MARK SCHUMANN

See also: Sunshine Law questions raised with State Attorney’s Office

According to Assistant State Attorney Christopher Taylor, Indian River Shores Mayor Brian Barefoot and recently re-elected councilman Dick Haverland were served with a civil summons today for allegedly violating Florida’s open government laws.

Barefoot and Haverland, both charged with non-criminal infractions of the Sunshine Law punishable by a fine not to exceed $500, are to be arraigned April 21, 2015 at 8:30 a.m.

Between July 19 and July 21 of last year, Barefoot and Haverland exchanged a series of emails discussing how the Town arrived at its claim that Shores residents are being overcharged by Vero Electric some $2 million a year.

The email exchange in which the two members of the Shores Town Council discuss public business in violation of the Sunshine Law was first reported by InsideVero on August 7. (The Press Journal and the island weekly, Vero Beach 32963, have over the past seven months chosen not to report on what Taylor described as a “risky email practice/pattern by members of the Indian River Shores Town Government.”)

In a March 19 memorandum to State Attorney Bruce Colton, Taylor wrote, “The email exchange between Haverland and Barefoot dated July 19-21, 2014 (see attached “F”), is evidence that the two councilmen violated the Sunshine Law.”

Taylor continued, “The public had a right to hear and discuss the information exchanged between Haverland and Barefoot. The July 21, 2014, email (see attached “H”) to Schumann in which Haverland states that “I am not at liberty to discuss the source of the number ($2 million rate differential)” is evidence that Haverland may have believed his email exchange with Barefoot was a violation of the Sunshine Law. Likewise, Barefoot’s revelation of the email exchange at the August 29, 2014 regular meeting is evidence that Barefoot may have believed that the email exchange was a violation of the Sunshine Law and that a full discussion concerning the $2 million evaluation at a public meeting was needed.”

On August 7, InsideVero also reported that Haverland urged Town Manager, Robbie Stabe, to schedule a special call meeting on hiring an attorney at “an extremely inconvenient time – say 7 or 7:30 a.m.”

“My guess is no one will come,” Haverland added.

Stabe did not follow Haverland’s advice. “If Haverland’s intentions were implemented,” Taylor wrote, “a violation of the Sunshine Law would have occurred.”

Taylor added, “Haverland’s intention to exclude members of the public from a public meeting may not have been illegal under existing law, but is none the less troubling.”

Taylor also expressed concern over the Town’s regular practices for handling email correspondence. “A review of several of these emails reveal that individuals such as the Town Clerk, Town Manager, Town Attorney and staff members have a practice of emailing all five members of the IRSTC (as a group) relating information and/or asking for feed-back on issues. This practice could easily result in a discussion of Township business between members of the IRSTC.”

Below is the full text of Taylor’s memo to Colton:

M E M O R A N D U M

TO:   Bruce H. Colton

FROM:   Christopher Taylor

RE: Indian River Shores

DATE: March 19, 2015

************************************************************************************

Mark Schumann of Inside Vero.com submitted a complaint with this office alleging possible Sunshine Law violations by members of the Indian River Shores Town Council (IRSTC). Mr. Schumann makes reference to email correspondence in the rendition of the facts of his complaint. This office investigated Schumann’s allegations and will present our findings in this memorandum.

In his first allegation, Schumann references two emails written by Councilman Haverland. On March 6, 2014, Haverland wrote that two Indian River Shore residents, John McCord and Bill Grealis, had been in regular contact “re. the FPL status.”(see attached “A”). Schumann believes this indicates that McCord and Grealis had been in regular contact with representatives of FPL concerning the franchise agreement between Indian River Shores Township (IRST) and the City of Vero Beach Electrical Utility (VBEU) on behalf of the IRSTC. On April 7, 2014, Harverland wrote to McCord and Grealis that “I know you two are driving the process.” (see attached “B”) Schumann believes that this indicates that McCord and Grealis were acting on behalf of IRST in vetting possible candidates in search of a law firm to represent the Town in its then contemplated lawsuit against Vero Beach. Schumann opines that Grealis and McCord were acting as agents of the IRSTC, yet the Town has refused to provide copies of their correspondence with each other and with FPL representatives on this matter. He believes this may be a violation of the Sunshine Law and the Public Records law.

Investigation reveals that both McCord and Grealis have extensive prior experience in the electric utility business. McCord’s previous employment history includes owning several companies who specifically assisted industrial clients with the purchase of energy at a greatly reduced rate. Another company McCord owned would provide consulting services for industrial companies who wanted to purchase energy on the open market. Grealis’ previous employment history includes being an attorney in the Washington, D.C. area. Grealis assisted in the merger of two electric companies and subsequently became the President of Cincinnati Gas and Electric which was bought out by Cinergy and then Duke Electric Company. Grealis has over twelve years of experience in the utility business.

