A meeting on the topic was convened Friday afternoon, March 26, but was canceled for lack of a quorum. Only Mayor Kathy McKeithen and Councilman Jim Dobbie showed up, and those two council members held an informal meeting to hear from residents who showed up.
Mr. Marsala has been harshly criticized for asking resident Jon Buckheit, who is suing the town, for a $500,000 loan in August of last year. He also has been accused of no longer living in Atherton, although council members are legally required to live in the towns they serve.
Mr. Marsala is renting out his Emilie Avenue home to a Stanford Hospital patient and her family, and said the family needs to remain in the house at least through part of April. He said he has been living with friends in town.
Mr. Marsala said he didn't know Mr. Buckheit was planning to sue the town when he asked him to help him secure a loan, although Mr. Buckheit had filed a legal claim against the town on April 9 2009. Filing a claim against a public agency is the legally required first step before filing a lawsuit.
In an interview with The Almanac, Mr. Marsala said the claim didn't come before the council until mid-July, and the council voted unanimously to reject it. Because it was on the consent calendar, there was no discussion of it, and "I considered it closed," he said.
According to City Council agendas from 2009, the council met in closed sessions to discuss legal actions filed by Mr. Buckheit against the town on April 15, May 20, June 17, and July 15.
Mr. Buckheit filed a lawsuit against the town in federal court on Oct. 20, alleging police misconduct during a domestic dispute at his house in 2008 that resulted in his arrest. He was never charged with a crime, and recently won a court declaration of factual innocence in the matter.
Town attorney Wynne Furth, in an analysis of questions surrounding Mr. Marsala's loan request and residency prepared for the April 7 special meeting, said that Mr. Marsala asked Mr. Buckheit for financial assistance in August 2009. "The recession had led banks to change their lending practices and Mr. Marsala's usual sources of commercial lending were unavailable," she wrote. "The proposed loan was a four-year loan secured by Mr. Marsala's house at an interest rate of 8 percent."
In a Sept. 23 e-mail, "Mr. Buckheit informed Mr. Marsala that he could not assist him with a loan or arranging a loan," Ms. Furth wrote.
In her analysis, Ms. Furth detailed two laws that govern conflict of interest on the part of public officials: the Political Reform Act and Government Code Section 1090. The laws deal primarily with whether the official has a financial interest.
"Based on the information that Council Member Marsala has provided, he did not violate any conflict of interest rules because he had no financial interest in any of the decisions in which he participated," she wrote.
Mr. Marsala has stated "that he will recuse himself from future discussions concerning Mr. Buckheit's lawsuits," she wrote. "We believe this is a sound position. Because council members are elected to make decisions, recusal is not something to be done lightly. However, the principle of avoiding both actual and apparent conflicts of interest takes precedence."
The analysis is an expanded version of a summary Ms. Furth presented at the special March 26 meeting that was canceled for lack of a quorum. It is a summary of a thicker document provided to council members, marked "confidential."
Mayor Kathy McKeithen said she'd like to see the more detailed review made available to the public. "It's very important to the town," she said. "I think the public has a right to know what is in that document. It was prepared at taxpayer expense, and I don't see any reason why it should remain confidential."
Ms. McKeithen has been a regular critic of Mr. Marsala for years, and led the charge to schedule the special meetings to meet what she characterized as the public's demand for the council to address the questions surrounding Mr. Marsala.
Another critic, former Atherton finance director John Johns, said he intends to call for Mr. Marsala's resignation at the April 7 meeting.
Mr. Johns, fired from his job in October 2007, sued the town for wrongful termination and is on the verge of signing a settlement agreement that would award him $225,000 and other concessions.
During the town's investigation of Mr. Johns, Councilman Marsala made a number of public statements alleging wrongdoing on the part of Mr. Johns.