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Home My WebLink AboutCC 8 SAN DIEGO PIPELN 10-19-88~, ~,~ ~=, ..,, ~ CONSENT CALENDAR ~ NO. 8 .. ~HONO~LE ~YOR & ME~E~ OF THE CITY coUNCIL TO: FROM: SUBJECT: CITY ATTORNEY SAN DIEGO PIPELINE V. BOARD OF EQUALIZATION, CITY OF TUSTIN, ET AL. Pursuant to the letters from the County Counsel of the County of Orange and the Attorney General, copies of which are attached, we recommend that the City Council approve and authorize entering into the partial settlement proposed in the attached letters. City Attorney JGR:se:D: 9/19/88 (1115) cc: WH 714/ OFFICES OF THE COUNTY COUNSEL COUNTY OF ORANGE 10 CtWC CENTER PLAZA MAILING ADDRESS: P.O. 8OX 1379 SANTA ANA, CALIFORNIA 92702-1379 James G. Rourke CSty Attorney . City of Tustin Rourke and Woodruff 1055 North Main St., Ste. 1020 Tustin, California 92701 ADRIAN KUYPER COUNTY COUNSEL WILLIAM J. McCOURT CHIEF ASSISTANT ARTHUR C. WAHLSTEDT, JR. LAURENCE M. WATSON ASSISTANTS 7141834-3300 August 30, --~'?':" '-'2- '{ / I ~'~"- JOHN R. GRISET "~ ~ ~' '"' ' ~ ! "' "" EDWARD N. DURAN /~::" "' "~,--'~'~¥ / 3'.. IRYNE O. SLACK /(.'-i:' .,"'~' '~' . "~ ';'"i .R'CHARD D. OV,EDO ! ' , , ' 'BENJAMIN E DE MAYO ¥_G,E N E AXELROD I-RObERT L. AUSTIN ~ !DONALD H. RUBIN ~'-'~-:, ".- ..~,,,,~ I~11~ ~.- ;-C, ROL D. ~ROWN ADR,ENNE ~. SAURO ,;' I~AI~IBARA L. STOCKER KARYN J. WARNER /" '.:J~MES K MEADE KATHY PAUL .%. ~..: ',: ' ?~I'EFEN H. WEISS KAREN R. PRATHER ~' ,' ' ,'~ C' //SUSAN STROM ...... ~,,,-' DEPUTIES VICTOR T BELLERUE DAVID BEALES TERRY C. ANDRUS JAMES L. TURNER PETER L. COHON NICHOLAS S. CHRISOS THOMAS F. MORSE WANDA S. FLORENCE HOPE E. SNYDER THOMAS C. AGIN SHERLE A. CHRISTENSEN SUSAN M. NILSEN SARA L. PARKER Re: San D..ie~o Pipeli.ne Company v. Board of Equaliz. a.ti.on, et al., LASC No. C-502532 Dear Mr. Rourke: As you are aware, this office represents your City in the above-entitled action. Enclosed is a letter dated August 25, 1988, from the Attorney General, as the attorney for Lead Defendant Board of Equalization, outlining a partial settlement of this and related actions. 'Ail of the issues in these cases revolve around the legality of the State Board of Equalization's assessment of pipelines and pipeline-rela~ed rights of way, equipment, and storage tanks, and around the valuation of this property determined by the State Board. The Attorney General has negotiated a partial settlement of these actions, as outlined in his letter of August 25, 1988. This proposed partial settlement would reduce or eliminate the "valuation" issues by stipulating to reductions in the assessed valuation of the pipelines by approximately ten percent (10%), plus accrued interest. Rather than effect a refund of taxes paid, however, this agreement provides that the reduction shall be given as credits against Plaintiffs' property taxes in tax year 1989-90. The proposed partial settlement will not resolve the follow- ing issues, which would remain to be determined at trial: 1. Whether the State Board of Equalization has the legal authority to assess the lands and rights of way over which the pipelines are placed; and D05/218 City Attorney's Office August 31, 1988 Page 2 2. Whether the State Board of Equalization may include in its assessment of the pipelines the related storage.tanks and equipment. As you can see, the Attorney General has indicated a deadline of September 19, 1988. We have requested that the Orange County Board of Supervisors approve and authorize entering into the proposed partial settlement, and the matter is set on the Board's Agenda for September 13, 1988. By this letter we also seek approval and authorization from your City. Recognizing that time may be a problem, we have orally. advised the Attorney General that we may not be able to execute a settlement on behalf of your City by the designated deadline. Since the assessed values were determined by the State Board, we believe that the Attorney General may stipulate to reduction without the approval or consent of co-defendants. Nevertheless, your cooperation in obtaining the consent and approval of your City will be greatly appreciated. Thank you for your anticipated courtesy and cooperation in this matter. Very truly yours, DRC:db Enclosure ADRIAN KUYPER, COUNTY COUNSEL David ~'.'