After investigation, it was determined that neither McCord nor Grealis conducted an independent search for an outside law firm to be hired by IRST. As a resident of IRST Grealis spoke at regular meetings of IRSTC concerning the utility issue and the need for the Town to hire outside counsel that specialized in this area of the law. During the April 24, 2014 meeting of the IRSTC, Robbie Stabe, Town Manager, was tasked to research, select and sign a letter of engagement for outside counsel. Stabe set up phone conferences with a number of firms that specialized in utility issues. Because of his prior work experience, Grealis was asked by Stabe to sit in for a phone conference with the firm Holland and Knight. Also present for the phone conference was Town Attorney Chester Clem. Stabe and Clem wanted someone knowledgeable in the utility field present so that informed, intelligent questions could be asked concerning Holland and Knights qualifications. McCord and Grealis also attended a meeting with Stabe, Clem and Bruce May (attorney for Holland and Knight) for the same reason. During the May 22, 2014, meeting of the IRSTC, if was announced that Stabe had chosen Holland and Knight, that the firm was analyzing IRST’s options and would contact Stabe when ready to discuss these options with IRST. Neither McCord nor Grealis were appointed to any fact finding committee, empowered or given any authority to select or appoint outside counsel for IRST.

In Sarasota Citizens for Responsible Government v. City of Sarasota, 48 So.3d 755 (Fla. 2010), the Florida Supreme Court stated that individuals consulted by deputy county administrator while negotiating a memorandum of understanding with a baseball team served an informational role and therefore did not constitute an “advisory committee” subject to requirements of Sunshine Law. More specifically the Court stated:

Because the individuals consulted by Bullock served an informational role, the so-called negotiations team did not constitute an advisory committee subject to the requirements of the Sunshine Law. As explained above, only advisory committees acting pursuant to a delegation of decision-making authority by the governmental entity are subject to the open meetings requirement of section 286.011. Advisory committees functioning as fact-finders or information gatherers are not subject to section 286.011. See Lyon, 765 So.2d at 789; Cape Publ’ns, Inc. v. City of Palm Bay, 473 So.2d 222 (Fla. 5th DCA 1985); Bennett v. Warden, 333 So.2d 97 (Fla. 2d DCA 1976). This is not a situation where Bullock and the individuals he consulted made joint decisions. Dascott v. Palm Beach County, 877 So.2d 8 (Fla. 4th DCA 2004). Instead, these individuals were simply providing advice and information, which does not make the negotiations team a board or commission subject to the Sunshine Law. See, e.g., McDougall v. Culver, 3 So.3d 391, 393 (Fla. 2d DCA 2009) (“[T]he senior officials provided only a recommendation to the Sheriff but they did not deliberate with him nor did they have decision-making authority. Therefore, we conclude that the use of the memoranda did not violate the Sunshine Law.”); Jordan v. Jenne, 938 So.2d 526, 530 (Fla. 4th DCA 2006) (“Because the [group] provided only a mere recommendation to the inspector general and did not deliberate with the inspector general, the ultimate authority on termination, we conclude that the [group] does not exercise decision-making authority so as to constitute a ‘board’ or ‘commission’ within the meaning of section 286.011, and as a result, its meetings are not subject to the Sunshine Act.”).

Because McCord and Grealis served informational roles and were not acting pursuant to a delegation of decision making authority, no Sunshine Law violation occurred. Please see all reports and recordings of interviews for further detail.

Schumann’s second allegation also involves Grealis and McCord and their contacts with FPL as expressed in the March 6, 2014, email (see attached “A”). Investigation does not support Schumann’s allegation that the March 6, 2014 email indicates McCord and Grealis had been in regular contact with representatives of FPL concerning the franchise agreement between IRST and the City of Vero Beach Electrical Utility (VBEU) on behalf of the IRSTC. The email itself indicates that it was Haverland’s belief that McCord and Grealis had been in contact with each other “re. the FPL status.” In the past, Grealis had represented IRST on the City of Vero Beach Utility Commission. After his duties on that commission were completed, he still held an interest in the potential sale of Vero’s utility to FPL and how that would affect IRST. In May, 2014, McCord and Grealis accompanied Stabe to a meeting with Amy Brunjes (representative of FPL). Grealis stated that he would also take the opportunity to talk with Brunjes whenever she was in Indian River County speaking to the local governmental boards. Investigation does not reveal that McCord or Grealis were acting as “agents” of the IRSTC in their communications with FPL. Please see all reports and recordings of interviews for further detail.

