Lawsuits Costing City Nearly $1 Million

Malibu City Hall

If there’s one thing the City of Malibu is used to, it’s lawsuits.

Not surprisingly, legal fees top the latest additions to the city’s 2014-2015 budget, with City Council recently approving $1.09 million in additional spending at its midyear budget meeting, including a $400,000 increase for legal fees to the city attorney, $200,000 for sewage treatment at Las Flores Canyon and $185,000 to hire two new city planners.

The allocation to legal fees drives up total legal expenses to $939,777 this fiscal year alone.

“We’ve added this to account for the increase in litigation costs that are associated with the Malibu Township Council case, the Preserve Malibu case and then the more recent case having to do with Measure R,” Assistant City Manager Reva Feldman said.

According to City Attorney Christi Hogin, it’s the MTC and Measure R cases that are most likely to draw city funds — and attention — in the coming year.

“The two lawsuits that take up the lion’s share of resources in Malibu are the ridiculous lawsuit by the MTC where the MTC has just engaged in a scorched-earth effort to find evidence of a secret deal on the swap of Charmlee for Bluffs Park, and there was in fact no secret deal … the second one is of course a defense of Measure R,” Hogin said.

The MTC case was brought on in 2013 by a group that believes there was a secret deal over an eventual five-year lease swap between Malibu Bluffs Park (owned by the Santa Monica Mountains Conservancy) and Charmlee Wilderness Park (owned by the city).

The Measure R case is the lawsuit that has recently been filed against the city by developers with the Malibu Bay Company and the Whole Foods in the Park Project. Developer Steve Soboroff is working to build a Whole Foods in the Civic Center and was the financial backer of the “No on R” campaign leading up to the November 2014 elections.

“It’s a big number but we felt that it was appropriate to add it in to make sure we’re accounting for those expenses,” Feldman said.

Hogin agreed that the legal fees could come to much less.

“Hopefully we will not have to spend all the money that’s set aside,” Hogin said. “To some extent, the purpose is to set aside a realistic idea of what to expect, but also an indication that the city has the resources to defend the lawsuits, so obviously there’s an element of that in the budgeting.”

Several environmental expenses were added to the 2015 budget in January, including $200,000 for biofiltration devices to treat wastewater at Las Flores Canyon Road and Pacific Coast Highway.

“The city is required to implement low impact development elements that are designed to meet the waste load allocation set forth in the Santa Monica Bay Beaches Bacterial TMDL [total maximum daily load],” reads the report prepared by city staff. 

The new budget additions also include allocations for full time salaries and benefits for two new city planners, an associate planner and an assistant planner, though Feldman predicts the actual expenditure will come out to less.

“We won’t have the people here the full year,” Feldman said.

According to Feldman, the additional spending is justifiable based on the city’s healthy tax base. 

In June 2014, said Feldman, the projected general fund undesignated reserve balance was $16 million; however, the reserve by January 2015 was up to $16.9 million.

“We can attribute the increase to higher than anticipated tax revenues and also some lower spending than we had originally anticipated,” Feldman explained.

Also as part of the budget, the city has adopted a complete schedule of parking fines, designed to clarify how much various parking tickets are worth.

“We’re very happy with the new company, just right off the bat, they’ve been very helpful,” said Assistant City Manager Reva Feldman about Turbo Data, the company used by the city to process fines. Turbo Data has also updated technology, including hand-held automatic citation printing.

“So now you can actually pay your parking ticket while you’re still parked illegally,” joked City Councilmember Lou La Monte.