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Home My WebLink About01/05/96 ," ( ~ . ~).~ I -- B A K E R 5 F I E L 0 MEMORANDUM .January 5, 1996 TO: HONORABLE MAYOR AND CIT~ COUNCIL FROM: ALAN TANDY, CITY MANAGE SUBJECT: GENERAL INFORMATION 1. The negotiations with Olcese Water District on some sort of a merger or agreement to cooperate are not going particularly well. You will remember that this is a fairly weak district serving portions of the northeast, which does not have as firm a water supply as they should for the area with its growth potential. We had entered into discussions with them and, basi ca 11 y, they amended the document so that it was very one-si ded and there was no real mutual benefit in proceeding with discussions. Perhaps they can resume again after some period of quiet. 2. You probably know from media coverage that William Horton and Eric Matlock were promoted to the position of Assistant Police Chief this week. 3. Staff is starting on the internal budget process for fiscal year 1996-97. We always begin in January. 4. We anticipate the PRIME computer to shut down for the last time on or around January 12th. We have now transferred all of the Legacy internal software applications to the IBM System 400. 5. In response to a Councilmember inquiry, Community Services has compiled a list of the number of reservations issued for the use of the Beach Park rugby/soccer field. 6. A notification from California Water Service is enclosed noting a 2.26% increase for the Bakersfield service area, effective January 1, 1996. 7. Attached is a status report from Publ ic Works regarding the Greenwaste Recycling Facil ity. Costs have stayed wi thi n the budget so far, and revenues are slightly above what was expected. 8. Also attached is a memorandum from Economic Development noting the opening of the Holiday RV Superstore on January 1st, along with a thank you letter from Holiday RV for the block grant provided by the City. './ .-' - \ / " . ',r. 't ~r / . / /1 . '¡" HONORABLE MAYOR AND CITY COUNCIL January 5, 1996 Page -2- 9. There is a memorandum enclosed from Fire Chief Kelly pertaining to the enforcement of AB13, the prohibition of smoking in designated buildings. Enforcement is going smoothly, with the exception of Zingo1s Restaurant, which will be receiving a second citation for noncompliance. AT:GW:rs cc: Department Heads Carol Williams, City Clerk Trudy Slater, Administrative Analyst ' I ~ I ~...- .~ ,~ ~EMORANDUM TO: Alan Tandy, City Manager I FR~: Lee Andersen, Co~nity Services Manager~ DATE: January 2, 1996 SUBJECT: BEACH PARK RUGBY/SOCCER FIELD In response to an inquiry from Councilmember Randy Rowles, staff has compiled information regarding the number of reservations issued for the use of the Beach Park rugby/soccer field since its dedication on August 28, 1995. The field has been used for rugby and soccer, as well as for both adult and youth flag football. Reservations have been as follows: September - 5 dates October - 13 dates November - 21 dates December - 17 dates January - 17 dates February - 12 dates March - 8 dates April - 1 date Dates reserved through April 6, 1996 total 94. All indications are that this facility will be heavily used by the community. Attached is a copy of the entire rugby scheduled for the 1995-96 season, with no less than six games slated to be played at Beach Park (Ray Trichell Rugby Field). Should you have any questions regarding this information, please contact me at 326-3700. RECE¡VED , ~ I JAN 3 19q6 -_Ji ¡;CITY MANAGER'S OF~~r . '- ~~ " /- -.... """.r: ~'~ DEC 27 '95 11:22 -- P.2 1996196 Rugby Schedule. Practi()Ð - Ray Triche1l Rugby Field, Beaoh Park - Tueød.ay & Thrusday &.00 - 8:00 P. M. Hotne Games - Ray Triobell Rugby Fiel~ Beach Park .. Saturdays 1:00 P.M. October 7 Fresno 10'8 Away Kearney Park October 1 7 Rugby IG'ø '", 1 øt Practice Beach Park November 18 So. OrangeCQ. Home Beach Park November 21S ThankšgrVtñi.~"¡;"". No Game -0- December 2/8 Las Vegas Tour AwaJ T.B.A. December 9 Old Timers Hmne Beach Pa1"k December 18 Fresno RFC Home Beach Park December 23 Cbrist~:RR Week No Game . ..0- December 80 New Years Eve No Game ..0. January 6 SLO RFC A w8: San Lui8 Obispo January 14 .Pomona RFQ Away T .B.A. January 20 .Pasadena RFC Away T.B.A. January 21 .NORRFC. Home Beach Park February 3 *Finlanders Away T.B.A. February to *Eagle Rock Away T.B.A. Februa.t7 11/18 OMBAC Tour ' Awaa Robb Field February 24 .pomona RFC Home Beach Park March 2 .Pasadena RFC Home Beach Park March 10 -NOR RFC Away T.B.A. March 18 -Finlanders Hoine' Beach Park March 20 Narrabli RFC Home Beach Park March 23 *Eagle Rock Home Beach Park March 80 Pl~offs- . AprU 8 Playoff. Aprilt3 Playof£ø April 20 Playoffs April 21 Bakermeld 15's Home Soccer Complex "League Gameø ~ I - :, -~~ --- - r;~ . --,--, CALIFORNIA WATER SERVIOE COMPANY 1720 NORTH FmsT STREET. P. O. Box 1150 . SAN JOSE, GA 95108 . (408) 451-8200 December 22, 3.995 TO ALL INTERESTED PARTIES: Enclosed is a copy of Advice Letter No. 1397, BAKERSFIELD DISTRICT, which has been approved by the California Public Utilities Commission. Very truly yours, CALIFORNIA WATER SERVICE COMPANY ~ Dolores Wriglesworth Administrative Assistant /dw Enclosure ,~" ._~ RECEIVED JAN 2IQQ~ , ~ !CITY MANAGER'S OFF!C'¡ -" ,j --- ~ ,¡ ." " "'" l' ' , 'CALIFORNIA WATER SERVICE COMPANY 1720 NORTH FIRST STREET' P.O. Box 1150 . SAN JOSE, GA 95108 . (408),451-8200 ~ '"-~ ,- -' r, r,..::J \\i7 r,:J ¡ ~4'\ November 13, 1995 0 ~ [; ~ ~ \~ lS Il \'1 Advice Letter No~ 1397 NOV 1 3 1995 L:l CALIFORNIA WATER SERVICE COMPANY (V 60 W) \AlA-T~R UTILIT!r-" p"",n;"'H T th Publ' V .1" C " f th S f Cal'" ' ~¥ t ,I it~ ..;¡\i',~~v" 0 e IC tl ItIes ommISSlOn 0 e tate 0 ' 110rn1a, California Water SerVice Company (Cal Water) hereby transmits for filing five copies of the following changes in its tariff schedules 'applicabletQ its BAKERSFIELD DISTRICT: Cancelling C.P.V.C. Schedule C.P,V,C. ~ NQ... IiIk cl ~ Number ~ MQ... 5074-W General Metered Service BK - I 4980-W 50ï5-W Residential Flat Rate Service BK - 2R 4981-W & 4818-W 5076-W Table of Contents (continued) 5066-W 5077-W Table of Contents 5073-W An original and four copies of the advice letter and the tariff changes are being s~bmitted pursuant to Decision No. 93-08-033 dated August 4, 1993. The effective date of the revised tariff schedules is to be January 1, 1996. The Commission staff has been furnished copies of the detailed workpapers showing the rate of return on rate base for a current twelve-month period based upon recorded data and adjusted for rate-mat.ing purposes. (Proforma Earnings) In accordance with General Order 96-A, Section III,G., a copy of ¡Pis advice letter has been mailed to competing and adjacent Utilities and other utilities or interested panies having requested such notification, A list of those utilities and/or parties is attached. CALIFORNIA WATER SERVICE COMPANY ,~ a ~1f~---J --) Thomas A. Lorenzen' Rate and Valuation Assistant T AL:slh Enclosures cc: Jolm A. Yager, DRA Han L. Ong, DRA - - - ,i ,-. 1 '" BAKERSFIELD DISTRICT ADVICE LETTER FILING MAILING LIST PER SECTION III (G) OF GENERAL ORDER NO. 96-A Competing and Adjacent Utilities: City of Bakersfield, City Hall Asst. Director of Water Resources: Florn Core 4101 Truxtun Avenue, Bakersfield, CA 93309 Casa Lorna Water Company 1016 Lomita Drive, Bakersfield, CA 93307 East Niles Community Services District Manager: Roland W. Stephens 1417 Vale St., P.O. Box 6038, Bakersfield, CA 93386 Greenfield County Water District 551 Taft Hwy., P.O. Box 49217, Bakersfield, CA 93382, Manager: Donald B. Patrick Krista Mutual Water Company 1830 Brundage Lane, Bakersfield, CA 93304 Manager: Jim Bradshaw North of the River Municipal Water District 4000 Rio Del Norte St., P.O. Box 5577 Bakersfield, CA 93388 .; Manager: Ralph L. Gifford Oildale Mutual Water Company 222 Minner Ave., P.O. Box 5638 Bakersfield, CA 93388, Manager: Douglas Nunneley Rancho Verdugo Mutual Water Company 10506 Laurie Ave., Bakersfield, CA 93312 Manager: Camille Kimbriel Stockdale Annex Mutual Water Company P.O. Box 9726 Bakersfield, CA 93386-9726 Manager: Eugene F. Cassady Stockdale Mutual Water Còmpany P.O. Box 788, Bakersfield, CA 93302 Attn: Angus Crites Vaughn Water Company, Inc. 10014 Glenn St., Bakersfield, CA 93312 Victory Mutual Water Company P.O. Box 40035, Bakersfield, CA 93304 Attn: Robert Calton --- ~ " 1 ¡ BAKERSFIELD DISTRICT (Continued) Airport Mutual Water Company 6630 Tallman Ave., Bakersfield, CA 93308 Other Utilities and Interested Parties Requestinq Notification: Kern County Water Agency P.O. Box 58, Bakersfield, CA 93302 Mr. John Gardiner Tilden Engineering ., . P.O. Box 897 Menlo Park, CA 94026 Service Area Maps Executive Officer Kern LAFCo 2700 M Street, Suite 302 Bakersfield, CA 93301 I ,. I .. . I ¡ , ' j A TT ACHMENT California Water Service Company, Bakersfield District, Advice Letter No. 1397 filed November 13, 1995, requested a step increase in water rates of $454,700 or 2.26% pursuant to Decision No. 93-08-033. '< . . ' G' ¡ CALIFORNIA WATER SERVICE COMPANY Revised Cal. P.D.c. Sheet No. 5074-W 1720 North Fir~t Street, San Jose, CA 95 112 (408) 451-8200 Canceling Revised Cal. P.D.c. Sheet No. 4980- W Schedule No. BK-l Bakersfield Tariff Area GENERAL METERED SERVICE APPLICABILITY Applicable to all metered water service. TERRITORY Bakersfield and vicinity, Kern County, " RA TES Quantity Rates: Per 100 cu. ft. .................................c................................................ $ 0.6135 ( I ) Per Meter Service Charge: Per Month ". For 5/8 x 3/4-inch meter.................................................................. $ 6.70 ( I ) For I-inch meter .................................................................. 10.80 I For 1- II2-inch meter .................................................................. 14.50 r For 2-inch meter ................................................................... 19.20 I For 3-inch meter .......................................................~........... 37.00 I For 4-inch meter ................................................................... 49.00 I For 6-inch meter ................................................................... 83.00 I For 8-inch meter ................................................................... 121.00 I For 10-inch meter ........................;.......................................... 147.00 (1) The Service Charge is a readiness-to-serve charge which is applicable to all metered service and to which is added the charge for water used computed at the Quantity Rate. SPECIAL CONDITIONS (D) (D) 1. All bìl1s are subject to the reimbursement fee set forth on Schedule No. UFo (To be inserted by utility) Issued by (To be inserted by CaL PU,C) Advice Letter No. 1397 FRANCIS S. FERRARO Date Filed ~5 NAME 1 '!C;S6 Decision No, Vice President Effective \ r\ h\ ", " I , ~- \~ TITLE Resolution No. , ,'" ',' " , . CALIFORNIA WATER SERVICE COMPANY Revised Cal. P.U.c. Sheet No. 5075-W 1720 North First Street, San Jose, CA 95112 (408)451-8200 Canceling Revised Cal. P.U.c. Sheet No. 4981-W Schedule No. BK-2R Bakersfield Tariff Area RESIDENTIAL FLAT RATE SERVICE APPLICABILITY Applicable to all flat rate residential water service. TERRlTORY Bakersfield and vicinity, Kern County. RA TES For a single-family residential unit, including premises Per Service Connection having the following areas: perMonth 6,000 sq. ft., or less ....................................................................... $ 21.90 ( I ) 6,001 to 10,000 sq. ft. """"""""""""""""""""""""""""""""'" 25.26 I ", 10,001 to 16,000 sq. ft. ............................................................".... 31.49 I 16,001 to 25,000 sq. ft. ................................................................. 39.87 I I For each additional single-family residential unit on the same premises I and served from the same service connection .............................".............. 15.39 (I) SPECIAL CONDITIONS (D) (D) I. The above flat rates apply to service connections not larger than one inch in diameter. 2. All service not covered by the above classifications shall be furnished only on a metered basis. 3. For s~rvice covered by the above classifications, if the utility or the customer so elects, a meter shalI be instalIed and service provided under Schedule No. BK-I, General Metered Service. 4. This Schedule is closed to alI new connections as of May 8, 1991, the effective date of Tarriff Sheet No.4 133- W. 5. All bills are subject to-the reimbursement fee set forth on Schedule No. UFo (To be inserted by utility) Issued by (To be inserted by Cat P,U,C) Advice Letter No. 1397 FRANCIS S. FERRARO Date Filed ~5 NAME Decision No. Vice President Effective J [\ \\ 1 íQS6 I,'" - '-' TITLE Resolution No, . ,~"., I ' " t, CALIFORNIA WATER SERVICE COMPANY Revised Cal. P.U.c. Sheet No. SO76-W 1720 North First Street, San Jose, CA SO66-W (408)451-8200 Canceling Revised Cal. P.U.C. Sheet No. TABLE OF CONTENTS (continued) Schedule Cal. P.D.C. Subiect Matter of Sheet Number Sheet No. RATE SCHEDULES: .. ALL DISTRICTS Conservaton and Expense Surcharge CON-l 4619-W Dept. of Health Services, Office of Drinking Water Fees Surcharge DHS-1 SO12-W Tax Reform Act of 1986 Surcredit TRA-l 4649 -W Surcharge to Fund Public Utilities Commission Reimbursement Fee UF SO64-W BAKERSFIELD General Metered Service BK-l 5074-W {C} Residential Flat Rate Service BK-2R 5975-W (C) (D) Private Fire Protection Service BK-4 4645-W Public Fire Hydrant Service BK-5 3444-W Service to Company Employees BK-10 881-W BEAR GULCH General Metered Service BG-1 5006-W Private Fire Protection Service BG-4 367S-W Public Fire Hydrant Service BG-5 3445-W Service to Company Employees BG-10 143-W CHICO-HAMILTON CITY General Metered Service CH-l 4963-W Residential Flat Rate Service CH-2R 4964-W Schools and Public Park Flat Rate Service CH-2L 4965-W Private Fire Protection Service CH-4 4904-W Service to Company Employees CH-10 18S0-W DIXON General Metered Service DX-1 5035-W Private Fire Protection Service DX-4 5036-W Service to Company Employees DX-IO 165 -W (continued) (fo be inserted by utility) Issued by (fo be inserted by Cal. P.U.c.) CD 1397 FRANCIS S. FERRARO Date Filed'~ "! Advice Letter No. :> NAME J þ"-\ 1 KO; Vice President Effective - lvJ", Decision No. TITLE Resolution No. Q) )no71 - ~ ~ '. -', .,~. . ~ , , .. . CALIFORNIA WATER SERVICE COMPANY Revised Cal. P.lI.C Sheet No. 5077-W 1720 North First Street, San Jose, CA 5073-W (408)451-'-8200 Canceling Revised Cal. P.U.C Sheet No. TABLE OF CONTENTS The following listed tariff sheets contain all effective rates and rules affecting the rates and serVice of the Utility together with information relating thereto: Cal. P.U.C. Subiect Matter of Sheet Sheet No. Title Page ...................................................... 871-W Table of Contents..... ... .....SO77-S076-S060-S072-S0S6-S063-4920-2926-W (T) Preliminary Statement ........;............................. 3836-610-W Service Area Maps: General Location of Districts ............................... 3027-W Bakersfield ................................................. 5027-W Be.p.:ç' Gulch ........................................ ...,..... 4799-W Chico-Hamilton City......................................... 4877-W Dixon ....................................................... 4633-W East Los Angeles ............................. .'.............. 1683-W Hermosa-Redondo ............................................. 168S-W King City ................................................... 492S-W Livermore ................................................... 4929-W Los Altos-Suburban .........................,................. 3S10-W Marysville .................................................. 1689-W Mid-Peninsula............................................,... 4801-W Oroville ............................................. '....... 3477-W Palos Verdes .....................................'........... 4927-W Salinas ........................................... 4S60-W Las Lomas Division ....................................... 3820-W Oak Hills Division' ....................................... 3821-W Selma ....................................................... 48S6-W South San Francisco .................................... 3368-3245-W Stockton ...........................................'......... 4935-W Visalia ........'............................................. 4882-W Westlake .................................................... 3294-W willows ..................................................... 323S-W (continued) (fo be inserted by utility) Issued by (fo be inserted by CaLP.U.c.) CD 1397 FRANCIS S. FERRARO NOV13~ "! Advice Letter No. Date Filed ::> NAME J t, \1 1 <r,"'-"" Vice President Effective ......, . ¡:-;:irì Decision No. ' TITLE Resolution No. 92 20271 - ~ . - B A K E R S F I E L D , PUBLIC WORKS DEPARTMENT MEMORANDUM January 3, 1996 TO: Alan Tandy, City Manager FROM: Raul Rojas, Public Works Director ~ RE: UPDATE ON THE GREENWASTE RECYCLING FACILITY The City's Metropolitan Greenwaste Facility is doing extremely well compared to previous years. Costs are tracking within the budget, and revenues are slightly better than expected. Although there are large amounts of material onsite due to the fall leaf and pruning season, materials are being processed and marketed sufficiently. It is nice to know that all the compost produced so far has been reserved. Staff is evaluating screening equipment in order to increase compost production. The facility is processing increasing amounts of material from curbside greenwaste routes, which have been fully implemented in all city-served areas. The County Environmental Health Services Department has indicated that the facility's state-required composting permit will be issued soon. Capital improvements for the facility will begin construction in spring of 1996. These include lots of crushed rock base, which will be provided by Granite Construction from the adjoining concrete recycling site. The facility will soon be staffed with more permanent City employees, who are now available following completion of our route automation project. This will help stabilize the operation further. Unfortunately, our site supervisor, John Cook passed away last week. In order to maintain an effective operation, we will assign Fleet Mechanic James Scrivano as acting supervisor for the facility. Mr. Scrivano has demonstrated competency and a good attitude in recent months, and is the City's most qualified employee for this assignment. We are confident that he will do well. KB:Slrfl updat ,~'~~ ,- -- RECEuVlED [~~-~'j ':Jrv ¡VLl\NPJ~r:r's Cf-?