Attorneys in a class action suit sent notices this week to some 2,470 residents and businesses that may be entitled to refunds of new-development impact fees paid to the Washington County Water Conservancy District (WCWCD).
According to the class administrator, Craig Call of Anderson Call & Wilkinson, the notices explain a class action lawsuit against the WCWCD over impact fees assessed by WCWCD and paid by anyone who received a homebuilding permit or residential subdivision approval beginning in August 2012 through December 2017.
“For more than five years, the WCWCD collected some $70 million in fees ostensibly to offset the cost of providing water to new residences,” Call stated. “While those challenging the fees agree they should pay for the cost of providing water for new homes they built, they claim the fees were excessive.” Call stated that the plaintiffs’ claim for a refund is fully supported by thorough and informed opinions of experts in the field.
The action alleges that according to WCWCD’s own documents, a new home required less than half the volume of water that new houses were required to pay during that time. The suit also claims that unlike businesses, which were charged based on their actual historical water demands, new homes were charged based on a formula that far exceeded historical demand.
Finally, the class plaintiffs allege that in May 2006, based in large part on the efforts of the WCWCD and others, Utah lawmakers adopted the Lake Powell Pipeline Development Act (LPPDA) under which the State of Utah was to pay for, construct, own, operate, and maintain the Lake Powell pipeline. Even though the LPPDA went into effect in May 2006, by the beginning of 2007, the WCWCD began charging fees to folks building homes and subdivisions not only for the estimated cost of buying the necessary property rights and the cost of construction of the Lake Powell pipeline, but also for interest on bonds that, according to the LPPDA, would be issued by the state, not the WCWCD.
The suit, filed in 2013, argues that the WCWCD would not need to begin paying the state for water from the Lake Powell pipeline until it was completed and flowing water to users and, even then, could pay back the cost over 50 years. As of today, ground has not been broken on the pipeline.
“To be clear, the class plaintiffs are not against paying their share of the impact their homes and developments had on the WCWCD’s ability to provide water – far from it,” Call stated. “They just want to pay the actual cost required to deliver water based on realistic numbers. In fact, they are not suing the WCWCD over the fees collected today. The WCWCD’s board changed the way they calculate the impact fees beginning in January 2018 and now – perhaps in part because of this case.”
According to its 2021 financial statements, at the end of 2021, the WCWCD reported $239 million in cash on hand.
In 2021, the court ordered that the plaintiffs’ lawsuit be maintained as a class action. Notices sent this week advise those who potentially might be entitled to refunds of impact fees paid.
Currently, the class action is on hold because the WCWCD filed an appeal with the Utah Court of Appeals after the local judge appointed a special master to expedite the case. According to Call, the judge appointed a special master—who was agreed to by the WCWCD—to, among other things, speed up resolution of this refund suit. Call says the move would originally have likely resulted in a trial by the end of 2022. But, because of the appeal, that has not been the case. Ironically, in its appeal, the WCWCD claimed the appointment of a special master would take too long and cost too much.
The named plaintiffs and class are represented by three law firms: Kirton McConkie, Anderson Call & Wilkinson, and Checketts Law. In 2017, the attorneys representing the class in this suit against the WCWCD successfully resolved a similar impact fee dispute with another improvement district resulting in a refund of more than $33 million to individuals and entities who overpaid impact fees, as allegedly occurred here.
More details for potential class members and contact information can be found at https://impactfeeclassaction.com.