In Schumann’s third complaint he alleges that an April 7, 2014 email (see attached “B”), indicates that a meeting was planned on April 8, 2014 between two councilmen, Haverland and Cadden. A closer look at the email shows that only McCord, Grealis and Cadden planned to meet together. Investigation shows that McCord, Grealis and Cadden did meet together and that Haverland was not present.

Schumann next alleges that an email exchange dated March 28-29, 2014 (see attached “C”), appears to be a violation of the Sunshine Law. On March 27, 2014, a regular meeting of the IRSTC was held. At that meeting Brunjes spoke to the IRSTC in support of the sale of the City of Vero’s electric to FPL. IRSTC during the meeting also engaged in a lengthy discussion concerning the Towns options, consulting with a specialized engineering firm, hiring an outside attorney and other topics. (see minutes and recording of March 27, 2014 regular IRSTC meeting) On March 28, 2014, Janet Begley wrote a news article covering the meeting. On the same date, Laura Aldrich (Town Clerk) attached the news article to an email to councilmembers commenting “Like Heather, I don’t recall bonds being mentioned. Otherwise, I thought it was a well written article.” On the same date, Brian Barefoot (Town Councilman) replied “Tom C (referring to Councilman Cadden) mentioned it in passing and unless u [sic] were paying close attention u [sic] would miss it.” On March 29, 2014, Tom Slater (Town Councilman) replied to Barefoot, copying other parties, that “Tom C did mention it and John McCord mention [sic] it in the context that we could sue FMPA and others regarding anti- trust [sic] and limiting their ability to be in the bond market as a very powerful pressure point to get them to the table and cooperate OR [sic] we could actually sue them. John is an expert at this type of action and using it to the benefit of the groups who want independence in their power supply decisions.”

The March 28-29, 2014 email represents a risky email practice/pattern by members of the Indian River Shores Town Government. Numerous emails were collected from IRST pursuant to this investigation. A review of several of these emails reveal that individuals such as the Town Clerk, Town Manager, Town Attorney and staff members have a practice of emailing all five members of the IRSTC (as a group) relating information and/or asking for feed-back on issues. This practice could easily result in a discussion of Township business between members of the IRSTC. This is what appears to have happened in the March 28-29, 2014 email exchange.

Although the email exchange appears to violate the Sunshine Law, proof problems exist that tend not to support a prosecution in this instance. The context of the email indicates that Barefoot was responding to the email from Aldrich who is not a member of the IRSTC. In regards to Slater, the email shows that he was responding directly to what Barefoot had stated to Aldrich. The email exchange does not show a clear “discussion” of a subject, outside of a properly noticed meeting, concerning an issue that could come before the IRSTC for formal action. See Florida Statute 286.011. Therefore, because the evidence does not show a clear violation of the Sunshine Law, a prosecution will not be pursued.

Schumann in his fifth complaint references an email dated April 24, 2014 (see attached “D”), in which Haverland states “Looks like Weick (Town Councilman Gerry Weick) wasn’t in the loop.” Schumann is apparently alleging that members of the Council, other than Weick, had discussions outside the Sunshine concerning the hiring of outside counsel for IRST. The minutes of regular meetings of the IRSTC, prior to April 24, 2015, show that the hiring of outside counsel was discussed (see all reports for further detail). Investigation did not reveal evidence of discussions between councilmen outside of the Sunshine in regards to this issue.

In his sixth complaint, Schumann includes an email from Haverland to Stabe dated April 14, 2014 (see attached “E”), in which Haverland encouraged Stabe to schedule a public meeting for “an extremely inconvenient time, say 7 or 7:30 am” so that members of the public would not notice or likely attend. Haverland also advised Stabe to to be “very unspecific as to agenda item.” In that way, Haverland wrote, “I think it would have a good chance to escape notice.”

Investigation reveals that Stabe did not follow Haverland’s advice/direction and that the April 24, 2014 meeting occurred at its regular time. Haverland’s intention to exclude members of the public from a public meeting may not have been illegal under existing law, but is none the less troubling. The Sunshine Law should be construed so as to frustrate all evasive devices. Wood v. Marston, 442 So.2d 934, 938 (Fla.1983). This is especially true even when a board member does not wish the public to know of a particular action because he believes it is ultimately in their best interests. In the spirit of the Sunshine Law a board should be sensitive to the community’s concerns that it be allowed advanced notice and, therefore, meaningful participation on controversial issues coming before that board. See AGO 03-53. The Sunshine Law mandates that members of the public shall be given a reasonable opportunity to be heard on a proposition before a board or commission. Herrin v. City of Deltona, 38 F.L.W. D1767 (Fla. 5^th DCA August 16, 2013). If Haverland’s intentions were implemented, a violation of the Sunshine Law would have occurred.

