Judge: Beaumont Engaged in Pattern of Deception; Must Pay $42 Million Plus Interest

Riverside, CA – May 27, 2014 – Orange County Superior Court Judge Hon. David Chaffee on Thursday, May 22, 2014, rendered his decision in the Western Riverside Council of Governments’ (WRCOG) case against the City of Beaumont (Case No. 30-2010-00357976).  The Court found that the City had failed to comply with the Transportation Uniform Mitigation Fee (TUMF) Program administered by WRCOG.  The TUMF Program is a region-wide transportation mitigation fee program that the City joined in 2003 along with the County and all other cities in Western Riverside County.  

After evaluating the evidence and arguments presented at trial the Superior Court, in a strongly worded decision, found that the City had misdirected funds which had been intended for the TUMF Program and he ordered the City of Beaumont to pay WRCOG more than $42 Million, plus interest, for the City’s failure to remit TUMF revenues to WRCOG.  These funds represented revenues that the city was required to, but did not, make available to WRCOG for regional transportation projects since 2005.

In the official Court transcript of the Judge’s ruling, released today, the Court also found that “... in no instance did the city’s claimed construction of transportation improvements satisfy the TUMF requirements to add true roadway capacity.  If anything, the evidence shows poor local transportation planning and execution…”  The court further stated that “The evidence and testimony reveals that city management and staff engaged in a pattern and practice of deception that transcends the typical give and take of dispute negotiation.  Had this been a typical civil trial containing allegations of fraud, I would have found fraud by clear and convincing evidence as against the city.”

The Court directed Beaumont to remit TUMF funds commensurate with the fees it had committed to remit from the time period of 2005 through 2009, a total amount of $42,994,879, plus interest, to be calculated from 2009 to the present.

WRCOG filed suit against Beaumont in 2009 after years of discussions and negotiations failed to result in a settlement.  Of primary concern was the City’s failure to provide WRCOG with adequate documentation supporting the City’s compliance with the TUMF Program which justified the City’s failure to remit funds to WRCOG.  The City of Beaumont’s actions stood in stark contrast with all of the other TUMF member agencies. 

WRCOG believes that the Court’s verdict is a victory not only for the TUMF Program, but for the regional programs that bring together local governments to work towards region-wide solutions to common issues.

The transcript of the court’s decision is attached.

About WRCOG

WRCOG is a joint powers authority, consisting of the County of Riverside, 17 cities, two regional water districts, the Riverside County Superintendent of Schools, and the Morongo Band of Mission Indians.  Its actions and activities are guided by its members.  Recognizing that issues related to growth are not constrained by city or county boundaries, WRCOG focuses on a number of regional matters important to the future of Western Riverside County.  By working together through its committee structure and utilizing existing resources, WRCOG is cost-effective by reducing duplication of effort and sharing information, enabling strong advocacy and strengthening Western Riverside County’s standing in southern California and the State.  WRCOG’s program areas are varied and range from transportation to air quality, solid waste, environment, energy, economy, sustainability, and growth.  For more information about WRCOG please visit www.wrcog.cog.ca.us.