December 14, 2005

Laguna Beach OKs tax to dig out from landslide

By Tori Richards

LAGUNA BEACH, California (Reuters) - Voters in Laguna
Beach, California, have approved a half-cent sales tax to
repair city infrastructure ruined by a massive landslide in
June that destroyed a neighborhood perched on a cliff with
Pacific Ocean views, according to election results posted on

The landslide marked Orange County's worst natural disaster
this year, forcing hundreds of Laguna Beach residents to flee
for their lives as waterlogged ground gave way.

National media descended on the seaside town, known as an
artists' colony, to report on multimillion dollar homes
dangling on a cliff for weeks.

Torrential rains and flooding caused a populated hill and a
dozen homes to collapse onto a street below, and another 10
homes in the slide area were damaged and deemed uninhabitable.

The new tax was approved by 55.7 percent of the voters in a
special election on Tuesday. Effective July 1, 2006, Laguna
Beach's sales tax rate will be 8.25 percent, the highest in
Orange County and equal to the sales-tax rate in neighboring
Los Angeles County.

Landslide cleanup and ground stabilization costs are
estimated at $15 million, a huge bill for the Southern
California town with a population of 24,000. U.S. Sen. Dianne
Feinstein secured $7 million in federal funds after the Federal
Emergency Management Agency had initially declined to help.

Without a tax increase, the Laguna Beach city council would
be forced to make unpopular spending cuts to police and
life-guard services. One money-saving option included selling
city land used by the Girl Scouts.

"Council members are not anxious to raise taxes -- three of
them are up for re-election in November," said City Manager
Kenneth Frank. "If we had a decent option, we would do it. We
gave the community a list of projects we would have to curtail
if the tax wasn't an option. People want a high level of
service and they're willing to pay for it."

New revenue will not be used to help residents rebuild
homes and about $3 million will replenish a disaster fund
depleted by expenses related to the landslide. Laguna Beach has
battled landslides, floods and fires over the years.

Displaced residents have agreed not to sue the city in
exchange for having the city shore up their hillside and
install storm drains. Existing homes should be habitable within
six months and rebuilt homes within a year.

"I actually feel pretty safe -- that hill is engineered in
a way that it would never slide again," said Todd MacCallum,
who fled the neighborhood as another home crashed into his.

(Reporting by Tori Richards in Laguna Beach, California)