A legal disagreement about who is responsible for the Coastside’s sewer main system has cost local districts a total of at least $727,000 to date. The suit, which the parties failed to settle in mediation, is now in the discovery phase.
The latest numbers, provided to the Review by district leaders, show the city of Half Moon Bay has spent nearly $500,000 to date, with estimates from Granada Community Services District at around $200,000 and the Sewer Authority Mid-Coastside at almost $60,000. Leaders at the Montara Water and Sanitary District declined to give an estimate of their legal costs related to the lawsuit.
The suit revolves around whose taxpayers and ratepayers should bear the cost and responsibility for millions of dollars worth of needed updates to the Intertie Pipeline System. That system delivers wastewater from communities to the north to the SAM wastewater treatment plant in Half Moon Bay. After mediation failed late last year, the city announced it would move forward with the lawsuit in Santa Clara County Superior Court, now in the discovery phase.
Leaders from both sides of the suit are at an impasse after the failed negotiations, each blaming the other for walking away from the table. While Half Moon Bay officials say GCSD and MWSD stepped away, MWSD Director Clemens Heldmaier maintains that Montara agreed to the terms of the settlement, but Half Moon Bay did not.
“The cost has been high,” Heldmaier said. “It’s costing our community dearly and we don't understand why the City Council members did not agree to the mediated settlement, why they misrepresented what happened in mediation, nor why they thought it was OK to violate the confidentiality of the mediation.”
One thing everyone agrees on is that the suit has been a huge time and money pit for each of the agencies, which are also juggling myriad other responsibilities. To Kishen Prathivadi, SAM’s general manager, just retrieving decades-old documents like board meeting minutes and policy papers for discovery takes up valuable staff time and funds that could instead be spent on the highest priority projects.
“That is a humongous task,” Prathivadi said. “The time is money.”
The city of Half Moon Bay has spent the most on the suit, and Public Works Director John Doughty said the latest costs, related to discovery, are particularly steep. He said he’d rather see the money go to capital improvements or to offset rate increases.
“Ultimately, it’s not about the city’s money, it’s about the ratepayer’s money and what they have to pay into the system,” Doughty said. “No one has enjoyed this, and no one has enjoyed having to put this money into (the lawsuit) rather than making additional improvements to our systems.”
The Midcoast Community Council weighed in in late May with a letter encouraging the city of Half Moon Bay to end the suit to save money and time. In a response, the city maintained that it preferred to settle the dispute and avoid litigation, but that MWSD and GCSD reneged.
“It’s unfortunate that the three member agencies cannot come to an agreement outside of court,” wrote MCC Chair Michelle Weil in an email to the Review. “The litigation not only creates a divide among Coastsiders when we should be striving for unity, but it will end up costing ratepayers millions of dollars in legal fees.”