Newport Coast cash may be out of reach

June Casagrande

Even if they discover that $50 million of their tax money was

mishandled by the county, it’s possible that Newport Coast residents

will be powerless to get any of their money back.

City staff are looking into the legal gray areas that will

determine whether statutes of limitations apply to an inquiry into

how Orange County handled about $170 million in assessment district

taxes levied on Newport Coast residents in the 1980s and ‘90s. Up to

$50 million of that money may be unaccounted for -- a lingering

mystery that Newport Beach officials are determined to solve for

their newest and highly valued residents.

On Tuesday, City Council members voted unanimously to hire

attorneys Robert Messinger and William Mitchell to ask questions that

Coast residents say that county has not answered satisfactorily.

Though officials caution that there’s no sign of any wrongdoing or

mishandling of the money, until about $50 million is accounted for,

the law could get involved.

“The city shall use its best efforts, including litigation ... to

recover such funds” should an inquiry prove that the money was not

used appropriately, Assistant City Manager Dave Kiff wrote in a staff

report.

But statutes of limitations could leave the city and residents

virtually powerless.

“I think there’s a very good chance that the statute of

limitations expired long ago,” City Atty. Bob Burnham told council

members at the meeting.

Attorneys will look into the question even as they begin to

assemble a list of more complicated questions. County officials have

already submitted a lot of documents about where their money went,

but many of their most salient questions continue to puzzle.

For example, residents want to know why they were paid only $3

million for a stretch of road that originally cost Coast residents

about $13 million to build when it was reacquired by the

transportation agency. Someof the money that was supposed to improve

police and library services to the residents were instead used to

bolster services in other Orange County communities.

Officials say they will look for ways to assure that these

taxpayers get a fair deal.

“Remember that these property owners are paying every year. Every

year, they write a check to pay into that assessment district,” Kiff

said. “I think it could be argued that because they’re paying every

year, they might be able to challenge where the money goes and how

it’s used.”

* JUNE CASAGRANDE covers Newport Beach and John Wayne Airport.

She may be reached at (949) 574-4232 or by e-mail at

june.casagrande@latimes.com.