CC SR 20170606 E - SB 231 OppositionRANCHO PALOS VERDES CITY COUNCIL
AGENDA REPORT
AGENDA DESCRIPTION:
MEETING DATE: 06/06/2017
AGENDA HEADING: Consent Calendar
Consideration and possible action to oppose Senate Bill No. 231 regarding local
government storm drain fees
RECOMMENDED COUNCIL ACTION:
(1) Authorize the Mayor to sign a letter to Senator Hertzberg in opposition to Senate
Bill No. 231 (SB 231) regarding local government storm drain fees.
FISCAL IMPACT: None
Amount Budgeted: N/A
Additional Appropriation: N/A
Account Number(s): N/A
ORIGINATED BY: Kit Fox, AICP, Senior Administrative Analyst"
REVIEWED BY: Gabriella Yap, Deputy City Manager
APPROVED BY: Doug Willmore, City ManagerV1
ATTACHED SUPPORTING DOCUMENTS:
A. Draft letter in opposition to SB 231 (page A-1)
B. California Contract Cities Association letter in opposition to SB 231 (page
B-1)
C. SB 231 (page C-1)
BACKGROUND AND DISCUSSION:
At the May 16, 2017, City Council meeting, Council Member Misetich asked for Senate
Bill No. 231 (SB 231) to be agendized for a possible letter of opposition. The California
Contract Cities Association (CCCA) has taken a position in opposition to SB 231
(Attachment B). As currently proposed, SB 231 would effectively redefine the term
"sewer" as referenced in Proposition 218 (Prop 218) to include storm drains
(Attachment C). This action would permit local governments to impose storm drain -
related fees without voter approval, which is otherwise required under the prevailing
interpretation of Prop 218. As the City Council is aware, the City's storm drain use fee
has been allowed to expire.
Rancho Palos Verdes is one of many cities facing daunting costs in complying with the
Los Angeles Regional Water Quality Control Board's municipal separate storm sewer
system (MS4) requirements for stormwater capture and treatment. Although Senator
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Hertzberg's attempt to find solutions for cities looking for funding sources to comply with
these regulations is appreciated, CCCA argues that simply passing the costs onto
homeowners without a vote is the wrong way to go about doing it. Prop 218 guarantees
citizens the right to vote on local taxes, fees, and assessments, but carves out
exceptions for trash, water, and sewer fees. The measure did not fully define these
exceptions, leading an appellate court to determine in 2002 that property fees for
stormwater collection were not covered by the water or sewer exceptions.
CCCA argues that SB 231, while well-intentioned, violates the intent of Prop 218 to only
include limited exceptions to the requirement of a vote on most taxes to maintain a
baseline level of public health and safety services. Carving out new exceptions by
changing the definitions of the original exceptions would set an unfortunate precedent
and undermine the longstanding right of residents to vote on their own local taxes and
fees.
Staff has prepared a letter in opposition to the bill for the Mayor's signature (Attachment
A). If approved, Staff will immediately transmit this letter to Senator Hertzberg and
CCCA.
ALTERNATIVES:
In addition to the Staff recommendation, the following alternative action is available for
the City Council's consideration:
Do not authorize the Mayor to sign the letter in opposition to SB 231.
2
June 6, 2017
The Honorable Robert Hertzberg
California State Senate, 18t" District
State Capitol, Rm. 4038
Sacramento, CA 95814
Via FAX: (916) 651-4918
SUBJECT: SB 231 (Hertzberg). Local Government: Fees and Charges
Notice of Opposition
Dear Senator Hertzberg:
The City of Rancho Palos Verdes respectfully expresses its opposition to your SB 231.
Rancho Palos Verdes is one of many cities facing daunting costs in complying with the
Los Angeles Regional Water Quality Control Board's municipal separate storm sewer
system (MS4) requirements for stormwater capture and treatment. We do appreciate
your attempt to find solutions for cities looking for funding sources to comply with these
regulations.
However, we believe that simply passing the costs on homeowners without a vote is
the wrong way to go about doing it. Proposition 218 guarantees citizens the right to vote
on local taxes, fees, and assessments, but carves out exceptions for trash, water, and
sewage fees. The measure did not fully define these exceptions, leading an appellate
court to determine in 2002 that property fees for stormwater collection were not covered
by the water or sewer exceptions. Including stormwater collection in the definition of
sewers would, therefore, allow cities to impose large fees on property owners without a
direct vote of our residents.
