ENCINITAS — A sometimes bitter legal battle between the city and a Leucadia couple over their converted garage unit ended Wednesday night with a “thank you” and loud applause.
That’s because the City Council voted 4-0 on a settlement arrangement that lifts a nearly $190,000 tax lien off of the homeowners Lynn and Russell Marr. Councilwoman Teresa Barth abstained from the vote.
A subcommittee composed of Mayor Kristin Gaspar and Deputy Mayor Tony Kranz negotiated the settlement in September with the Marr family, bringing an end to the complex, winding saga that started back in 1998, when code enforcement first notified Lynn Marr that the garage unit was an unpermitted, illegal dwelling unit.
The city sued the Marrs in 2002, and in 2004 won a default judgment against the couple for $95,000 in attorneys’ fees. The Marrs appealed the judgment all the way to the state Supreme Court, which declined to review the case in 2007.
City officials said the Marrs refused a settlement offer in 2007 that would have forgiven the lien if the couple brought the unit up to code for a period of five years.
Over the last 10 years, the judgment swelled to $187,000 due to accrued interest.
After several years of inactivity, the city renewed its efforts to collect the lien in July, which prompted a council meeting to discuss the case and hopefully work towards a solution.
The settlement, agreed upon by the Marrs, lifts the lien and allows the Marrs to apply for the city’s amnesty program, which allows homeowners to legalize unpermitted dwelling units provided they are earmarked for affordable housing.
The Marrs, as part of the settlement, will agree to reimburse the city $50 a month for five years toward city administrative costs, and will pay the $900 application fee for the amnesty program. If the city lowers the fee, it will reimburse the Marrs the difference.
The Marrs also agree to keep the unit as affordable housing for 20 years. The family will have 90 days after the final approval of the settlement to apply for the amnesty program.
Nicole Braun, Lynn Marr’s daughter who has served as the family spokesperson, thanked Gaspar and Kranz for coming to the table to negotiate with the family.
“For 16 years, this issue has literally consumed my family, but thanks to you a resolution may be in the making. We truly hope so,” Braun said. “This agreement will help the Marrs rebuild their lives and ends a 16-year-battle that has been costly, time consuming and draining for all those involved.”
At the August City Council meeting, City Attorney Glenn Sabine opined that forgiveness of the loan might be considered a gift of public funds. He reversed course at Wednesday’s meeting, saying the city would be receiving an equitable asset in return — an affordable dwelling unit that will help the city meet its mandate for more of such housing.