HomeMy WebLinkAboutContracts & Agreements_42-2013_CCv0001.pdf PROPERTY TAX ADMINISTRATION FEE
RELEASE AND SETTLEMENT AGREEMENT
This Release and Settlement Agreement ("Agreement") is made by and between
the County of San Bernardino ("County") and the City of Redlands ("City") (individually a
"Party" or together the "Parties") and effective March 19, 2013 ("Effective Date").
I. RECITALS
A. A dispute arose between the County and the City regarding the amount of
property tax administration fees ("PTAF") charged to City by the County and County
officers, beginning in fiscal year 2006-07, pursuant to various provisions of the Revenue
and Taxation Code. The City contended that the County charged more for PTAF than the
statutory mandate allows, whereas the County contended that it charged PTAF within its
statutory authority (the "PTAF Dispute").
B. This same dispute exists on a statewide level between other California
counties and many cities located within those counties' territory as well as between the
County and other cities located in this County,
C. On November 19, 2012, the California Supreme Court issued a decision in
City of Alhambra v. County of Los Angeles (2012) 55 CalAth 707 resolving the PTAF
Dispute. In the decision, the court held that the method used by counties to calculate
PTAF is improper. As a result, the County has implemented the City of Alhambra decision
for the current (2012-13) and future fiscal years, for the calculation of PTAF.
D. In accordance with the Supreme Court decision, the City of Alhambra case is
currently on remand (Los Angeles Superior Court Case No. 5185457) to the trial court.
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The County expects that during the remand proceedings, the Superior Court will resolve
the following issues: (i) the extent of the retroactive application of the City of Alhambra
decision; (ii) the applicable Statute of Limitations; (iii) the interest rate. if any, due on any
refunds, and; (iv) whether refunds for past years are subject to various claims-filing
requirements ('PTAF Issues"). The Parties acknowledge that resolution of these
remaining PTAF Issues through the court system could take many years. Any and all
liability and damages resulting from these remaining PTAF Issues, and any and all
amounts owed by the County to the City pursuant to the City of Alhambra decision for
fiscal years 2006-07 through 2011-12, are referred to herein as "County PTAF Liability".
E. The Parties desire to avoid the additional expense, delay and uncertainty
that would result from the continuing litigation over the PTAF Issues and have agreed to
settle amicably said dispute and any underlying claims and litigation between them
including the County PTAF Liability, rather than engage in protracted and costly litigation,
Il. SETTLEMENT TERMS
A. SETTLEMENT PAYMENT, The County, in consideration of the
performance of this Agreement by City, shall pay to City and City accepts the total sum of
Seven Hundred Twelve Thousand Five Hundred Sixty Three and Thirty-Two One-
Hundredths Dollars ($712,563.32) (the "Settlement Amount") in full satisfaction of the
County PTAF Liability and full resolution of the PTAF Dispute, as set forth in Exhibit "A",
The Settlement Amount shall be paid by County to City within thirty (30) calendar days
after the Effective Date, except that if City has filed a lawsuit against the County then
payment will be made within thirty (30) calendar days after the Dismissal Date, as defined
in subparagraph B., below, The payment shall be made by warrant or electronic funds
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transfer, in accordance with existing payment protocols between County and City. If the
City wants to change existing payment protocols with the County then the City shall timely
provide to County such information as may be necessary for the remittance of this
payment, no later than ten (10) calendar days after the Effective Date.
B. DISMISSAL OF CLAIM AND LAWSUIT, IF ANY. (i) On the Effective Date of
this Agreement, if City has filed any claim with the County pertaining to the PTAF Dispute
or the County PTAF Liability, such claim shall be deemed settled and released in
accordance with this Agreement, (ii) Within fifteen (15) calendar days of the Effective
Date of this Agreement, if City has filed any lawsuit pertaining to the PTAF Dispute or the
County PTAF Liability, City shall take all necessary steps to dismiss the lawsuit with
prejudice, and shall provide to County a file-stamped copy of such dismissal. The date of
the County's receipt of the City's proof of dismissal shall be the "Dismissal Date".
C. MUTUAL RELEASES. Each and every Party to this Agreement, on behalf of
that Party, and its representatives, trustees, predecessors, successors, assigns, affiliates,
subrogors, subrogees, assignees, assignors, subsidiaries, agents, employees, servants,
officers, elected official, directors and attorneys ("Releasors") release every other Party to
this Agreement and every other Parties' representatives, trustees, predecessors,
successors, assigns, affiliates, subrogors, subrogees, assignees, assignors, subsidiaries,
agents, employees, servants, officers, elected officials, directors and attorneys
("Releasees") from any and all disputes, damages, actions, causes of action, suits, rights,
demands, controversies, entitlement to equitable relief, liabilities, fees, costs, interest and
any other claims, of any nature whatsoever, known or unknown, suspected or
unsuspected, whether in tort or in contract or statutory or under any other theory, arising
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out of, in connection with or relating in any way to the PTAF Dispute and/or the County
PTAF Liability.
