We are celebrating a new court victory!
A Ventura County Superior Court judge ruled in a tentative decision that the City of Oxnard was spending money from its Landscape Maintenance Districts (LMDs) for illegal purposes ... declaring that the City’s expenditures charged to LMDs “violated both the statutory text and purpose [of the Landscape and Lighting Act].”
LMDs are funded by an extra assessment on the property tax bills of homeowners who live there, but those assessments can only be used for specific purposes under state law.
The court’s decision requires the City to stop charging LMDs for those unlawful expenditures and restore the wrongfully spent money.
Back when we filed this lawsuit, we mentioned that the City contracted with a consultant (NBS Government Finance Group) to conduct meetings with Oxnard residents who live within Oxnard’s LMDs, with the goal of lobbying those residents to form Mello-Roos tax districts to replace the LMDs.
This program was nicknamed “Renew Oxnard.”
But here’s the legal problem for the City: State law restricts how LMD assessments can be spent. Those funds are for installing and maintaining specified “improvements” (in this context, that means special benefits to only that district such as maintenance of plants, trees, grass, etc.) within the boundaries of that district.
If City Hall were to successfully arm-twist residents into paying Mello-Roos taxes, it could charge homeowners a lot more money and unfairly make residents pay extra for things which ought to be covered by normal property taxes, such as maintaining landscaping on City property outside of the LMDs.
For City Hall, that’s a no-lose proposition – if it wins, City Hall shifts its obligations to these homeowners; if it loses, other people’s money paid for the attempt – “heads they win, tails you lose.”
But City Hall was not counting on us fighting back to defend homeowners.
City internal emails and meeting transcripts showed overwhelming evidence that these meetings between the consultant and residents were focused on funding maintenance of areas on the EXTERIORS of the LMDs, and using Mello-Roos districts to do it. It was never really about maintaining the “improvements” within those LMDs.
And this was not a trivial amount of money.
Oxnard contracted to spend $403,650 – not to actually take care of your grass and trees, but instead to lobby residents to pay more taxes – and as a result, LMD residents got LESS service for their landscaping.
By comparison, assessments for all Oxnard LMDs combined for the current fiscal year totals $816,112.
Many residents have for years complained about LMD misspending. We even collected and submitted to the Oxnard City Council written protests signed by residents from a majority of the LMDs objecting to this particular spending. Residents in the LMDs also protested these expenditures during the Renew Oxnard meetings.
Unfortunately, the Oxnard City Council basically said, “Turf luck!” ignoring the residents and forging ahead with the misspending. Going to court to make the City follow the law was our only remaining option.
Notwithstanding its public comments to the contrary, we believe City Hall knew it was on shaky legal ground.
During this lawsuit, the City paused the consultant’s contract at its halfway point – after having spent more than $200,000 from the LMDs – waiting to see what the judge would decide.
Now, because of this court victory, the City must restore those funds it unlawfully took – giving them back to the LMDs to be spent on actual landscape maintenance – and the City can no longer charge LMDs for prohibited expenditures.
In a twist that is no surprise to anyone who watches city finances, even though the contract and staff reports promised the Oxnard City Council that no LMD would be charged more than $14,950 for this program, that’s not what really happened!
Some LMDs that had small fund balances were charged as little as $2,700 while other LMDs that had larger fund balances were charged over $24,000 by the City … even though they got the same amount of lobbying “services” from the consultant.
In other words, some LMDs were made to subsidize this illegal expense for other LMDs.
Sadly, this is just one of MANY problems we have discovered with management of the LMDs. You may recall this video which describes a few more (but not all) issues we have found. We know city management has watched this video, but they’ve done nothing to remedy these issues, either.
Unfortunately, Oxnard’s city leadership is not generally inclined to fix these kinds of problems until there is a court order to do so.
Sadly, there is more work to be done to bring transparency and honesty to Oxnard City Hall (e.g. the City has never released the secret portion of the LMD audit from 2016).
Fortunately, we possess unlimited resolve to make sure this happens.
Thank you very much for all your support. We have some tough battles ahead, and I just want you to know how much your support has been greatly appreciated.