Finally, Schumann alleges that an email exchange between Haverland and Barefoot on July 19-21, 2014 (see attached “F”), violated the Sunshine Law. At the July 18, 2014 regular meeting of the IRSTC, Bruce May, outside legal counsel for IRST and partner with the law firm Holland and Knight addressed the Council and presented his evaluation of the legal options available to protect the Town’s residents regarding electric rates charged by the City of Vero Beach. To facilitate the analysis May hired a consultant, Mr. Terry Deason, a utility rate expert and the former Chairman of the Board of the Public Service Commission. May stated that research shows that Town residents collectively are paying $2 million more per year under Vero’s utility than if they were under electric service by FPL. At the end of the meeting, IRSTC voted to authorize legal counsel to file a lawsuit against the City of Vero Beach structured around the causes of action May outlined. IRSTC also voted to initiate intergovernmental conflict resolution procedures with the City of Vero Beach that would involve mandatory conference and mediation procedures set forth in Florida’s Governmental Conflict Resolution Act. On this same day, after the meeting, an email exchange began between Schumann and Haverland. This exchange is the first group of emails that need to be considered in addressing this issue and are dated July 18-19, 2014. (see attached “G”). Schumann, at one point criticizes IRSTC for initiating a lawsuit against the City of Vero Beach by stating “If nothing else, the filing of this lawsuit proves the Town of Indian River Shores has money to burn.” Haverland defends the actions of the Town and the money authorized to be paid to Holland and Knight by stating that IRST residents would save $2 million per year forever. The email exchange continued from July 18, 2014, to July 19, 2014, the content of which centered on the $2 million figure and how that figure was arrived at. The last email in this exchange is July 19, 2014 at 12:31pm. On July 19, 2014, at 12:56 pm, Haverland sends an email to Barefoot asking the source of the $2 million figure. This email exchange between Haverland and Barefoot continues until July 21, 2014, which shows the two councilmen discussing the $2 million figure and how it was arrived at. (see attached “F”). Haverland initiates the exchange by asking Barefoot “Do you know what the source of the $2 million difference was?” Barefoot responds by stating “I do not. In his original draft remarks he had $3 million but I asked him to reduce it to $2 myn [sic] because I don’t want us accused of exaggerating.” Investigation reveals that prior to May’s presentation at the July 18, 2014 regular meeting of the IRSTC, Barefoot met with May and Deason and discussed the issue of overpayment to Vero’s utility. May and Deason told Barefoot that the overpayment was as much as $3 million. Barefoot wanted to err on the side of caution and asked that May quote a $2 million figure during his presentation to IRSTC. The email exchange continues with Haverland informing Barefoot that Schumann in an Inside Vero news article is claiming that the $2 million figure “is suspect.” Barefoot replies that “The analysis was done by our expert, the past Chairman of the PUC, who claims the number is in excess of $3 myn [sic] due to the size of the home etc. vs [sic] other parts of the county. All the detail should come out during the mediation process.” Haverland responds “Great. The more Mark Schumann is wrong, the less credibility he will have. He has a pretty close following, including Winger and Graves.” This last exchange between Haverland and Barefoot is dated July 21, 2014, at 2:51 pm. On July 21, 2014, at 3:06 pm, Haverland sends an email to Schumann stating “I am not at liberty to disclose the source of the number (see attached “H”). Based on information I was made privy to, I believe the number is, if anything, an understatement. This figure’s derivation will be made clear to everyone in the mediation process.” In an interview pursuant to this investigation Barefoot stated that in hindsight, he believes that he should not have responded to Haverland’s email, even though the question was regarding an issue previously brought before the IRSTC.

