By Ryan Hagen, The Sun
Posted: 10/08/13, 12:00 AM PDT | Updated: 12 hrs ago

SAN BERNARDINO >> The City Council approved a “term sheet” Monday night, a draft of the final plan of adjustment that will guide the city in mediation with its creditors and a retired bankruptcy judge.

The 5-2 vote, with Councilmen John Valdivia and Chas Kelley dissenting, was cast in closed session after less than 10 minutes of discussion, and the term sheet itself is also confidential.

That didn’t sit well with some creditors and residents.

“It is absolutely appauling that the taxpayers of the great City of San Bernardino have no idea what the terms of the ‘term sheet’ are and how the elected officials are attempting to negotiate with creditors with our money,” wrote Scott Beard, a resident leading a recall effort in the city, in response to a version of this article posted online Monday night. “I have never seen anything so corrupt on the surface in my entire career.”

U.S. Bankruptcy Judge Meredith Jury ordered the city not to release the term sheet or to discuss it outside of mediation sessions, said City Attorney James F. Penman.

“The court directed that all discussions and mediations be confidential,” Penman said Tuesday. “That is customary in many lawsuits where the court makes a determination that the mediation is to be confidential, because outside pressures tend to get involved and it thwarts the mediation process. That’s the theory behind it.”

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