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Riverside electricity tax election on November 2 could be overturned by lawsuit – press enterprise


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A group of residents are suing the November 2 election shutdown in Riverside over a move that would continue a long-standing city practice of charging utility customers more than the cost of providing electricity and using extra money to pay for independent municipal services.

The lawsuit follows a chain of events punctuated by an October 2020 court ruling declaring Riverside’s overcharging of customers an unconstitutional tax and a May settlement requiring the city to seek voter approval in an election November special to continue the practice.

Measure C, if approved by simple majority, would allow the city to continue to charge more than it costs to serve electricity and transfer up to 11.5% of electricity revenue in its general fund. Essentially a tax that raises around $ 40 million a year, the extra money helps pay for police and fire protection, park maintenance, street maintenance, library operations and others. programs.

However, a new lawsuit filed Thursday, Sept. 9 by Big Bear Lake attorney Chad D. Morgan, argues that the city cannot put this issue on the ballot this fall under the state’s constitution.

“This trial is necessary because Proposition 218 does not allow votes on tax increases in special elections,” Morgan said in an email on Monday, September 13.

The lawsuit argues that such measures can only be organized in general elections, when the turnout is usually much higher.

“It is unusual to challenge the validity of measures like this before the election,” Morgan wrote, adding that he had asked for the case to be heard “on an expedited basis.” Morgan said a court hearing is scheduled for Friday, September 24 in Riverside.

Morgan filed a lawsuit in Riverside County Superior Court on behalf of Riversiders Against Increase Taxes. The lawsuit names the city, City Clerk Donesia Gause and Riverside County Registrar of Electors Rebecca Spencer as defendants.

City spokesman Phil Pitchford and Riverside County spokesman Brooke Federico declined to comment on the lawsuit.

City officials have called the cash transfer an important tool in funding services for decades. Voters in the city approved it by passing an amendment to the 1968 charter setting a transfer limit of 11.5%.

A voting argument in favor of Measure C signed by Mayor Patricia Lock Dawson and four others emphasizes that the measure would not increase taxes or utility tariffs.

“As we work to recover from the pandemic, it is essential that we maintain vital services and have the resources to rebuild our local economy – by retaining local businesses, repairing roads and tackling homelessness in our region. community “, indicates the argument.

In July, Riverside City Manager Al Zelinka said the transfer generated $ 40 million per year, or about 14% of the city’s operating budget.

“It is not an insignificant amount of money,” he told Riverside City Council.

Losing those dollars would likely trigger cuts to programs at all levels, Zelinka said.

As for the election, Federico said it is expected to cost $ 150,000.

Sharon Mateja, spokesperson for Riversiders Against Increase Taxes and a local businessman who has been active in the Riverside issues, underscored the group’s opposition to holding an election this year in a press release on Monday.

“For years, city officials have ignored the almost constant complaints from members of the general public that Riverside Public Utilities overcharged their customers in order to support the city’s general fund,” said Mateja. “Now that this has proven to be true, we see the city once again attempting to violate the California Constitution by calling an election at a time when it knows there is great potential for low voter engagement and, therefore, undue influence on election results by special interest. crooks. “

Mateja said the city’s electricity customers “deserve honest and ethical treatment” and the practice of overloading must end “if only to end the considerable economic and personal hardship of the elderly, poor and disabled in the city. our city”.

Riverside’s electric utility supplies power to 109,000 customers and collects around $ 350 million annually, according to court documents in Parada v. City of Riverside that triggered the ruling that overcharging to raise funds for city services is unconstitutional.

The May settlement in that case asked Riverside City Council to ask voters in November if they approve, and the deal is conditional on voters passing the measure, according to the settlement.

The settlement provided for reimbursement of electric customers of $ 24 million, less attorney fees, which were capped at $ 2.24 million. Riverside spokesperson Pitchford said in May the city would reimburse taxpayers over five years by issuing credits on customers’ utility bills.

The agreement also provided for the payment of $ 5,000 each to Summer Parada and Vincent Parada, the plaintiffs in the lawsuit.

The agreement called on the city to declare, as part of the ballot and the resolution fixing the election, that its policy of transferring money from public services to the general fund is “a general tax requiring the approval of the voters.”

The question that Measure C would ask voters on November 2 is: “Maintain general municipal services such as 911 intervention, firefighters, paramedics, police, street repairs, parks, emergency services. the elderly ; fight homelessness; the charter amending measure of the Town of Riverside to continue to collect electricity tariffs and maintain the voter-approved transfer of funds (established in 1968), capped at 11.5% of gross revenue, providing approximately 40,000,000 $ per year to the Town of Riverside General Fund without raising taxes or utilities rates, until terminated by voters, requiring audits / all locally controlled funds, passed? “

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