~ . ,-,===~-= 0-- --' 0 ¿-. - ='-". Æ . -- BAKERSFIELD Economic and Community Development Department MEMORANDUM January 3, 1996 TO: Alan Tandy, City Manager @ FROM: Jake Wager, Economic Development Director' . SUBJECT: Holiday RV Superstores Update On January 3, 1995 I spoke with Buddy Maltone, the local General Manager for Holiday RV Superstores. Mr. Maltone indicated that they were successful in opening their store by the projected target date. In just the few days since opening he has already seen an increase in traffic. He specifically mentioned contacts from out ofthe area travelers. Weare continuing to work with Mr. Maltone to identify eligible items to be acquired in order to use the balance (approximately $24,000) of the approved grant amount. As you will note in the attached letter Holiday RV is very appreciative of the assistance granted by the City. Mr. Kindlund, the Chainnan of Holiday RV Superstores, also expresses his confidence in the company's ability to meet their low to moderate income hiring requirement. enclosure dlt:jw8 Holupdtmem ~ RECEIVED ~ . ~ '~ITY MANAGER'S OFFfC~ : -. '.<~ ,---.~. HOLIDAY 1(V 8UPEI{8T°1&n~ CORPORATE HEADQUARTERS 7851 Greenbriar Parkway Orlando, FL 32819 (407) 363-9211 Fax (407) 363-2065 December 28, 1995 John F. Wager Jr. Economic Development Commission 515 Truxtun Ave. Bakersfield, CA 93301 Dear Mr. Wager: In behalf of our Company we wish to thank you and the Economic Development Commission for the block grant you have provided our Company. We are well on target to open our store January 1, 1996, and have already proceeded with targeted job recruitment in the salary range your guidelines call for. It would appear to us that those objectives will be easily met over the next five years, for which we thank you and the commission. At this time it would appear that we have $22,000 to $24,000 dollar balance outstanding which we will be filing for. I know that you have been working with Buddy Maltone, our store General Manager, however I also wanted to convey to you the name of Hardee McAlhaney, who is our Vice President, CFO, who will also be assisting Buddy in wrapping up the details of this grant. Either Hardee or I can be reached toll- free, 1-800-243-4432 in the event any questions arise that Buddy is unable to answer. Thanks again for your cooperation in this unique re-Iocation. We view the Bakersfield market as an emerging one and I think that the sales tax contribution we will make to the City in the decade ahead will more than off-set this investment. Our best wishes to you and your family over the holidays and a prosperous New Year. Sincerely, ' ~~e. ~ Newton C. Kindlund ¿¡1- cc: Buddy Maltone, J. Kindlund H. McAlhaney NCK:bgf file: wgrItr -- I MEMORANDUM "WE CARE" DATE: JANUARY 3, 1996 TO: ALAN TANDY, CITY MANAGER FROM: MICHAEL R. KELLY, FIRE CHIEF~ SUBJECT: AB13 - NO SMOKING The enforcement of AB13 dealing with the prohibition of smoking in designated buildings has gone smoothly w;th one exception. The exception is Zingo's Restaurant located at 3201 Pierce Road. As shared with the Council, the enforcement of this program is generated on a complaint basis. As of this date, Zingo's Restaurant has received three verbal consultations regarding the law and three letters to stop and cease. They have also received one written citation. The written citation was challenged in court and zingo's lost. The fine for this first citation was $103. The restaurant is about to receive a second citation and the fine will increase to $250. Upon receiving a third citation the fine will increase to $500 and after this third citation we will have to turn this information over to OSHA and their fine can be as much as $7,500 per instance. From what I have been told by my inspectors, the owner of Zingo's Restaurant is very non-cooperative and feels that we are out to put her out of business. She has stated if smoking is prohibited in her establishment, she will have to close her doors. Carl Hernandez from the City Attorney's Office is well aware 0 f this case and has advised us during each step of the process. I doubt if it will do any good, but I have offered to accompany Fire Marshal Ron Fraze on the next visit to discuss the law with Zingo's owner. MRK/kec MEMO\KELLY\ZINGOS ','- ,i b'--¡ :1 'I ; .. .IAN 4 1996. I ~ I I f j i , C!TY IVIANAGEFrS OFFIC':: ,! I I ~-~-.- .' , ~ r ..' j Bakersfield Fire Dept. . .~r- Page 1 CONSOLIDATED MONTHLY REPORT FOR THE MONTH OF NöIJeftiJer ,143~ This Last This This Last CLASSIFICATION OF ALARMS Month Month Month Year Year Last Year to Date to Date HOW ALARMS WERE RECEIVED: TOTAL ALARMS 1376 15æ 1120 15 , 501 13,686 FIRES: FIre Explosion Not Classified 10-19 3 6 - !:D 41 Structure FIre 11 28 28 32 ~I ~ Mobile Property Used as a Structure 12 - - - 3 3 Mobile Property Inside Structure 13 1 - 2 10 11 Mobile Property Outside 14 22 :D 25 291 332 Trees, Bush, Grass 15 15 47 10 368 311 Refuse FIre 16 27. 36 37 371 479 Other Ouside FIres 17 6 10 7 65 73 TOTAL FIRES 1œ 157 113 1445 1543 CALLS OTHER THAN FIRES: Overpressure, Explosion (no fire) 20's 5 10 4 65 81 Meärcal Call 30's 570 530 492 6249 5845 Rescue Call 35 2 3 3 34 21 Miscellaneous Medical 30-39 5 6 3 42 42 Hazardous Condition 40's 78 ... 107 77 1046 814 Public Service . SO's 137 139 94 1336 945 Good Intent Call 60's 412 470 297 4583 :m2 False Call 70's 64 81 37 659 469 Natural Disaster 80's - - - 3 4 Not Classified 00-90's 1 - - 39 20 TOTAL CALLS OTHER THAN FIRES 1274 1346 1007 14.Œ6 12,143 TOTAL EMERGENCIES 1376 15æ 1120 15 . 501 13 . 686 DIRECT FIRE LOSS This This Month This Year Last Year Month Last Year to Date to Date FIre Loss (Best FIgures to Date) PERSONS KILLED BY FIRE: Civilian FIrefighters - - - - PERSONS INJURED: Civilian N/A N/A N/A N/A FIrefi hters 1 '. .1 - 43 14 This Year Last Year INDEX FIGURES to Date to Date Fires per One Thousand population 1.36 1.47 FIres per One Million dollar valuation .w .W FIres per One Thousand buildings 4.00 5.10 FIre loss per capita 27.31 22.23 FIre loss per One Million dollar valuation 1374.62 1113 . œ Average FIre loss per building 20 156.34 15.154.41 Additional data used in INDEX FIGURES: Populatio" 212 . Em Valuation of Real Estate, corrected to true I value $ 4,m,RR?,4fP Buildings in City 59 , 812 Building permits issued \,Ð¡= 1m , nEMll TTTfJIf> 2 NOTE: Building FIres and Losses only are used in INDEX FIGURES and LOSS BY SIZE OF FIRE. I I --~---'~----- y-- Page 2 STRI.!,~TURE lOSS IV SIZE OF FIRE This Moñth This Year to Date Last Year to Date ,. I Fires Losses Fires Losses % of Fires % of Loss % of Fires % of Loss Over $ 50,000 $ 1.000. $ 49,999 Less than $ 1,000 No Loss - - - - TOTAL 477 ,700 5,OOS,a25 100.00 100 . 00 This Month This Year to Date Last Year to Date VEHICLE lOSS av SIZE OF FIRE Fires Fires Losses % of Fires % of Loss % of Fires % of Loss Losses Over $ 25,000 - - 4 220 a:xJ 1.37 24.00 - - $ 1,000 - $ 24,999 9 26 roJ 168 637 665 57.34 71.:rJ 52.77 76.94 Less than $ 1,000 9 3.200 93 36.635 31.74 4.10 37.61 23.00 No Loss 3 - 28 - 9.55 - 9.62 - TOTAL 21 :rJ. 100 293 894:m 100 . 00 100.00 100.00 100.00 FIRES AND lOSSES av TYPE OF aUllDING This Year to Date Last Year to Date Fires Losses Fires Losses 1. Type Not Classified/Undetermined 'to:¡ RR fl?t:¡ Q ?Q ern 2. Type I Previously Fire Resistive 6 292 100 6 27:3:E 3. Type II Previously Non-Combustible 7 21, 005 6 l,2f£J 4. Type III Previously Ordinary '66 1 5J5 495 79 866 . 3E 5. Type IV Previously Heavy TImber 3 5765OJ - - 6. Type V Previously Wood Frame 193 3 341:m 196 3.561.945 TOTALS IN BUILDINGS 288 5,OOS,Œ5 296 4,485,7Œ No. of This Year to Date Last Year to Date CAUSES OF FIRES IN aUILDINGS Fires No. of % of No. of %of this Fires Loss (Best Figure) Total Fires Loss (Best Figure) Total Month Loss Loss 1. Outside Fires O's 2 36 1 673.485 28.84 29 962 070 21.45 2. Spark from Cutting/Welding Torch 11-12 3 37 863 675 14.88 30 213 800 4.77 3. Heat/Spark from Natural Gas/LP/Liquid Fueled Equipment 13-19 - 27 893 . roo 15.40 21 100 150 4.19 4. Chimney (Spark/Heat) 21.22 6 55 343 . 070 5.91 47 293 . 325 6.54 5. Heat/Spark Coal/Solid Fuel 23-20 - - - - - - - 6. Electrical Short 31-36 3 16 298.100 5.14 20 ill. roJ 2.49 7. Defective Electrical Equipment 37-30 1 5 1.a:xJ .œ 8 38 . 200 .85 8. Heat from Hot Object 40's 1 11 49 . a:xJ .84 12 63550 1.42 9. Munitions/Explosives 51-53,55,59.50 4 36 367.535 6.33 40 373 . 2f£J 8.32 10. Fireworks 54 - 2 2 em .m 6 2.:m .Œ 11. Incendiary Device 56 - 7 25.Em .44 3 9850 .22 12. Open Fires (cigarettes, matches) 60's 1 5 152675 2.63 4 4:m .1O 13. Natural Source 70's 4 21 2œ.æJ 3.59 28 233 100 5.20 14. From other Fire 80's - 1 4.em .07 2 4.Em .1O 15. Other 90's 2 '29 922 ,4Œi 15.88 46 1. 987 . 250 44.:rJ TOTAL BUILDING FIRES 27 288 5 OOS.œ5 100 . 00 296 4.485.7Œi 100 . 00 yo Page 3 ~ ' HOW ALL FIRES WERE CONTROLLED This Month This Year Last 'fear to Date to Date Self Extinguished 1 2 28 29 Makeshift Aids 2 6 59 69 Portable Extingusher 3 6 15 26 Automatic Extinguishing System 4 2 8 1 Water Carried on Apparatus 5 7 100 110 Water from Hydrant, Draft, Standpipe 6 3 ED 47 Water from Tanker Shuttle 7 - - - Ground Crew/Air Support 8 - - - Undetermined/Not Reported 9110 1 9 14 TOTAL FIRES ?7 ?RR ~ MISCELLANEOUS WORK This This Year last Year Month to Date to Date New hydrants - - - installed 2 24 127 Hydrants painted 20 1630 2146 Hydrants repaired 139 6542 .6515 - - This Last Same CHANGES: This This Year Last Year PERSONNEL DATA Month Month Month Last Year Month to Date to Date MANPOWER: Appointment - 19 2 Total personnel at end of month 196 198 100 Resignations 2 9 3 Total Days lost for sickness 95,58 74.92 75.64 Retirements - 1 4 Total days lost for injury 2.12 16.03 41.34 Dismissals - - - Average daily absences 3.19 2.41 3.00 Deaths - 1 - Smallest fighting force on duty 48 48 45 Promotions 2 16 6 Largest fighting force on duty 52 53 48 Demotions - - - This Year to Date last Year to Date INSPECTION IV REQUEST ONLY Total No.of No.of Are Inspections Ares Ares Loss Residential 462 219 This Year to Date Last Year to Date REGULARLY INSPECTED OCCUPANCIES Total No.of Are Total No.of Fire Inspections Fires loss Inspections Fires loss Exclude apartments, houses, private garages, and incendiary fires æ27 69 1,CID,575 5713 64 1,652,23) .--.---- ~ t < , Page 4 This Year to Date Last Year to Date INSPECTIONS, FIRES AND LOSSES BY OCCUPANCIES Inspections Fires Losses Inspections Fires Losses Eng. FSC Eng. FSC OCCUPANCY OF BUILDING A. Flammable liquids 1. Bulk Storaae 15 2 - - 13 4 - - 2. Dry cleanino plants 10 - - - 17 - - - 3. Flammable finishes 12 10 - - 12 12 - : - 4. Oil bumina Eauipment 1 - - - 1 - - - 5. Service Stations 48 4 - - 51 5 - - 6. Undercround Installation 12 2 - - 9 6 - - 7. Transportation 5 2 - - 8 - - - 8. Other flammable 6auids 5 3 - - 8 4 - - B. Special Hazards 1. Combustible fibers 4 - - - - 4 - - 2. Hazardous dust 2 ,- - - 1 7 - - 3. Explosives 2 48 - - 14 19 - - 4. Repair aaraaes 168 8 2 8 em 114 11 1 'In 5. TIre recappino plant 13 - - - 29 - - - 6. Hazardous chemicals 182 2 - - 177 2 - - 7. Hazardous plastics 29 - - - 2 - - - 8. Lumber Yards 12 3 - - 3 4 - - 9. Woodworkina plants 11 - - - 11 19 - - 10. Metal Process 15 - - - 10 1 - - 11. Radioactive material 2 - - - 3 - - C. Miscellaneous Hazards 1. Solid fuel and ashes - 1 - - 1 - - - 2. Incinerators - 1 - - - - - - 3. Railroads - - - - 3 - - - 4. Junk storaae 2 2 - - 4 29 - - 5. General storace 15 2 2 55em 11 -1~ t:¡ 1R rrn 6. Wholesale houses 27 10 - - ~ ç -' - 7. Weldinc and cuttina ?? 2 ~ ~:um 1R 1n - - 8. Restaurants 1~Fì 52 1 ':!1iIl rrt1 1M R4 ':¡ 1 'rf1 9. Warehouse 56 2R - -:¡q !ïO 1 - 10. Oilwells/Tank facilities - -1 - - - 1 - - D. Flammable or compressed gas 1. Liquid petroleum gas 6 15 - - 1 19 - - 2., Compressed aas 26 ~ - - 31 R - - 3. Other flammable cas 2 ~ - - 1 11 - - 4 .Transportation 2 - - - 2 1 - - E, Supplemental Fire Prevention Activities 1. Schools ç 1Œ ':! 1 '¥Yl R 1ÇR 1'\ 1 rR"'I 2. Hospitals 7 25 2 5 ('05 14 ~ - - 3. Rest Homes 11 1R - ~ ?1 - - 4. 24 hr. Child-Adult Care ? 1!=M 2 - 1 1!=17 1 - 5. Dav Care Nurseries 13 55 -- - 21 00 -- --~- - - - 6. Jails - - - - 1 ~ - - 7. Churches ffi 14 1 ?m 4"q ~ ? ':!f1 ?q) 8. Hotels 15 25 - - ?1 R - - 9, Theaters 7 17 - R 1Ç 1 ?rY'I 10. Auditoriums 4 17 - - 2 XI - - 11. Gvmnasiums R 4 - - R 1':! - - 12. Public Assemblv 1R 110 ':! !ïO - 2m 24 ?R4 1 - 13. Game Rooms 1 3 - - 10 14 - 14. Mortuaries - - - - - 1 - - 15. Like Occupancies 7 3 - - 9 11 - - "INSPECTIONS BY OCCUPANCY" CONT: ON NEXT PAGE ,. Page 5 <' , This Year to Date Last Year to Date INSPECTIONS, fIRES AND LOSSES BY OCCUPANCIES Inspections Inspections CON'T Ares Losses Ares Losses Eng. FSC Eng. FSC OCCUPANCY OF BUILDINGS F. Miscellaneous Inspections 1. Aoartments ZJ7 163 65 1,770,æ5 3œ 114 75 667,500 2. Dwellinas 9 37 152 2.943.755 55 62 156 2.140,975 3. Miscellaneous structures 51 12 5 56.em 32 20 3 4.~ 4. Motels 37 19 1 500 29 18 - - 5. Office buildinas 331 164 1 500 511 382 6 1.289.520 6. Private aaraaes 14 2 2 10 em 19 14 1 25.OCU 7. Retail stores 323 94 22 2m 925 444 183 10 55 . 3)) 8. Miscellaneous manufacturing 40 4 - - 29 9 3 10 3)) 9. Automatic spñnlder sYStem 38 4CB - - 47 828 - - 10. Alarm svstem 12 Z32 - - 6 259 - - 11. Are extinauishina survev 8 2œ - - - 5J5 - - 12. Other 23 70 21 326 925 87 19 22 241,300 TOTAl INSPFCTI()NS FIRES AND LOSSES 2187 22œ 288 5.005 025 2540 3745 296 4.485.7eE FOLLOW-UP ON INSPECTIONS AND OTHER FIRE PREVENTION WORK This Month Last Month This Year to Date Last Year to Date Are FSC Are FSC Are FSC Are FSC NUMBER OF CASES IN WHICH THE FOLLOWING WORK WAS DONE: Inspections 14.1 ?P.4 239 ~7 2187 ;-'2202 2540 3745 Complaints received 1? - 7 1 191 354 187 279 Violations found 1!=1 1.tï ~ 10 411 544 411 474 Notice of Violation 1n 1.:1 2R 8 2ffi /J.77 272 568 Violation corrected - 14 - ?1 - ~ - 300 Items reffered to other departments 1 - ? 1 47 1R 28 67 Total reinspections 1.:1 1? ?n 15 256 LlT! ~14 418 Extensions of TIme 2 2 1 ::> !;4 1R 00 64 Fir e- Arson-I nves tigations - l'iq - 73 - 682 - 700 False alarm investigations - - - - - - - 2 Arrests made - - - 7 - 28 - 61 Court actions - - - 3 - 26 - 42 Weed abatement 6 - 9 - 317 1318. 254 1621 Are drills supervised - 4 - 79 130 - 85 Talk or lectures 11 4 29 2 124 22 134 54 Total audience 710 33 1386 30 5370 329 6428 328 Stake out - 2 - - - 6 - 3 Special inspections 6 4 10 3 59 00 713 249 Office time (reports, etc.) - ?7? - 274 - 2045 - :me Meetings attended ?':: !1.q 2h !1.1 1R7 689 115 1041 Demonstrations 12 1 13 1 82 3 leE 8 Photographs taken - 117 343 - 2m3 - 1270 -.-.-- . '~ - Page 6 . " This This last last I INVESTIGATION OF FIRES Month Month Year Year to Date to Date TOTAL FIRES INVESTIGATED 14 23 217 100 Determined accidental ~ Q 7.1 SA Under investigation 1LL 11 1t:ï.1 R1 Undetermined - 1 12 13 Incendiary 5 13 129 110 INCENDIARY FIRE: : Fires for which arrests were made - 2 17 40 Number of arrests - 3 23 01 Cases in which convictions were secured 1 - 7 24 Number of convictions - - 5 31 FALSE ALARMS: Alarms for which arrests were made - - - - Cases in which convictions were secured - - - - MISDEMEANORS (in connection with fires) Convictions - - - - REMARKS ON INVESTIGATION WORK au.JSEL & RELEASE 1 - !) ::>1 ŒlJRT JlPPE.ARAlŒS -- - - 20 37 , , " '~ ... " ,i ," -Page 7 WORK OF FIRE COMPANIES ENGINE COMPANY No. Number of Runs Engine 1 146 Truck 1 74 Patrol 1 84 Engine 2 162 Engine 3 '100 Engine 4 137 Engine 5 223 Engine 6 168 Patrol 6 102 Engine 7 176 Truck 7 78 Patrol 7 107 Engine 8 124 Patrol 8 74 Engine 9 86 Engine 11 75 Haz-Mat 11 4 Engine 13 66 Er1c:dre 10 18 Patrol 10 '8 /!' Ili' ~ "I§W i, ."~ , :,1,r-":'" .,~ ,,;} . i.~ i.l ¡ , '1'ì ~ .:, /'} .. h:""$q//~?f I:,. !i2:r¿... 4&' . ;>, '. ,,1 /' i iwt 'II, . b J; '~.:.,W " '!f. c '. ~.. ;- ~ ,! RECEIVED \1 '! DEC 2 I \995 I ! I JTY MANAGER'S OFF'~, . ~--- ~~.. - -- -~ -- .t. ---- ' <-- ~I... 1 )- 91... f el.." League of California Citifti3: - JAN 2 IQO~ QI... SI... 1400 K STREET. SACRAMENTO, CA 95814 . (916) 658-È'3;:j;: ---I ~I..