~ffe~e,~ D05/.218 --~OHN K. VAN DE KAMP orney General August 25, 1988 State of California ~~/ DEPARTMENT OF ]USTICE :1580 Wii~HIRE BOULEVARD, ROOM 800 LOS ANGELES 90010 (213) 736-2304 Adrian Kuyper, County Counsel David R. Chaffee, Deputy 10 Civic Center Plaza P. 0. Box 1379 Santa Ana, California 92702-1379 Dear Mr. Kuyper: SOUTHERN PACIFIC PIPE LINES, INC. v. BOARD OF EQUALIZATION OF THE STATE OF CALIFORNIA, et al.;LASC NO. 502533; SAN DIEGO PIPwr. INE CO~PANXv. BOARD OF EQUALIZATION OF THE STATE OF CALIFORNIA, et al., LASC No. C 502532; SOUTHERN PACIFIC PIPE LINES, INC. v. BOARD OF QUALIZATION OF THE STATE OF CALIFORNIA, et al., LASC No. C 688460; and · SAN DIEGO PIPELINE COHPAN~v. BOARD OF EQUALIZATION OF THE STATE OF CALIFORNIA, et al.; LASC No. C 688463 Please be advised that the State Board of Equalization and Southern Pacific Pipe Lines, Inc and San Diego Pipeline Company have agreed to a settlement of ail but two issues in the above entitled cases. The settlement is as follows: 1. Southern Pacific Pipelines, Inc. assessed value will be reduced by the respective amounts for the following assessment years 1980 through 1986: ~ear Assessed Value (in thousands) 1980 120,000 1981 125,000 1982 135,000 1983 157,000 1984 234,000 1985 263,000 1986 · 360,000 1986 assessment. Added in 1987 19,620 Assessed Value Reduction '"i'in thousands ) 9,600 10,000 10,800 12,560 18,720 21,040 28,800 1,570 Mr. Kuyper August 25, 1988 Page Two 2. To the assessment reductions shatl be added a percentage amount of 6% per annum for assessment year 1980 and a percentage amount of 9% per annum for the remainder assessment years 1981 through 1986, which interest shall accrue to the date of payment or credit of the tax refund much in the same fashion as interest would be added to a tax refund made pursuant to Revenue and Taxation Code section 5150. 3. The basic assessment reduction, plus any reduction in lieu of interest shall be given as credits against the annual assessment of Southern Pacific Pipe Lines and San Diego Pipelines in the tax assessment year 1989-90. 4. A Stipulation and Proposed Order shall be entered'into by the parties that would accomplish the following: · . (a) All valuation issues described in paragraph 1 in paragraph 1 hereof would be dismissed from all pending lawsuits by plaintiffs SPPL and SDPC. (b) The lands and rights of way issue would remain in the cases recently filed. (c) The "tanks issue" for the years 1981-1982 and 1982-1983 wold be consolidated into the cases .recently filed. The five year rule wold be waived as to this tank issue for thos earlier years. (d) The two recently-filed cases would be consolidated. The only issues in the consolidated cases would be assessment of the tanks (1981-1982 and 1982-1983 from the first cases and 1983 - 86 for the second cases) and lands and rights of way. (e) The trial date of October 13, 1988 would be vacated. A stipulation will be prepared and presented to the trial judge at the conference or before the conference scheduled for September 19, 1988. It is anticipated that the trial will be continued because of the consolidation of all of the cases. I will keep you advised of further progress in the case. It is anticipated that the reduction and the allocation of next year's assessment will take place in July of 1989, which will include .both tax reduction and interest so that there will be no tax refund. Mr. Kuyper Augus= 25, 1988 Page Three Your acceptance and agproval of the settlement is resgec~fully requested. It will be grea=ly agprecia~ed if you would give ~his matter your 9romgt attention. Very ~ruly yours, JOHN K. VAN DE KAMP Depu=y At=orney General PCG/9=