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Arbiter awards $10 million to city of Half Moon Bay in Beachwood case

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Posted: Thursday, September 20, 2012 3:54 pm

The city of Half Moon Bay announced Thursday it has received an interim award of $10 million from a former insurer following a long-standing dispute over liability coverage related to the Beachwood land-use case. The award is the result of arbitration the city’s attorney considers binding and the money could be forthcoming in a matter of weeks, according to City Attorney Tony Condotti.

The award was rendered by retired California Supreme Court Justice Edward A. Panelli and could cost the Insurance Company of the West millions of dollars. It represents the culmination of the first of two phases of arbitration. The second phase could add interest to the total payout. That phase of discussions has yet to be scheduled, Condotti said.

The city ultimately paid $18 million to the owner of land known as Beachwood on the city’s north side, after a court ruled the city rendered parts of the land undevelopable as the result of botched drainage work years ago. Since then, the city has struggled financially, shuttering its police force and laying off employees.

The city has already recovered $5 million from a separate claim against a liability plan run by the Association of Bay Area Governments. The $10 million award means that the city has recovered 84 percent of the total judgment from its insurers.

Condotti said he expects the money “in the next several weeks to months.” He said the insurance company, sometimes known by the initials ICW, is viable and able to pay the claim.

In a press release from the city, Mayor Allan Alifano said city leaders would be meeting to decide how to spend the money but that he expected the city would be “looking to pay off much of the $18 million” in bonds issued to pay for the settlement with landowner Chop Keenan. He indicated some of it could be used for other city priorities.

Welcome to the discussion.

17 comments:

  • John Charles Ullom posted at 5:05 pm on Tue, Sep 25, 2012.

    John Charles Ullom Posts: 1070

    What Ullom and Muteff are doing is far from evidence based.

    Politicos. They'll say just about anything with the assumption that those they serve are stupid in comparison to them.

    Mr. Larimer. I provided links to my assertions.

    The Mayor said that we were almost bankrupted our city. That is a fact backed up by evidence.

    I cited a study and a map that was provided by the city via a PRA request. Most people would call that evidence.

    Why the babble Mr. Larimer? Are you really of the opinion that Half Moon Bay is well run just because a City Council in the early 1990's bought an insurance policy?

    Do you want some more evidence on how recklessly those who spend are money behave? --- http://startthinkinghmb.org/Kehoe/index.php

    Watch the video and check out the links to evidence Mr Larimer.

     
  • George posted at 12:00 pm on Mon, Sep 24, 2012.

    George Posts: 610

    "...neither Muteff nor Ullom understand that."

    Thank you Mr Larimer for being so kind as to tell me what I understand and what I don't understand.

    How totally and pompously arrogant of you to presume such; but unfortunately we have become accustomed to that behavior from you.

    Perhaps you might want to review some of the founding documents of this Republic. IF you do, try reading them as if it were the first time. You might learn something about how this country works and what our duties include (not just rights) as citizens.

    PS: it was an arbitration, not a "court ruling". Just looking at the title of the piece would provide a good clue. Perhaps those rose colored glasses could use a cleaning?

     
  • Jim Larimer posted at 11:43 am on Mon, Sep 24, 2012.

    Jim Larimer Posts: 41

    There is nothing wrong with criticizing people in public office when the critique is evidence based. What Ullom and Muteff are doing is far from evidence based.

    This court ruling is good news for the community and hardly reason to start complaining about the City Council; neither Muteff nor Ullom understand that.

     
  • J C Cervantes posted at 9:01 am on Mon, Sep 24, 2012.

    J C Cervantes Posts: 178

    I have in the past followed the writings of Jim Larimer here as well as on Talkabout. I am shocked to see his becoming a "toady" of the City Council and his attacking citizens who attempt to hold their feet to the fire.

    The lack of citizen's active participation in our government and challenging every action is the primary cause pf the mismanagement of our city.

    We owe much to the efforts of Ullom and Musteff. Keep up the great work.

     
  • George posted at 8:09 am on Mon, Sep 24, 2012.

    George Posts: 610

    I just saw Mr Larimer's comment here and am a bit surprised at such a ridiculous statement. What is he thinking?

    Larimer says (in part), "It would be refreshing to hear an apology from Muteff..." For what, Mr Larimer; for following what the City says and what it does and expressing the obvious?

    This news is wonderful, if in fact the City does recover yet more from their particularly cruel, premeditated and methodical actions and inactions regarding the Beachwood matter.

