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City Lacks Insurance for Jury Award

August 11, 1994|RICHARD WINTON | SPECIAL TO THE TIMES

South Pasadena officials say the city has no insurance policy to cover a jury's award of $1.2 million to former Mayor Lee Prentiss and will be forced to use reserves and cut services unless the huge verdict is overturned.

A Pasadena Superior Court jury two weeks ago decided that city officials violated Prentiss' civil rights in 1990 by conspiring--for political reasons--to revoke a building permit to expand his 86-year-old home. It awarded him $1.06 million for actual damages and $150,000 for emotional distress.

South Pasadena is self-insured through an organization formed by Southern California cities known as the Joint Powers Independent Authority. To the surprise of city officials, the authority denied South Pasadena's claim to cover part of the jury award, saying it does not pay out on civil rights lawsuits.

"If the verdict stands, the citizens are going to pay with some major cutbacks in city services," said Chuck Conn, assistant city manager who is running the municipality while City Manager Ken Farfsing is on vacation.

"We would be forced to cut the softer items such as library, the recreation programs and the senior center and, of course, personnel," said Conn, who added that his job may be among the first to be cut.

The city would pay the award with a large chunk of its $2.7 million in reserves that cover emergencies and purchases of new equipment such as police cars and firetrucks. Conn said that money would then have to be replaced through cuts in services and personnel.

The city's general fund budget is $10.6 million this fiscal year. Mayor Amedee O. Richards said no decision has been made on whether to appeal the verdict or seek a retrial, since Judge J. Michael Byrne is still reviewing the jury's July 29 decision and could cut the award.

But a challenge is likely if the award remains high. In April, residents approved a special tax to generate $234,000 annually to keep the library open. But that amount could be smaller than Prentiss' attorney fees which the city will now have to pay in addition to the award, said city officials. The city itself has spent more than $300,000 fighting the case.

At last Wednesday's council meeting, many residents urged the council to drop the matter. "You have been . . . told that you're wrong," said resident Mary Wirth. "I am shocked and amazed that the city is so pigheaded."

Speakers said the case should have been settled out of court before the award. On Sunday, a group of residents calling for a recall of the council will hold a meeting in Garfield Park.

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