Ross Valley Sanitary District agrees to pay $4.75 million legal settlement
Richard Halstead
Marin Independent Journal
03/31/2011
The Ross Valley Sanitary District has agreed to pay a developer $4.75 million to settle a lawsuit stemming from an aborted development plan for 9.5 acres near the Larkspur Landing ferry terminal.
Campus St. James Larkspur LLC entered into an option to buy the property at 2000 Larkspur Landing Circle from the district in 1999 and began preparing to develop it. Campus planned to build 126 condominiums and townhouses, a 100-room hotel and a new headquarters for the district at the site. The district expected to get paid about $12 million in the deal.
But Campus halted development plans and sued the district for $15 million in early fall 2009. In its suit filed in Marin Superior Court, Campus asserted that the sanitary district contaminated the property — the site of a former wastewater treatment plant — with the hazardous PCBs, or polychlorinated biphenyls, while conducting demolition and grading operations.
In a press release posted on its website, the district states, "After extensive mediation, a settlement was reached which ends the litigation, and returns the property to the sewer district in exchange for three annual payments of approximately $1,583,334."
The press release quotes Marcia Johnson, president of the district's board of directors, as saying, "In considering the best approach to handling the suit, part of the process was considering the value of the asset. We believe this piece of property is worth
significantly more than its original sale price even when factoring in the downturn in the economy and our legal costs. Ross Valley ratepayers stand to benefit from our decisions."
Neither Johnson nor Brett Richards, the district's general manager, responded to requests for further comment.
Michael Hooper of Larkspur, a principal in Campus Properties, said the settlement agreement prevented him from commenting.
The district last week sued JMB Construction Inc., a South San Francisco-based construction company, claiming that JMB damaged one of its old sewage lines while installing a new line, causing two massive sewage spills in December. The district is seeking at least $650,000 in damages.
Marin Supervisor Hal Brown late last year asked the county counsel to look into the sanitary district's finances after several Ross Valley town officials expressed concerns about the district's management.
In his report, County Counsel Patrick Faulkner compared the amount the Ross Valley district had budgeted for general legal services that year, $204,000, to the general legal service charges budgeted by the Central Marin Sanitation Agency, $17,500, and the San Rafael Sanitation District, $15,268. Faulkner found that the district was spending nearly 94 percent more. That comparison did not include another $1 million budgeted for Ross Valley Sanitary District's legal expenses in connection with the Campus suit.
