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ITEM: |
CONSENT CALENDAR |
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5.a |
CONSIDER AUTHORIZING BOARD CHAIR TO SEND A LETTER EXPRESSING SUPPORT
FOR LEGISLATION SPONSORED BY ASSEMBLY MEMBER ANNA CABALLERO -- AB 1260, LOCAL GOVERNMENTS TAXES, FEES,
ASSESSMENTS AND CHARGES NOTICE |
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Meeting
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April 16, 2007 |
Budgeted: |
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From: |
David A.
Berger, |
Program/
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General
Manger |
Item No: |
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General Counsel Review: N/A |
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Committee Recommendation: N/A |
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CEQA Compliance:
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SUMMARY: Proposition 218, approved by the California voters in November 1996, applies to all California's cities, counties, special districts and other local agencies; and requires that certain taxes, including fees that are property related, be voter approved. Specifically, Proposition 218 provides that property owners must be mailed a notice of hearing regarding proposed increases to fees and charges for property related services. An agency may not adopt a rate increase if written protests against the proposed fee or charge are presented by a majority of the affected property owners. Water agencies have historically held the position that ongoing water delivery was not property related, but was a voluntary decision made by the customer to obtain water service from each agency. The District has also held this position regarding its User Fee, which is collected based on the charges for water billed to California American Water and the Seaside Municipal Water System customers. The User Fee was last increased in August 2005 to provide additional funding for the Aquifer Storage and Recovery Project.
The issue of whether a fee for providing water service is considered to be property related charge was addressed in a recent court case, when the California Supreme Court held, in Bighorn-Desert View Water Agency v. Verjil (2006) 39 Cal.4th 205, that charges for water delivery are property related and subject to Proposition 218 restrictions. It is not presently clear whether or not the California Supreme Court ruling would also apply to other types of charges such as the District’s User Fee.
AB 1260, a copy of which is included as Exhibit 5.a-A would clarify how water agencies provide notice of proposed new or increased rates and the method for counting written protests. AB 1260 authorizes water agencies to include proposed rate change notices along with the regular billing statement, eliminating the need to send notices as a separate mailing; and would also impose a 120-day statute of limitation on the commencement of a judicial action or proceeding to attack, review, set aside, void, or annul an ordinance, resolution, or motion adopting a new fee or charge, or increasing an existing fee or charge. AB 1260 is scheduled for a hearing in the Assembly Local Government Committee on April 25, 2007.
Without passage of AB 1260, which is strongly supported by the Association of California Water Agencies, water agencies will continue to have uncertainty about how, and to whom, notification of new or increased are provided to and how to count protests. This uncertainty is causing many agencies to spend considerable public funds on additional mailings or duplicate notices. Water agencies will potentially see increases in litigation and associated costs and will have increased difficulty in effectively and efficiently managing their budgets. Without AB 1260, water agencies will remain subject to litigation for a fee increase that was adopted in prior years.
RECOMMENDATION: District staff recommends that this item be adopted with the Consent Calendar, and that the Board Chair will be authorized to sign the letter of Support of AB 1260 (Exhibit 5a-B).
EXHIBITS
5.a.-A AB 1260
5.a.-B Draft District Letter of Support of AB 1260
U:\staff\word\boardpacket\2007\2007boardpackets\20070416\ConsentCal\05a\item5a_exh5aA.doc