Apple Valley

Legal filing says town has illegally transferred funds, among other claims

By Matthew Cabe
Staff Writer
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Posted Apr. 21, 2016 at 12:16 PM

APPLE VALLEY — A lawsuit filed in the Superior Court of San Bernardino alleges Proposition 218 violations related to Apple Valley’s Wastewater Division, which provides sewer service to more than 22,000 town residents.

Town resident Christina Lopez-Burton filed the suit on March 28. One of the accusations includes the illegal transfer of nearly $5 million from the town’s wastewater fund to its general fund between 2012 and 2015. More than $1.8 million is budgeted for transfer in 2015-16, according to lawsuit documents.

Town Spokeswoman Kathie Martin said the town is not able to comment on current litigation, but the suit showed that the town “contends that these transfers represent reimbursement of expenses that the general fund has incurred on behalf of the wastewater enterprise” and are justified as a result.

The lawsuit alleges, however, that expenditures identified in the “General Government budget” include costs that are not related to providing wastewater service and claims a transfer of $1,072,660 to the town’s struggling Parks & Recreation fund, as well as a nearly $350,000 transfer to the Apple Valley golf course fund.

“Neither the Parks and Recreation Department,” the suit said, “nor the town’s golf course support wastewater operations.”

In addition to the illegal transfers, Lopez-Burton’s lawsuit alleges that the town’s imposing of fees and charges “exceed the cost of providing wastewater services” to its customers and that those fees and charges are not proportionate among customers.

Lopez-Burton’s attorney, Eric Benink of the San Diego-based Krause Kalfayan Benink & Slavens law firm, told the Daily Press on Wednesday that the suit’s allegations are all related to the town’s violations of California constitutional requirements.

“Among (the allegations) is the fact that the town is not carefully ascertaining costs and, thus, are overcharging some of its customers for sewer fees,” Benink said. “I think each one of the allegations is important in its own right, with the bottom line being residential customers are not supposed to be charged more than the proportionate costs.”

The alleged overcharges referenced by Benink are in relation to what the suit claims are flawed rate increases given that the town “has not conducted a rate study, cost of service study, or an internal analysis” to ensure it complies with Prop 218.

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