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21 ATTACHMENT 3
City of Pleasanton
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072021
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21 ATTACHMENT 3
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7/15/2021 2:13:11 PM
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CITY CLERK
CITY CLERK - TYPE
AGENDA REPORT
DOCUMENT DATE
7/20/2021
DESTRUCT DATE
15Y
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<br />76 <br />imposing or increasing such fees. The California Supreme Court denied the City of Fresno’s <br />petition for review of the Court of Appeal’s decision on June 15, 2005. <br /> <br />In July 2006 the California Supreme Court, in Bighorn-Desert View Water Agency v. Verjil <br />(46 Cal.Rptr.3d 73), addressed the validity of a local voter initiative measure that would have (a) <br />reduced a water agency’s rates for water consumption (and other water charges), and (b) required <br />the water agency to obtain voter approval before increasing any existing water rate, fee, or charge, <br />or imposing any new water rate, fee, or charge. The court adopted the position indicated by its <br />statement in Richmond that a public water agency’s charges for ongoing water delivery are “fees <br />and charges” within the meaning of Article XIIID, and went on to hold that charges for ongoing <br />water delivery are also “fees” within the meaning of Article XIIIC’s mandate that the initiative power <br />of the electorate cannot be prohibited or limited in matters of reducing or repealing any local tax, <br />assessment, fee or charge. Therefore, the court held, Article XIIIC authorizes local voters to <br />adopt an initiative measure that would reduce or repeal a public agency’s water rates and other <br />water delivery charges. (However, the court ultimately ruled in favor of the water agency and held <br />that the entire initiative measure was invalid on the grounds that the second part of the initiative <br />measure, which would have subjected future water rate increases to prior voter approval, was not <br />supported by Article XIIIC and was therefore invalid.) <br /> <br />The court in Bighorn specifically noted that it was not holding that the initiative power is <br />free of all limitations; the court stated that it was not determining whether the electorate’s initiative <br />power is subject to the statutory provision requiring that water service charges be set at a level <br />that will pay for operating expenses, provide for repairs and depreciation of works, provide a <br />reasonable surplus for improvements, extensions, and enlargements, pay the interest on any <br />bonded debt, and provide a sinking or other fund for the payment of the principal of such debt as <br />it may become due. <br /> <br />Application of Article XIIIC and Article XIIID. For information concerning the specific <br />procedures employed by each Member with respect to its charges and fees, see “DUBLIN SAN <br />RAMON SERVICES DISTRICT,” “CITY OF PLEASANTON” and “CITY OF LIVERMORE.” <br /> <br />The Members believe their wastewater service charges do not constitute “taxes” under <br />Article XIIIC as revised by Proposition 26 because, as described in subsection 1(e)(7) of Article <br />XIIIC, they are “property-related fees imposed in accordance with the provisions of Article XIIID” <br />(and are also charges for a “property-related service” as defined in subsection 2(g) of Article XIIID) <br />and because, as described in subsection 1(e)(2) of Article XIIIC, they are charged for wastewater <br />service, “a specific government service or product provided directly to the payor that is not <br />provided to those not charged.” <br /> <br />The Members believe their connection fees are not “taxes” as defined by Article XIIIC as <br />revised by Proposition 26 because they are charges to a landowner that are imposed (typically in <br />connection with property development) and, as described in subsection 1(e) of Article XIIIC, they <br />are imposed (1) “for a specific benefit conferred or privilege granted directly to the payor that is <br />not provided to those not charged” and/or (2) “for a specific government service or product [a <br />time-limited share of capacity in the wastewater system] provided directly to the payor that is not <br />provided to those not charged,” and which do not exceed either the reasonable costs of conferring <br />the benefit or granting the privilege and/or the reasonable costs of providing the service or <br />product. <br />
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