----- ¡!CITY MANAGER'S OFF/C, California Cities --<"- "-~~ > Work Together December 11, 1995 Implications of the Santa Clara County Case The following is the joint project of a group of municipal attorneys to offer analysis of some of the issues raised by the court's decision in Santa Clara County Transportation Authority v. Guardino, 11 Cal. 4th 220,45 Cal. Rptr. 2d 207 (1995). As of this writing, the petition for rehearing in the Santa Clara case is still pending; the deadline for court action on the petition is December 27, 1995. While the League of California Cities is distributing this paper to assist its members, the statements in this paper do not represent the official position of the League or its members on the legal issues discussed. City officials are encouraged to consult with their respective city attorneys and city attorneys are encouraged to perform their own analysis of these issues to assure the best interests of each individual city is served. REMEDIES ISSUES 1. How long after the imposition of a tax may a lawsuit be filed to invalidate the tax for failure to comply with Proposition 62? The answer to this question is not yet clear. A strong argument can be made that the three-year rule of Code of Civil Procedure section 338(a) applies, thus protecting any tax adopted more than three years ago. Section 338(a) establishes a three-year statute oflimitations for "an action upon a liability created by statute, other than a penalty or forfeiture." As Proposition 62 is a statute, a lawsuit challenging a local tax ordinance as violative of Proposition 62 ought to fall within this section. In addition, the word "statute" in section 338(a) has been construed to include local ordinances, and if liability is argued to have been created by the wrongful adoption of a tax ordinance or to involve a tax liability created by the ordinance, section 338(a) would apply for this reason as well. It might also be argued, however, that continued collection of taxes under such an ordinance constitutes a "continuing wrong" sufficient to toll the statute of limitations and to eliminate a time-based defense. However, tolling doctrines are equitable in nature and courts will not apply them where it is unfair to do so. Courts have also stated that it is not the purpose of tolling doctrines to allow potential claimants to take no action to assert their claims until after someone else has successfully done so. Moreover, the public policy purposes underlying statutes of limitations are important, and, as is the policy of article II, section 9( a) of the California League of California Cities Implications of Santa Clara County Case ---- - ¡. ~ ,~ -. ,December 11, 1995 ,,;.-.' ' Constitution to promöte fiscal stability in local government. These policies provide a compelling argument that taxes adopted o~ increased more than three years ago are protected from further challenge. Nonetheless, additional guidance from the courts may be required before it will be possible to' say with assurance that tax ordinances which go unchallenged for three years are thereafter immune from legal attack. It should also be noted that if refund claims are available for taxes imposed more than three years ago, then the three-year statute of limitations means little, as an ordinance valid on its face would still generate refund claims sufficient to practically defeat the revenue-raising purpose of the tax. 2. Are refunds available to taxpayers who paid taxes which were not adopted in compliance with Proposition 62? As discussed elsewhere in this paper, a strong argument can be made that the sole remedies for violations of Proposition 62's requirements are those provided by the measure itself. Section 53728 of the measure provides for a withholding of property taxes to offset proceeds from a tax adopted without voter approval and a taxpayer's action "to invalidate any tax imposed in violation of this [measure]." Ifthese are the sole remedies for violations of Proposition 62, then the refund remedy is not available. If the courts c(mclude that the re!lledies expressly provided in Proposition 62 were not intended to be exclusive, then other sources of law must be examined to detennine if a refund claim can be made. State law authorizes refund claims for some local taxes. Revenue and , Taxation Code section 5097 authorizes claims for refunds of property taxes collected via the county property tax assessment roll and may apply to some parcel taxes. Similarly, Revenue and Taxation Code section 6902 authorizes the refund of sales and use taxes. The Legislature has not expressly authorized refund claims for many local taxes, including transient occupancy (hotel bed) taxes, business license taxes, utility users taxes, and other taxes. If Proposition 62 does not bar refund claims, and state law does not expressly authorize refund claims, the tenus of local ordinances may be controlling. Many local ordinances are based on model ordinances used widely in California and those models do provide refund 'procedures. Accordingly, cities and counties would be well advised to examine their own ordinances to detennine if those ordinances authorize refund claims. Finally, legislation might provide a refund procedure. Refund legislation passed in the aftennath of the Rider decision appears at Revenue and Taxation Code section 7275. It is possible to argue that, because (as discussed elsewhere in this paper) California law generally forbids an acti?n to prevent the collection of a tax, federal due process principles will League ofCaIifornia Cities 2 Implications of Santa Clara County Case I ~- - ---~, --~-~~- 'i'-- .' December 11, 1995 require an after-the-fact remedy in the form of a refund, whether or not state law or local ordinances authorize refund claims. However, the federal cases in this area, led by McKesson v. Division of Alcoholic Beverages and Tobacco, 496 U.S. 18, 110 S. Ct. 2238, 110 L. Ed. 2d 17 (1990), provide only that there must be some effective remedy for an illegal tax. McKesson involved a tax which had been invalidated as violating the federal Constitution itself. If Proposition 62 is read to forbid a refund, but to require a redistribution of property taxes, it can be argued that Proposition 62 did not make the tax approved without voter approval "illegal" but rather provides how such taxes should be distributed, much as the Legislature redefines the distribution of property taxes each fiscal year. Simply put, the federal constitution does notrequire voter approval of local taxes; it also does not require any particular distribution of tax revenues imposed without that approval. Since cities' concern in this instance are taxes collected without complying with Proposition 62 (not the federal constitution, as in McKesson), the issue of refunds would appear to be a question of state law alone. In sum, whether refunds are available turns on the intent of Proposition 62 and the existence of authority for refunds under state and local law. The answer may vary from ordinance to ordinance and tax to tax. Until the intent of Proposition 62 is clarified by the courts, however, the view that refunds are not authorized appears defensible. 3. How long after paying a tax may a taxpayer seek a refund? A strong argument exists that refund clai~s must be filed within one year' of the payment of the challenged tax. In Volkswagen Pacific, Inc. v. City of Los Angeles, 7 Cal. 3d 48, 101 Cal. Rptr. 869 (1972) (per curiam), the California Supreme Court concluded that the one-year claim period of the Tort Claims Act applied to a challenge to a tax imposed by the City of Los Angeles. The court noted that even if this were not the case, Los Angeles' local claims requirements themselves made the one-year limit of state law applicable. Without discussing Volkswagen Pacific, a court of appeal concluded that the local tax refund claims were exempted from the Tort Claims Act claims period and that only a local claims requirement could apply. Pasadena Hotel pevelopment Venture v. City of Pasadena, 119 Cal. App. 3d 412, 174 Cal. Rptr. 52 (1981). Volkswagen Pacific appears to benefit from a more careful reading of the statute and is a decision of the state's highest court. Therefore, it appears that the one-year requirement of the state Tort Claims Act applies of its own force to local tax refund claims. However, if they have not already done so, cities. and counties would be well advised to adopt local claims ordinances of their own to protect against a possibility that a trial court would follow the Pasadena case.! 1 Copies of a sample ordinance are available for check-out from the League. To do so, use the order fonn on the inside back cover of the City Attorney's Index or at the end of the City Attorneys Newsletter and ask for Saltzman, Claims Ordinance and Memorandum, 11/17/95. League of California Cities 3 Implications of Santa Clara County Case I ... ' '; . December 11, 1995 IftheT~rt Claims Act does not apply òfits ownforce, locafdaims procedures will control. Many cities adopted transient occupancy '(hotel bed) taxes 'and utility users taxes using model ordinances which provide three-year claim periods. Some cities have adopted claims . requirements for tax refunds-by separate ordinance which apply to more than one localtax or bro,adly to include both tax and non-tax claims. It will be helpful toexaminé a city's tax ordiminces 't,odetermirie ifclaims provisions are included. If a city has adopted a clàims period, oflôngerth~mthe one-year period of the Tort Claims Act, it may be appropriate to reduce that claims requirement to tþ.e one-year minimum authoriz,ed by Government Code sections 935( c) . , and 911.~. Car~ rnustbe tal<,en iridoing so, howe,ver, to avoid extinguishing claims which àfe not öbso~ete \¥henthe ordinance reducing the chlims period is adopted. ' " " ' .', " " -, . "" , ' , It should be noted th~i a 'cause of action to recover an illegal tax arises; and the tl~e, in which to seeka'rëfund b~gins to run, when the tax ispaid-- not on theclate Santa 'Clara was " de~i(,ied. ,T4er~foré, taxes¡)aid some 'time ago may alreadybe'prõte~ted' against refund claims by , therunni!lg cifiheclairilspériÒd,or the statute ~flimitations. " '" . , ' . Asdisc~ssedels~wher~ iiÌ'thi~ paper, it is possible that a tax ot~inance ~ay become: immun,e frómchallenge after the rml11iIig of a three-year statute df)iinitàtiöns.lf so', it is also possible tl1atthere woùld be no duty to make refunds claims under such:àn ordinance evenif " refundswouldotherwise:be- ava,ilable, Thus: it is arguable that a refurid claim based solely on an ~gumei1t that the ordiri,ånce wàsadopted without compliance with Proposition 62 must be ' brought ~ithin.the tlnie,~or a facial challenge to the' or~inance (perhaps three' y~ars as,discussed .' abo,"è) as,well as withintl1e time limits ,discussed immediately above. ' " ' , " I 4. ' Can à clàim or 'a lawsuit befiledon behalf of the entire class of persons whppaida I /ch~lle1Ìged tifXor on béillÎlfofany otþergroup? , ' ' .,' ' ' , " ,., , , . , ' ' , , ' Probably not., Nq class action or~class è1a~m for â re~d can be filed'oole'ssa statute or . ord~nance ,e~piessly authorizessuch\class proceeding. The CalifomiaSupreri1è Court stated. 'this rule in a case involving a tax. ~ollected by the Department of Motor Vehicles, Woosley v" ~,State ofCa[ifOl:nia, 3 Cal. 4th 758~ 13 Cal. Rptr. 2d 30 (1992), and a cç>UÌto~ appeal ve!y . ", , receJ).~ly applied it to a challeñge to a city tax inNee.cke v. City of Mill Valley, 39 CaLApp.~th ,946,46 Çal Rptt. 2d 266, 274:.275 (October 25~ 1995):, It is doubtful that J?,any ordinances or " stätuteswill bé read to.authorize class claims. Cities may wish to examine 'the Claims. provisions öfth~ir ordinances to ~nsure that the language is àdequate on this þòÍnC; If dassçlaims àre not:, ,', pemitted: each cl~imantwill be obliged to file an individual claim.' . . "., , . ,:,' ", . " " - ,- " ..' , , ' ;.. ' '-,' ,;;. , .. League of California Cities 4 Implications of Santa Clara County Case ..., '¡, . '¡- . December 11, 1995 ENFORCEMENT PROVISIONS 1. What enforcement provisions are set forth in Proposition 62? Proposition 62 contains an enforcement provision to be applied against any local government or district that imposes any tax in violation of Proposition 62. Specifically, section 53728 of the Government Code provides that if any local government or district imposes any tax without complying with the requirements of Proposition 62, the amount of property tax revenue allocated to the jurisdiction pursuant to the Revenue and Taxation Code shall be reduced by $1 I. for each $1 of revenue attributable to such tax for each year that the tax is collected. Cal. Gov't Code § 53728. Section 53728 specifically provides: If any local government or district imposes any tax without complying with the requirements of this Article, or in excess of its authority as clarified by Section 53727, whether or not any provision of Section 53727 is held not applicable to such jurisdiction, the amount of property tax revenue allocated to the jurisdiction pursuant to Chapter 6 of part 0.5 of Division 1 of the Revenue and Taxation Code (commencing with Section 95) shall be reduced by one dollar ($1) for each one dollar ($1) of revenue attributable to such tax for each year that the tax is collected. Nothing in this section shall impair the right of any citizen or taxpayer to maintain any action to invalidate any tax imposed in violation of this Article. This provision was found to be unconstitutional in City of Wood lake v. Logan, 230 Cal. App. 3d 1058, 1069,282 Cal. Rptr. 27, 24 (1991). The court in Woodlake held that neither the Legislature nor the people by initiative may "impose unconstitutional conditions on receipt of revenues nor sanction local government for refusing to abide by a constitutionally impennissible requirement." W oodlake, 230 Cal. App. 3d at 1069,282 Cal. Rptr. at 34; see Sonoma County Organization of Public Employees v. County of Sonoma, 23 Cal. 3d 296, 152 Cal. Rptr. 903 (1979). However, Woodlake has been disapproved by the California Supreme Court, implying that section 53728 is constitutional. Santa Clara County Local Transportation Authority v. Guardino, 11 Cal. 4th 220,45 Cal. Rptr. 2d 207 (1995). The Santa Clara court did not specifically address the constitutionality of section 53728, leaving open the question of the effectiveness of this remedy. 2. How would section 53728 operate if city has collected taxes without complying with Proposition 62? Although section 53728 does not specify the county as the entity that should withhold tax from a local government, it is implicit that counties are the intended enforcers as counties are the entities charged with the collection of the property tax. Taxes levied by the county for a city must be collected at the time and manner of county tax collection and paid into the county League of California Cities 5 Implications of Santa Clara County Case ., \C, ! '. December 11, 1995 ' " treasury. Cal. Gov't Code § 51513. The net amount of the taxes; after,deduction ofthe county's compensation for the services of its treasurer, assessor, and tax collector, must be paid to the city. ' , Cal. Gov'tCode § 51513. ¡ The duty to pay into the treasùry all moneys colh~cted for property taxes ha~ generally been held unconditional, and exists whether or not the tax is void, the tax is paid under protest" or an action.to recover back the money has been brought. See San Francisco v. Ford, 52 Cal, 198, 200-01 (1877); C~aig v.Boone, 146 Cal. 718, 7.19 (190,5); Phelan v. San Francisco, 120 Cat 1, 4"'5 (1898); County of San Diego v. Croghan, 2 Cal. App. 2d 494,497-98 (1934): ' Providing for the impounding or withholding' of taxes a~ in section 537~8 is not with911t , : precedent. Section 26906.1 of the Government Code may provide some limited guidance and. suggests that the decision may be discretion~ry to the board of supervisors. Section 26906.1 'provides as follows: " , , .' " , ,"The county auditor, with the approval of the boardo~supervisors, may , impound the disputed:revenuesofany tax upon secured òr u~securedp.roperty, 'leviêdandcollected:byt4~county for tl1ecounty, or ~y.rev~nue district, , , .... whenever, pursuantto .:. . the 'Revenue and Taxation Çode, éI; c1ai~ or action is , filed for the return of the r~venues, 'or the audito~ reasonably,~ticipatesthàt"the' tax.mày bè refunded inwhol~ or in part. The county auditor~hall continué to impound such revenues until the final disposition of the"slaim or aéti~n;:or a "': .', ' refun~ oqhe tax is ndlong~r ari.ticipat~d:, If, under the final dispositiqt1, it is ' ,', ' ,detemiined that such taxeswef~'þr()perly leviedàgainstsùcl1property, the auditor " shall t:eleas~therevenues to theÖol,inty or ievenue.,dis.trict, 0;" , 'I , , , , . , " , '" , ,C~I'.Gov'tÇode §26906.l; Daar'!; Aivor(j, 101C~l. ÅPp. 3d 480, 4~o6;oI61 e~l. Rptr~'95~,,661-o,' ,0 : ,0 !, 62(1980)." ' 0' " ,'. ,c' 0" , " .' .. " " The impoundmènt oft~es provided forin séCtioIÌ26906.1 o"rthe Gove~~nt Code has '.l:e~~ i1!terpreted as being piscretiohary rather thàn míll1datory. paar, ,1 Q 1 Càl. App..3 d, at 486" '.. ' '16l:C.al. Rptr, ,at 661-62. Whereas the'¡anguagecontai~edin section 26906.ljs,permis~iye;,,' ',' ':1 section 53728 contains mandatorylangua~e. It states tha! with respectto ¥1y,local.go~enímeíÎt' ' . imposing a tax without complYÎIlg,with Prop'osition 62, the'propertytaxrevenue alloëåted to '. such local goyernmerltshall ~e reduced.by.one dollé:U' for eac~oÌ1e'dollar òfrèyen~e attriput,able, : to ,such tax for each year that tl1e ta~ is collected. Cal. Gov't Code' §, 53728. . . . . " , . However; the provision does not indÎ(~~te whetherth~ county hasth~autnority to reduce a'. . ' . cÚITent year's property taX allocation as aopenaltyfora tax cöllecÚ~~ by a local government in 'a . previous year: A local government faced with reductions of property tax allocations may be able to raise a statute òfliinitationsargument against retroactive witlÌho"Idingby.a çoÙnty.Practically, a county may not be able to re,duce a city's allocation by an amo~t equal to thé collections of a [ "' " . .' ' , ' I League of California Cities 6 Implications of Santa Clara County Case -----.-. .:\ ---..