News Digest News Digest (January 11, 2002)

East Palo Alto sued over tax

Residents have filed a lawsuit against East Palo Alto contending the city is still illegally collecting a utility users tax that a court last year deemed illegal in another part of the state.

The state Supreme Court ruled in June that the city of La Habra's utility users tax was in violation of Proposition 62, passed by the voters in 1986. That measure required that all local taxes be approved by the voters.

East Palo Alto's tax, passed by the City Council in 1989, never received voter approval.

"The tax is illegal," said Tony Tanke, attorney for the residents filing the lawsuit. "The Supreme Court of California said so. Yet the city keeps collecting the tax. The city is showing contempt for its citizens."

City Attorney Michael Lawson said that since the court ruled last spring, the city has been placing the utility users tax revenue it collects into a special fund, pending further clarification of the legal issues. He said there are a number of active lawsuits that may resolve the issue.

The city collects about $900,000 a year from the tax, which is not being spent.

-- Don Kazak
Cop stays off the beat

East Palo Alto Police Sgt. Robert Cole has his job back, technically speaking, but he's not on the beat. The East Palo Alto City Council voted 3-0 Tuesday night for Cole to remain on paid administrative leave pending another disciplinary hearing.

A previous disciplinary hearing on whether Cole allegedly violated departmental rules led to the officer's dismissal. But a federal judge ruled in December that the city did not conduct the first hearing properly and ordered the city to reinstate Cole.

There was no word on when another hearing might be held.

Cole and his supporters attended the City Council meeting Tuesday night, with several residents urging the council to reinstate Cole as an active policeman.

Councilwomen Donna Rutherford and Myrtle Walker abstained on the vote to keep Cole on administrative leave, which is where he was put when he was officially reinstated Jan. 2.
Stanford loses some cash

Stanford University isn't broke, but it's less well off than it used to be, thanks to the battering the stock market took last year.

The university's endowment lost $636 million, from $8.9 billion to $8.3 billion.

On the other hand, the university benefited greatly during the boom days of the Internet economy, when its endowment rose 40 percent in 2000.

The reduction in the endowment will have no immediate effect on the university's budget, university officials say.

The economic downturn is having an effect on Stanford, though. Provost John Etchemendy has asked all department heads to cut their budgets by 5 percent for the next academic year.

-- Don Kazak
R.B. Jones goes to prison

Former East Palo Mayor and Councilman R.B. Jones entered Lompoc federal prison Monday. He began serving his 27-month sentence after pleading guilty to bribery, fraud and filing a false income tax return last year.

Jones admitted taking a $5,000 bribe from a water company in return for helping it do business in the city.

Jones was a member of the City Council from 1992 through 2000, when he was defeated in his bid for a third term. He also served as mayor for three years and was part of a council leadership that successfully got two major redevelopment projects going, helping turn the city around fiscally.