From the Howard Jarvis Taxpayer’s Association, Sept. 13, 2022:

Back to The First Vote

Thank you for your inquiry regarding the formation and funding of the Tuscan Water District.


You first asked whether the $10 per acre charge is an assessment or a tax. I don’t know. Neither the District’s LAFCO application nor the election ballot is clear on that point.


A Water District has power under Water Code section 36455.1 to impose a benefit assessment on properties specially benefitted by the acquisition or construction of public works for water, sewer, or storm drainage. The uniform $10 charge here, however, does not seem to qualify under that statute because it is not funding any work or improvement, and because such assessments must be supported by an engineer’s report apportioning the costs of the project according to each property’s relative benefit.


Under Water Code sections 36552-36560, Water Districts can seek two-thirds voter approval of an ad valorem property tax in excess of Proposition 13’s one percent cap to repay bonds for the acquisition or improvement of real property by the District.  Again, however, the $10 charge here does not seem to qualify because it is not funding a bond issuance, and because the District formation ballot seeks only simple majority approval.


Water Districts, of course, have authority to establish and collect rates for providing water or sewer services, and can charge fees to well pumpers under the Sustainable Groundwater Management Act, but the $10 per acre charge here does not seem to be tied to either the receipt of a service or the pumping of water.


Under Government Code section 50077, all local districts, including Water Districts, have authority to impose special taxes with two-thirds voter approval. Again, however, this authority seems inapplicable because the District formation ballot seeks only simple majority approval.


Water Code section 36557 authorizes a one-time charge of “fifty cents ($0.50) per acre for each acre of land [to] be used by the board to pay the preliminary expenses incurred in forming the district.” Here, although the District formation ballot states that the $10 per acre charge is “to fund the initial administrative/organizational activities,” it is much greater than fifty cents, and the ballot states that it is “an annual parcel assessment.”


The statute that seems to come closest to authorizing the annual $10/acre charge here is Water Code section 35539 et seq., which empowers a Water District Board, when adopting its budget for the next year, if it finds that expenses will exceed its revenue from all existing sources, can seek majority voter approval of a uniform one-year “special assessment” to make up the difference. But even this statute faces obstacles. The ballot states that the $10 is “an annual parcel assessment.” And it was not proposed by the District Board because there is no board yet.


In short, I don’t know how the $10 charge has been classified by the proponents, or what statutory/constitutional authority they are proceeding under. If the ballot is passed with less than two-thirds landowner approval, you may very well have a good case to challenge it.


You next asked whether the ballot must be limited exclusively to the question of district formation, and not include the $10/acre annual assessment. Ordinarily I would say no, because it is generally legal to combine on one ballot the formation of a district and its proposed initial funding source, provided that the vote required to pass the measure matches the vote constitutionally needed to approve the proposed funding source. In this case, however, since I don’t know the nature of the proposed $10/acre charge, or the statutory authority for it, I cannot say whether it is proper to include it in a simple majority-vote proposal to form the District.


Finally you asked, if the measure is legally challengeable, what course of action is recommended. I would immediately deliver (by means that makes a written record of delivery and receipt) a letter to everyone involved (the County Elections Official, County Counsel, LAFCO, and the proponents of the LAFCO application) explaining why the $10/acre charge is legally suspect. You may provide them a copy of this email if you wish. I would ask them to provide citations to the statutory and constitutional authorities that validate a uniform $10/acre annual “assessment” for administrative expenses, approved by a simple majority.


It is so close to the date of the election, it is likely you will receive no response. At least, however, you will have put them on notice that there is a problem. In any event, you must be prepared to act swiftly if the measure is passed with less than two-thirds voter approval. The statute of limitations for filing suit is probably 30 days (which is the time allowed for challenging a voter-approved assessment or a declared election outcome) and you may need to file your case as a “reverse validation action” under Code of Civil Procedure sections 860-863.  We recommend, therefore, that you retain counsel who is familiar with this procedure.


Timothy A. Bittle

Chief Counsel

Howard Jarvis Taxpayers Association

Back to The First Vote

No comments:

Post a Comment

You may comment anonymously. But keep it civil. We all depend on this water together.