Developers’ Suit Claims School District Fees Too High

The Building Industry Assn. of Southern California on Wednesday filed suit against Saddleback Valley Unified School District, charging that officials are trying to collect nearly twice what the state allows in developer fees.

The lawsuit, filed in Orange County Superior Court, claims that district officials embarked on a “comprehensive scheme” to deny builders certificates of compliance--prerequisites for obtaining building permits--unless they pay fees higher than those allowed by state law.

Other plaintiffs include Baldwin Building Co. and Village Properties.

Baldwin had already agreed to pay more than the fee ceiling to obtain permits for 1,481 homes in Portola Hills. The suit seeks an injunction to prevent the district from seeking the same fees for an additional 800 homes planned nearby. If the district won’t comply, additional monetary damages will be sought, the lawsuit warns.

School district officials were taken aback by the suit.

“I have no idea what they’re talking about,” Asst. Supt. Robert Cornelius said. “I don’t know what their problem is. We’ve been working with them for months and years on building schools. This isn’t an adversary relationship.”

The Saddleback Valley Unified School District gains 1,000 students a year. To finance school construction, Cornelius said, “we either charge the developer fee or the full cost of the school that supports their development.”

He added: “We have not done anything illegal.”

School board member Raghu P. Mathur observed that the growing school district received “wonderful cooperation” from the Santa Margarita Co., developers of Rancho Santa Margarita, which is included in the school district.

“The community expects the same kind of cooperation from other developers in the area to house and educate the students generated from their developments,” Mathur said.

As a result of dwindling state money for education, the Legislature in 1986 approved a law allowing districts to charge developers $1.56 per square foot on residential construction and 26 cents per square foot on new commercial construction.

The Building Industry Assn. sued the Newport-Mesa Unified School District the following years, claiming the fees it imposed were not needed because its enrollment was declining.

A Superior Court judge ordered a $600,000 refund to local builders in that case. But the sum represented only a portion of the total $3 million collected for reconstruction projects, and the decision was considered only a partial victory for builders.

Meanwhile, school enrollment statewide is growing by 165,000 students a year, generating annual costs of $1.6 billion for adequate school facilities, said Dave Walrath, legislative consultant to the Coalition for Adequate School Housing, a statewide organization concerned with adequate funding for construction and maintenance of school facilities.

But the state, he said, “is out of money.”

The $800 million generated by bond issues approved in each of the 1988 June and November elections is already committed. “The need and demand are still there,” he said.

According to a statement issued by the Building Industry Assn., the powerful developer group “has always been supportive of statewide efforts to achieve a broad-based solution to the current financial crisis which many school districts face.”

But it added, “the development community should not be forced to bear the entire burden of financing public education.”