    Are we to believe that IF we get this $10 Million from arbitration that all the mis-steps in every regard that preceded are null and void? - that none of them ever occurred? How delightfully and blatantly ridiculous.

    The old "pay no attention to the man behind the curtain' comes to mind. Perhaps Mr Larimer needs a refresher course in HMB history. He could certainly use a lesson in speaking to topic.

    I read and responded to the Mayor's comments below on TA, so I won't repeat them here, other than to say thank you Mr Alifano for the efforts.

     
  • Allan Alifano posted at 3:36 pm on Sat, Sep 22, 2012.

    Allan Alifano Posts: 3

    I also posted this to another section of the On-Line paper but wanted to make sure you all have as much information on this developing situation as possible:

    Just to help clarify things a bit; you all have seen and heard what little information is available on the results of the judge’s arbitration decision. As we get more information, we will pass it along.

    In our press release I said we are very pleased with the decision but won’t consider this fully concluded till we have funds in our hands. That was and still is our view.

    As far as exactly how the city will apply any funds we may receive, this has not yet been discussed. Naturally I would personally expect our main goal would be to retire as much bond debt as possible. But I can’t speak for the council, especially as this hasn’t been considered yet.

    The bottom-line is this decision potentially can be a very encouraging chapter for our city. We will take this one step at a time.

    Hope this helps. When I have more to add, I’ll be happy to do so.

    Allan

     
  • John Charles Ullom posted at 1:30 pm on Fri, Sep 21, 2012.

    John Charles Ullom Posts: 1070

    This City Council respects the rights of individuals and it respects the law and that is good government.

    Then why did they ignore their own LCP when it came to Kehoe? On the 9th of February, they were using front end loaders. On the 17th of February, Mo Sharma flat out told them that the whole area was sensitive habitat. The city supplied the public with maps made in 2000 that show two thirds of Kehoe as being Riparian Vegetation. In 2005 the city commissioned a study on the Kehoe/SAM land in question. It declared that their were Riparian plants, wetlands, and protected habitat. Here is a link to that study: -- http://startthinkinghmb.org/Kehoe/SmokingGun.pdf

    Yet they continued to tear the ditch up after Mo Sharama told them it was all sensitive. Is that your idea of respecting the law?

    The city was almost bankrupted, the Mayor said it, because of the lack of respect for the law when they tried to scam the feds using stimulus funds meant to create jobs to pay for a mistake.

    ... but abusing the law to achieve a future illegally has cost this community dearly.

    Yes, it has, and still is, and nobody has 'fessed up to making a single mistake regarding Kehoe or Build America Bonds.

    This City Council respects the rights of individuals and it respects the law and that is good government.

    Some politicos will say just about anything. It appears that something happens to them when they obtain even a little bit of power. Suddenly, it's us vs them. They lose their abilities to articulate a rational argument. In spite of Kehoe and Build America Bonds, Mr Larimer sees nothing but good government.

    Folks, if I am elected, and I ever start babbling like that, please slap me silly and start a recall.

     
  • Jim Larimer posted at 12:29 pm on Fri, Sep 21, 2012.

    Jim Larimer Posts: 41

    Tyler Durden has all the players mixed up.

    It was the NIMBY controlled City Council who created the Beachwood disaster with their attempt to stop development by what turned out to be a taking of property without paying for it. In this case their actions to stop drainage repairs destroyed the property's value and utility. That is well documented in the court records that Durden either has either not read or wants to ignore.

    The many claims that the current Council and City Councils of a quarter of a century ago, i.e., mid 80's, are and were too friendly to developers is based upon mistaken views of the rights of property owners. Respecting the rights of individuals is not the same as either agreeing with their goals or promoting their goal. This lesson in government generated the $40,000,000 penalty in the Beachwood case when a NIMBY lead Council ignored fairness to promote their goals for our future.

    Arguments about what the future should be for this community are fair game for out local political debate, but abusing the law to achieve a future illegally has cost this community dearly. This City Council respects the rights of individuals and it respects the law and that is good government.

     
  • John Charles Ullom posted at 11:47 am on Fri, Sep 21, 2012.

    John Charles Ullom Posts: 1070

    Many in this community would rather doubt than believe anyone who is in an elected office; Muteff and Ullom have been leaders in this group.

    I admit to that but consider it a wise policy.

    Yet this announcement today can only be taken as substantial evidence of the excellent management of our common interests by this Council.

    Really? Less then 6 months ago the Mayor was saying we could have been bankrupted by the choices that many on the current council voted for, per the use of Build America Bonds to pay for Beachwood. Got that Mr Larimer? Their most excellent management put us in a position where we were fortunate the IRS did not force us into bankruptcy.