-. " . December 11, 1995 non-voter approved tax as such tax may far exceed the property tax allocation for a given year. The'resolution of the retroactive application of the Santa Clara case could resolve this issue. Furthermore, the withholding provision does not specify what the county should.do with the moneys withheld from a local government pursuant to section 53728. An argument can be . made that the tax monies withheld would be redistributed to the taxing entities in proportion to their allocations of the one percent property tax because this is the only statutory authority for a county to distribute tax monies it collects. Additionally, if, as discussed below, section 53728 is the exclusive remedy for a violation of Proposition 62, the monies withheld would need to somehow be distributed. The Legislative Analyst's analysis and the ballot arguments for Proposition 62 do not shed any light on this issue. . ' 3. Is the. enforcement provision of section 53728 the exclusive enforcement mechanism for a tax collected in violation of Proposition 62? The enforcement mechanism contained in section 53728 is not the exclusive remedy with respect to challenging the validity of a tax. It provides that 11 [n ]othing in this section shall impair the right of any citizen or taxpayer to maintain any action to invalidate any tax imposed in violation of [Proposition 62].11 Cal. Gov't Code § 53728. Accordingly, any citizen or taxpayer may pùrsue appropriate actions to invalidate the tax, subject to the limitations discussed elsewhere in this paper. A more difficult question concerns whether section 53728 is the exclusive remedy for individual taxpayer refunds. In addressing the voters in the ballot argument in favor of Proposition 62, the proponents argued that the measure would 11 give back your right to vote on any tax increases proposed by your local governments 11 and right the perceived injustices in the California Supreme Court's interpreting Proposition 13 in the Farrell decision. See City & County of San Francisco v. Farrell, 32 Cal. 3d 47, 184 Cal. Rptr. 713 (1982). In providing the mechanism to implement this goal, the proponents provided a specific remedy for violation ofthe voter approval requirements in section 53728. Moreover, the proponents specifically exempted from section 53728 an action to invalidate a tax in violation of Proposition 62, but did not specifically exempt an action by a taxpayer seeking a refund of a tax collected in violation of Proposition 62. The California Constitution provides that the manner in which an illegal tax may be refunded is to be determined by the I1Legislature,11 although as discussed in greater detail below, questions exist as to the direct applicability of this provision to local government. The Constitution provides: After payment of a tax claimed to be illegal, an action may be maintained to recover the tax paid, with interest, in such a manner as may be provided by the Legislature. Cal. Const. art. XIII, § 32. League of California Cities 7 Implications of Santa Clara County Case ~. j . December 11, 1995 ~ ,Thus, a significant argument may be made that the remedy for violations pf Proposition 62 is an action to' invalidate the tax and withholding of monies equal to the invalid tax às prov~ded In section 53728, but does I).ot include an individual taxpayer refund.' , \Yhere a tax is held to b~ invalid on constitutional grounds, some cases have held that a , taxpayer has a ,due proce~s rightto a refund of the tax. See McKesson v.' l)ivision of Alè(}~olic, ' , Beverages & Tobacco, 496 U.S. 18, 110 S. Ct. 2238, 110 L. Ed. 2d 17 (l~90). Proposition 62, I " , howeve~, is a statutory, measure' and an arg~ment can be made that the, n::fund procedures required "by due process in the McKesson,case are not applicable because the def~ctin the tax is not,a federal Or state c~)lìstitutional one. Additionally, a violation of Proposition 62, doesnotaffeçt the , , , personal rights of a taxpayer as did the unequal application,of the tax at issue in the McKesson çase..See also Kuykençlall v. State Board of Equalization, 22Cal. App. 4th 1194, 27 Cal. Rptr. " 2~ 783 (1994) (upholding ,a sales tax roll-back procedure and. a ,minimum c~aim thnishold'as an .<' 'ap'propriat~ r~fup~'proceduœ). The remedy of withholding property taxes then, maybe an ' adçquate rem~~yfor the failure to seek voter approval. " , .' ' , '," , , , ", , ':",', Jfåcpurtdete~ines:t4atsectipn 53728 is not the eJ<:c\usiv~ œm:eqy f~r.yiolation of 'Propositión62a~d that a taxpayer ,lias a right to a-refund of-a tax co~lected inviolation~of' , PtoP9sition 62, wu} a city whi<?h has colléètecÍ a tax that does 'not complýwithProposition 62 be ' " " forced tô iricur a double penalty by paying' a œfund and suffering a reduction, in-Ïts ptopertytaX. 'þursuantto section 53728? Ce!fainly a fairargumentcan be made that Propósition62 does not ' imposéthisdQuble penalty. S_ection53728 is silent as to how'the taxes withheld' will be, ' , '~llôcated. Gov~rnment Cöde"s'ec!ion 26906.1 provides, some guidan,çe as a ~echan~sm aUowing -, , for the withholding of taxes ,collected where a disP'!lteexists as to th,e'validityofthe tax<~r its ," i " , application. A qity may need"to make achiim againsithe çounty fòr potentiàlrefunds ifthé, " ',qounty. in wþich it is located ,chooses t<?withhold its pròperty ta)Çesþased onsection,;~1728;... This' , , ,may also,be an appropriate area for legi~lation to clarify'refund procedure$ \n light of :" ." ' section 53728 and pre,:,ent ~ double penalty.' '", ' ,- ",,' ':,: , " , " . , ' " '" , " " '" ' " , ~, Another ,important question)s whether a county cari reduce property t~x atloca'tiohs;based , pn#xes imposed by 'a city in viola~ion ofProp~sition ?2, if such taxes are not $u.bj~èttôrefund que, to the äpplicablestatute of.limitations:, , On its face, sectiòn'5}728,does no(contain'any ~ -', .. ë, ',limitations on tlÌe.mandatory direction to reduce property tax'alloçations of offending cities; The' œsolution ofthis issue,may ~lso depend on theresolu!ion oftl1,eßtatute oflimitat~òns'and ,', , retrqactiv~ty issues. .; ',' ,': '~' , ", " , ' -, ' , ' , ,'- " ~ " 4.", ,What remedies are available to ii, taxpayer toinvalidâte a tax collected in violation 'of Proposition 62? '. " ' , :", " i' , " , , , - .. ,- , " , '" , The vaiidity 'of a tax is normally chaÚenged by a taxpayer paying th~' t~' urider protest' " and filing an' açtion for a refund. A state tax calÛ1ot generally be challenged by:injunction, ¥it 'of mandate or 'öth~r equitable pro~ess prior t<:> payment, however, a 'question ~xis~s'tls to \vh~ther , , ' "",' ,';, .. " League ofCaliforni3,Cities ' 8 ' Implicationsqf Santa Clgra County Case ---~~---,~,--,~---- ~', ¡' ---~,,-,~ ,------- _L__--___- , December 11, 1995 a court would extend this rule from state taxes to local taxes. Mandate might, however, be appropriate to compel an officer or a legislative body to comply with the law thereby addressing the legality of the law or clarifying its provisions. Article XIII, section 32 of the CalifomiaConstitution provides: No legal or equitable process shall issue in any proceeding in any court against this State or any officer thereof to prevent or enjoin the collection of any tax. After payment of a tax claimed to be illegal, an action may be maintained to recover the tax paid, with interest, in such a manner as may be provided by the Legislature. This prohibition has been applied to an action for mandamus and declaratory relief. Pacific Gas & Elec. Co. v. State Board of Equalization, 27 Cal. 3d 277, 165 Cal. Rptr. 122 (1980). In applying this prohibition, the courts have held that it carries out the policy to allow revenue collection during litigation so that essential public services dependent on the funds are not unnecessarily interrupted. Some prepayment relief has been allowed for penalties or inquiries of a taxpayer by taxing authorities if the prepayment relief is limited so that the court does not determine the ultimate validity ofthe tax. Western Oil & Gas Assn. v. State Board of Equalization, 44 Cal. 3d 208, 242 Cal. Rptr. 334 (1987). A number of courts have stated that this provision applies only to the state but not to local governments.. Pacific Gas & Electric Co. v. State Board of Equalization, 27 Cal. 3d at 282, 165 Cal. Rptr. at 125; Shiseido Cosmetics (America) Ltd v. Franchise Tax Board, 235 Cal. App. 3d 478,490,286 Cal. Rptr. 690, 697 (1991), Neecke v. City of Mill Valley, 39 Cal. App. 4th 946, 46 Cal. Rptr. 2d 266 (October 27, 1995). None of these cases, however, directly rules upon the issue of whether the anti-injunction provisions of article XIII, section 32 would be applicable to local government. Some cases have discussed article XIII, section 32 and have assumed, without discussion, that at least the second sentence of the section relating to refunds would apply to a county or charter city; See Westinghouse v. County of Los Angeles, 42 Cal. App. 3d 321, 116 Cal. Rptr. 742 (1974); Todd Shipyards v. City of Los Angeles, 130 Cal. App. 3d 222,227, 181 Cal. Rptr. 652,655 (1982); Connolly v. County of Orange, 1 Cal. App. 4th 1105,4 Cal. Rptr. 2d 857 (1994). What the cases dealing with article XIII, section 32 do disclose, however, is a strong policy of the state that an injunction or other forms of prejudgment equitable relief are not appropriate remedies in a state tax dispute due to the disruptive effect of such remedies upon the ability of government to provide essential services. The rationale of these decisions should apply with equal, if not greater force, to local governments which do not have the broad tax base of the state and yet are also charged with providing essential public safety services. Mandamus would be a proper remedy to seek to compel the legislative body of a local government to submit a tax ordinance to the electorate. Geiger v. Board of Supervisors, 48 Cal. League of California Cities 9 Implications of Santa Clara County Case .----_u ",,',,' " '. December 11, 1995 I ,2~ 832,'835, 313 P.2d 545, 546 (1957) (proceeding in mandamus to compel the Board of " Supervisors of Butte County to suspend and reconsider an ordinance providing for a sálès and use tax, and either to repeal the ordinance or submit it to the referendum vote of the electòrs of the county); Furthennore, mandate is an appropriate remedy to clarify the nature of a statutory or constitutional tax provision. CalFärm Ins. Co. v. Deukmejian, 48 Cal. 3d 805, '258 Cal. Rptr. 1-61 (1989); Franchise Tax Boardv. Superior Court, 212 Cat. App. 3d 1343, 261 Cal. Rptr. 236 (1989); Huntington Park Redev. Agency v.Martin, 38 Cal. 3d 100, 211 Cal. 'R,ptr. 133 (1985); Ci~ & Còùhty of San Fran'cisco v.: Farrell, 32 Cal. 3d 47, 184 Cal. Rptr: 713 (1982). " ,Mandate j~' aiso available tò conìpellegislati~e bodies to perform ministerial acts that the law specifically requires them to'perfonn. See Cal. Civ. Proc. Co,de §'1085;Terminal Plaz.a Corp::v. City & County of San Francisco" 186 Cal. App. 3d814, 836, 230 Cal.Rptr.875:, 888 " (1986). MåÌ1ciaté may also be sought against a legislative body thåtácts'withoùt power Of, refuses ,tò:Qbeythe pláinmandate of the law. Walker v. County ojLQ$.Angelf!s, 55 "cal. 2d626,J2 tal. ' , Rpii. 671. (196l);AmericèmDistiliing Co. 'v. City Council, 34 èal. 2d 660,213 P..2d 704 (1950).' , ',::,' " " , ,, , ,', " " ' , ,', ",,' " " , 0, " " .. ," ," "" ' ,, ' ,-' I ,RETROACTIVITY IS'SUES ,..,,',' . ' , '. 1. ',', ", Can theL~gislatur~ limit the court's retroactive revival ófPropositi~n62? " , , " ' ',", "" " " - , , ' , ' " .. , , , , ,'~, ",' ,Yes, ~he Legislãture_~oul~þass àbiiI thatHm~ts thei~troaé~iyèàpplicatidn:_oftheSan({i Clara decision. See, Forster Shiþbûilding Co. v. Los Angeles, 54.Cal. 2d 45.0, 6-Cal. Rptr. 2~ ' , ~' ' (1960}?!i couid, for ~xaniþle,eJ1acta statu,te requiring ~h~t WoodZ¿!1œ govern all~ax~såd~pied' , ' before I?ecember 31, 1995; The Legislature took this type of action,'in 1992 when itadqedcsection. , ,,9955Q,1:9ihe',PublicUtl1ities Code t~ prevent the appliqltion of the RiderdecÏsion to èxisting "'" ,'~,:..ttanspprtàtion ag"~ncy sales taXes. The bill was SB J 845 ànd c4aptei)233 of the Statute~' ~fI992~ "::';'él11çl iš.w9rth't~ing aJookatfofits firidings~ "',' ,:' ,,' :" ""';; ': " ' , ,I ! , . ' , , , ' ,,', ~.. ' , : ' " " , ' ' ",' ,'" " ,'- ':' : , , , T:ha(seétiorionlyàppliedtò certain'transpoi1:átiontaxes: Other taXes\yèrenot ":saved." . .. 'Instead, the I.;egislaturè aiithorizeda refund p~oced~e. See Cal. .R~y.&, Tax.Code'§7275. The, ; ~egálity of s~çtiòÌ17275 was upbeld in Kuykendall v.State Board of Eqúalizatiori; 22..Cal. '{\pp.4th " 1192Í~ 27 Ca(Rptr. 2d 783'{1994). SectiQn 99550 itself was not challengedincòurl. Sol11e may; .,' 'Q,owevex, argu~ such-legislation violates separation of powers or infringes on~oÌlstitutiona1 rights ..' '.. .<, '6f¡~axpayers. Seegene~ally EståteofThrqmm, 80 Cal.App.2d 756,765~ 183P.2d 9.1'(1947); . ,Westfie'ld Palos, Ver(jes Company y. City of Rancho Palos Verdes~ 73 Cal. App'-~d486, 14fCal. ,:,-', ~ptr.36(1977)~. ".'. ::,",;,' :. "", . ,: '.; , dC, ;,' ,'C' , "'. ,,~ ".. ,.,', '. - I , , ' , , " , " . " ' :' ':.:"We' hiwe'hith~rt~ recágniied'that the èalifomia Constiru'tion permits 'an appellate éouÌ1 to apply: an overrulirÌg . decision' pr,ospectively Ohly' .'" theLi;)gislatUre is no less competent than the court to evaluate, the hardships þ1volved and, I decide whether considératioris'offaimess ànd public polic~ warrant the granting ofrèlief." Id. at 459' " ," , ' \ - , '.. .., ¡ , - .. L~~~¿e ofçaÍifo~'lÏ~ Cities fo " , Impli~ations of Santa clara County C~e ,~ I -. "' ; December 11, 1995 . At present, no state statute exists that would limit the retroactive application of Santa Clara. . However, the Legislature could certainly enact such a law in the future, and cities may wish to take an advocacy role on this issue in order to protect themselves and to protect parties (bondholders, employees, contractors, those protected by police services) who may be adversely affected by a repeal of existing taxes. The Howard Jarvis Taxpayers' Foundation takes the position that such legislation would, without voter approval, violate Proposition 62' s requirement that article 3.7 would be amended only by vote of the electorate. See Cal. Gov't Code § 53729. Since there is no need to place legislation on the Santa Clara case in that section, the argument is not conclusive. An alternative argument is that the Legislature can specify prospective effect only when a supreme court decision I is overruled. However, since the Forster court refers to appellate courts generally in describing this power, and extends the power to Legislature as well, this argument too has its limits. Any argument that legislation limiting retrospective application violates constitutional rights oftaxpayers faces the problem that Santa Clara revives a statute, not a constitutional amendment. Therefore, if the supreme court can limit retroactivity without violating individual constitutional rights, so can the Legislature. 2. Can the courts limit retroactive application of the Santa Clara decision? Yes, though the general rule is that California Supreme Court decisions are retroactive in their operation, courts have established exceptions to this rule to protect those who have relied on overruled decisions or laws. See Hoogasian Flowers, Inc. v. State Board of Equalization, 23 Cal. App. 4th 1264,28 Cal. Rptr. 2d 686 (1994); Monterey Peninsula Taxpayers Assn. v. County of Monterey (MPT A), 8 Cal. App. 4th 1520, 11 Cal. Rptr. 2d 188 (1992). The decision may be made by the appellate court without referring the matter back to a lower court or waiting for another case to come before it. County of Los Angeles v. Faus, 48 Cat 2d 672, 681, 312 P.2d 680.686 (1957). See also Westbrookv. Mihaly, 2 Cal. 3d 765,87 Cal. Rptr. 839 (1970).3 3. Is Santa Clara likely to be held retroactive? If Santa Clara is applied retroactively, then those taxes adopted after the effective date of Proposition 62 would be susceptible to legal challenge. In California, the general rule is that judicial decisions are applied retroactively. Waller v. Truck Ins. Exchange, Inc., 11 Cal. 4th 1, 24-25,44 Cal. Rptr. 2d 370, 382 (1995); Newman v. Emerson Radio Corp., 48 Cal. 3d 973,978- 82,258 Cal. Rptr. 592, 595 (1989); Peterson v. Superior Court, 31 Cal. 3d 147, 151-52, 181 Cal. Rptr. 784, 785 (1982). However, this general principle is not absolute. Newman v. Emerson \ 3 The California Supreme Court decision in Westbrook prompted cross petitions for certiorari. On the first petition, the U.S. Supreme Court granted the petition, vacated the California Supreme Court decision, then remanded to the California Supreme Court for reconsideration in light of the U.S. Supreme Court decision in Gordon et at v. Lance et at., 403 U.S. 1,91 S. Ct. 1889,29 L. Ed. 273 (1971). The case was never reheard by the California Supreme Court (presumably, the parties settled). League of California Cities 11 Implications of Santa Clara County Case ~ December 11, 1995 , Radio Corp., 48 Cal.Jd adr79, 258 Çäl. Rptr. at'59'5. In certain cases, courts have held that new decisions should not apply toèases that arose before the decision was reached. Woods v. Young, , 53Cal.3d 3'15; 330,79 Cat Rptr. 613,621 (1991); Estate of Propst, 50 Car. 3d 448, 463, 68 Cal. Rptr.,114,124{1990); , ' " , , , "," , ,Ip dete~ining whether a decision should be applied retroactively, courts have developed I, ' ' ,:~Ietroacth:,ity test whfch involves a balàncing of a variety of case~specific factors and is , , , generally analyzed in light of the particular circumstances of each case., Monterey Peninsula 'Taxpayers Assn. v: èountyofMonterey (MPTA), 8'CaL App. 4th 1520, 1536-37, 11 Cat Rptr. 2d ,,' 18M; 197 (l9?2). The'factorswhich,are consideredby the court include the reasonableness and , " e,xtent of the parties' reliance on the former rule, the ability of the, parties to foresee a change in ,,: 'the.hlw, teJroa9tivity~s effect:'onthe administration of justice, and the degree of hardship or ,',' unfailTIess that 'would result from a retroactive appl~cation. Id~. See èllsò Estate of Propst, 50 Cal. 3d 4,48,,462-463, '68 CaL-RJ?tr.,IJ4, 123(1990); In re Marriage ofHopiäns, 143 Cal.,App. 3d 350, : 357, 9pCal;, Rþtr. 70; 75'(198,3). ' ,-"" ", '. " " , , While therë have been dozens of cases deciding the retroactivitý or'decisions affecting, <,vat:io~s areas of the law,:onl~a few involve tax cases comparable't9 Santa Clárâ. .Most notable' , ' are several recent cases in the 'analogous context of Proposition I} -rejecting claims that another " decis,ionof. the CalifòmÏa Supr~me Court," Rider v.County of San Die go; 1 Cat 4th 1,2 Cal. I Rptr. 2dA90,{12?1), should,be.appliedonly"prospeçtively:, ~ ' , ',,:: "",:,~",."