Former officials help sue county

Class action suit alleges impact fees were misspent

homeowners seek refund

Anne Arundel

March 02, 2004|By Ryan Davis | Ryan Davis,SUN STAFF

As senior Anne Arundel County officials in the 1990s, Phillip F. Scheibe and Robert J. Dvorak were involved in high-level discussions about how to build roads and schools with millions of dollars in developer fees.

Scheibe, the county's attorney, advised top leaders on how the revenue from impact fees could be used. Dvorak, the planning director, signed a letter extending the deadline for spending the money.

Now they are leading a multimillion-dollar class action lawsuit that contends that the county misspent the money - even while the two were in power.

Scheibe, a private attorney, represents homeowners seeking more than $30 million in refunds. Dvorak, meanwhile, is digging through county records searching for missteps.

Although it is common for lawyers and planners to leave government for private practice, county leaders and watchdog groups question whether Scheibe and Dvorak's roles in the lawsuit are proper.

"We use the metaphor of a revolving door all the time," said James Browning, the executive director of Common Cause/Maryland, a government watchdog group. "This is like someone coming through that door, turning around, throwing a rock and shattering the glass."

County ethics laws prohibit former employees from representing anyone on matters in which they had substantial responsibility while with the county, and from using confidential information to assist others.

But the two former employees say they haven't done anything wrong, or even come close.

They say any discussions they had about the fees while employed by the county were unrelated to the issues raised in their lawsuit. They say they held high positions that did not directly oversee the use of impact fee revenues.

"If I had handled some matter that's the subject of this lawsuit, that would be a conflict of interest," Scheibe said. "There was never any matter that came across that had any relationship to any of the issues raised in this lawsuit."

They also point out that the county has filed neither a formal complaint against them nor a motion to dismiss them from the case. Without those, they said, complaints from the county are frivolous.

"They haven't been able to refute the numbers," Dvorak said, "so they're coming after the messengers."

Ties to fees

At issue are the impact fees and whether more than $30 million should be refunded to homeowners. The February 2001 lawsuit, Cambridge Commons vs. Anne Arundel County, bears the name of some homeowners from a planned community in Odenton, but Scheibe said he represents 25,000 homeowners whose houses were assessed impact fees.

The revenue spent was directed to projects such as schools and roads. But the lawsuit alleges that some money was not properly used to benefit those who paid it; that portable classrooms were not an acceptable impact fee expenditure; and that money was not spent during the allotted time.

The county began charging developers - and, indirectly, homeowners - for growth-related infrastructure in 1987. For a single-family home, the fee has increased over the years from $877 to more than $4,000.

After the fees were established, Dvorak held various county posts, including planning director from 1993 to 1994 and chief administrative officer from 1994 until his retirement in 1997. Scheibe served as county attorney from 1994 to 1999.

Four memorandums obtained by The Sun tie Scheibe and Dvorak to discussions about impact fees while in office.

The third player in the lawsuit is John R. Greiber Jr., Scheibe's law partner. Greiber advised former County Executive John G. Gary, but county records show that Greiber was never a county employee.

County officials are troubled by Dvorak and Scheibe's roles in the lawsuit.

"I was a trial lawyer for over 18 years, and there never was a time I would have represented a client and then turned around and sued that client later," said County Attorney Linda M. Schuett.

Dvorak said he is being paid by the hour for his work on the lawsuit. Scheibe declined to discuss his fee; contingency arrangements often provide lawyers with a large percentage of a settlement or verdict.

As a former employee, Dvorak is bound by the county's ethics law. If a former employee violates the policy, the county's Ethics Commission can seek a court-imposed fine of $1,000.

In part, the suit alleges that impact fee revenue was not spent in the six years as required by law. And when the spending time frame was extended, it was done so improperly, the suit says.

Attorneys questioned Dvorak during a hearing last year about the extension letter he signed in 1994. Dvorak responded that he had no recollection of writing the letter.

"It was basically a form letter that came out, and I was asked to sign it. I really didn't have any input on it," Dvorak recently told The Sun. He also said that the key issue is not the extension, but how the money was spent after the deadline was extended.

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