The state of Nevada has won its fight with the city of Las Vegas over $400,000 to $500,000 in parking ticket fines that were overpaid.
The Nevada Supreme Court ruled Thursday that excess fines before December 1996 were considered abandoned property and should be turned over to the state.
The sad thing for the city -- and its current taxpayers -- is that the money was not set aside when the litigation began, but instead has bolstered the general fund since the mid-1990s, the city attorney's office said today.
"We will have to write the state a check," said Bill Henry, the city's senior litigator. "We did everything we could do. I have been practicing law for 25 years and I'm not surprised by decisions. We argued what we felt was reasonable under the law."
The state and city, unable to find case law regarding overpayment of parking fines to resolve the matter, decided to take it to a judge to determine whether the state's Unclaimed Property Division or the city was entitled to the money. The city won in District Court, sparking the appeal.
The issue stems from a city ordinance that was in effect before December 1996. The ordinance encouraged people who paid the city parking tickets within 15 days, to pay only half of the fine -- $10 instead of the full $20 levy.
Many people, however, did not read the fine print, mailed in the entire amount and never claimed a refund. Today, as a result of the conflict between the city and the state, a parking ticket fine is $20 whether it's paid early or on time.
Henry said that although the city maintained a database of those who overpaid, it would have been costly to hunt people down to give refunds, especially since a number of the citations were issued to out-of-staters.
The state maintained that the unpaid sums in effect were abandoned property because the money was not claimed for more than five years.
"The situation was that we simply felt we were right," said Nevada Treasurer Brian Krolicki. "But it is never pleasant to file a lawsuit against a municipality."
Krolicki said that despite the amount being so large, it was comprised of a lot of small overpayments. Still, he said, he believes at least one third of that money eventually will be claimed.
Henry said he believes next to none of it will be claimed because several years ago the city ran ads and got no responses from those who overpaid the parking fines seeking refunds. He declined to speculate on what city services, if any, will be cut to offset the general fund money that is lost to the state.
On Thursday the court ruled the "parking fine overpayments are abandoned property subjected to the provisions of the (unclaimed property) act if they have remained unclaimed for more than five years." The court reversed District Judge Michael Cherry, who ruled for the city.
Money turned over to the state's unclaimed property division is to be held in trust in perpetuity for the true owners.
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