-""".,~'c"',,.--. ,',,',:." --,'~P ,} ..- ,," :" ,,:,:~: . In. $,ider;thè,Çalifornia Supreme,Court hadpccasionto ~ì&ify thetetm "speèial district" 'a().~ound ilJ;ArticleXIII A,Sèction4 ofthe CaliromiaCo~stitutio~. Article XIIA: Section 4 of ,;';, ", ,thtfC()llstitutiojl;which was added bÿ Proposition 13; prohib~ts "[è]ities, cmÛ1ties, and sp~cial . ,.. " ,: ::,'dlstri~ts"'fr~m; levyi~~aspecial t~(i.e."a tax de:oted toea speci~Þ gQvernmeJ;1.talpurpose or , ,I '" \", purposes) wIthout gettmg,.a'two-thltds vote <?fth~ electorate. In Los Angeles ,County , , . . ',Transportatidn'Cômrnissio~v. Richìnònd;3CCa1.3d197,205-08;'ì82 Cal. Rptr. 324, 328,.~0 :' , " " ',' " " , ' (1982), the California ~uprem~Court held thata "special distriêt" within th~ meaning of ' section 4 included only th9se districts authorized to levy a property ,tax. '" ' " , ,,' , ,,' ,', . c. '," , ," " i . ",Tènyeárs later, in Ridá~ theCalifòmi~ Supreme Cburtnarrowed Richm~nd, holding that' that:<Íecision applies only to special districts created before th~passage of Prop' osition 13. Rider "v, coU11iYþ/SanDiego,lCaL4th 1, 2 CatRptr~ 2d 490(1991). "With respec.t:to dìstricts created ,- ',after the adoptioÌ1'òfPropositibn 13, Rider holds tliåt such 'a district is: coverèd by SectionA i[it' was cr~ated "to raise ,fUnds for city or county pur¡)oses to replace revenües lost by reason of the' ", 'restrictions o{Proposition 13:" ¡d. at It':, ' ," , , ,,' " , ~-" ' ,," : "', " ,', ,', ,.:' " , :'" .~:' , , " , '" " ',' , ',' " ~ ' , " Th~' Ridë; còûrtleft openthe q~estionof whetherthis ruling applied tÖ agenc¡'e~ creåted . ' ': ,after Richmond and before Rider. The cPuÌ1: expressly refused to decide whether its decision " . would'be retröactÏ;\'.<;;ly applied,to tax dístricts other'than the agency that levied the t~ challerged , in that ci1s.~~ jd.~:~~"J 3~ . Th~ coùr,t .stated:, " " '" -,' " " , - ' , " " , , ,',", ,."," -", ..., '" ',. League ofCaiifomia Cities ' '",,', ,-12 , Implications o{Santa Clara County Case . . " December 11, 1995 The issue of prospectivity involves difficult constitutional and policy . considerations largely unbriefed in this case. In addition, resolution of the prospectivity issue may depend on a variety of case-specific factors, including the degree of hardship or other adverse consequences that would result from a retroactive application of our holding in a particular setting. Under these circumstances, we believe that any blanket pronouncement on the prospectivity issue at this time would be inappropriate. Id. Local governments seeking to escape Rider's clutches argued that they reasonably relied on the law as it existed prior to Rider, specifically on the court's decision in Richmond and on the endorsement of Richmond's holding by the Legislature. The Legislature had passed numerous statutes enabling counties to create special districts which could levy taxes by a majority vote. They also attempted to make showings of the hardship retroactivity would cause public agencies that have levied taxes and commenced projects. But such claims were rejected by the courts in two cases. In Monterey Peninsula Taxpayers Assn. v. County of Monterey (MPTA), 8 Cal. App. 4th 1520, 11 Cal. Rptr. 2d 188 (1992), the court declined to give Rider only prospective effect The court held that Rider "did not overrule Richmond, reverse a well-settled, judicially created rule oflaw or clearly break with the past" Id. at 1537-38. Indeed, the California Supreme Court had already decíded Rider before Monterey County created its taxing entity. Id. at 1539. Moreover, since the county had impounded the proceeds of the tax, it had not taken substantial and material steps in reliance on the availability of the tax that would irremediably worsen its fiscal condition if the tax were invalidated. Id. at 1543. Consequently, the court did not find that the hardship to the county outweighed the considerations underlying Proposition 13' s restrictions on special taxes. Id. at 1543-44. Hoogasian Flowers, Inc. v. State Board of Equalization, 23 Cal. App. 4th 1264, 28 Cal. Rptr. 2d 686 (1994), rejected an even thinner retroactivity claim. In that case, the voters approved a tax by less than the required super-majority one week before the Rider decision and the agency only began to collect the tax after Rider became final. There was plainly no prejudice in that case, since no employees, structures or other facilities were hired or commenced in reliance on the tax. The court, therefore, held Rider retroactive in that instance as well. Id. at 1280-81. Although these decisions held Rider to be retroactive, there are several reasons why the same may not be true for Santa Clara. First, while Rider did not "reverse a well-settled, judicially created rule of law or clearly break with the past," Santa Clara did. Santa Clara specifically disapproved City of Wood lake. Santa Clara, 11 Cal. 4th at 246. However, it should be emphasized that the fact that a new decision overrules (or disapproves) prior rulings does not in and of itself compel denying retroactivity. Woolsey, 3 Cal. 4th at 794 ("The circumstance that League of California Cities 13 Implications of Santa Clara County Case I 'I ' . December 11, 1995 , , , , . , our decision overiulesprior decisions of t4e Courts of Appeal does not in itself ju'stify prospectiveapplication'} An analysis of , other case specific factors must also be undertaken. , , Second, the taxing entity in MPT A adopted its tax, after the trial éÒurt had invalidated the ' . tax in Rider; the agency thus knew that its legal basis for imposing"the tax wa~ q~estiçmable. In contrast, ma~ypublic entities imposed pre-Santa Clara taxes when their legat authority to do so seemed ~lear under the court of appeal's decision in City of Wood lake. Until Rider, the law appeared tò be settled that Proposition 62 was unconstitutional, given City of Wood lake and the' prior court of appeal decision in City of Westminster v. County ofOrånge, 2Ò4 'tal. App. 3d 623, I ,'251, Cal. Rþtr. 511 (1988), which had invalidatedstiU anotherparfofProposition 62.4 ' ,j .' : . P~Þli~ entities that imposed pr~-Santa Clara taxes, have a strong argume~t that they hád , .' " '" ',' , ~ a right tq rely: orithen-existing law. in adoptÜlg their taxes. SeèAine'fican Trucking Ass'nv. ' I , Sm~(iz, 496 U.S.167~ 183,UO S; C(232~, 11.0 L, Ed. 2d 148 (1990) ("[I]l1validation,ofthe" ", I " ta:i ~as the poteiiÌiaifòr seriously qurqening the State' s operatio~' s',: :,' [W]e thi~ it u~justto' I ,", ~ i11?-pôse this burden when théStaie:¡'elie~ on~alid, existing precedent in enacting and': " , "implementing its taX").' ' , ' , " " ,,' , ) p';', ' ,', i " ~, , . , ' , , " ' " ' , ,Finally, public agencies should'be able to make more'coirìþeilingshowings òfthe'" hardship t~at would ensue if pre-Santa: Clara taxes wen~ invalidated than was true under Rider. The: finàncialimpad of any retroactjve effect ofthis decisiqn could 'be devastating.~athêr,than þeing,~armarked for special projeéts, general taxes are dèp~sited into general f'lmd~tÒ fund essentialgoyernmental operatioJ).s.' A significant reduction. in these funds dù~ 't9retwactive ' applic,ation òf Santa' Clara could seriously burden local agéncies' daily operation~. ,," ' - ',' , ' :, ' , ',;, - , , ,:" , ' , ' , ','" ",-"",' ,',,' ", " " ' .. . ' ' , ' ",',' Public áge~¿ies should bepreparêd to show that thêy' have 'relied oft th~h pre-Sèì'nta Clara , taxes in a vaJ:iety of wáys~ such as by entering into'contracts or in~ebtedness, t4at would not have : beenlÌndertakenwithoutthe availability of the funds collected Jrom pre-Sa1)taClardtaxes. The, impact on local' general funds of st¡lte revériue "take aways" i~ reljànce on Woodlåke sp,ould; ålso, " be"made, clear;- Th~s; any decision to begin impminding pie'-Santa Clara taxesshoulg. be,' " ' .', 'reviewed carefully,ås it could, impact this showing of reliance,. , If a publi,c,entity c'anIÌ1ak~ a-,', '" . '.'" ' '~ ' ' , ',',~ ,strong shówingòfhardship, it is uhlikely--although by no mèansimpossibh~--tÞ:at a court ~ould~" " , '~~dertheentitie,sto return monies ;obta~ned fr°fi?,pre-Santq Clqra taxes;, - , '. ',' " .', . ": '. '," '.' " ',", ~ - '.. ' ,; , ',- - ' ,-. ' - - : 'F..,), ' " "4 SoIIle'may:argue theSantd 'Clara decisionwas foresh~dowed by a con~J.lrri!1g opiniÓ~ inRid~r','which ~rgu~'d tÍ1~t . , , :proposition 62 \-vas constitutional. Públic agénciesthat adopted taxes after, Rider was issued in_D~ceìnber .1991, migh~have a weaker, claim for prospectiv~ application of Santa Clarabecausethey were arguably onnoticethàt the law with respect to.', Propo~ition 6:2 ~as \}nsèttled andthatthe initiative might be upheld. However, the California SupreÍI1e Cò.urt'smore -recent ,- deçlsiol1 in.J?q~~i v. Brow~ dt~d the, Woodlâlœ décision with approval, thus weàkenmgany-argumerit the minority'dècisi~n in ~i~~~~S?rrlehow underminèdieliance on Tfoodlàke. . ' .: '" - ." . . ,LeagueofCalifori1i~tities ~'.14 ImPlicatiOl)sofSan!a~lar~C9ùnty,C~e -~ I' - " '" ---, '. December 11, 1995 4. Can a local election retroactively "validate" city taxes previously adopted by the council without a vote? A popular vote to retroactively validate a local tax cannot be objected to as abrogating the rights oflocal voters. It could be challenged as violating Proposition 62 itself, which requires election be!ore collection. A more serious issue, however, is whether a popular vote to retroactively validate a local tax would be unconstitutional. The general rule on this issue is that "laws which have some retrospect effect are. not per se invalid. It is only when the law operates to deprive a party of a vested or substantive right in violation of due process that it is invalid." Westfield Palos Verdes Company v. City of Rancho Palos Verdes, 73 Cal. App. 3d 486, 141 Cal. Rptr. 36 (1977). A line of income tax cases has used this vested rights approach to limit retroactive application to one year. Allen v. Franchise Tax Board, 39 Cal. 2d 109, 245 P .2d 297 (1952). Another line of cases, however, suggests that courts should consider three factors in determining whether a vested right is involved: a. The nature and strength of the policy interest served by the statute, b. The extent to which the statute modifies or abrogates the asserted pre-enactment right and c. The nature of the right that the statute alters. Flournoy v. State of California, 230 Cal. App. 2d 520, 41 Cal. Rptr. 190 (1964). To the extent this three-step analysis results in a finding that no vested right is infringed, a court following the Flournoy approach will not overrule a legislative enactment approving retroactive application of a law. NEWLY INCORPORATED CITIES ISSUES 1. Does a city incorporated after Proposition 62 's passage have to obtain voter-approval for its taxes that were previously imposed by the county? No, if the Santa Clara case is determined to operate only prospectively. This is because the voter approval requirement will only be applied to taxes adopted after that court decision by the California Supreme Court. This will be true whether or not the city involved is a new city. However, if Santa Clara applies retroactively and must be applied to taxes adopted since November 1986 when Proposition 62 was enacted, additional facts must be considered to answer this question. League of California Cities 15 Implications of Santa Clara County Case ~ . " ; December J I, 1995 2. Is voter-approval required if the taxes were adopted by the county prior to Proposition 62? " '," ' , ' " ",,' No,ther~ is judicial support for the position that no voter approval is required. The court in City of Cathedral City v. County of Riverside, 163 Cal. App. ~d 960, 210 Cal. Rptr. 60 (1985), heldthat a new city did not violate the prohibition against documentary transfer taxes in Jiroposition 13, see Càl. Canst. art XIII À, § 4, when the city adopted a"documentary transfer' tax that the county had already adopted'. The city's' ordinance merely caused' a shifting 'of tax revenue from the county to the city. The city's tax did not increase any tax obligation ofthe' taxpaying public whom Proposi,tion ,13 was designed to protect. This same reasoning should apply for Proposition 62 for taxes the county adopted before Proposition 62 and a new city merely co~tiriues them. The strength of this argument can vary depending upon thespecific'tax~ irivolvèd. The argument ,isstrongest,for those taxes that, would continue after incorporation, whether or not the . ëitÿ ènacisih~m,>e.g.;docu~entàry transfer taxes arid saies taxes. .The'issue isa èlosedegal , , question regardi~g còunty taxès t4at would end upon incorporationynless adopted .by the new, city. " ,,' " -: ',' , " ,. " , ',' ,', 'c" ",,:, . .. 3. " Isvoier-ápp~oval required, if ihè county adopted the taxe~ after Proposition 62 without ' " , coínþlÿingwith'it?' ':' ", '.. ,'- ' " ':,~' ..' ' , '" , " , iL" 'No, iêthe bailot q~esti~n on incorporatIon included:a~ki~gfor approvàl'of coritïÍ1~~tion 'of' county taxes. ,After adoption of Proposition 62, the 'Legislature. modified state law to allow th.e ,. , "'votérs the, opportunity to decide '.the question of tåxation 'sipultaneously. with thequèst!~nof " ' ," , incofPora\ion/'See 8tats. .1987, ch. 21; § 2; and Goverí1111entCode §56844(t). :'J;'he voter,:' approval requirement is satisfÚ~d where there is actual méitionofthe çôi1tiiluation of the taxes in' '-'~h~bal1ot questiQn:(It ~houldbe noted thatGovernment Code section57135requireš:the ballot, .' "question;o~ incorporation.to inc1u"dea summary of any taxes to be continued by the.new city) ,.' , , ".,.. , , , ' , " ' , ,,' ' , .. .. "", " , , b. ,,", Maybe, if thëþallotquestion does not' ref~r tocontinuatión of còûnty taxes. . In .thiscäse~' the city cannot safelyrelý on the in~orporatronvote as satisfying the Proposition 62 vote! ." ' apptovat requirement .It'i:s a c1os.e ,legal question whether the rationale of City of Cathedral. City ,ap:plies, becal}se ~like the'preexisting taxes in City of Cathedral City, these taxes were adopted ", '. aftèr'Proposition 62and:'Yere therefore new.taxes which were intended to require voter approval. ",. " " "';-.'" ..>-" :'-",' " . . . ,;",:, . ' ' . ; ';', ' . ' 'c~' ,.' Màybe; ev~Î1,without refef'ence to taxesiilthè balrot questiôn;thêreinäy be'factspresënt , " In a p~icular diy's case on. 'which to baseari argUment that the vote on.incorPoration~was aÌso ,a vpteon continúati6i1 of county taxes. . For example, the ballot question may statëthe citY's', ~.,': illcorporátionis subj'~ê~ to á~l t~rnis and conditions c,ûntained in theordei caHin.g fof, the election ,I , 'on~ncorpöration and one of those conditions. isthe continuation oft4~ countytaxesaild the finàncial feasibility study for the newdtyconcluded county taxesm1Íst beconthïued and the .: ballot arguments referredto, such continuation. An argument can be máde thattheincorporati,on vote shôuld sufficè because the vòter 'apprô~al is satisfied. To pursue the possibility of this' , I , " 'Lèag~e of Cali fomi a Citi~s ' ,- 16 Implic~tions of SantaÒara County C~~ ",': ---~ . . December 11, 1995 argument all of the ballot material and LAFCO incorporation documents must be examined closely. 4. Is voter approval required if the county increased the tax after Proposition 62 without complying with it, but adopted the tax before Proposition 62? a. No, if the ballot question on incorporation included asking for approval of continuation of county taxes. See discussion in 3a above. b; No/maybe, ifthe ballot question does not refer to continuation of county taxes. A reasonably supportable position is that the portion of the tax rate existing before the increase is valid, but that the validity of the amount of the post-Proposition 62 increase is questionable. The tax rate existing before Proposition 62 is valid under the analysis for paragraph 2 above. Whether the increase is valid without obtaining voter approval is a close legal question as discussed in the analysis in paragraph 3b above. 5. Is voter approval required if the county adopted the taxes after Proposition 62 and did comply with it? a; No, ¡fthe ballot question on incorporation included asking for approval of continuation of county taxes. See discussion in 3a above. b. No, even ifthe ballot question does not refer to continuation of county taxes. The city can reasonably argue that although these taxes were not preexisting before Proposition 62 as the taxes in City of Cathedral City, part of the court's analysis in that case still applies. That is, the city's act of continuing the county tax was not "imposing" a new tax, but merely shifting existing tax revenues from the county to the city. 6. Why? After the adoption of Proposition 62 by the voters on November 4, 1986, in 1987 the Legislature amended certain state law provisions dealing with the authority of Local Agency Formation Commissions. See Stats. 