The Hanford City Council on Tuesday approved a legal settlement agreeing to pay Helena Agri-Enterprises $12.5 million over the next five years.
During the special meeting, it was agreed that $7.5 million will be paid within the next 30 days, and the remaining balance will be paid in annual installments beginning on March 1, 2024.
The City’s General Fund unrestricted fund balance is around $11 million, according to the meeting agenda packet, but only contains $5.5 million in cash that can be paid without internal borrowing.
City Manager Mario Cifuentez said that the city had several funds to borrow from but hasn’t identified which one makes sense.
The settlement stems from a land disagreement between the City of Hanford and Helena. Helena alleged in their complaint that the City of Hanford had violated a contractual agreement by failing to purchase their factory after initially agreeing to do so in 2016 in exchange for Helena purchasing land for a new facility at the Kings Industrial Park.
All claims against the City of Hanford will be dismissed with prejudice after Helena receives the first payment of $7.5 million, according to the agreement. City staff estimated that had Helena received the full $38 million in damages they were seeking at trial, interest and attorney’s fees could ultimately bump that number above $50 million.
During public comment, community members including former council members Art Brieno and Francisco Ramirez, said the special meeting should have been called with more advance notice or postponed to a day where more of the public could give their input on the settlement agreement.
Councilmember Lou Martinez asked whether the public could have been more involved in the process to reach a settlement agreement. City staff responded that sharing too much information about the lawsuit before an agreement was reached would be actively detrimental to the City’s position and could be used against them court. Staff additionally said it would be impossible to delay the first trial date.
Another issue brought up by those who took the podium was the special meeting’s time at 3:30 p.m., which they said didn’t allow as many people to attend as would a usual city council session at 7 p.m.
Some members of the public said they had received no notice of the meeting. City staff and council members said while testing the agenda management software during a special meeting Monday, the agenda was visible and available to the public.
After the meeting, Cifuentez told the Sentinel that with the change to the new city website, the old email mailing list for agenda alerts was not transported over. He added that the last agenda alert had asked residents to sign up for the new system and noted that the alerts are a courtesy and not legally required under the Brown Act, as long as the agenda is posted 24 hours in advance of the meeting.
Mayor Travis Paden additionally asked City Attorney Ty Mizote whether a special meeting was required for a city’s council to approve the settlement and whether the council was going beyond legal requirements by holding the meeting. Mizote responded that a special meeting was not required under the Brown Act to approve the settlement.
Councilmember Kalish Morrow asked for a period of discussion before the settlement was approved and said she would be voting in favor of the settlement because she was unwilling to gamble with the consequences of a lost lawsuit and losing $50 million, comparing the trial to roulette.
Vice-Mayor Mark Kairis emphasized that he understood the importance of the settlement to the community by mentioning that he had gotten no sleep the previous night because of the importance of the vote, but ultimately supported the settlement.
