Placentia Ca

A soon-to-be-released Caltrans audit will assert that Placentia improperly spent as much as $36 million in state funds to pay for an ambitious rail-corridor project that drove the tiny north Orange County city to the brink of bankruptcy, state and municipal officials said Wednesday.

Placentia officials vowed Friday to fight claims by Caltrans that the small north Orange County city owes the state more than $36 million. The money was spent for a controversial rail corridor project that devastated the town's finances. "Our understanding of the contract is that the state has no legal right to ask for money back unless there is an erroneous or mistaken payment," Mayor Scott Nelson said during a news conference at City Hall.

A state appellate court has dismissed a conflict-of-interest charge against former Placentia City Manager Robert D'Amato, a central figure in the town's controversial OnTrac rail project that was shelved in 2006. The 4th District Court of Appeal in Santa Ana threw out the felony charge on the grounds that D'Amato did not stand to gain financially from an OnTrac management contract awarded by the city to Christopher Becker, Placentia's public works director at the time and a friend of D'Amato.

Grossly incompetent bookkeeping that plagued the failed OnTrac rail project is making it difficult for Placentia officials to determine the financial health of the city, the new finance director for the city said Wednesday. Although Terrence Beaman said he had found no indication of accounting fraud by former or current officials, his downbeat assessment only underscored the city's difficult situation. Placentia is about $30 million in debt and faces a $2.

Caltrans is auditing $36 million in state funds given to Placentia's controversial OnTrac project -- the troubled rail plan that has pushed the northern Orange County city to the brink of bankruptcy. Department officials said they were reviewing OnTrac's funding to determine if it was properly spent. They declined to comment in detail, saying it was Caltrans policy not to discuss ongoing audits. The inquiry began in 2005. "They are looking at the whole thing," said City Councilman Russell J.

It's been a rough few years in Placentia, an old railroad town that dreamed of carving out trenches for the trains to eliminate the need for engineers to sound their horns as they rolled through town. After $55 million spent and a near municipal bankruptcy, the trench plans withered and died and two former city leaders were indicted on criminal charges. Now there's some good news around the bend.

For 13 years, police detectives suspected that two cousins were responsible for Placentia's No. 1 murder mystery, the slashing death of a promising Cal State Fullerton student. But each frustrated investigators by providing the other with an alibi. The physical evidence was never enough to tie them to the crime, and one of the men dismissed the police department's focus on him as a "waste of my time."

Already at the brink of bankruptcy, Placentia may now owe Caltrans millions for the improper use of funds allocated to an ill-fated plan to improve rail corridors. A multimillion-dollar assessment could be a crippling blow to a city that has already gone $6 million in debt because of the failed $650-million project.

An 89-year-old woman was killed Sunday in a hit-and-run accident by a driver pulling out of a church parking lot, police said. Jessie Ruth Pound of Placentia was taken to Placentia Linda Hospital, where she died at 9:42 a.m., about half an hour after the accident. Pound was run over while crossing a driveway at St. Joseph Catholic Church on Bradford Avenue. A witness described the driver of the white sedan as a woman in her 70s or 80s with curly brown hair who then headed south on Bradford.

Orange County's largest transportation agency agreed Monday to pay $200,000 to help fund a rail improvement project in Placentia but rejected the cash-strapped city's request that it actually take over the project. Placentia asked the Orange County Transportation Authority to take the lead in the project, which began six years ago but has advanced slowly. The work -- which is expected to result in the silencing of train horns -- involves improvements to eight street crossings.