More action, sides no closer on Dunsmuir lawsuit

Lauren Steinheimer

In the midst of ongoing litigation involving accusations of unconstitutional collection of garbage fees, the City of Dunsmuir is taking steps toward a revised garbage rate structure that would lower fees for all customers and gradually spend down the controversial surplus.

The lawsuit filed by citizen Leslie Wilde against the City of Dunsmuir continues to unfold, and although Dunsmuir City Council members won’t comment, their desire to attempt to mitigate the source of contention has been expressed during meetings over the past month.

Wilde’s lawsuit claims the city’s garbage rates increase in 2004 led to an excess of revenue, culminating in a large surplus in the solid waste enterprise fund. She claims portions of that surplus were unlawfully transferred into the water enterprise fund, and that the city violated Proposition 218 by failing to notify the public of the rate increase with an appropriate protest period.

Actions taken by Dunsmuir City Council include revising the garbage rate structure to make it equitable for both residential and commercial customers, whereas the current structure has commercial users paying a higher rate for the same service.

Council members unanimously agreed to amend the rate structure proposed by interim city manager Randy Johnsen at the Nov. 19 meeting to further reduce fees for all users across the board by approximately 30%. The proposed additional reduction would leave the city with less solid waste revenue than expenditures and allow the negative balance to be covered by the existing surplus.

During the Dec. 3 council meeting, Johnsen plans to present two options for new solid waste rates. One option includes a 29% reduction in fees, the other 30%.

Johnsen said the 29% reduction would decrease solid waste revenue by $9,834.57 per month. A 30% reduction would cut revenue by $10,284.94 per month.

“There is certainly enough in the surplus to carry the city over to 2017, when the current Clemens [waste removal] contract is set to expire and another rate study should be done,” Johnsen said.

If council approves one of the two options, Johnsen said the next step will be to have the city attorney arrange paperwork to initiate the Prop 218 process. In case citizens are opposed to a decrease in their garbage fees, they’ll have a 45 day period to protest. Following that protest period, an election will be held at a city council meeting.

The reduced rates would not go into effect until after this process has occurred.

Wilde, City disagree

on lawsuit’s validity

In response to council’s ostensible intention to reduce garbage rates, Wilde wrote in an email, “They. Still. Don't. Get. it.”

Wilde continued to explain, “I believe the randomly proposed 30% reduction in garbage fees is arbitrary because it does not relate to the cost of service as is required by Prop 218. The City did not review the costs (Clemens contract+tipping fees+administration/billing) and the current revenue generated (garbage ratepayers paying their monthly and mandatory garbage fees) and then determine the current garbage fees could be lowered, across the board for every class of ratepayer.”

Wilde said she assumes the garbage rates will go back up again in two years once the surplus is spent down.

When asked for a copy of the city’s current contract with Clemens waste disposal, Johnsen said the original contract was executed in 1973, with one page amendments each year until 1993. “The last contract extension was for 2012-17 and provided little to no information,” he said.

The 2014-15 city budget shows $412,500 in revenue and $354,753 in expenditures for the solid waste fund. There’s a surplus balance of $484,062.

Representing herself in the lawsuit, Wilde procured an amicus curiae from Howard Jarvis Taxpayers Association attorney J. Ryan Cogdill. The letter supports the validity of Wilde’s case and pleads to overrule the demurrer issued by Dunsmuir’s city attorney.

The amicus curiae argues that Wilde’s case is not time-barred, as claims the city attorney. It states, “These claims are not time-barred because the rate structure was first adopted in 2004. The statute of limitations begins to run when the fees are owed; the date the city originally adopted the ordinance is entirely inapposite. For this reason, this court should overrule the city’s demurrer, and plaintiff’s complaint and petition should not be dismissed with prejudice.”

It also counters the city’s argument that Wilde’s complaint is non-justiciable. “the city makes a variety of unsupportable arguments regarding its allegedly exclusive jurisdiction over garbage collection utility rate setting,” the letter states.

The amicus curiae acknowledges that a surplus is not conclusive evidence of a Proposition 218 violation, “but it is circumstantial evidence of a Proposition 218 violation and thus likely entitles plaintiffs to their day in court.”

In response, the city attorney released two reports: one objecting to the amicus briefing and requesting that the submission be stricken from the record; another in support of the demurrer.

The city attorney continues to claim, “Ms. Wilde’s allegations are time-barred and otherwise non-justiciable.”

To support his argument that Wilde’s case is time-barred, counselor Rob Taylor states, “As the First Amended Petition disputes fees, not taxes, it does not invoke the theory of continuous accrual stated in Howard Jarvis Taxpayers Assn. v. City of La Habra.”

The defendants’ reply in support of the demurrer states, “Ms. Wilde’s challenge to the surplus is non-justiciable... In taxpayer actions to restrain waste of public funds, courts should not take judicial cognizance of disputes which are primarily political in nature, nor should they attempt to enjoin every expenditure which does not meet with a taxpayer’s approval, as doing otherwise would invite constant harassment of city officers by disgruntled citizens.”