GHAD: Whatever doesn’t kill it makes it stronger

Despite a new state law empowering the City Council to dissolve the Las Tunas Geological Hazardous Abatement District, the GHAD has cheated death once again.

Using what the city calls a “sham transaction,” the district has tied the city’s hands and is forcing it, for the time being at least, not to dissolve the district.

The city originally attempted to dissolve the GHAD in 1993 after the district produced a plan for preventing erosion on Las Tunas Beach that the city deemed unacceptable. Challenging the city’s right to dissolve it, the GHAD sued the city in 1994. The trial court ruled in the city’s favor, but a court of appeal said the state law on GHADs did not permit the city to undertake the dissolution.

The city then turned to Assemblywoman Sheila Kuehl, who won passage of a bill that granted cities the dissolution power. Now, the law that was specifically meant to bring the district to an end has inadvertently breathed new life into it. Under the law, the city must assume responsibility for the district’s obligations.

Shortly before a council meeting during which the district would have been dissolved, the GHAD board of directors voted to treat all of the district’s expenses as loans that must be repaid. Theoretically, this means if the council dissolved the district, the city would have to repay members for their expenses. More than $2 million was originally set aside for the formation and functioning of the GHAD.

Faced with uncertainty about its financial obligations, the city filed suit late last month against the GHAD board, claiming that the resolution converting the expenses to loans was a “sham transaction and a fraud.” The city is seeking an order from the court declaring the resolution null and void.

In her complaint filed jointly with outside counsel, City Attorney Christi Hogin argued, “Unless restrained by an order of this court, defendants . . . will have created sham transactions benefiting no one other than its attorneys and/or consultants, which . . . the city will be compelled to assume [responsibility for] should it approve a resolution dissolving the GHAD.”

The city also claims board members violated state law by approving the resolution because they had a financial interest in it.

A hearing is set on the matter in November. Representatives of the GHAD could not be reached for comment.

The Malibu Times is the first newspaper in Malibu, serving the community since 1946.

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