REDLANDS, Calif. — The Redlands City Council on Tuesday approved a $1.82 million allocation tied to a legal settlement involving alleged damage from the city-owned Mill Creek Zanja canal.
The funds will come from the General Fund’s unassigned fund balance.
The council voted 5-0 without discussion.
According to the staff report, the property transaction stems from a lawsuit filed in 2022 by property owner Miller & Associates LLC alleging government infrastructure damaged its private property at 611 W. Redlands Blvd.
Under the 2025 settlement agreement, the city secured an option to purchase the property for $3.4 million or pay $2.1 million to settle the lawsuit. Instead of purchasing the property directly, the city approved an agreement assigning its purchase rights to a third-party buyer.
Under the agreement, the buyer will pay $1.6 million and the city will contribute $1.8 million, plus up to $20,000 in escrow costs.
Assistant City Manager Chris Boatman told council the structure would cost the city about $300,000 less than paying the settlement outright.
The staff report also noted approval of the deal would complete the settlement and “resolve outstanding issues related to the site.”
Zanja dispute ends in settlement
The Mill Creek Zanja (pronounced “Zahn-ha”) is a historic irrigation canal dug by the Serrano people in 1819 to provide water from Mill Creek to agricultural lands in what is now Redlands.
The canal runs through Sylvan Park and passes beneath multiple properties, including the commercial site at 611 W. Redlands Blvd.
In the complaint, Miller alleged the Zanja moved subsurface water and soils beneath the property, causing settlement-related damage to the building and surrounding site.
The lawsuit claimed the city negligently owned, maintained and operated the Zanja and failed to properly inspect, repair and monitor the channel, resulting in damage to the building and loss of use and enjoyment of the property.
The complaint also states that on or before 2013, a neighboring building at 624 W. State St. required repairs after its floor “fell into the Zanja,” and alleges the city reimbursed the prior owner for repair costs in 2014. The complaint estimated costs to shore up that building at approximately $500,000.
The lawsuit further alleges sinkholes developed near the subject building in 2019 and 2020 and were later filled and patched by the city.
The 2025 settlement released both parties from further claims related to the property.
City Council decision
While staff emphasized cost savings, council members did not discuss what repairs or monitoring, if any, have been implemented to address the alleged damage or whether similar risks exist for other properties along the stormwater channel.
While settlement matters are typically handled in closed session, no questions were raised and no additional details were discussed during the public portion of the meeting before the vote.
The only public comment on the item came from Redlands resident Andy Hoder, a volunteer guide with Redlands Heritage Tours, who thanked staff for using the historically accurate term “Zanja” rather than the locally common “Sankey” or “Zanji” in the agenda materials.
A former local TV news producer, Stephanie launched CFR in 2023. Originally from Michigan, she’s made Redlands home with her husband and three kids. When she’s not reporting, she’s problem-solving at the climbing gym or trying new local restaurants.
