Lawsuit Demands City Return $9.7M in Residents' Fees

About 5,200 property owners east of the 5 Freeway in San Clemente should get back the $1,500 they each paid in city fees, according to a lawsuit filed against the city Thursday.

The city never built the beach parking officials touted 15 years ago as necessary to support new development, and the money -- $9.7 million in resident fees retained by the city -- has been collecting interest in the city's beach parking fund.

Without the additional beach parking, keeping the money is tantamout to an "unwarranted, illegal and continuing violation of the Mitigation Fee Act," charges Brad Malamud, a local attorney suing the city on behalf of the affected residents.

The suit states the act was set up to allow cities to collect cash from new residents to offset the strain on public facilities caused by new development.

But, as the civil complaint against the city states, "the act imposes an obligation to refund to current property owners the collected impact fees if it turns out that, contrary to earlier expectations, the funds are determined to be surplus funds, not needed because the anticipated detrimental impact failed to materialize."

The suit cites several studies involving the Pier Bowl and North Beach -- where the city would have used the $9.7 million to build parking -- showing that no new parking was necessary.

Furthermore, because San Clemente is now built out and because the homes on which the fees were collected have been occupied for years, any need for new parking in the future wouldn't have anything to do with the homeowners who paid the fees in the first place.

"The nexus between the fund and new parking projects no longer exists," the complaint states.

, but City Attorney Jeff Goldfarb said in May that he read the law differently.

The city was actively working to develop a number of different beach parking projects to which the money was allocated, though none had come to fruition. This satisfies the requirements of the Mitigation Fee Act, Goldfarb said.

Related:

• A Parking Garage at the Pier?
• Council to Discuss Spending Millions on Beach Parking Expansion
• OPINION: Why Spend Money on Parking Studies for Unneeded Lots?

Correction: Because of a reporting error, the first name of the attorney was mistaken in an earlier version of this article. Patch regrets the error.