Sometime after July 21, 2014, Schumann made a public records request with IRST and received a printout of the email exchange between Haverland and Barefoot dated July 19-21, 2014 (see attached “F”). Subsequently, Schumannn wrote a news article publishing the email exchange asserting that Haverland and Barefoot may have violated the Sunshine Law. During the August 29, 2014 regular meeting of the IRSTC, Barefoot, pursuant to the agenda item “Update on Conflict Resolution Process (Bruce May)” addressed the news article written by Schumann, the email exchange between Schumann and Haverland, and the email exchange between himself and Haverland. (see attached “I” the Minutes of the August 29, 2014 regular meeting of the IRSTC). Barefoot explained that the email exchanges involved the subject of the $2 million rate differential and how it was calculated. Barefoot stated, that in an abundance of caution, he wanted to make the Council and the public aware of the email communications so that the Council and the public could have the opportunity to discuss the reporter’s question, and the facts relating to that question, during the open and public meeting. Barefoot then asked if May would explain to the Council and for the record, how this $2 million differential was calculated. May then addressed the IRSTC and stated that the $2 million rate differential was developed by Deason. May stated that he believed that Deason’s estimate was conservative.

The email exchange between Haverland and Barefoot dated July 19-21, 2014 (see attached “F”), is evidence that the two councilmen violated the Sunshine Law. It is clear that the $2 million rate differential calculation is the basis and central feature of IRSTC’s lawsuit against the City of Vero Beach, as well as the conflict resolution process. The lawsuit or conflict/mediation process is a subject that could come before the board for official action. Barefoot admits in the email that the differential rate calculation would be introduced during the mediation process in great detail. The fact that May and Deason originally calculated a $3 million differential was never discussed at a public meeting, but it was discussed by Haverland and Barefoot. The fact that Barefoot asked that the $3 million differential be lowered to $2 million was not discussed at a public meeting, but it was discussed by Haverland and Barefoot. The reasons why Barefoot asked May and Deason to lower the evaluation to $2 million was never discussed at public meeting, but it was discussed by Haverland and Barefoot. The public had right to hear and discuss the information exchanged between Haverland and Barefoot. The July 21, 2014, email (see attached “H”) to Schumann in which Haverland states that “I am not at liberty to discuss the source of the number ($2 million rate differential)” is evidence that Haverland may have believed his email exchange with Barefoot was a violation of the Sunshine Law. Likewise, Barefoot’s revelation of the email exchange at the August 29, 2014 regular meeting is evidence that Barefoot, may have believed that the email exchange was a violation of the Sunshine Law and that a full discussion concerning the $2 million evaluation at a public meeting was needed.

The Sunshine Law applies to any gathering of two or more members of the same board to discuss some matter which will foreseeably [emphasis added] come before that board for action. Florida Statute 286.011. It has been stated that the application of the Sunshine Law is not limited to meetings at which final, formal actions are taken. See AGO 2001-20. Rather, it applies to any gathering where members deal with some matter on which foreseeable action will be taken by the board. See Board of Public Instruction of Broward County v. Doran, 224 So. 2d 693 (Fla. 1969). Florida courts have recognized that it is the entire [emphasis added] decision-making process that is covered by the Government in the Sunshine Law, not merely meetings at which a final vote is taken. Canney v. Board of Public Instruction of Alachua County, 278 So. 2d 260 (Fla. 1973).

In Times Publishing Company v. Williams, 222 So. 2d 470, 473 (Fla. 2d DCA 1969), disapproved in part on other grounds, the Court states that in enacting a new statute declaring that all meetings of any board or commission at which official acts are to be taken must be public meetings, it is the entire decision-making process that Legislature intends to be affected by statute. Further, since every step in the decision-making process, including the decision itself, is the necessary preliminary to formal action, each such step constitutes an “official act” and an indispensable requisite to “formal action” within meaning of statute. Florida Statute 286.011. Similarly, in Neu v. Miami Herald Publishing Company,462 So. 2d 821 (Fla. 1985), the Court stated:

Petitioners’ broadest argument, and the one most fervently pressed, is that this Court’s decisions in Doran and Berns have effectively strangled the political process in Florida and forced political bodies and officials to evade the Sunshine Law, as interpreted, in order to make the political process function. On this point, petitioners’ arguments go beyond the issue here of consultations with attorneys on pending litigation to ask that we recede completely from Doran and Berns. Essentially, petitioners would have us read section 286.011 narrowly and hold that it applies only to the climatic meetings where official actions and acts are approved by the governing body. We have recently articulated why we will not adopt such a reading in Wood v. Marston, 442 So.2d 934 (Fla.1983), and will not repeat the reasons here. One can argue and reargue whether the broad reading of the Sunshine Law in Doran and its progeny is politically wise.* The fact remains that Doran was rendered fifteen years ago and placed the legislature and all concerned on notice of our broad reading of section 286.011…Every step in the decision-making process, including the decision itself, is a necessary preliminary to formal action. It follows that each such step constitutes an ‘official act,’ an indispensable requisite to ‘formal action,’ within the meaning of the act.