The case between the school teacher who owned land in Hesperia [CA] and the city that tried to foreclose on her was settled Monday.
Ellen Zunino owned a 10-acre parcel of land in what is referred to as the "Golden Triangle" area of Hesperia that increased dramatically in assessed valuation, but she said she was unable to pay the assessment.
Under the terms of the settlement agreement, Zunino gave the land to the city without a foreclosure — something she did not want against her name, she said.
She was also paid a financial consideration of less than the real market value of the property, she said.
Before the city established an improvement district in the area — west of Interstate 15 and south of Avenal Street — Zunino's land had an assessed value of $9,800. After the city made some improvements, the city assessed the value of her land at $4.3 million and Zunino was required to pay a $1.2 million assessment on the property.
The city borrowed more than $21 million using the Golden Triangle properties as collateral on borrowed money and spread the burden over the parcels, based on improvements.
Zunino said she tried at one point to sell her land to pay for the assessments but found out it wasn't worth enough.
Facing foreclosure by the city for her inability to pay the steep assessment, Zunino hired attorney Marjorie Mikels, who filed a countersuit against the city of Hesperia for fraud and violation of the Fifth Amendment to the U.S. Constitution.
The Fifth Amendment stipulates that a government cannot take private property without just compension. Zunino's suit maintained that the city's large assessments constitute away of taking her property without just compensation.
"The city placed huge assessment liens on the property (that) no reasonable person could afford to pay," Mikels said.
Mikels found a number of property owners in the area who were also being foreclosed on under similar circumstances, she said.
"It's outrageous," Mikels said. "I think we're the only ones who came back with (a countersuit) for fraud charges and the Fifth Amendment."
The fraud claim against the city refers to the alleged unusually high valuation of the property by the city and to the percentage of property owners who protested the district, she said.
The city was supposed to give the property owners 30 days to protest establishment of the proposed improvement district, Zunino said.
Mikels said the 30 days did not apply if 50 percent of the property owners filed protests, unless the matter was overridden by a four-fifth's vote of the City Council. Mikels said the council vote was only three-fifths and that initially there was a 70 percent protest by property owners to establishment of the district.
Mark Devey represented the city of Hesperia in the case. Devey said he had no comments.
Zunino said other cities are trying to do similar things to others, and she refused to sign a confidentiality agreement to not discuss the case with anyone.
"There is not a better time to make people aware of what cities are doing to them," she said, adding that she plans to write articles and essays about eminent domain.
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