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The City of Santa Clara, which undertook a legal defense of its at-large election system and lost, was ordered by the court to pay approximately $4.5 million in plaintiff's attorneys' fees. The City of Santa Monica currently has a case pending before the California Supreme Court. In that case, the plaintiffs have demanded approximately $22 million in attorney's fees for just the trial court proceedings. These amounts are in addition to the substantial amounts the cities spent on their own lawyers. For example, the City of Santa Clara spent $1.5 million for its own lawyers in its unsuccessful attempt at defending its at-large election system at the trial court level alone. On the other hand, even if a city prevails it cannot recover either attorneys' fees or costs. Also, the city would remain vulnerable to subsequent litigation brought under the CVRA by different plaintiffs. To date, staff is unaware of any city that has prevailed through final judgment in defending its "at-large" system of election under a claim filed by any individual or group under the CVRA. On September 28, 2016, the Governor signed AB 350 into law. This legislation attempts to provide a "safe harbor" from CVRA litigation for cities that choose to voluntarily transition to a district-based election system. If a city receives a demand letter, such as in Pleasanton's case, the city is given 45 days of protection from litigation to assess its situation. If within 45 days a city adopts a resolution declaring the city's intent to transition from at-large to district-based elections, outlining specific steps to be undertaken to facilitate the transition and estimating a time frame for action, then a potential plaintiff is prohibited from filing a CVRA action for an additional 90-day period. The city and the prospective plaintiff may enter into a written agreement to extend that 90-day time period for up to an additional 90 days in order to provide additional time to conduct public outreach, encourage public participation, and receive public input. Thus, the legislation provides time for a city to assess and implement a transition to a district- based system before a lawsuit may be filed. The legislation sets out a number of steps a city must take in the effort to assess and transition to a district-based election system, which is laid out in further detail below. Under AB 350, a city's liability is capped at $30,000 (plus an annual adjustment for inflation) if it follows this safe harbor process after receiving a threat, and the plaintiff must show financial documentation that these costs were actually incurred. Transition from At-large to District-based Elections Under AB 350, the City is required to hold at least four public hearings within the allotted 90 day "safe harbor" period. However, Kevin Shenkman, counsel for the proposed plaintiff, has expressed his willingness to extend the safe harbor period by another 90 days if the City adopts a resolution of intent to transition to district-based elections. The first two public hearings will give the community an opportunity to provide input on the composition of the districts before any maps are drawn. Subsequently, draft district maps will be drawn and two additional public hearings (hearings three and four) will be held for the public to provide input regarding the content of the draft maps and proposed sequence of elections. The maps must be published at least seven days before the public hearings. The fifth, and final, public hearing will be for Council to consider an ordinance that establishes Pleasanton's district-based elections. By law, there is no ability to cut short or extend the terms of sitting councilmembers through this process. Page 3 of 4