1987, chap. 21. This amendment was enacted as an urgency statute based upon this explanation: The voters approved an initiative statute known as Proposition 62 at the statewide general election in November 1986. Among other things, this initiative statute requires voter approval before a general tax may be imposed by a local government or district. Further, voters may be asked to vote on the incorporation of new cities which are proposed to be financed with general taxes. Accordingly, in order to allow these voters the opportunity to decide the question of taxation simultaneously with the question of incorporation, it is necessary that this act take effect immediately. League of California Cities 17 Implications of Santa Clara County Case ,', "" , December 11, t 995 , , , ,', , , ' " " , This amendment modified,two provisions found in Government Code section 56844, i.e. subdivisi<;nis (s) and (t). Section 56844 sets out various tenus and conditions that a LAFCO can plac~ .upon the incorporation, of a city. The modified subdivision (s) merely made clear tl1at there could be a condition that r~quires: "The levying of assessments or the approval by the votè¡'s , ' ' I of general or special taxes (emphasis added)." This subdivision seems to deal with NEW taxes,- I "" rather than tå){~salreadY:beihgimposed by the county because the qmtinuation of taxes is ' , covered by subdiv~~ion (t). - , :' .subd~vi,§ion (t) -was origin~llywritten to only apply to special taxes, ,It stated:, "The c(mtiIlqationOfa~y p'revi?usly au~þ.orized standby oravailability charge, benefi(assessment, or speci~l tax. by a, successorlocål agency." In order to m~e it cover both general and special taxes , the Ìr1pdit¡éatioll changed the subdivision to re¡id: "The continuation of any previously , ,allthorized:~llarge,- fee, assessIi1é~i" or. tax bya successor local 'àgency." , , . " , , - " " '" "', , , ,- Theré i~ ¿ som~w1iat' si~ilàr provision' enacted by th~ tegi~lature after Proposition 13. -To e~ta~lish procedu.res fôr obtaining voter. approvàl for special taxes, the Legislature enacted Gove~entCqde sections ,5007~ through 50077. Section 50077(c) provides that theç9unty , " whençonducting the proceedings for, a city incorporation may propose the adoption of a special n taxJor the n~w ,city, and pJåce, thaJ òri. the ballot with the incorporation question.: Th,is procedure now seemsunnecessarygiveJ). the procedure discussed aboye for,il)cluding thèapproval of taxes "as partofth~ i1iç()rporatioÍ1ques~ion. ' " '" , ,.", , ":,,','.., ";c,"":,"'"",, ',' '" ","",' ,", , - , , " 'N ów~þ.eneýer~ th~ 'financiàl circumstanêes require- it, a LÃFC(), may iqIpose a condition thata.1?ropos.ednew.Çity, continueJhe ,existing taxes being imposed by the county. Pursuant to, ' , anoth~r' prOvision 6fthe çortese-Knöx Locai Govemment Reorganization Act of.¡ 985, s~ction' ." , , , , " ,. 57'135(a), when there is a LAFCOiconditionplacedupon thè incorporation of a new; city that.- ' ',' impos~sJiability fof,payment'oftaxes, the ballot measure question must "contain a very brief 'T ' summary of the' purp.ose, nature, and extent of the liability~'. ' , , , " , , , ,- , , . Hetç i~ an example, of the \y()rdirig that the, Orange èò~ty LAFCO has used, several , I times' for theballotqùes5!on for a propo.sed city incorPoration to comply with these, requirements: '\Sh~JI the'6rq~r a~optedon Mar~h 8', 1988 by the ~oàrdofSuperviso~s'~f'the": -, , County:ofOrárïge'ordering the incorporation ofthe. ','. City of Dana Point 'subject .' , "tothè-tefms ,and'c9I?-ditiÖns sp~cified in the order; including., .', the~oÌltinùance as: ' ': d.~y tél}(:es of the sales and use .t~, transient occupancy, the real pr~p~rty transfer:, , :, tax, allÇi;othergènenlttaxes pre~eI1t1y imposeçlby the qöunty at the,salpe'rate as - , ,imposed by-th,e couniyand using the same tp.anner of collection, be collflnned? Of cour~e,rio{ ~ll LA~CO~' are'\lsing :simÚarly worded ballot q~~siionsfor city incorponltions: " F or e~amplè, the ballot que~tiori. used for,the incorporátion of Çhino Hills in N ovembert991' omitted,allY expres's râ~rence}o tàxes and asked only if the _~rder' c:lli~g. for the incorporation ~ , , ' " " ~eaguèofCalifo'niia, Cities "', 18 Implications 9f Santa Clara CountyCase " - ., I i I December 11, 1995 should be confirmed "subject to the terms and conditions more particularly described in said order?" The LAFCO resolution calling for the incorporation contained a condition which read: "All previously authorized charges, fees, assessments, and/or taxes currently in effect by the County of San Bernardirio . . . shall be continued by the City of Chino Hills, as a successor local agency, pursuant to the provisions of Government Code section 56844(t)." Newly incorporated cities need to check the language used in their incorporation. The significance of the 1987 amendment to section 56844 and the explanation given to support its urgency is that it seems to show that the Legislature felt that when a new city is , incorporated if existing county taxes were to be continued there would have to be a vote in order to comply with Proposition 62. The amendment simply allows the single vote on the incorporation also to serve as the Proposition 62 vote on the taxes. (Note that if there is a special tax involved and the vote on the incorporation passes by a majority but not the 2/3 vote required for special taxes by Proposition 13 section 4 and Proposition 62, the voter approval requirement for these special taxes would not be satisfied.) Notwithstanding the above indication of the Legislature's opinion on how new cities may comply with Proposition 62, there is judicial authority supporting an alternative analysis contained in the case of City of Cathedral City v. County of Riverside, 163 Cal. App. 3d 960, 210 Cal. Rptr. 60 (1985). That case upheld the adoption by a new city of a documentary transfer tax despite the prohibition in Proposition 13, section 4 of any transaction taxes on the sale of real property. The court stated Proposition 13 was intended to bar only new taxes and not sharing revenue from taxes already being collected by the county. The effect of the city's enacting its documentary transfer tax was that the city thereby became entitled to receive 1/2 ofthe documentary tax the county was already collecting. See Cal. Rev. & Tax. Code § 11911(b). The county refused to turn over to Cathedral City its half of the taxes on the ground that the city had adopted a new tax prohibited by section 4. The court rejected the county's argument with the following analysis: [I]mplementation of ordinance 2 will not increase any tax obligation of the taxpaying public whom Proposition 13 was designed to protect and, as such, it does not create a new'or additional tax within the meaning of article XIII A, section 4. [I]t is clear from an examination of the ballot arguments in the official voters' . pamphlet published prior to the election that article XIII A, section 4, was not intended to deprive newly incorporated cities of a right enjoyed by existing cities to share in already existing county revenues. . . [I]t is clear that section 4 of article XIII A does not pertain to the allocation of existing tax revenues. League of California Cities 19 Implications of Santa Clara County Case I t " '. December 11, 1995 I Id at 964-6~. , , , ' An argument can likewise be made that in adopting Proposition 62 the ballot analysis and ".' argum~nts sþow ,that the voters di~ not intend to require a vote on taxes that a new city~as I, ' merely contiii.uing as its own aft~r the incorporation. A new city can argue that when it adopts an ,,' 'ordinance that establishes the same taxes that the comity was collecting, ÌIO vo'té is required under, " seëti'ons 53722 or 53723. The city is not in effect "imposing" any new tax, but is merely' continuing e.xisting taxes which are not the object of the Proposition 62 vQterapproval , . requirement. ' As stated by the court in City of Cathedral City: "The 'tax' thu~ crç~ted did not - -, .increase tþ.etax liability of any person; it merely required the alloca~ion of existi~g çounty Jax , . reve~uestoCï'ty in accordance with the statutory scheme (Rev. & Tax. Code,seè. 11~11).'" See " 163 G~1. App. 3d at 963, 21OCal.Rptr. at 61. ' " " ' Reliailce upon City of Cathedral City is not free from possible challenge. The new city " tax that that coUrt upheld would have continued to he collected by the county even if the city did no,tadopt the tax. It involved a shifting of the tax revenue. That situation is analogous to sales ',' taxest~ata new city.~dopts. But it is not so similar to some ,otherpossiblenewcjty taxes. For , " ex(imþle, if a city adopts:a transient occupancy tax("TOT") in the same rate, as the county's TOT~ ' q , '::;thecoip1ty t~xwithill the, dty~~ bo~ders would ~ave ended but.for the, city',s act of ~ontinuing it ..' '~.,~, by adopting, its own TOT. ,Therefore, the rationale of City of Cathedral City strongly supports ' , ',årguing no' yoter'approval.is needed for those taxes that automaticålly continue after', ' " ,incofPoáltion like thed9~llrperitary transfer,tax arid sales tax. .It ì.s'noti as stron~' àn arglmient for' " ..' t~o~etaX:esthat do not autóm.atiCaUy continue, e.g., utility tax, businesslicense tax and transient, occupancy tax. This wgument pre,~ents a dose legal qúestionwhendèfending a city's ,,:,; cOlitinu~tío~öf co~iy t~ésthat wóuìd have ended upon thçíncorpoféltion: ",' '::, ' , Co , " , . ' '0 : " ,,: " '" ' , C ,: " .. , ' " '0, 0 ' '..:.' , ' ,~ ' " - , ,Also thériltionale of City of Cathedral City is more clearli applicable wbèn arguing no voter approval is needed for taxes that the countyha~ adopted beforèPropositiöiì 62'l?ecàuse " ' these pre-existing taxes could not have been the target of the Proposition'and these faéts, are Illore, analogous to,those in the Cathedral City case; The City ofCaihedr;al'City case applies less' ' .. clearly where the city hascontiIlu~d taxes the county adopted after the eIlac~meÌ1t of ' 'c Proposition 92becau~e all 'new, PO$t:-Proposition 62 taxes were i~tended to require ~oter, ~. approval. Alsouriderthèse facts, the argument could bemade,mòre diffi~ultifthe LAFCQ approval of in corp brat ion did not r~ciuire contin~ation of the county's tax. ' " , , .. .. " . , , , -, , , , 0" '. > ' ' THE "'IMP()SITI ON", ,ISSUE , , , ' , ..' . ' ':' ,I. Does Pr~position: 62 appl)J onl)J to néw t~es or alsQto inèreáses in existingt~es?' , , , " , , Propositi~n 62 does not sp~cifically .statewlÌether its majority voter approval , requirements for general taxes apply ~mly to new taxes imposed by the legislativ,e body or to both new and increased taxes. Government Code section 53723 provides: ' " c I 'league ofCaJifornia,Cities 20 ,,' i~i>lications of Santa Clar'aCounty Case " I -,- .' . ;- December 11, 1995 No local government, or district, whether or not authorized to levy a property tax, may impose any general tax unless and until such general tax is submitted to the electorate of the local government, or district and approved by a majority of the voters voting in an election on this issue. (emphasis added) No reported court cases have addressed this question directly. While several courts have discussed the term "impose" in the context of various types of tax or fee statutes or ordinances, these cases have not developed a single uniform definition of the term. Instead, the courts have stated that the term "impose" must be construed with respect to the context and purposes of the tax or fee measure. Santa Clara County Transportation Authority v, Guardino, 11 Cal. 4th 220, 45 Cal. Rptr. 2d 207,95 Daily Journal D.A.R. at 13022 (1995); Ponderosa Homes, Inc. v. City of San Ramon, 23 Cal. App. 4th 1761,29 Cal. Rptr. 2d 26 (1994); Jones-Hamilton Co. v. Franchise Tax Board, 268 Cal. App. 343, 73 Cal. Rptr. 896 (1968). Three California Supreme Court decisions interpreting the provisions of Proposition 13 provide guidance as to how the courts will construe an initiative measure. See generally Amador Valley Joint Union High School District' v. State Board of Equalization, 22 Cal. 3d 208, 149 Cal. Rptr. 239 (1978); City and County of San Francisco v. Farrell, 32 Cal. 3d 47, 184 Cal. Rptr. 713 (1982); Carman v, Alvord, 31 Ca1.3d 318,182 Cal. Rptr. 2d 506 (1982). In Amador, the supreme court stated: . [C]onstitutional and other enactments must be receive a liberal, practical common-sense construction which will meet changed conditions and the growing needs of the people. . . A constitutional amendment should be construed in accordance with the natural and ordinary meaning of the words. .. The literal language of enactments may be disregarded to avoid absurd results and to fulfill the apparent intent of the framers. Id. at 245. In addition, when, as here, the enactment follows voter approval, the ballot summary and argument and analysis presented to the electorate in connection with a particular measure may be helpful in determining the probable meaning of uncertain language. Id. at 245-46. In Farrell the supreme court held that the term "special taxes" used in Proposition 13 did not include taxes placed into the general fund for general governmental purposes. The court restated the rules of construction described in Amador: [T]hat an initiative measure should receive a practical construction, that its literal language may be disregarded to avoid absurd results and to fulfill the intent League of California Cities 21 Implications of Santa Clara County Case I -----,,------- ----- . , December 11,1995 , , of the framers; and that ambiguities in the wording of the measure may be clarified by reference to the material presented to the voters in the ballot pamphlet and thecontemporanèous construction of the measure by the Legislature. Id. at 52. Later, in Carman, the supreme court cautioned that "[ e ]lection materials may be helpful but are not conclusive in determining the probablè meaning of initiative language," particularly : where the materials are cöntradict()ry. - Id at 330-31. ' In the ballot pamphlet fo1" Proposition 62" the official title and summary prepared by the, Attorney General stated the measure applied to both new and higher general taxes. Similarly, the -, analysis by the' Legislative~nalyst stated that "this measure establishes new requirements for the adoption of new or higher general 'and special taxes' by local agencies." In addressing the fiscal' , impact of the initiative, the Legisl~tive Analystconclúded: "This measure would prevent the imposition of new and higher gen~ral taxes without voter approval by local agencies other than , charter cities:' .,',-, ,; , " ,I -', , , - ,- 'In't~eballot pamphiet the propönentsargued to the voters that by VOtlngYES'to Proposition 62, "you can take back your right to vote on your hew òr increased 10caLtaxes." the ,argument went on to state: "Proposition 62 gives you the right to votèonnew taxes as 'well as ,increases.in existing taxes." The argument also stated the proponents' intent to statUtorily' -, oveni_lie iheFarrell décisic5p." Ifshould be noted that Fqrrell involved anincn~ase to,an e~isting - gen'eraltax;_'-.-,:'" ',,'" - , -" . - - ' , , , " -- °llly the reblltta1.t~ the-argument in favor of Proposition 62 stated that "[i]t probably .' w°l!}dn't require a vòte"ÒÌ1 tåxincreases:' " '- - , " ,- .<- . . - , ' - , .. " c:: - ", ,_Applying the rules of construction applied by the California Supreme Court in the ," Proposition 13 cases, it would appear that Proposition 62 will be interpreted by the courts to appty t9 both new t~xes and increases in existing taxes., The proponents argued'to the-voters that , the intent of Propositipn62 was to return the power to 'control tax increases to the people. The \- propon~IÍts -further argued that they intended to sta~torily overturn the Farrell decision. Tl1e , fr~ers'statedjntent it further supported by the summary of the initiative prepared by the - Attorney General and the--analýsis:preparedbythe Legislative Analyst. 'The only contrary view wàs_all equivocál one statt~4'in the rebuttal ar¡?;ument.5, '", , ,-' " " , , , " sIn Sante: Clara, the supreme court rejected the district's argument that since the pwporients' arguments in the, , ballot milterials specifically stated their intent tooveirule Farrell, but failed to mention Richmond, that Proposition 62 should '. be limited to districts who have the power to levy a propertY tax~ In addressing this issue, the court quotes from the, ' pwponents' arguments and the legislative analyst's analysis thatPwposition 62 applies to any ' tax increases.' Although the court's quotàtion indirectly suggeststhatthé supreme court does not disagree with the argument that Pwpositiori 62 applies - I to b()th new and increased taxes. Santa Clara County Transportation Authorityv. Guardino, 11 Cal. 4~ 220, 45 Cal. Rptr. 2d I 207,95 DaiI)' Joùmal D.A~R. at 13021 (1995).' ' , , League of California Cities 22 Implications of Santa Clara County Case' & ¡ . December 11, 1995 To construe the words "impose any general tax" to mean only new taxes would leave a gap in Proposition 62's protections as a city or county could increase its existing taxes by as much or more than the amount of a new type of tax. Thus, a too literal interpretation of the word "impose" could lead to results contrary to the state intents of the framers of the initiative. 2. Does Proposition 62 apply to automatic escalator or increase provisions in a valid tax? Many tax ordinances, particularly business license taxes provide automatic annual increases in the tax rate. If the tax was validly adopted prior to or after Proposition 62, then any increase in the tax rate that results from an automatic escalator or adjustment provision adopted as part of the original tax measure should be valid and enforceable. Santa Clara briefly discusses the meaning of the tenD "impose" used in Proposition 62. The court stated that in the context of the initiative, the tenD "imposed" means "enacted." Similarly, in Ponderosa Homes, Inc. v. City of San Ramon, 23 Cal. App. 4th 1761, 29 Cal. Rptr. 2d 26 (1994), the court of appeal held that a traffic mitigation fee was imposed when it was created by a condition added by the city council to the subdivision map, not when the developer later complied with the condition by paying the fee. A built-in escalator would be enacted or created at the time that the original tax ordinance was adopted. It does not seem reasonable to construe the automatic, ministerial application of an escalator provision as an enactment. 