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During a closed session meeting on Tuesday, San Clemente City Council voted to petition the California Supreme Court regarding the Beach Parking Impact Fees case as well as the burden of attorneys’ fees.
Council originally voted to petition the case during closed session at the Sept. 15 meeting but did not properly notify the case on its meeting agenda.
The civil case was originally decided in favor of the plaintiffs, the homeowners subject to the fees, in Orange County Superior Court. The city challenged the decision in the Court of Appeal, in which the lower court’s decision was upheld, and it was bifurcated into two separate decisions—the burden of paying attorneys’ fees and the court’s decision requiring the city to return all BPI funds to the 6,200-some residents who paid into the fund. The city had only listed one case on its Sept. 15 agenda, and petitioning a case not announced is not compliant with the Brown Act, California’s law for open meetings.
Council rescinded its Sept. 15 closed session action on Tuesday.
The case, Walker v. San Clemente, was first decided in favor of the plaintiffs, who filed a lawsuit against the city for not tracking money properly that is intended to be spent on beach parking and that the funds should be returned to the property owners. The decision also stated the city had not spent the funds in “a timely manner” since the start of the collection of funds between 1989 and 2012.
In 2013, the city passed a resolution to return the fees to the citizens as soon as the BPI funds were used to construct necessary parking, if a project was approved, with a deadline set at the end of 2014. In 2014, the city extended the deadline to the end of 2016 under the same requirements.
“California’s Mitigation Fee Act requires periodic accounting and reporting of the spend-down of mitigation fees collected,” a press release from the city stated. “The Court of Appeal found that the city’s 2009 report and accompanying budget documents did not adequately explain why those beach parking impact fees had not been spent, or how they would be spent in the future.”
The court has ordered the city to dissolve the funds and return $10.5 million that was collected over the course of more than 20 years. The city wants to be able to provide evidence of the 2009 report rather than completely dissolve the fund.”
Additionally, the city’s appeal to the cost of attorney fees was dismissed by the appeals court as the court found there was case law to suggest it had no standing to appeal the fees. The cost is currently $1.5 million for the plaintiffs. The plaintiffs of the case then filed for about $3.5 million, according to court documents, under private attorney doctrine, but the court awarded the original amount.
“Part of the reason that we are appealing this to the Supreme Court is because of the outlandish, extraordinary, way over-the-top attorneys’ fees awarded in this case,” Councilman Bob Baker said during the Tuesday meeting.
There is no timetable as to when or if the Supreme Court will hear the case. Also, each person who contributed to the BPI fund will be due a different amount during the time they owned the property in the designated locations. The funds cannot be returned until that is determined.