    This Council inherited the Beachwood problem; they did not create it.

    True, sort of. But many on the council messed up the financing big time. Councilman Muller who was then Mayor Muller actually asserted that that use of Build America Bonds instead of Judgement Obligation Bonds to pay off the judgment provoked no questions in his mind.

    Today's news of this victory in court...

    Mediation is not the same court.

    ...and I commend and thank our leaders for this remarkable accomplishment.

    Remarkable accomplishment? An insurance payout? Seriously? I am sorry, I just can't argue with that kind of logic.

     
  • Tyler Durden posted at 9:55 pm on Thu, Sep 20, 2012.

    Tyler Durden Posts: 417

    Well first let's remember that the Old Guard City Council made a dumb decision to give away the store to Chop Kennan:

    http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/04/04/EDRUSSELL.DTL#ixzz1oUFYmqDC

    Now, years laters, they get lucky and end up sticking the insurance company with the bill for their own bad judgement in the Keenan settlement.

    And former politicians like Larimer (who supported the original bad judgement to give in to Keenan) are now cheering the Old Guard City Council's good "judgement" just because they got lucky and stuck the insurance company with the bill for their prior screwup. Amazing.

     
  • Jim Larimer posted at 9:39 pm on Thu, Sep 20, 2012.

    Jim Larimer Posts: 41

    Muteff and Ullom certainly, and to some extent Rarback, have been highly critical of the current City Council. It would be refreshing to hear an apology from Muteff and Ullom who have been particularly accusatory regarding this Council's actions regarding Beachwood given this good news.

    Many in this community would rather doubt than believe anyone who is in an elected office; Muteff and Ullom have been leaders in this group. Yet this announcement today can only be taken as substantial evidence of the excellent management of our common interests by this Council.

    This Council inherited the Beachwood problem; they did not create it. Today's news of this victory in court recovers a significant amount of the loses generated by the no-growth Councils of the past that abused the rights of property owners creating a huge liability for the entire community. My family and I commend and thank our leaders for this remarkable accomplishment.

     
  • George posted at 5:59 pm on Thu, Sep 20, 2012.

    George Posts: 610

    "The city of Half Moon Bay announced Thursday it has received an interim award of $10 million..." What is an interim award? What does that mean? Does it mean that HMB has been awarded $10 Million. Is it a certainty? Are there more steps in the process to go through before it is a certainty (one way or another)?

    When I hear words like interim, or could - well, it doesn't sound solid. However, when I see comments discussing how it will be spent, that makes it sound certain.

    I am hopeful, cautiously optimistic, but uncertain from this piece.

    IF it occurs, IF HMB does get a $10 Million award, I believe it's safe to say that that is the best City news I've heard since I can't remember when; and I'd have to agree with those that suggest using it to pay down debt - but I've learned not to spend anticipated money until it is "in the bank".

    I have a hard time understanding how an insurance company would pay out $10 Million on deliberate actions taken by their insured - but I am surely not going to argue about it.

    Anybody have answers to the questions I've asked?

     
  • John Charles Ullom posted at 5:43 pm on Thu, Sep 20, 2012.

    John Charles Ullom Posts: 1070

    The only exception to a pay off might be to invest some into beachwood to get it ready to develop that part which is develop-able.

     
  • Aryae Coopersmith posted at 5:37 pm on Thu, Sep 20, 2012.

    Aryae Coopersmith Posts: 1

    Great news! I agree with John & August: use the money to pay off the debt.

     
  • EMcG posted at 5:30 pm on Thu, Sep 20, 2012.

    EMcG Posts: 1

    Yay! Now, let's be smart about where the money goes.

     
  • John Charles Ullom posted at 4:53 pm on Thu, Sep 20, 2012.

    John Charles Ullom Posts: 1070

    In a press release from the city, Mayor Allan Alifano said city leaders would be meeting to decide how to spend the money but that he expected the city would be “looking to pay off much of the $18 million” in bonds issued to pay for the settlement with landowner Chop Keenan. He indicated some of it could be used for other city priorities.

    Spend every penny paying down debt. This is great news. Don't waste the money. You can't make a mistake if you just pay off the debt.

     
  • August West posted at 4:23 pm on Thu, Sep 20, 2012.

    August West Posts: 338

    Great. Pay off whatever bonds available to be called. Put the rest in sinking fund.

    DO NOT spend any of this money for ANYTHING until there is a plan in place on how to pay off the remaining bonds as quickly as possible.

    I bet Mike F. is not happy about this one bit.

     

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