3. Does Proposition 62 apply to the repeal of a ~~unset clause in a general tax ordinance? In recent years, some cities have adopted general tax ordinances with sunset provisions which provide that the tax ordinance will tenninate automatically on a specified date. After Santa Clara, the question has been asked as to whether such a sunset provision may be repealed without voter approval. As discussed above, it appears that the courts will construe the tenD "impose" to apply to any enactment or creation of a tax. When a tax ordinance has been adopted with a sunset provision, the applicability of the tax is limited to a stated tenD beyond which the tax cannot be collected without further legislative action which would require the "enactment" of a new ordinance amending the original !I tax ordinance. In other words, the repeal of a sunset provision has the effect of creating a new 'I tax that becomes effective when the tax otherwise would have expired. Although no reported cases were found directly addressing this question, it would appear that the repeal of a sunset provision would require voter approval under Proposition 62. League of Cali fomi a Cities 23 Implications of Santa Clara County Case u - ---- - . ~ '. December 11, 1995 CHARTER .CITIES ISSUES . , 1. DoesProposition 62 apply to charter cities? . Proposition 62 says in California Government Code sections53722 and 53723 that local governments are prohibited from imposing either special or general taxeswithoutobtaining voter approval therefor. The tenn "local government" is defined in Government Code section 53720(a) to include charter cities: . .' '. . . , . , "".' . Despite this language, there is a strong argument that the voter approvalrequiremeÌ1t~ of . . Proposition 62 may not be constitutionally applied to charter cities.' . . ." , . , , ... . 2. What does the Santa Clara case say about 'charter cities? . .' - . The CaJifornia SuprenieCourt in Sa1)ta Clara detenninedthat a special taX issued by a .district but approved by'less than two-thirds öfthe voters was invalid underPróposition 62, but the . court did ,not specifically add~ess the question of whether Prqposition 62 may constitutionally apply, to Gharter citie~;. " c. . ' :.'. ': ' .- . , The ,Santa Clara C;ounty Local Transportation Authority ,argued that Proposition 62 should, 'be invalidated because itwas unable to carry out its exþresspurpose (i.e. to give votèrs the right to' " ~. vote'oll new local taXes) from the outset since It is inapplicable to charter êities~ .where nèárlyone- I half of the population 'of the state resides. The court rejectèd the Authorjty's argument without' , . I .' " deciding whetþ.er the,underlying premise was correct. The majonty opinion: states the folloWing: . . "", , . ~ , ' . , 'To deem Propositic)fi' 62 inapplicable to charter cities does hot' make , 1 it partially unconstitutional; it simply limi!s the .reach of the measure by . . >" I I , excludii1g such cities from the mandate. :.. A statute is not invalid merely,. , " 'I " .".' becåuse it may fall short of accomplishingâll that its drafters intended~"c' '1 , . , Santa Clara County Transportation Authority v. Guardino',11Cal. 4th 22~:45 Cal.Rptr. 2d: I 207,95 DailyJournaID.AR. at 13031 (1995). ' . , . ' , . , Two court of appeal decisions,Pielder v, City of Los Arigele$, 14'CaLApp..4th 13.7; '17 Cat 'RptL 2d 630 (1993), ánd Fisher v. County of Alameda, 20 Cal. App:.4t~-l20,20 Cal. Rptr. 2d 24' , (1993), have ruled that charter cities are exempt from Proposition 62. The California Supreme .Court did not express any opinion on either öfthese cases. Accotdingß<:lf any infereÌ1.ce 'canbé " .dra~ from,the foregoing stateplent by the 'court, it Ís that Proposition 62.does not apply' to charter' ..1 cities. ' I '-: " , . Leagúe of California Cities 24 Implications of SalJta'Clwa County Case. --- ------ ----- '" " - December 11, 1995 3. Are there any decisions which address Proposition 62's applicability to charter cities? ' In two different cases, Fielder and Fisher, taxpayers brought suit against charter cities alleging that real property transfer taxes imposed by the cities violated article XIII A, section 4 of the California Constitution (proposition 13}and was preempted by California Government Code section 537256 (Proposition 62). "- - -,' -., With respect to Proposition 62, the taxpayers alleged that section 53725 prohibits "local governments," which term is defined by section 53720(a) to include charter cities, from imposing a real property transfer tax. The cities, however, maintained that they were empowered to impose the transfer tax by virtue of the home rule powers conferred on charter cities by California Constitution, article XI, section 5~ In both cases, the two courts of appeal ruled that Proposition 62's prohibition on real property transfer taxes, section 53725, could not constitutionally apply to charter cities as the power of taxation is a municipal affair which is beyond the reach of legislative enactment7 Neither the Fielder nor the Fisher8 case specifically discussed the voter approval provisions of Proposition 62, for special and general taxes. 4. Why is it generally assumed that Proposition 62 does not apply to charter cities? The primary aim in construing any law is to determine the legislative intent. ,Committee of . Seven Thousand v. Superior Court, 45 Cal. 3d 491,501,247 Cal. Rptr. 2d 362,367 (1988)., Moreover, initiative measures are subject to the ordinary rules and canons of statutory construction. Evangelatos v. Superior Court, 44 Cal. 3d 1188, 1212,246 Cal. Rptr. 2d 629,644 (1988). Relevant to the inquiry into legislative intent is the,context of the legislative enactment and, in this case, the intent ofthe voters of Proposition 62. To ascertain the intent of the voters and their understanding of the ballot measure, it is appropriate to consider the ballot pamphlet in which a measure is presented, including the summary, analysis and arguments. Legislature v. Deukmejian, 34 Cal. 3d 658,673, fn. 14, 194 Cal. Rptr. 781,789, fn. 14 (1983); Sanfordv. Garamendi, 233 Cal. App. 3d 1109,1118,284 Cal. Rptr. 897,901 (1991); Amador Valley Joint Union High Sch. Dist. v. State Ed of Equalization, 22 Cal. 3d 208, 149 Cal. Rptr. 239 (1978). The ballot title and summary of Proposition 62 prepared by the Attorney General clearly states that Proposition 62 was "a statutory, not a constitutional, initiative" and the "provisions. . . 6 Hereafter all statutory references are to the California Government Code unless otherwise specified. 7 The courts rejected the Proposition 13 argument in reliance on Cohn v, City of Oakland, 223 Cal. App. 3d 261,272 :1 Cal. Rptr. 2d 714 (1990), which held that the enactment of or increase in a transfer tax is not prohibited by article XIII A when the transfer tax is a general, rather than a specific tax. 8 In Fisher, 20 Cal. App. 4th at 128, the court noted that the prohibition of real estate transfer taxes in section 53725 "appears in a provision with a purpose distinct from the voter approval requirements found in other parts of the initiative." League of California Cities 25 Implications of Santa Clara County Case ",> -: December 11, 1995 imposing penalties and requiring voter approval cåimòt be applied to cnarter cities." Further, the 'I "Analysis by the Legislative Analyst" provides: I Because this measure is not a constitUtional amendment, the voter approval, ,I requirements for the adoption of-new or higher general taXes; and the pen~lty ," , 'provisions, would not apply to charter cities. Thus, this measure does not èhange " the constitutional authority of charter cities to impose new or higher general taxes by a majority vote ofthè CitY council. .. This measure would prevent the , imposition of new or higher general taxes without voter approval by local agencies' 'other than ch,<irter cities. ' ' ' , " , , , , c , ' , , I, ,Thè "Rebuttal to Argument in Favor of Proposition 62," also says the following: " ' ";', ' :, .. ..' ',' ' , , , '" The authors even negleèted to make this a constitutional amendment That means they've left out charter cities, which have constitutional authority to gov~rn I : themselves. They've)eftout 82 cities; .'. . [t]hat leaves mostly small-,andmediUIIl- " sizèdcities, whichalreil~y generally have 100yer taxes:than charter cities. ' , - »articulàriY,ri()tewortliy is the faêt that thè "Argument i~Favó~ofPropositi~n62" did n~t.', : contradict or. refute the information of either the Attorney General, Legis~ativ~Ap,alys~ or '" .... 'opponents of Proposition 62; It is evidentthat the þallot pamphl,et prepare,d for and, as,presented t~ "'" ,'.thevótèts'prior toJh~a~öption of Proposition 62 discussed the effect oftheinÜiative, I1amely that', ' -the provisions of the measÚfe could not be applied t9,chartercites. "" ' : ' , " :Thec'órrectrless of the Attorney General or the Legislative Analyst anályses is riötthe issue; c, ' ' " " " " .. there' isarèliable basis for the courts tódetermine that the voters considered thè,nîáti:er'ancl must' , hàve intend~~?hat ch'!i1er cities, were exempt from Proposition 62's voter ,appro~al:r~qui¡'einents. " , , ' , ' , " " 5; 'How dl!es the plain meaning-rule apply to the charter city issue and Proposition 62? " , ' , , As j~st discussed, Proposition"62 plainly states that its voter approval requirements âpply to ,'charter ciiies.9" However, both the official title and summary and the longer analýsis of Proposition .. .. I ' , ' , " 9,The keYlàngu~ge'åppears in tIi~defmition seçtion, whiCh includes charter cities within the defmitioil of local , .. ,govê~ents to which the~nitiative applies: ' , " ,', ' , ,,' '-'" i ,',: , . . ,(a). "local government" mean!) anycoúnty,city, city and ~ounty, mc1uding à charte'r city or" " , countY, or any public or municipal ~orþoration; .. -, . ' , Gov'ièode § 53720: - ,~I " ,League of California Cities 26 ' Implications of Santa Clara 'County Case -- ' - ---~~--'~-~- I I ç 0, 0' I ~ December 11, 1995 I 62 that appeared in the 1986 ballot pamphlet informed voters that the measure could not constitutionally be applied to charter cities.lO The California Supreme Court has acknowledged that "[o]ften voters rely solely on the title and summary ofthe proposed initiative and never examine the actual wording of the proposal." Taxpayers to Limited Campaign Spending v. Fair Political Practices Com., 51Cal. 3d 744, 770, 274 Cal. Rptr. 787, 803 (1990) (quoting Schmitz v. Younger, 21 Cal. 3d 90,99,145 Cal. Rptr. 517, 522 (1978)). On the other hand, the general rule is that the plain meaning of the statute will control over any legislative history that conflicts with it. There are two arguments, however, that might overcome that presumption. What has become know as the "plain meaning" rule is really a procedural hurdle--similar to the parol evidence rule applicable to interpretation of a contract--that must be overcome in order for a court to consider a statute's legislative history. The plain meaning rule holds that if the meaning of a statute is plain on its face, there is no need for statutory interpretation to divine legislative intent and therefore no need for such extrinsic aids as ballot pamphlet materials or other legislative history. Lungren v, Deukmejian, 45 Cal. 3d 727, 735, 248 Cal. Rptr. 115, 120 (1988). Relying on this rule, the court in Fisher v. County of Alameda, 20 Cal. App. 4th 120, 127,24 Cal. Rptr. 2d 384 (1993) held that because the language of Proposition 62 is unambiguous, it would not consider the measure's legislative history. The Fisher court could easily have gone the other way on this issue had it chbsen to. The city's brief!! in the Fisher case, does an excellent job of applying the supreme court analysis of latent ambiguity in the Kennedy Wholesale case to Proposition 62. Kennedy Wholesale, Inc. v. State Bd of Equalization, 53 Cal. 3d 245, 279 Cal. Rptr. 325 (1991). See also Silver v. Brown, 63 Cal. 2d 841,845,48 Cal. Rptr. 609, 611 (1968); County of Sacramento v. Hickman 66 Cal. 2d 941 849,59 Cal. Rptr. 609, 614 (1967); People v. AU, 66 Cal. 2d 277,57 Cal. Rptr. 348 (1967); Nat. RR. Passenger Corp. v. Passengers Assn., 414 u.s. 453,458,94 S. Ct. 690,38 L. Ed. 2d 646 (1974); Sutherland, 2A Statutory Construction, § 48.01 at p. 302 (5th ed.). 10 The Attorney General's title and summary goes further than the legislative analyst's analysis and says: "As this is a statutory, not a constitutional, initiative, the provisions of this measure imposing penalties and requiring voter approval cannot be applied to charter cities." Presumably, because of Proposition 13's voter approval requirement for special taxes, the legislative analyst said only that Proposition 62 would be apply to general taxes imposed by charter cities: Because this measure is not a constitutional amendment, the approval requirements for the adoption of new or higher taxes, and the penalty provisions, would not apply to charter cities. Thus, this measure does not change the constitutional authority of charter cities to impose new or higher general taxes by a majority vote of the city council. (Emphasis in original.) 11 Copies of the brief is available for check-out from the League, To do so, use the order form on the inside back cover of the City Attorney's Index or at the end of the City Attorneys Newsletter and ask for Brown, Fisher Brief, 10/31/95. League of California Cities 27 Implications of Santa Clara County Case I ~ "., ..í ~, ------- " :;" December 11, 1995 Here, where the circumstances under,which the law was passed so dearly indicated'a legislative intent contrary t<? the words of the statute, a court should take that intent into account. This is particularly the case in situations where the statute is passed by popular initiative, where the deliberative process is not available. If the applicability of the statute,to charier cities haq come up , in the legislature prior to enactment, the authors would have had an opportunity tò take' amendments of to participate in full debate on the issue. ' , , I ~, In a statewide initiative, however, there is iloprocedlire by which a r:neastÌr~ can be amended once it has qualified for the ballot, and formal debate is limited to the arguments for and against the measure in the ballot pampWet. The people must take what is prese1).ted to them and: , vote yes or no based on the information given them inthe ballot pamphlet. The supreme court's acknowledgment that most people never read the text of a measure and rely insteàd on the title and , , sUII1IÌlary makes the plaiPrnea,ningrule particularly inappropriate herè. ,,' , - , However,'acoUI1 may be reluctfutt to rule that the AttomeyGeneral's intèrptetatiòn of a , 'statúte$hould prevail overthe statute's clear language to the contrary. There is an additional , , argumentthat is not inconsist~nt with t4e latent ~~iguity argument and.Jhatis l~mitêd to the ',' " 'peculiar facts surT<;>undingthe passélge ofPropósitión62. It relies On traditional severábility aÌ1alysis, but w~tþ a twist.: , 0:,' " , " '::' " " - , . ' The ståtements ofthe Attorney GenerafandtheLegislative:Anffiystirithe ballot þ'ampWet , about the,élpplicability of Proposition 62 to chartircities apparently weréthe subjèct oflitigation'in , August 1986. TheSåàamento Superior Court ruled that tl).estatements were'coiTectàri.d defied the ' proporiént~' petition for writ of~andate to have them changed. C~ties litigating thìs issue should' obtain 'a copy ofthepleading in the case and the court's judgment and to determine whether or not 'I , the proponents sought furthenelief in the Third District Court of Appeal. If they did~ they clearly' , I did 'not succeed, because the statements were printed in the ballot pámpWet. -" ,> " I Thus; cities may have a final declaration of a court of competent jurisdiction thClt I , , - , I , Proposition 62 cannot constitutionally be applied to,charter cities; The measure has aseverability I clause, albeit a strarÍge one.l2' Thatdausé explicitly provides that: " ,.":' , ,', " " , ' , " ,'" . " , , If any pr~vision 9f this Article; or the ~pplication thereof to' any persoil, - ," '., '" - - organization, local goveniment, district, or Circumstance is held inV:éllid or' " ' :è, 1Ìi1éonstitutiçnal, the provision to other persons, organizati~n; local' gòvernÌrieilts, d~strict, Qr'circumstances shall not be affected thereby but shall remain in'full force ' , and effect. " , , " .- , , . . " Cat Gov'-t Code § 53750." ',. , , : .', , , " " , , 12 Â,discussi~n ()fProposition 62~s oddseverability clause appears in City JjWdtm!nster~, County of Orange, 204 CaLApp,3d623,251CaLRptr.511(l988). ' ;' " "'f' " , ,-~ .., , League ofCaiïfo~ia èìties <: ,~' ., 28 - Implicationso'rsa¡Ùa Cl~ra C~un'tyç'aSe . c, ------- r ,- -, . .. . ';;; December 11, 1995 62 despite or because ofthe fact that it could not be applied to charter cities. They were informed - of that fact, and they voted for it assuming that it would not be applied to charter cities. Under the unique circumstances of this case, the measure cannot be applied to charter cities, because the voters did not enact it thinking that it would have any effect on charter cities. Both the severability clause and the voters' approval of the statute on the basis of the ballot pamphlet statements about charter cities leave no doubt about what the voters intended. Subsequent courts are not free to go beyond those assumptions to hold now that the measure does in fact apply to charter cities. 