City accused of acting too slow on tax judgment

Tariq Malik

HUNTINGTON BEACH -- A former city councilman is charging city

officials with stalling on a potential $20 million worth of refunds for a

city property tax that was found to be illegal by a Santa Ana judge last

month.

And while City Council members and some city officials tried this week

to clear up the confusion, questions are still lingering about the

decision by Orange County Superior Court Judge Robert Gallivan.

Gallivan sided with the Howard Jarvis Taxpayers’ Assn., which was

acting on behalf of resident Chuck Scheid, that the tax was illegal.

The judgment was a tentative decision, however, stating the tax

violated the 1978 Proposition 13, which capped property taxes at 1% of

assessed value, and has yet to become final.

But former Councilman Dave Sullivan says the city needs to take action

now.

“I still feel that nothing has changed and that the city is

stonewalling the public,” said Sullivan, president of the Huntington

Beach Taxpayers’ Assn. “People are very angry about this.”

The council took the issue up at Monday’s meeting.

“It was my intent to move this issue forward and be proactive,” said

Councilwoman Debbie Cook, who brought the matter to the council’s

attention. “The confusion on this seems to be getting worse, and this was

an opportunity for the council to get more information as well.”

The property tax charges about 5 cents for every $100 of assessed

property value, and goes to fund some city employee retirement benefits.

Jarvis filed claims challenging the illegality of the tax in 1999.

Residents filing for refunds of the tax automatically start the clock

ticking on their claim, and the city has six months to accept or reject

it. If it’s rejected, residents would have to file suit to seek their

refunds.

“If the city decides to appeal [Gallivan’s ruling] then it will deny

all claims,” she said, adding that she wants to avoid even more confusion

in the future. “I want to make sure that there isn’t more finger

pointing, where the public thinks we’re just trying to stick it to them

when we’re there to do the right thing.”

The council, she said, made it clear that if the city chooses not to

appeal, or appeals and loses, those who filed claim forms will get their

money.

Some residents, however, still have questions.

Sullivan said his organization has received more than 3,000 phone

calls from residents complaining about the difficulty in filling out city

forms and seeking information on the case.

The city’s form calls for more information that is necessary and its

Web site scares off residents by stating they should contact an attorney,

he added.

City Atty. Gail Hutton said the city is not able to counsel residents

on whether they should or should not fill out the forms, nor assist in

any way since it is part of the lawsuit.

Jon Coupal, president of the Jarvis group, said Tuesday that

Gallivan’s decision is still tentative, but that the taxpayer’s

association has a solid case in the event of an appeal by the city.

City officials stressed there has been no decision to appeal

Gallivan’s March ruling, but estimate a total of about $20 million,

accrued by the tax since 1997, would have to be refunded if the city

should lose an appeal, with an added loss of up to $7 million in future

annual revenue.

“We haven’t even seen the decision, let alone had a chance to let our

legal team look at it, make comments and decide whether to appeal,” said

city spokesman Rich Barnard.

Once Gallivan makes a final decision, the city will have 60 days to

decide to appeal.

Assistant City Atty. Scott Field added that should the city choose to

appeal, the case may not reach resolution for about three years.

FYI

For more information on the Huntington Beach Taxpayers’ Assn. call

(714) 840-4015 or visit the Web site ato7

https://home.socal.rr.com/hbtax

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