Cities Along Alameda Corridor Get Windfall

In most civil lawsuits, the losers do not end up getting a bundle of cash from the winner.

But that is exactly what happened when a group of small cities along the route of the Alameda Corridor rail line sued the public agency in charge of building the $2.4-billion project.

The cities of Compton, Lynwood, Vernon and South Gate lost a 1996 suit that sought a larger voice in governing the project. Despite the loss, today those cities and two other towns along the route, Huntington Park and Carson, are enjoying a $12-million settlement paid by the winner of the suit: the Alameda Corridor Transportation Authority.

The unexpected windfall is paying for some long-needed projects, such as new parks and traffic improvements. Some cities have yet to decide what to do with the cash.

Alameda Corridor officials defend the payout, noting that in exchange for the cash, the six cities along the route have promised not to delay construction of the project with any lawsuits or other legal challenges in the future.

“In my opinion, it was necessary and very prudent,” said Joe Burton, general counsel of the Alameda Corridor Transportation Authority.

Huntington Park and Carson did not sue the authority, but Burton said agency officials decided to reach a settlement with those cities to preempt future lawsuits.

The strategy has appeared to work so far. The massive project is on schedule and on budget for completion in April 2002.

The Alameda Corridor is envisioned as a 20-mile rail line stretching between the bustling harbor and rail yards near downtown Los Angeles. It is intended to dramatically reduce the time it takes to ship cargo from the port to the rail yards, where the shipments can be sent across the country.

Half of the corridor runs along a trench that cuts through the six cities receiving the settlements.

Compton is getting the biggest share, $3 million, because the largest portion of the corridor trench cuts through that community. The city of Carson is getting the least, $1 million, while Vernon, Huntington Park, Lynwood and South Gate are getting $2 million each.

Compton and Huntington Park officials have deposited their share into their city general funds to help defray the loss of tax revenues from businesses along the corridor during construction.

Carson city officials say they haven’t spent the money but have a tentative plan to use it to build a sound wall to protect residents near the corridor from the din of the trains and street traffic.

In Vernon, where city officials have long been frustrated by traffic snarls at the Bandini Boulevard onramp to the Long Beach Freeway, the money is slated to help pay for traffic improvements, such as added street lanes, said city spokesman Mike Gagan.

Lynwood is using its settlement share to pay for extra Los Angeles County sheriff’s deputies to monitor the trucks hauling dirt from the project site to ensure that the drivers stick to designated truck routes, Lynwood City Manager Ralph Davis said.

In South Gate, city officials hope that the settlement will help pay for a new 32-acre park along Southern Avenue in a densely populated neighborhood where open space is scarce, South Gate City Manager Andrew Pasmant said.

“Without the money to balance our budget, we would not be able to afford this,” he said. “It makes things possible in the city.”

The Alameda Corridor project is funded by the sale of revenue bonds, a $400-million federal loan, a $400-million grant from the county’s two ports and $347 million from the Metropolitan Transportation Authority.

In 1996, South Gate, Lynwood, Compton and Vernon sued the authority, alleging that they were locked out of important financial decisions made primarily by the cities of Long Beach and Los Angeles.

But in 1997, a three-judge appellate panel dismissed the lawsuit, saying Long Beach and Los Angeles created the agency’s joint-powers authority and the other members do not have the power to reorganize the agency’s structure. The state Supreme Court allowed that decision to stand.

In a separate lawsuit, Lynwood challenged the adequacy of the project’s environmental impact report. But a U.S. district judge dismissed the lawsuit.

The agreements required each city to “support the timely construction of the project” and give up the right to sue or challenge the project. The cities also gave up the right to claim revenue losses caused by construction of the corridor.

The transportation authority agreed to pay the money in three annual installments without restrictions on how the funds are spent.

Private individuals and businesses can still sue the transportation authority.

“It was a bona fide, good-faith effort to resolve issues,” Burton said of the settlements.