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Pajaro Valley water officials conclude $11 million refund effort...

Donna Jones, Santa Cruz Sentinel

Pajaro Valley water officials conclude $11 million refund effort: 2007 court ruling forced repayment of fees

WATSONVILLE - A three-year effort to repay Pajaro Valley Water Management Agency ratepayers more than $11 million is over.

The agency refunded the final $1.27 million in fees collected between 2003 and 2007 in violation of state law this past week.

"This was a great effort on the part of many people, directors and staff to build the credibility of the agency in the course of very hard times," said Dennis Osmer, a member of the board of directors who spearheaded the refund process.

The refund stemmed for a 2007 court ruling that found the augmentation charges - a fee on pumping groundwater from private wells - violated Proposition 218, a state constitutional amendment that require voter approval of taxes.

The augmentation charges had been imposed by the board, and were the subject of several lawsuits.

The legal loss cost the agency $4 million annually, and the repayment requirement put a further strain on agency finances until a year ago when well owners approved a new fee. That charge is now being challenged in court.

General Manager Mary Bannister said refunding the money was complicated by the fact that the agency sent out more than 16,500 bills and, due to ranch leases and subleases, the person paying the bill who was due the refund wasn't always the person billed.

"The magnitude of this effort cannot be understated," Bannister said.

More than 3,500 refund checks were issued. But some larger ratepayers took credits instead of refunds, helping the agency stay in the black. They were Dobler & Sons, Ed Kelly/Colleen Strawberries, Larse Farms Inc., Monterey Bay Academy, Del Mar Foods, Scurich Brothers and Kitayama Brothers Nursery.

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