By Joe Nelson Staff Writer
Posted: 04/14/2011 09:52:34 PM PDT

San Bernardino County has spent $21 million on its lawsuit seeking to recoup the cost for its $102 million settlement with Rancho Cucamonga- based developer Colonies Partners LP in 2006.

In all, $30.6 million in public money has been spent on the litigation, when the county’s costs are added to the cost to the city of Upland, Caltrans and San Bernardino Associated Governments. The county sued the three agencies on Nov. 2, 2004, claiming they were responsible for the design and construction of the 20th Street storm drain that channeled water onto Colonies’ property adjacent to the 210 Freeway in Upland.

The runoff occurred during a heated legal battle between the county and Colonies Partners over who was responsible for flood-control improvements at the developer’s property, which ended in the landmark Nov. 28, 2006, settlement.

SanBAG, the county’s transportation planning agency, maintains the storm drain has been part of the county flood-control district’s master plan since 1966 and that the district always intended for the storm drain to protect the entire region from flooding.

The county has paid $21million in legal and expert fees over the last six years – more than one-fifth of the Colonies’ settlement – in pursuing its suit against SanBAG, Caltrans and Upland. And the county spent $7 million defending itself in the Colonies litigation that spanned more than four years, according to a statement released Wednesday by the San Bernardino County Counsel’s Office.

“It should be noted that although the source of this funding is one-time flood-

control district funds and not general fund monies, it is public money nonetheless – public money that would not have been spent had the public agencies SanBAG, Upland and Caltrans accepted the responsibility that is obviously theirs,” according to a statement from the County Counsel’s Office.

As of February, SanBAG reported it had spent $3.2million defending itself against the county. Upland has spent $3.7 million, and Caltrans, while not able to produce exact numbers, says it has spent more than $2.7 million on its defense.

Ken MacVey, an attorney defending SanBAG in the litigation, said Thursday he was stunned to learn how much the county has spent on the suit.

“This is extraordinary and shocking. It shows the county’s litigation is out of control and needs to stop now,” MacVey said. “Instead, the county needs to take immediate action to recover from the Colonies the $102million paid under the corrupt settlement, which the county is entitled to do under the state’s conflict-of- interest laws.”

Prosecutors say the Colonies’ settlement was tainted by bribery and extortion.

They allege former Board of Supervisors Chairman Bill Postmus conspired with former Assistant Assessor Jim Erwin and five unnamed and uncharged co-conspirators to get the nine-figure settlement approved in exchange for political favors and at least $400,000 in bribes.

The uncharged co-conspirators were later identified as including Colonies co-managing partner Jeff Burum, former Supervisor Paul Biane and Mark Kirk, the former chief of staff for Supervisor Gary Ovitt.

Under a plea bargain with prosecutors, Postmus on March 28 pleaded guilty to 14 felonies, including conspiracy to commit a crime, conspiracy to accept a bribe and conflict of interest.

Only Postmus has admitted any wrongdoing in regards to prosecutors’ allegations.

Postmus’ pleas prompted SanBAG and Upland to demand the county drop its suit against them and instead sue Colonies to recoup the settlement.

They say case law has determined that official contracts tainted by bribery are void and that the county is entitled to be reimbursed the entire amount of the settlement and keep any proceeds from it.

Upland City Attorney William Curley said Thursday that the City Council was reviewing a letter it intends to send to the Board of Supervisors no later than Monday requesting that the county drop its lawsuit.

SanBAG’s board of directors adopted a resolution April 6 demanding the same.

The Board of Supervisors said in an April 8 news release that it will take at least a month or more of legal analysis to determine what course the county should take about the Colonies settlement in the wake of Postmus’ pleas.

Whatever direction the county takes, it stresses that its lawsuit against SanBAG, Caltrans and Upland isn’t about cost recovery but about determining liability for the ill-fated 20th Street storm drain.

“Their liability existed before the settlement and will exist in the event the settlement is voided,” the Board of Supervisors said in its statement.

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