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June 03, 2005

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Publication Date: Friday, June 03, 2005

Court will hear parcel tax suit Court will hear parcel tax suit (June 03, 2005)

Saratoga lawyer says school and hospital bonds unfair

By Kathy Schrenk

The local hospital district and three South Bay school districts will have to keep fighting the lawsuits of landlord Aaron Katz after a decision by a Santa Clara County judge last week.

Katz, an attorney, sued the districts after voters in each one passed bond measures or parcel taxes. He owns land in the districts, but wasn't allowed to vote because he lives in Saratoga. He believes this is unfair, so he challenged the results of the elections in court.

Superior Court Judge Kevin McKenney found last week that the districts' motions to throw out the case weren't convincing, so Katz's cases will proceed.

This means trouble for the hospital district, said Jon Friedenberg, hospital vice president of resource development. About 70 percent of district voters passed Measure D in 2003, authorizing the hospital to issue $148 million in bonds to build a new, seismically safe campus.

The hospital has been planning to break ground on the new buildings in the fall, but that could change if the Katz suits aren't resolved.

And until the cases are resolved, it doesn't look there's anything that can be done legislatively to stop Katz, who has also filed suits against the Mountain View-Whisman School District, Campbell Union High School District and West Valley-Mission Community College District.

So far, Katz has followed the letter of the law, said State Assembly member Sally Lieber. "It leaves our districts in the position of hoping Katz won't be their neighbor."

"What's going on seems to fly in the face of what the very well-established legal precedence has been," Lieber said. "We have 'one person, one vote' and you vote in the jurisdiction in which you live. Mr. Katz has decided to buy property in other communities, and that's unfortunate for public education."

The next round of motions for Katz and the districts is scheduled to take place in Santa Clara Superior Court on Tuesday.

One of the districts' arguments was that Katz's suits were contesting elections, and therefore, according to state law, had to be filed within 30 days of the elections. McKenney found that Katz's action did not fall under the definition of "election contest," and so was not limited to the 30-day restriction.

Mountain View-Whisman officials have called the lawsuit "frivolous" and have already spent more than $50,000 in litigation fees.

If Katz succeeds, Mountain View-Whisman would be forced to reimburse taxpayers millions of dollars, which would be fiscally devastating to the cash-strapped district.

The school district's Measure J, a $1.6 million parcel tax, won with 70 percent of the vote in March 2004. It costs the average property owner $75 a year.

E-mail Kathy Schrenk at [email protected]

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