Orange is authorized by Section 53684 of the California
Government Code to serve as a trustee for trust funds deposited by cities and other
governmental agencies; and
WHEREAS, the City of Huntington Beach has made substantial trust fund deposits with
Orange County; and
WHEREAS, the City of Huntington Beach has acted to maintain trust fund deposits with
Orange County in substantial reliance upon the State Government Code with regard to the
safety of trust funds invested by Orange County; and
WHEREAS, the City of Huntington Beach has acted to maintain trust fund deposits with
Orange County in substantial reliance upon the Orange County Investment Policy with regard
to the safety and liquidity of trust funds invested by Orange County; and
WHEREAS, the Orange County Treasurer/Tax Collector made assurances to the City
of Huntington Beach concerning the safety and liquidity of the City's deposits; and
WHEREAS, the Orange County Board of Supervisors is required by law to exercise
oversight of the activities of the Orange County Treasurer/Tax Collector with respect to such
trust funds; and
WHEREAS, on December 5, 1994, the County of Orange filed for bankruptcy under
Chapter 9 of the Federal Bankruptcy Code on behalf of the County and the Orange County
Investment Pools; and
WHEREAS, the County of Orange has admitted illegal activities which amounted to a
breach of its fiduciary duties as trustee in connection with the investment and safekeeping of
trust funds; and
WHEREAS, the Orange County Board of Supervisors has failed to acknowledge its
fiduciary responsibility to insure the safe return of all participants' trust fund deposits and
accrued interest earnings and has failed to return such trust funds; and
WHEREAS, it has recently been revealed that County officials have wrongfully and
illegally diverted and skimmed at least$85 million in interest earning from trust fund depositors
to a County "economic uncertainty fund" established by the Board of Supervisors and
controlled by County officials and have converted profitable investments to County accounts
while switching unprofitable ones to trust fund participants.
NOW THEREFORE, BE IT RESOLVED, that the City Council of Huntington Beach
demands that the Orange County Board of Supervisors immediately draft, adopt, and seek
approval of a motion in the Bankruptcy Court which will result in the return of 100% of the trust
funds the City of Huntington Beach and all other participants deposited with Orange County,
together with interest thereon, based on the following principles:
1. Orange County has a fiduciary responsibility to all participants who deposited
trust funds with Orange County for investment purposes, including the taxpayers of the City of
Huntington Beach.
2. Orange County has the financial responsibility for all losses of investment funds
and has an obligation to take all steps necessary to pay all trust fund participants in full and
immediately.
BE IT FURTHER RESOLVED that the City Clerk of the City of Huntington Beach shall
forward a copy of this resolution to each member of the Orange County Board of Supervisors
and to each of the other cities in Orange County and to the Attorney General of the State of
California for appropriate action by him in the event the Supervisors of Orange County fail to
perform their fiduciary duties as demanded herein.
THE FOREGOING RESOLUTION is approved and adopted by the City Council of the
City of Huntington Beach this 6th day of February, 1995.
r
MAYOR
CITY OF HUNTINGTON BEACH
ATTEST:
CITY CLERK
CITY OF HUNTINGTON BEACH
APPROVED AS TO FORM:
-2"Z
CITYATTOR EY
CITY OF HUNTINGTON BEACH
Res. No. 6665
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss:
CITY OF HUNTINGTON BEACH )
I, CONNIE BROCKWAY, the duly elected, qualified City Clerk of
the City of Huntington Beach, and ex-officio Clerk of the City Council of said
City, do hereby certify that the whole number of members of the City Council of
the City of Huntington Beach is seven; that the foregoing resolution was passed
and adopted by the affirmative vote of at least a majority of all the members of said
City Council at a regular meeting thereof held on the 6th of February, 1995 the
following vote:
AYES: Councilmembers:
Harman, Sullivan, Leipzig, Dettloff, Green, Garofalo
NOES: Councilmembers:
None
ABSENT: Councilmembers:
Bauer
t
City Clerk and ex-officio C erk
of the City Council of the City
of Huntington Beach, California
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