City Threatened With Lawsuit Over $20 Million in Port Funds
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State Atty. Gen. Dan Lungren has issued an ultimatum to city officials in a two-year feud over Los Angeles port revenues: return a $20-million payment made by the Harbor Department last year or face a lawsuit.
In a Feb. 15 letter to Michael Keeley, the city’s chief operating officer, Lungren and Chief Assistant Atty. Gen. Roderick E. Walston said the payment, which was deposited after a private study concluded that the port owed the city fees for municipal services provided on its property since 1977, violates state trust law.
“If the city insists on retaining trust revenues . . . for past services, we would have no recourse except to commence an action on behalf of the State Lands Commission and the people of California . . . to recover those revenues,” the state officials wrote.
Keeley said the city would “absolutely not” relinquish the money, but said upcoming meetings between city and state attorneys might still avert a legal showdown.
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