6. Is the power to enact general and special taxes a "municipala/fair,,?14 Every California city possesses the general power to "make and enforce within its limits all local, sanitary, and other ordinances and regulations not inconflic1 with general laws." Cal. Const., art. XI, § 7. Ché¡u1:er cities, however, have even greater authority: they have exclusive power to legislate over "municipal affairs." Ordinances enacted in a charter city relating to matters which are purely municipal affairs prevail over state laws covering the same subject. Article XI, section 5 of the California Constitution addresses the "home rule" powers of charter cities. The general principle of self-governance is set forth in subdivision (a), which provides: It shall be competent in any city charter to provide that the city governed hereunder may make and enforce all ordinances and regulations in respect to municipal affairs, subject only to the restrictions and limitations provided in their several charters and in respect to other matters they shall be subject to general laws. City charters adopted pursuant to this Constitution shall supersede all laws inconsistent therewith. Subdivision (b) sets out a nonexclusive list offour categories which are, by definition, "municipal affairs." In terms of the taxation power, there is a line of authority which holds that" ...the levy of taxes for city purposes is a municipal affair. .." See Ex Parte Braun, 141 Cal. 204, 74 P. 780 (1903); City of Grass Valley v. Walkinshaw, 34 Cal. 2d 595, 599, 212 Cal. Rptr. 894 (1949); City of Glendale v. Trondsen, 48 Cal. 2d 93,308 P. 2d 1 (1957); Century Plaza Hotel Co. v. City of Los Angeles, 7 Cal. App. 3d 616,626,87 Cal. Rptr. 166, 173 (1970). However, in California Fed. Savings & Loan Assn. v. City of Los Angeles, 54 Cal. 3d 1, 283 Cal. Rptr. 569 (1991), while the California Supreme Court recognized the earlier cases had declared 14 The analysis for determining whether something constitutes a "municipal affair" can be quite involved. Further analysis of this issue is available for check-out ftom the League. To do so, use the order form on the inside back cover ofthe City Attorney's Index or at the end of the City Attorneys Newsletter and ask for Brown, CalFed and Proposition 62, 11/13/95, League of Cali fomi a Cities 30 Implications of Santa Clara County Case ----- ~, '<., ~ .. December 11, 1995 " If there is any situation for which this provision could have been intended, it is the question of charter cities. No other types of local government organization, district or person to which the initiative was meant to apply could raise a colorable claim of unconstitutionality that would allow the initiative to remain in effect against other entities but not against it. .' Thus, the drafters appear to have anticipated the problem with charter cities and provided for it with their ~usuál severability clause.' " . Severabilitý issues generally require courts to decide whether the voters (or the Legislature) would have wanted to enact the legislation had they known that part of it was invalid or would be held inapplicable to certain situations. People.'s Advocate v. Superior Court, 181 Cal. App. 3d 316, 226 Cal. Rptr. 240 (1986), describes that part of the severability test as follows: The test is whether it can be said with confidence that the electorate's attention was' . , ' sufficiently focused upon the parts to be severed so that it would have separately considered and adopted them in the absence of the invalid portions. Here, because the measure was held inapplicable to charter cities before the election and because the voters were informe~ of the fact in the ballot pamphlet and voted for it ànyway, the answer is clear. The voters wanted Proposition 62 even though they were told that it could not , apply to charter cities. . There is another interesting aspect to this, and that is whether Proposition 62 passed because the voters were told it would not apply to charter cities. Proposition 62 passed with 58 percent of the vote. There is no way of knowing how many people voted for Proposition 62 because it does not apply to charter cities, as opposed to voting for it in spite of the fact that it doesn't apply to charter cities. One possibility is to look into'what percentage of the total "yes" vote came from charter cities. 13 ' . The important point here is that because the declaration of invalidity came before the election and þecause it was officially communicated to the voters in the ballot pamphlet and because they voted for the measure anyway, we know their intent. The voters wanted Proposition 13 On the question of our ability to gauge how many people mig~t have voted for the mèasure because of the assurance that it wouldn't-apply to charter cities, see Taxpayers to Limit Campaign Spending v. Fair Political Practices Commission, 51 Cal. 3d 744, 274 Cal. Rptr. 787 (1991), in which the supreme court discussed the difficulty of discerning , whether or why voters might have voted for each of two ~ampaign reform initiatives on the 1988 ballot: The court [of appeal] assumed that because a majority of voters approved both initiatives, they intended that both take effect to the greatest extent possible. This assumption, however, is incapable of proof. That some voters would have been satisfied with the adoption of either proposition does not suggest that they wanted both, or that the same voters cast a majority of the affirmative votes for each initiative, (emphasis in original.) League of California Cities 29 Implications of Santa Clara County Case -; ',;:;' .. ,--- - ..: .~ .. ',~, I ~, '" . éw, December 11, 1995, ~aterials made it very clear the me,asure would not apply to charter .cities in ~atProposition 62 was' statutory and could not c~ange the constituti~rtal authority of charter Cities to t~.,. " 'Furthen:P.ore, Propositioh 62 doés riot meet the final test of Californi~ Federal as the 'enactmentis not reasonablý related and nàrrowlytailored to resolve the state's asserted interest. while the state statute in California Federal only prohibited the application of othetWise generally applicable local :tàxes to one particular taxpayer class, savings banks, the ,,~ter approval requirements öfProposition 62 broadly prohibits charter cities from imposing aný type of general or sI?ecial,tax absent vpter approval., ' .. The,Califomi~ Supreme Court pointed out in California Federal that savings b~s,~ollectively, contributed a comparatively small sum to the city's annual budget reserves; the loss of Which left the city's taxing authority fundamentally intact. This is certainly not the case here. Application of the voter approval requirements of Proposition 62 would seriously undennine and abrogate the ability of charter cities to levy any general of special tax. In the absence of1ègislative history which indicates a statewidè concern in how local taxes are decided, such a'matter is not of "sufficient extramural dimension" to "justify a new legislative intrusion into an area traditionally regarded as 'strictly a municipal affair.'" California Federal, 54 Cal. 3d at 24,283 Cal. Rptr. at 583. I g; II egal\i s IProp621Com pI ppr .Doc . League of Cali fomi a Cities 32 Implications of Santa Clara County Case í..' '" C' - .' ,> December 11, 1995 I I that local taxation is a "muniëipal affair" within the meaning of article XI, section 5, it ultimately ruled that in limited circumstances where the charter city tax is in conflict with state law and the state law is one of "statewide concern," said tax may be preempted. Specifically, a charter city's business license tax as applied to savings and loan assóciations was barred as a result of a state statute imposing an income tax on financial corporations in lieu of all other taxes and licenses. . . The Califor.nia Federal decision can be limited to the context öflocal taxation on savings banks. The càse does not undermine the fundamental taxing authority of charter cities. Even assuming that California Federal is applicable in this situation, a review of the test set forth by the California Supreme Court in that decision and its subsequent decision i~ Johnson v. Bradley, 4 Cal. 4th 389, 14 Cal. Rptr. 2d470 (1992) indicates that the power to enact general and special taxes is a 'imunicipal affair." .. .' , . . According to the' court, if the matter implicates a "municipal affair" and poses a genuine conflict with state law, the inqUiry then proceeds in two discrete steps. However, even "in cases presenting a true conflict between a charter city measure. . . and a state statute, . . . the hinge of the decision is the. identification of a convincing basis for legislative action originating in extramural . concerns. .. "Bradley, 4 Cal. 4th at 400, 14 Cal. Rptr. 2d at 477; California Federal, 54 Cal. 3d at 18, 283 Cal. Rþtr. at 579. Only if a genuine conflict is found to exist, will the court consider whether the conflicting state law qualifies as a matter of statewide concern. If the state statute does indeed qualify as ~ statewide concern, the statute must be "reasonably related to the resolution of that concern" and be "Ilarrowly tailored to limit incursion into legitimate municipal interests" before the court will find that the conflicting charter city measure ceases to be a "municipal affair." . Bradley, 4 Cal. 4th at 404, 14 Cal. Rptr. 2dat 479. While a conflict may exist between the text of Proposition 62 and a charter city's enactment of a general or special tax without voter approval, as enunciated by the court in California Federal and Bradley, the legislative history of Proposition 62 must be examined to determine whether there is in fact a "convincing basis" for rIDding ~at the issue is actually of statewide concern. I?radley, 4 Cal. ~th at 400, 14 Cal. Rptr. 2dat 477; California Federal, 54 Cal. 3d at 24-25,283 Cal. Rptr. at 583-84. There is no statewide interest in how general and special taxes are decided and Proposition . 62 was never intended totransforin this issue into a matter of statewIde concern. It is important to note that even if the drafters or voters of Proposition 62 had intended t~ create a statewide concern, the inquiry does not stop there as "the Legislature is empowered neither to determine what constitutes a municipal affair nòr to change such an affair into a matter of statewide concern." Bradley, 4 Oil. 4th àt 405, 14 Cal. Rptr. 2d at 480 (citing Bishop v. City of San Jose, 1Cal. 3d 56, . 63,81 Cal. Rptr. 465, 469 (1969)). . Therefore, in addressing this matter, the legislative intent as determined fÇ>r a ballot measure returns to the issue of what the voters had before them. This was discussed above. The ballot I League of Cali fomi a Cities 31 Implications of Santa Clara County Case ----. r - - ,---:=-:-- " ' . c- --- . " ., I ,,', a pub 1 i cat.i 0 n. . 0 f.. THE. ..1 E A <GY.c§9.E,!ÇJ.\.11F.ORN 1 A C.I TIE S . ," , ' , I,' "'" , , ' , ',-, ' " , "'Deceínber 26,1995 : N uniber One , ," ",' .. '.. ' " , , . , Welcome -to ' ,'W orkingG'toup'Cre~tedto " , ('1n,th~Red"', 'D.irect,Prop~, 62Deyel~pments, , " ,~.. ' , ,,' "Welcom~tothefirst A speciahvórking, group has bee¡{createdhy theLeague:ßoardò£', , èditi~n of the "In the Red'~ "Directors to prQvídéLeaguê'directÌonas developments re1åting1:o Jhe, , Alei(This sþeçiä~ bulle:- , ' Propositi?n 62 issue unfo1(:LThi~'gr()up will serve aš ~hedecision' ' , tii1,isspeciållydesigm~d to' ,'makìngbody, representing'the,hoard, and be ~b1e to respond to imm~~'~. ! ' ,'cohlinunicate the làte:st '::' diatel1eeds,throûghout th~ l,egis1ativep,rocess" " ,', , , 'information relating to the, ,'. ' " , '."", , ' , ' ,,' , " SantaClara,Cou,nty.o " ' 'The group, met recel1tlyvia conference call to review proposed legis1él~', , I'dec!sion~nc,hid~ng,qev~k tiv~J~nguaget~atwòuJdma~e~he $anta .clara Couri,t}'casep'rospectivé' .. 'I .opments In the legIslatIve only (see What 5 Next).. They wIll meetregulady, by conference call or ' 1 ,'andjudidalprÒcess,Look,inperson,to anticipäte eventsthroughoutthish~xtyeàraridhe1p guide, 'I I "for tlÏis.1ëtt~rhead t~,get, ' ,- cities , eff?rt ~s wè work together as one body ;~nthis måjórcampaigh:,' ,,' . " up-la-date mformatIOn'on effort., ' ' , , thiscriticaríssue, ," " " .' ' " ,,"", ',' ' ',,' , , , - " The n~xt meeting is 'scheciu1ed for Jan'. 5: 1996;,]fýpù ha.~e coßllnents, ' , thatyóÏi' d liketheLeagri'é to kndwabout;p1eas~Jorwardthen1to the' ! Léagueoffice(916/658~8200) ,or to one ofthecQmmiÙeemembers . listedhdow.'" "', "" ""," ',,' " ' " " ",'" , . Seda1iaSanders,'[eaguePresident, Mayor, E1 Centr~' " " " ' . Jim: Worthen, FlrstVicePresldept,CouÍ1ci1 Merilber,:Eureká fon Bates,SecöndViceJ?resident, CouncÙMember, ,,' " ' '.. 'Los A1amiios', " " " .. " , ',,' ,',' "" ',"'. '., ,Máfy,Andrews"PástPresident,.cóbncilMémber,Chico', On D~cel1lher 14d' t~ed9ah' hforn~a , C;raÎ1tBrimha11, Ci~yManagèrsBoaid Rep., City Manager,: , ,Suprel11e Co~rt ,eme t e . Thousand Oaks ,," " ',', , ,", petitio"nto,rehea,rSàntil"C,,',l,ara 'T"om"','Ma'uk',C'l;t'y" M",a'nag'ers'D"'" rt' ,"t,'p,',"','d' ,'t,'-c','t',": " "", '0:" ,"" ",,", "epamen reSlen"lY, ""C~u1Jty.LocaITrel:nsf°rtattO~Man'agèr,Whitti~r, ,',',,' '.,' " " " ,,:' " A,u.,th",orztyv, Gl1atdzno, , T"hlS ", N',at'a'l'l'e' W e'st 'Cl'ty' 'At' to"r"n' e D' 'rt," t--B' "d' "'R' ,'," ,,' 0"', ' """',' ." " " ys epamen oar ep", - . , means .tbeSepte~þer~~ decls~on.. City Attorney; Brentwood ' "", ~, ' ' , II,' thatrem,sta,te.dProp,osl,t,lo,n,6,2s D,a:,'n'H"'en"t'sc'hk,e",'C l't'y','A"t't,o' Y",D", "rt' "t'p, , 'd",,"t"': ',' ,,",' '.. °""",',',' ",', ',,' rnes',epamen ,reSlen;:' , ,voter-apP,r"o"va1, req" Ulre,ments for, 'C'l'ty', , ',A, 'tt'or'n' e' Y '0, ,c',e', .. .. 'd,' 'd'S- 1, ' 'B' "h' '"" ' ""1',." 'd, ' ,.,', ",ansl,ean,oanaeac,',' genera taxes stalls, , " , " John Witt, Bbarcl Member; City Attorney, San Diego ' , (ovei-) " " ,",' "" " , ' , '.. ' , "1400K,Str~et, Sacramento, CA95814 phone:916/658~8200 :.fax:916/658~8240: e mal/: Icc@statenetcomr ,"~' ,', " , ' -- -- . '.. ~. r~"':'=:. ' " 1 :, ", j!.."."........:...:.JA~.J....:.....,2.'rC'.'o~...'......,,',' ',' ,', ",:l ,: ""q, :'...J,,"!""'~ I, ,'" ::1 "'W" >h" ,t:' ""'N',"'e' 't',' 'C'-c' 0' n' 't'),' lCITY MANAGER~S~()FF,I~,,;,j: , '" as, x '" .~,a _,=,,1 r ~i:~~:~:~::~~~í:f~:oPosÌ" ,RighttQVot~oriíaxesAct " ," '. ,tiori~2 àpply~rtgrèt~oact!~ely,' , ,TheI-f'oward JarvisTaxpay~rs Assöciati~n ando:thersare attempting"" , , th~ ~eà~e w,~~l ~roc~edw;lt~ a , ~, to qualify an initiati"eforthe Novel11ber 5; 1996,getieral electiö~ " ", " , "umfIed campaIgn foraleg~sla- " , ,that\vould amend the California Constitution and would affect local, tiveremedy t(nhe'retróactive ' . gov.ernnl~nt's âu,thårityt6 imB~se taÚ~,f~èsand assessmem;, ~þe . , issue: Th~,J.-'eague's proposal' , , initiative, knowna$ th~~'Rightto VC?te()~,TaxesAct,"rèqilires a , ,wouldyalìdate aU ta~és passed ,niinimumof693,23o.'signatures~o'qualifyfor,ih~Novèmberb:allor. I '.'bef~~e the èffect~:e:daté,ofthe 1\.lth!?úghth'è~f£e\c.tiyedate. ot ~anY ofit~ provisions is~uly 1, 1997, , , ' ; ',' , ":,,'decIslOn, T)ec~mber14, 1995" thereis'O'ne provision relatIng tògeneral taxes that reqUIreS acön~ " ' , I, , ' bec'ausè o£cities' reliance,on,; i, ' firming voteoftaxes/'impo~ed, eXtended or increased, without voter' , : appellate co,urt ~e~cisioIls;that" " aPW9vaP'ånor.:aftèr]anllary 1; 19?5. ' " , ,'", "" ",' , dedar:éd PrOpÖSlt10n' 62 InvalId. ' ,'," " "'" , ' " ", ' ' , ,~, All,súbsequen~tax:e~i~posed, '" ' "'th~state 'Attorney Gene;al :has prèpa'r~d thefôllowing title and, .' " ',orincreaséd-:v,rillbe'subjecué> ' 's~mmary'of thepioposed intit~ative: " , ' ',,', , ,:, ' ,~Propositiån'6~',s voter<lpprova~,' ' ",', ',: ' , " .,',. """ ' -.." requirements. ',,' ' , ' , .' "~VotérApprovaIForLocaléovernmènt Taxe~. LirriìÚttiorìson " ' ,,',' ,"" ,,' " "', ' ,- ,', Fèes, Assessrriënts, ändCharges. InitiatiiJ~ Ço?Zstiiutio.rlaIAmen~- : TheLegislati:v.e'Committee af.': 'me1JLLjmits authority of local'gover~lTI~ntSto impose, taxes an4 ' the Ciiy.1\tt:orneys Deparl~en~ ' p~öperty~related <lssessments,fè~ and c?aiges':~Requires major.- " , , <,', ,'hà~ draftëdlangùage f~r the",' ,¡ty'of votêrs,approve, iricre<lses in gener'al'taxès'andreiterat~$ that, , , ',proposedJegislatìon:to apply, , ' tw,o~thirds mustapprovespecîitltax.Assessmënts, fe~s and" ' , '" ,San~aClar-a to ~PQstDec.l~, ," '; "èhargès must h~s1,Ìbtríitted.to prop~rty ovyuers forapprovalót 1995 tai iþ.áeases of enact- . ,:~~jeèdón,:"afte~noticeand:public'heiiing.,Assessmeiíts,are , :', '", 'meJ:its:oJ?ly:', Thëlanguage' '""',,, ,:liÌhlted,t6thespëeial bèn~fit c~'nferr~d.Jees and charges are ' ~, "a,rgues str~Ì1glythatêities feFed:':¡iinited,to:th~ cost of'p'rovidip.gthc:serviœ,:and may tiotbe, , ",?n pr~dr,'app:ellat~ co~rt d~ci-imposedfor gener<llgovern~ental.servícesava.ilable to th~ , '; ',. sionSi11i pass~ngtaxes1h re~' 'public." " " , , ' , , '". " sporisetoihetakeawayof,' '", ,,':,,"',', ,',' "" "',,',", ">'", "'" " pi-OpçI'ty"r'axesârid 9ther ,rev- ,'", State fiscal' offici'als estim~te the J?ropo~ed 'initi~tiye, if ,it q~ålifies and,' > enue losses due to the State's.. ,,' ", is:approvè4,bythev9ters~ may result.inannual1ocalgóvetnffient ," "buclget :problèmsoverthe last" " revel1li'elosses-whích'pöt'entially e~çeed'$100 million, a~nually; , ',:' " severalyears. Any further" ' , ' .Thesèöffici~lsals() pr~diá additional ànn~ral state atld löcalcasts of 1 , ',re,dùc;tiçni, in revenueloss to:, ' ',:pôtentiallY.tens,ofmillions bfdollars, as~ociated withnewpr()?e-,',. dti~s would devastate many, dural andelee:tion requirements/' , ,'", , '" , " ',,' , : I " ,essentialservicesincludirig" .' ",' " '",' ,,"" , ','" , ,,': ,':. "pÖliëe;fire;',liþraries; parks'etc. Apr,il 29, '1996, 'o/il,Lbe the'lastd,!y f?f þropònel}~s tocirtula~~ the "',' ',,': ,! "," ,',,': ,,',",: '" ',petitionJoisignâtuies'. TheSeèretarybfState:söfficeis:expectedt,ó, , . Disèussionsareundei",ay with, .. ceriifÿ ,by Mçnlday; August 26~ 1996# whether the :petitiónhas beei},' , ihec;overnor's Offi~e"Legisla~', ' signédhythe huinherdf quålifiedÝotefstc> put-the ~e~sureòhth~ " . , :,',tiveleadershipandotheralli~s' 'ballot.,','" "", ,",", ':" "':~' ,,',," ,', to'sëcurea spollsorandgain' "-" " ":', , '",' ",' '" ' ~" support £ot'theprop9saL,' ',' ',Còpi~s åftheproposed initi~tiveareàY:àilablef()r,check-outfr()m ' ',' , " ' ,,',:',: " ' ,,' " , ' ' th~ LeagUe. To b6rrow,a copy ohhe' proposediniative,please , ," . Lö6k'to fu~ure'éditionsöf"In, " 'cont~cqhéLeague Ò{Cali(orniaCitiesLibrary:; NOOK SÚeet, theRed~'for the latest develop- , Sacrameri'to,CA ,9.5814, n 6/658-8236 or-fax, ,916/658~8Z40~, ',' ,I merit:s irfthis;pro.~ess., "", ~ " ',,' , ,', - - -- -- --