Oakland Tribune

1/26/04

How city treasures became privatized

By Peggy Stinnett

THE PARAMOUNT Theatre, the Oakland Museum of California, the Oakland Zoo and Chabot Science Center are Oakland treasures we like to show off with civic pride.

And did you think they are public institutions because taxpayers paid to create them?

If the answer is yes, you're only partly right.

It's true all were built with public dollars but all have become privatized to such a degree they are no longer completely public institutions.

And that's only partly right, as well, because the institutions all occupy government-financed buildings but have spun off foundations or corporations that are non-profits not subject to the Public Records Act or the Brown Act.

What these non-profits do with their money, and some of it may be yours, is none of the public's business. That's what the state's Public Records Act says, and that's what the Oakland City Attorney says.

That's a blunt assessment but something you'll learn if you try to get financial information from them.

Under the Public Records Act, non-profits don't have to give up financial information for public inspection.

However, they are supposed to comply with Sunshine Act ordinances and their provision for open meetings.

The trouble with Sunshine Acts is they're different in various cities. According to knowledgeable sources, San Francisco's is tough, Oakland's is not. San Francisco government sources say: "We can't get away with anything because of Sunshine."

Oakland's Sunshine language does not go far enough and is considered "easy to slip through" by those who are trying to so.

The word "privatized" means to change from governmental ownership to private enterprise. Most make the transformation by creating a non-profit foundation. So a city creates a public entity which in turn creates a non-profit entity which is private.

Look at the Paramount Theatre. It's just one example, keeping in mind each Oakland institution has a different origin and formation.

The Paramount reopened its doors after an extensive restoration 30 years ago, and according to theater sources, has lost money almost every year since. That's one reason the Paramount recreated itself into Paramount Theatre of the Arts Inc., a non-profit group. But it hasn't had a public fund-raising drive for years.

Under the protection of being a non-profit, the Paramount board can keep its financial affairs private, unexamined by investigators, news reporters or curious members of the taxpaying public.

But the Paramount and institutions like it have no problem going to the taxpaying public when they need financial donations and support of their programs. They also like to bask in the compliments their institutions win only because the public has supported them.

The Brown Act exempts most non-profit corporations from complying with its open meeting requirements, and also ad hoc advisory committees of less than a quorum of the subject board.

The city's Sunshine Act, however, requires them to give notice to the public of board meetings, keep minutes and listen to the public.

No "sign-ins" can be required but the Paramount board last week required every person to sign in as they arrived for its board meeting and they were not allowed to enter the meeting room before the start time of the meeting.

The official opinion of the Oakland City Attorney's office fits the description of what the Paramount must do to stay within the law.

Deputy City Attorney Mark Morodami says there is no written legal opinion, so he verbally advised me the Paramount must comply with the Oakland Sunshine Act but not the Public Records Act because of it non-profit status.

He is working on a written opinion that will cover the Paramount and the three other public institutions to resolve a long-standing complaint to the Public Ethics Commission that arose from campaign literature promoting a bond measure for the museum, zoo and science center, which included free tickets to visit the facilities.