PEORIA, Ariz. (Nov. 22, 2010) – An independent hearing officer
considering an appeal from the Desert Harbor Homeowners Association regarding
Peoria’s water charges for the subdivision’s signature lake has ruled in favor
of the city.
On Nov. 17, Hearing Officer Harold Merkow issued his final written decision
that Desert Harbor owes the city $800,000. His ruling followed two days of
hearings and extensive written briefings.
“Obviously, the city is pleased with the outcome of these hearings,” said
City Manager Carl Swenson.
In April 2008, Desert Harbor stopped paying for water necessary to keep its
lake filled. When the homeowners’ association was informed that water delivery
would stop if payments were not made, it filed an appeal.
The hearing officer determined that the water rate was established in a
series of agreements between Desert Harbor and the city. In 1982, the developer
of Desert Harbor deeded a well on the property to the city in return for a
25-year reduced rate for water. Desert Harbor and the city amended the original
agreement in 1994 and again in 2005 to address a variety of development issues.
In 2005, as the expiration of the reduced rate approached, Desert Harbor
asked for additional time to plan and budget for the higher rate. To assist in
the HOA’s transition and as part of a resolution of many issues, the city
extended the reduced rate an additional eight months. The hearing officer found
that since Jan. 1, 2008, Desert Harbor has been obligated to pay the same rate
as other city customers.
The independent hearing officer was appointed pursuant to the Peoria City
Code. The decision is final for purposes of administrative review, although
Desert Harbor may challenge it in court.