SR-103-001-02
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City Council Report
City Council Meeting: May 9,2006
Agenda Item: l.I:l
TO: Mayor and City Council
FROM: Marsha Jones Moutrie, City Attorney
SUBJECT: Awarding Bid to Publish City's Legal Notices
Recommended Action
It is recommended that the City Council award a bid to the Santa Monica Daily Press to
publish the city's legal notices for fiscal year 2006-07, pursuant to the requirements of
Section 609 of the City Charter.
Executive Summary
State and local law require that legal notices, primarily relating to public bidding and
land use matters, be published in a newspaper of general circulation. Santa Monica
City Charter Section 609 sets forth the procedures for annual selection of an official
newspaper for publication of legal notices. Until recently, no local Santa Monica
newspaper qualified for selection, and since 1998, the city's legal notices have been
published in the L.A. Times. In January 2006, the City was notified that one local paper
had been established by the court ("adjudicated') as a newspaper of general circulation
in Santa Monica. In accordance with Charter Section 609, the city published a notice
inviting bids to publish the city's legal notices. Two bids were received and evaluated
based on criteria outlined in the notice. The Santa Monica Daily Press, with a Monday
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- Saturday circulation of 19,000, and a $10.75/column inch ad rate is recommended for
selection. The city currently places approximately 2500 column inches annually in the
L.A. Times and under an existing contract has been paying a discounted rate of
$44.95/column inch. Designating the Santa Monica Daily Press as the official
newspaper will result in a substantial cost savings to the city.
Discussion
Backqround
The Santa Monica Municipal Code and state law require that legal notices, primarily
relating to public bidding and land use matters, be published in a newspaper of general
circulation published in the city (MC Sec. 9.04.20.22.050) or, if there is none, in a paper
of general circulation published nearest to the city (Government Code Sec. 6042).
Under state law, a paper qualifies for city adjudication by either 1) being printed in the
city for one year or 2) being published in the city for three years and having a principal
office of publication in the city. In either case, some distribution to paid subscribers is
also required.
Since 1998, with the demise of The Outlook newspaper and in the absence of a city-
adjudicated newspaper of general circulation, the city has placed legal notices in the
Los Angeles Times, first in the now defunct Our Times section and since then in the
California section. For the last three years, the City has had a contract with the Los
Angeles Times which provides for reduced rates in exchange for a minimum amount of
monthly advertising. This year's agreement with The Times ends January 6,2007.
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The Santa Monica Daily Press, founded in 2001, was adjudicated as a newspaper of
general circulation for the City of Santa Monica on December 20, 2005 by Judge
Kenneth R. Freeman of the Los Angeles County Superior Court. The Daily Press
publisher notified the city of the adjudication status on January 16, 2006. Two other
newspapers-the Observer and the British Weekly-also claim adjudication within the
city; however, a recent appellate court decision in a case entitled Santa Monica
Observer Newspaper, Inc. v. City of Santa casts doubt on the Santa Monica Observer
Newspaper's legal status. The Los Angeles Times is not adjudicated in the city, nor is
the Santa Monica Mirror, another local news weekly.
Bid Selection Process
Although the City Charter (MC Sec. 609) gives the City Council the power to contract
with a city-adjudicated newspaper without advertising for bids if that paper is the only
qualified paper in the city, staff determined that the prudent and equitable approach was
to publish a notice inviting bids and to select an official newspaper based on the
following criteria:
. Proof of adjudication in the City of Santa Monica
. Amount of bid (ad rate, which cannot exceed customary rates)
. Circulation (including copies per issue, documented readership)
. Delivery methods (news racks, home delivery, on-line, other)
. Publication schedule (weekly, daily)
. Percentage of local news carried
The notice was published in the Los Angeles Times on March 10, 2006, with bids due
March 24, 2006. In addition, the city directly notified all local weekly and daily
newspapers circulated in Santa Monica that the notice had been published.
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The city received two bids: one from the Observer Newspaper and the other from the
Santa Monica Daily Press. Based upon the prior lawsuit between the City and the
Observer and the documents submitted by the Observer Newspaper in connection with
the bid, it is still not clear whether the adjudication order received in 2000 applies to the
current publication. The Santa Monica Daily Press's 2005 adjudication order is valid,
although the Observer is currently challenging the order in court.
The Santa Monica Daily Press is being recommended for selection based on the criteria
outlined in the notice inviting bids. The chart below provides a comparison of the two
bidders across all criteria:
Publication %of
Rate Circulation Delivery Methods Schedule Local
News
25 boxes, 322 racks,
$10.75/col. 19,000 355 drops, online &
Daily Press Inch (no min.) (audited) "substantial paid Daily, M-Sat 75%
subscriptions" (1,120
paid)
$8/col. Inch 200 racks, 200 drops,
or $ 7/co I.
Observer Inch with 10,000 5,000 home Weekly 100%
Newspaper 40"/mo. delivered, free online
minimum (100 paid)
By comparison, the Los Angeles Times' Santa Monica paid circulation is 16,921
weekdays and 21,306 on weekends, with 305 news racks throughout town.
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Staff is recommending the Santa Monica Daily Press for a number of reasons. In
deciding an official newspaper one of the most important factors is distribution. The
public interest is best served by ensuring that official city notices will be viewed by as
many residents as possible. While the Observer's rates are lower than the rates of the
Daily Press, the Daily Press's daily distribution more than offsets this modest price
differential. A daily newspaper attracts many more readers and thus results in better
noticing to the public. Further, a daily newspaper provides substantially more
advertising flexibility than a weekly newspaper. Finally, the data submitted by the Daily
Press, especially its audited circulation statistics, confirm that it in fact reaches more
local residents than the Observer.
While the City Charter requires the selection of a single city-adjudicated newspaper for
the purpose of publishing legal notices, it should be noted that display advertising to
inform residents of city programs and services can and will continue to be placed in
other local newspapers, both print and on-line, within approved budget allocations.
Also, certain legal noticing, particularly Purchasing Officer bid notices that require
dissemination beyond Santa Monica's borders, will continue to be published in the Los
Angeles Times or other regional papers in addition to the Santa Monica Daily Press.
The City Charter requires the bid process for publication of legal notices to occur
annually if there is more than one newspaper of general circulation in the city.
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Finance/Budget Impact
The city spent $113,211 in calendar year 2005 publishing legal notices in the Los
Angeles Times. Based on purchase of a similar number of column inches-2500-
the city expects to spend approximately $27,100 with the Santa Monica Daily Press, a
savings of more than $86,000, in fiscal year 2006-07.
Because the city's existing contract with the Los Angeles Times does not expire until
January 2007, however, the city is obligated to place a minimum amount of advertising
(14 column inches per week at an undiscounted rate) in The Times between July 1,
2006 and January 6, 2007. This is expected to be a one-time expenditure of
approximately $25,000 in addition to the amount paid to the Santa Monica Daily Press
in FY 2006-07.
Legal advertising is budgeted in General Fund Account No. 01211.522520, Records &
Election Services.
Prepared by:
Cara Silver, Deputy City Attorney
Approved:
Forwarded to Council:
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