IHD restores revenue as legal challenge continues

SANDPOINT — Beyond their family celebrations, city officials unwrapped an extra Christmas present — renewed snowplow services.

According to City Treasurer Shannon Syth, the city received all payments due since Sept. 30 from the Independent Highway District on Dec. 26. IHD officials are also doing a final accounting and will probably have another small payment after that is completed, Syth said.

For Public Works Director Kody Van Dyk and Street Department employees, the payment comes as very good news. The city can now be much more proactive when it comes to ensuring clear roadways, and operations will encompass a broader swath of Sandpoint streets. During the funding shortage, priority was given to the emergency snow routes on major streets like Division and Fifth avenues or Cedar Street.

Meanwhile, Street Department employees can rest easy knowing there’s sufficient funding to pay for additional operators and overtime as the weather requires.

“I can tell you the crew is very happy,” Van Dyk said. “They’re glad to know their jobs are secure for at least another year.”

The IHD action follows a decision by 1st District Court Judge John T. Mitchell, who ruled on all points in favor of the city following IHD’s motion to dismiss the lawsuit for unpaid funds. According to City Attorney Scot Campbell, IHD has agreed to pay withheld funds this year while still retaining its right to pursue its legal case.

Conflict between the city and IHD first arose when the district declined to turn over tax funds. The district claimed a 2003 joint powers agreement, which necessitated that the city receive all funds collected within city limits, was unconstitutional because it represented an unlawful indebtedness. Mitchell disagreed with IHD’s legal counsel on all five of their arguments, meaning that the city’s lawsuit against IHD will proceed. A portion of Mitchell’s argument suggested that the more appropriate course of action for IHD would have been to continue honoring the agreement while making its legal case.

“Rather than IHD bringing a declaratory action against the city where the IHD would continue to pay the city under the contract until those legal arguments are decided by a court, IHD instead chose to simply not pay under the agreement, leaving the city in the lurch financially and forcing the city to sue IHD,” he wrote in the ruling.

With the recent return of funds, IHD is effectively taking the route Mitchell suggested. The district’s lawyers have not yet declared whether or not they’ll be pursuing the case to a final judgment, at which point, they can appeal the decision.