News - September 14, 2011

Atherton: Developer agrees to reduced refund of road-impact fees

by Renee Batti

The town of Atherton will pay a Menlo Park development firm $72,500 to settle a lawsuit over road-impact fees — a sum that is $225,500 less than the company originally sought last year when it launched its legal fight against the town.

The City Council voted on Aug. 17, in closed session, to accept the terms of a proposed agreement with Pacific Peninsula Group (PPG), but the town wouldn't disclose those terms until PPG officially accepted them. That happened Sept. 8, when PPG principal Steve Ackley signed the document.

Each party will pay its own attorneys' fees, according to the agreement.

Although the development company originally sought $298,000 from the town, that figure had been lowered to about $215,000 during the discovery phase of the litigation process, the town's attorney for the case, Leah Castella, told the Almanac in March.

Pacific Peninsula Group, which has built numerous homes in Atherton over the years, sued the town after the council agreed to refund a portion of road-impact fees paid by builders before the town discontinued the fee in late 2009. That decision, which divided the council at the time, was based on controversy over the fee's legality.

Road-impact fees are charged by many California cities to pay for damage to roads caused by heavy equipment used in home and commercial construction. The question of whether the fees are legal is yet to be resolved, but just weeks after the council's July 2010 decision to partially refund them to builders meeting certain criteria, PPG sued to force the town to refund the fees it paid in their entirety.

The settlement agreement "should not and shall not be construed as an admission or concession of any liability, expressed or implied, or that any of the Parties have violated any laws or otherwise acted wrongfully in any manner or fashion," the signed document says. "The Parties have entered into this (agreement) in order to achieve peace and to resolve and settle all disputes and potential disputes between them."


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