County Offers to End Sewer Assessments : Environment: The city also says foreclosures against homeowners who refused to pay the levies would be delayed. Negotiations that could resolve the long dispute are continuing.

The Los Angeles County government, apparently seeking to end its years of warfare with Malibu residents over a proposed sewer system that most residents oppose, offered this week to stop all special sewer assessments in Malibu and to delay foreclosure proceedings against property owners who have refused to pay taxes to finance the project.

Malibu city officials, who disclosed the county’s offer, expressed amazement at the turnabout and said they hoped that the long wrangle over the sewer project might finally be winding down.

The county’s offer was presented by Deputy Public Works Director Harry Stone and a county lawyer in a meeting Tuesday with Mayor Walt Keller, City Atty. Michael Jenkins and acting City Manager Mark Lorimer.

According to Keller, Stone said the county would rescind a Sunday deadline for property owners in the sewer assessment district--which includes much of eastern Malibu--to pay their delinquent sewer taxes or face foreclosure.

Keller said Stone also proposed an end to further sewer tax assessments for the 2,200 commercial and residential property owners paying into the Malibu Sewer Special Assessment district since 1989.

Citing continuing negotiations, Stone declined Wednesday to confirm the offer, except to say the county would delay foreclosure proceedings against delinquent property owners until after a Feb. 10 meeting with city officials.

Stone also declined to say how the county would repay the bondholders for the ill-fated project if Malibu residents were released from the assessment district.

The sewer battle was a central issue in Malibu’s long fight to break away from county control. The coastal community was finally incorporated as a city in 1991.

County officials contended that the sewer system was necessary because pollution from leaking septic tanks was creating a health threat. Many residents, however, opposed the project as too big and too expensive and said it would foster widespread development.

As part of a deal in which the supervisors dropped their opposition to Malibu’s incorporation, community leaders agreed in early 1991 to come up with their own alternative to the county’s sewer plan. As part of that truce, the county agreed to halt its attempts to win the California Coastal Commission’s final approval of the sewer system.

The city and county have been negotiating since summer on the terms for scuttling the county project, but the county has continued to collect assessments from east Malibu property owners. To date, nearly $11 million has been paid by owners into the assessment district, with an annual charge of $890 to $1,300 for a typical single-family home.

The county estimates that by the time the project is shelved, it will have paid nearly $11 million for engineering, legal and other fees for the project, even though not a shovel has been lifted to build it.

Keller told a group of about 30 residents protesting the continued assessments at Monday’s council meeting that two things were not negotiable: The assessments on the 20-year bond issue must stop, and the county must refund more than $250,000 of the assessment money it spent in legal fees fighting Malibu cityhood.

Apparently, yet to be resolved is whether the residents can recoup much--or any--of the $11 million they have already paid in taxes. At Monday’s meeting, residents expressed a range of opinions about what they considered acceptable. Some were willing to write off what they had paid if assessments were stopped, and others wanted their money back with interest.

Keller said that he would brief the City Council in closed session Tuesday and that negotiations with the county would continue Feb. 10. He said he hopes that the county will continue to delay foreclosure proceedings beyond Feb. 10 while negotiations are in progress.

The county is requiring the city to come up with its own waste-water treatment plan in lieu of the county project and to accept liability for future claims that result from the county’s inability to install its $43-million sewer system.

“I have some reservations (about the county’s latest offer) and want to know how the community feels about it,” Keller said.

Councilman Jeff Kramer said the offer to stop assessments is “certainly a significant step in the right direction. It shouldn’t be minimized.”

Kramer said the county’s offer to delay foreclosure proceedings should also “ease the concerns of those facing foreclosures. The county should know that (foreclosure proceedings) will simply provoke a lawsuit. We can’t sit and negotiate with the county on the one hand while the county is foreclosing on those in the assessment district.”

Assessment protesters at Monday night’s council meeting agreed. The group criticized the council for the slow pace of the negotiations and threatened to take matters into its own hands with a lawsuit against the county if city negotiators failed to halt foreclosure proceedings against 143 residents.

A group of residents calling themselves Malibu Unfair Sewer Tax (MUST) said they had collected 400 signatures in four days on a petition that called for assessments and foreclosure proceedings to stop pending negotiations, for the county to stop spending any more money for the project, and for a refund of all assessments.

Some residents expressed continuing skepticism about the sincerity of the county’s offer. Ollie Dwiggins, a retired widow who owes more than $1,600 in assessments and penalties, said Wednesday, “I feel very strongly this a ploy to diffuse the issues.”

The county is not dropping the foreclosures, only delaying them pending negotiations, she said. “I’m still in the same predicament I was. They’re punishing me with foreclosure because I’ve said I will not pay for something that never will be.”

Resident Dan Hillman said he too was concerned that the foreclosure proceedings were being merely delayed. “The apparent victories are very incomplete,” he said. “It may mean we may need to sue and get an injunction.”

Of the 143 property owners who had received notices warning them to pay more than $670,000 in back taxes, 11 have paid, Councilwoman Carolyn Van Horn said.

The letters warned that the county was obligated to its sewer bondholders to begin foreclosure proceedings unless the delinquent taxes were paid.

To implement the proceedings, the county Board of Supervisors would have to approve a resolution to proceed with foreclosures, and then hire an outside law firm to begin judicial proceedings to foreclose, Van Horn said.