Judge rebuffs ethics panel

Local ex-officials can stay in impact fees class-action lawsuit filed against county

December 21, 2007|By Phillip McGowan | Phillip McGowan,Sun reporter

Two former county officials can stay in a multimillion-dollar lawsuit against the local government without sanctions, an Anne Arundel County Circuit Court judge ruled this week.

On Tuesday, Judge Paul F. Harris Jr. denied an injunction sought by the county Ethics Commission to oust former County Attorney Phillip F. Scheibe and Robert J. Dvorak, a former top administrator with the county, from a class-action lawsuit over impact fees.

Harris also refused a motion to levy fines against Scheibe and Dvorak of up to $1,000 a day since the start of the case in 2001 -- potentially more than $2 million apiece -- and to withhold attorney fees from Scheibe and witness fees from Dvorak.

The judge rejected the motions brought by Betsy K. Dawson, executive director of the Ethics Commission, in part on grounds that the panel waited years after the lawsuit against the county was brought in 2001 to claim a conflict of interest.

The ruling marks the latest turn of events surrounding a lawsuit that accuses the county of misspending millions in impact fees that developers paid for growth-related infrastructure.

Scheibe brought the case on behalf of a group of Odenton homeowners, and Dvorak has worked as a plaintiff's consultant.

Last December, the local government was ordered to pay $4.7 million plus interest to homeowners. The decision is on appeal.

The commission ruled last year that Scheibe and Dvorak had used inside knowledge of the impact fee program to try to make money by suing Anne Arundel after leaving their jobs in the late 1990s.

The state's highest court ruled in August that Scheibe and Dvorak had no right to appeal the ethics ruling.

But the ruling by the Court of Appeals was silent on whether the Ethics Commission had jurisdiction and whether county ethics rules that limit the work of former county employees should be applied indefinitely.

Christopher S. Rizek, chairman of the Ethics Commission, said that the rulings from Harris and the Court of Appeals "have validated our position on the merits but not on the remedy."

Harris' decision, Dawson said, "highlights the fact that the Ethics Commission can't enforce the law without the help of the court."

Scheibe and Dvorak reiterated their criticism this week that the ethics complaint is politically motivated and lacks merit. They called the actions of the Ethics Commission part of a broader attempt by the Anne Arundel government to crush the lawsuit by any means.

In 2004, then-County Executive Janet S. Owens issued a complaint against the two men, which led to the commission's later ruling.

Both have said that Owens sought to delay the resolution of the case until her term in office ended last year, an allegation that she long denied.

The men said they collected public records for the lawsuit, and they haven't relied on confidential information from their county employment.

Dvorak retired as chief administrative officer, the county's No. 2 position, in 1997, and Scheibe stepped down in 1999.

They accused county officials of seeking to destroy their reputations.

"It's maneuvering by a bunch of county officials that's out of control," Scheibe said. "They will do anything to keep these people from rightfully collecting their refunds."

The county began collecting impact fees in 1988 from developers. The fee is typically passed on to the homebuyer and must be spent on roads and other improvements necessitated by the new developments. Money left unspent after six years is supposed to be refunded to the property owner.

The lawsuit alleges that the county did not expand the capacity of public services or did not spend the money in time.

John R. Greiber Jr., an attorney working on the case with Scheibe, said the county could stand to owe $40 million, in part as interest builds because of county appeals.

Greiber called the legal action by the Ethics Commission "a blatant exercise of government power."

The commission is weighing whether to appeal Harris' decision, Rizek said.

Dvorak and Scheibe said an appeal would be pointless.

"She is wasting taxpayer money," Scheibe said of Dawson. "She's wasting her time and irritating ... me."

Dawson disagreed.

"The Ethics Commission was created to enforce the ethics laws," she said. "If that is a waste of taxpayers' money, what is the point of the Ethics Commission?"


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