D. RELEASE OF UNKNOWN CLAIMS /WAIVER OF CIVIL CODE SECTION
1542. Each Party to this Agreement expressly, voluntarily and knowingly waives and
relinquishes all rights arising out of, in connection with or relating in any way to the PTAF
Dispute or the County PTAF Liability to which it or its Releasors would be entitled now or
at any time hereafter under section 1542 of the Civil Code, as against the other Parties to
this Agreement and their Releasees, and does so understanding and acknowledging the
significance of such specific waiver. Section 1542 of the Civil Code provides:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER
FAVOR AT THE TIME OF EXECUTING THE RELEASE WHICH IF KNOWN
BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER
SETTLEMENT WITH THE DEBTOR."
Initials ials
E. ATTORNEYS" FEES AND COSTS. The Parties to this Agreement will each
bear their own attorneys' fees and other costs and expenses arising in any way from the
PTAF Dispute and/or the County PTAF Liability, To the extent that any Party seeks to
enforce this Agreement and a court finds that the position taken by the opposing Party was
"without substantial justification," then attorneys' fees for enforcement of the Agreement
shall be allowable.
F. COMPROMISE. This Agreement is the result of a compromise and
settlement of disputed claims, and nothing set forth in it shall be deemed or construed as
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an admission of any liability by any of the Parties to any of the other Parties or the
Releasees.
G. MUTUAL DRAFTING, The Parties, having mutually drafted this Agreement,
agree that no Party to the Agreement will be deemed to have been the primary author of
this Agreement or any portion of it. The Parties therefore agree that section 1654 of the
Civil Code, and other legal principles or laws that call for the construction of ambiguous or
uncertain terms against the drafting party shall not apply or be invoked for any purpose
whatsoever.
H. NO ASSIGNMENT. The Parties have not assigned any of the claims,
demands, or causes of action that are released and discharged under this Agreement.
1. COUNTERPARTS. This Agreement may be executed in several
counterparts and by fax copies and, as so executed, will constitute one agreement, binding
on the Parties to this Agreement, notwithstanding that such Parties are not signatories to
the original or the same counterparts.
J. WARRANTIES OF COMPREHENSION, CONSENT AND AUTHORITY.
Each person executing this Agreement warrants that he or she comprehends the terms of
this Agreement, and further warrants that he or she is executing this Agreement freely on
the advice of the undersigned counsel and that, if signing on behalf of an entity, he or she
has the right and authority to execute the Agreement on that entity's behalf.
K INTEGRATED AGREEMENT, This Agreement is the final expression of the
Parties' agreement with respect to the settlement of the PTAF Dispute and the County
PTAF Liability and supersedes all prior written or oral communications between the
Parties, The Parties cannot amend, after, modify, or otherwise change this Agreement,
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except by a writing executed by all Parties hereto and expressly stating that it is an
amendment to this Agreement. The Parties will make no claim, and waive any right they
now have or may have, based upon any alleged oral alteration, oral amendment, or oral
modification, except as set forth expressly in a written amendment executed as provided in
this paragraph.
L. SEVERABILITY. If any provision of the Agreement is held invalid, the
remainder of the Agreement shall nevertheless remain in full force and effect in all other
circumstances, so long as the essential purpose of the Agreement can still be achieved by
both sides to the settlement embodied in this Agreement.
M. BREACH. The Parties agree that this Agreement shall be deemed breached
and a cause of action accrued thereon immediately upon the commencement by any Party
of any action or proceeding contrary to the terms of this Agreement. In any such action or
proceeding this Agreement may be pleaded as a defense, or may be asserted by way of
counter-claim or cross-complaint.
N. MISTAKE. The Parties fully understand and declare that if the facts under
which this Agreement is executed are found hereafter to be different from the facts now
believed by them to be true they assume the risk of such possible differences in facts and
hereby agree that this Agreement shall be, and will remain, effective, notwithstanding such
differences in facts.
O. INCORPORATION OF RECITALS. The Recitals to this Agreement, stated
above, are hereby incorporated herein and made a part hereof.
IN WITNESS WHEREOF, the undersigned have executed this Agreement on the
dates shown below.
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DATED: CITY OF REDLANDS
APPROVED AS TO FORM:
By: A
V w (sign ure)
City Attar
Pete Aguilar, , `4R
ATTEST.
Sam Irwin, City i_erk
DATED: COUNTY OF SAN RNARDINO
By:
Q9,
ry C. Devereaux
hExecutive Officer
APPROVED AS TO FORM
JEAN RENE BASLE
COUNTY COUNSEL
By:
Kev--WL. Rorris
Deputy County Counsel
Doc#2A777985
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EXHIBIT "All
EXHIBIT"A"
PTAF RELEASE AND SETTLEMFNTT AGREEMENT
Property Tax Administrative Fee for
Fiscal Years 2006-07 through 2011-12
Entity: CITY OF REDLANDS
Tolling Agreement: Yes
Settlement Amount:
Fiscal Year 2006-07 $53,606.41
Fiscal Year 2007-08 $162,749,71
Fiscal Year 2008-09
$122,690,56
Fiscal Year 2009-10 $128,337.75
Fiscal Year 2010-11 $123,854.04
Fiscal Year 2011-12 $121,324.84
Total $712,563.32
EXHIBIT "A"
PTAF RELEASE & SETTLEMENT AGREEMENT
#2AB2877