San Bernardino Seal

Ryan Hagen, Staff Writer
Posted: 03/27/2013 01:06:14 PM PDT

San Bernardino is suing the state to prevent the Department of Finance from carrying through with a threat to withhold more than $15 million in taxes to make up for low- and moderate-income housing funds the city allegedly owes.

The lawsuit, filed with bankruptcy Judge Meredith Jury, seeks to prevent the taxes from being withheld by the Department of Finance or Larry Walker, who is San Bernardino County auditor-controller/treasurer-tax collector. The suit names Walker and state officials.

A March 4 letter from the Department of Finance said the money should be paid immediately, and that failure to pay or work out a payment plan within 30 days might lead to the withholding of sales tax, use tax and property tax to equal that amount.

The city counters that the $15 million sum “is almost exclusively intangible” and only $335,312 of it is cash and “vigorously disputes that it owes the sums demanded by the DOF.”

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