City agrees to $120,000 settlement in lawsuit over downtown PBID overcharges

City council agreed to end the lawsuit during an April 16 closed session meeting.

During a closed session meeting last week, San Diego city councilmembers approved the settlement offer from SCI Consulting for mistakes made in the engineer's report for the Downtown Property-based Business Improvement District.

The Orange County-based consultant will pay the City a total of $200,000 for the errant report that resulted in thousands of downtown property owners overpaying for their maintenance assessment district. The mistake is estimated to have cost those property owners over $300,000.

As agreed to in the settlement, the City must in turn pay SCI Consulting $79,577 in outstanding invoices, making the total settlement just over $120,000.

"The defendants will pay the City $200,000 in settlement of all claims. In exchange, the City will dismiss the action and pay SCI $79,577.37 for past invoices. The parties release and discharge each other from any and all claims except that the City reserves its rights to all other claims which may arise from certain agreements between the City and Schultz Consultants, Inc."

And although the numbers appear to show that the City took a hit in the deal, owing more in refunds than what they will receive from the settlement, that most likely is not the case.

So far, according Councilmember Todd Gloria's Office the City has received only 41 claims from downtown residents, amounting to a total payout of $14,585.74.

That small number is due to the lack of notice given to residents by the City of San Diego or the Downtown San Diego Partnership, the agency that manages the PBID. Many downtown residents, despite a few reports in the media, remain unaware of the issue.

But lack of notification isn't the only reason property owners are not receiving refunds. The City has also decided to enforce the 4-year statute of limitations for filing claims.

--http://www.sandiegoreader.com/news/2010/apr/21/city-light-2/" rel="nofollow">http://www.sandiegoreader.com/news/20...

--http://www.sandiegoreader.com/weblogs/news-ticker/2013/apr/14/settlement-reached-in-citys-lawsuit-over-downtown-/" rel="nofollow">http://www.sandiegoreader.com/weblogs...


There is another ongoing case, also moved to Orange county, between City and SCI, filed at the same time as the settled breach of contract case. This other case is a tort (for negligence). There is no settlement on the horizon for the tort. Should be interesting. Next hearing is June 18. The breach of contract settlement is small potatoes. The tort is a bigger deal.

I would like to know more about the tort case. Has an article been written on it?

I'm working on it, Nostalgic! I downloaded the case and am trying to wade through it all. I promise to get something up soon. Thanks!--dh

Log in to comment

Skip Ad