Castlewood homeowners sue county over $1.4M loan obligation amid financial strife

Contending that the Alameda County Board of Supervisors failed to follow procedures mandated in Proposition 218, the Castlewood Homeowners Association filed suit against the county on Dec. 3.

Bạn đang xem: Castlewood homeowners sue county over $1.4M loan obligation amid financial strife

Association president Rick Hammel said their attorneys advised filing the legal action to retain that option in negotiating with county officials. The association is fighting a $1.4 million loan from the general fund that the supervisors approved and obligated the association to repay. That amounts to about $6,000 per homeowner for water services. Unless the supervisors reverse the loan by a 4/5^th vote or the association prevails in court, the obligation will remain with the association.

The supervisors voted unanimously Oct. 3 to approve the action despite no Proposition 218 procedures. It had 60 days to follow that process after the vote and Hammel said they’ve heard nothing from the county.

The process includes notifying homeowners of the proposed loan and, if 55% object, it cannot move forward.  He said he hates litigation, but sees no other option at this time given the county’s performance and attitude.

The county operates a service area providing water, sewer and road repairs to the historic neighborhood located west of Foothill Road at Castlewood Drive. The county club dates to 1924 and was originally the summer residence of Phoebe Apperson Hearst. She and her guests would ride the train around the south end of the San Francisco Bay and through Niles Canyon to a station near where the pedestrian Verona Bridge stands today.

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She owned the Spring Valley Water Co. that was sold to the city and county of San Francisco. Those wells provide water to the homeowners and the country club to this day.

Association members are already smarting from a huge increase in their water rates assessed by the county. Rates went up 172% year-over-year so homeowners are paying $338 for 330 units per year. City of Pleasanton rates, even after this year’s hefty increases, are $180 while Dublin San Ramon Services District clients pay $169 and Fremont area users pay $168.

Association members have been digging into the finances and trying to figure out how the shortfall came about and said the county has been less than forthcoming with financial numbers. The discrepancy between what the association believes was a $600,000 balance in its account and the county’s demand for $1.4 million is nearly $2 million. There’s about $500,000 unaccounted for in their numbers.

Hammel and Mike Mitchell, one of the members digging into the finances, believe the issues stem from the protracted and mismanaged project to replace the original redwood storage tanks above the country club with new stainless steel tanks.

The legal action is one challenge of several the board and members are facing. The county public works department leadership has made no secret of its desire for Castlewood to go away. Two supervisors, David Haubert and Nate Miley, have represented the area and are familiar with the issues (Haubert’s district was extended to cover Castlewood after Miley’s district included it in the prior district lines). Even if they are on the same page, it takes one more vote to win at the supervisors.

Association leaders would like the county to fully fund the area from property tax revenues in addition to the assessments. That could allow setting up of a self-governing agency with a directly elected governing board. Supervisors would ultimately still have the final say.

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They could also pursue an annexation or association with the city of Pleasanton. Given its financial challenges, Pleasanton officials are unlikely to welcome Castlewood without revenue flowing into its coffers.

When association members met in September, the board told them that it would be a multi-year process and whatever decision would have to be approved by the membership.

They both believe the new operating contractor, Bracewell Engineering, is effective, but strapped by county directives. The association is paying $8,000 monthly to rent generators, but they are not connected to the water system so must be started manually after an employee is summoned to do it.  

By the county’s instruction, the association cannot alert Bracewell — it takes a homeowner calling on their own. There should be both an alarm and an automated starter on the generators so the water flow through the pumps is maintained, they said. They said during the fires that threatened houses and the club, one tank was dry during the installation and the other went dry leaving no water for the firefighters. That’s a matter of great concern.

They also pointed out that contrary to some opinions, about one-third of the residents have lived there for 20 or more years and are living on fixed incomes. Membership in the country club, which used to include most of the households, has declined to about half. Membership is not required to live in the neighborhood.

The Weekly did not receive a response from the county counsel’s office after being referred by public works.

Editor’s note: Journalist Tim Hunt is a freelancer for the Pleasanton Weekly. Hunt and his family live in the Castlewood area.