CANYONVILLE, OR, Oct. 5, 2012 -- After 15 months of legal dispute, the city government of Canyonville has agreed to pay Canyonville Christian Academy (CCA) $40,000 to resolve issues related to overcharges for water and sewer services. CCA has announced it will use half of the money to pay lawyers and donate the other half to a scholarship fund to help youth in need.
Federal Judge Michael Hogan reached a mediation on Sept. 10, in Eugene, Ore. The agreement becomes final after ratification by the city council and the Canyonville Christian Academy board of directors.
Going back more than 30 years, the city had charged the Christian school and other non-property tax-paying entities double water rates based solely on their tax-exempt status.
Other groups affected included a public school, seven churches, a museum, Masonic temple and two commercial properties owned by a Native American Indian tribe.
All churches and schools were also charged a sewer line surcharge in a city ordinance that stated the fee was "in lieu of taxes."
In addition to the $40,000 paid to CCA, the city earlier paid settlements that totaled $23,469 to other entities that were less effected by the policy. The city council has also replaced the two city ordinances that contained the discriminatory provisions.
Representatives for the city government continue to assert that the inequitable treatment of schools, churches and others is a legitimate way for the city to raise funds.
Other provisions of the mediation affect how various buildings will be billed for water and sewer services. Also, the reclassification of the school's three dorms that had been done by a city ordinance in April 2012 was reaffirmed, but some details amended. The new ordinance determined that henceforth each CCA dorm room, with no water or sewer connection, would be charged the same as any apartment or condominium regardless of how many bathrooms it may have. The boarding school contended that this was an unreasonable retaliatory action by the city designed to punish Canyonville Christian Academy for blowing the whistle on the unconstitutional taxing of the tax exempt.
Under the agreement reached with Hogan, the city will back down from charging each dorm room as a condominium or apartment but will charge it at a slightly lower rate, equivalent to the rate it charges senior citizens apartments which do have water and toilet connections. It is a slightly lower per unit rate than was stated in the original ordinance.
It should be noted that the city continues to charge schools and churches 90 percent more than standard commercial rates for sewer lines and 31 percent more for cubic foot usage fees. In mediation with Hogan, a representative for the Christian academy called for the Canyonville city government to separate water charges from city politics and simply charge all city users based on the water they actually use. "I think that the people of Canyonville long for simple fairness."
In October 2011, Canyonville Christian Academy offered to settle all issues for an amount less than the mediated figure. The school also offered to accept the settlement in the form of credits to future water bills. The city rejected all of CCA's offers.
CCA is a nondenominational Christian boarding and day school for high school students. The school was founded in 1924.