We believe that SB 231, while well-intentioned, violates the intent of Proposition 218 to
only include limited exceptions to the requirement of a vote on most taxes to maintain a
baseline level of public health and safety services. Carving out new exceptions by
changing the definitions of the original exceptions would set an unfortunate precedent
and undermine the longstanding right of residents to vote on their own local taxes and
fees. While our city appreciates assistance in complying with our MS4 requirements for
stormwater management, we believe that passing the costs on to property owners without
a vote is not the right or sustainable way to do it.
For these reasons, the City of Rancho Palos Verdes must express its opposition to this
bill.
Sincerely,
Brian Campbell
Mayor
A-1
2016-2017
EXECUTIVE BOARD
Lou La Monte
President
Malibu
Michael Davitt
Vice President
La Canada Flintridge
Sandra Armenta
Secretary/Treasurer
Rosemead
Sam Pedroza
Director -at -Large
Claremont
Jorge Morales
Legislative Director -at -Large
South Gate
Mark Waronek
Marketing Director -at -Large
Lomita
Gustavo Camacho
Immediate Past President
Pico Rivera
Frank Zerunyan
Associate Member Committee
Rolling Hills Estates
Nancy Tragarz
Budget & Audit Committee
Walnut
Liz Reilly
By -Laws Committee
Duarte
Reva Feldman
City Manager/Administrative
Committee
Malibu
Ana Maria Quintana
Legal/City Contract Committee
Bell
Ali Sajjad Taj
Membership Committee
Artesia
Mitch Englander
Resolutions Committee
Los Angeles
Lindsey Horvath
Selection Committee
West Hollywood
James Bozajian
Special Events Committee
Calabasas
Jeff Wood
Ambassadors Committee
Lakewood
Marcel Rodarte
Executive Director
April 11, 2017
CALIFORNIA CONTRACT CITIES ASSOCIATION
17315 Studebaker Rd., Suite 210, Cerritos, CA 90703
(562) 622-5533
www.contractcities.org
The Honorable Robert Hertzberg
California State Senate
State Capitol Room 4038
Sacramento, CA 95814
RE: SB 231 (Hertzberg). Local Government: Fees and Charges
Notice of Opposition
Dear Senator Hertzberg,
California Contract Cities Association (CCCA) respectfully expresses its
opposition to your SB 231.
CCCA is a collection of member cities who contract for municipal services to
provide residents with the best services at the lowest cost. Founded in 1957, today
CCCA represents 72 member cities with more than 7 million residents. Many of our
member cities face daunting costs in complying with the Los Angeles Regional Water
Quality Control Board's municipal separate storm sewer system (MS4) requirements for
stormwater capture and treatment, and we do appreciate your attempt to find solutions
for cities looking for funding sources to comply with these regulations.
However, we believe that simply passing the costs onto homeowners without a
vote is the wrong way to go about doing it. Proposition 218 guarantees citizens the right
to vote on local taxes, fees, and assessments, but carves out exceptions for trash, water,
and sewage fees. The measure did not fully define these exceptions, leading an
appellate court to determine in 2002 that property fees for stormwater collection were not
covered by the water or sewer exceptions. Including stormwater collection in the
definition of sewers would therefore allow cities to impose large fees on property owners
without a direct vote of our residents.
We believe that SB 231, while well-intentioned, violates the intent of Proposition
218 to only include limited exceptions to the requirement of a vote on most taxes to
maintain a baseline level of public health and safety services. Carving out new
exceptions by changing the definitions of the original exceptions would set an
unfortunate precedent and undermine the longstanding right of residents to vote on their
own local taxes and fees. While our member cities certainly need assistance in
complying with our MS4 requirements for stormwater management, we believe that
passing the costs on to property owners without a vote is not the right or sustainable way
to do it.
For these reasons, CCCA must express its opposition to this bill. If you have any
questions regarding our position, please contact our Legislative Analyst Ilissa Gold at
(562) 217-4703.
As
Sincerely,
Lou La Monte
Mayor, City of Malibu
President, California Contract Cities Association
Jorge Morales
Council Member, City of South Gate
Legislative Director At -Large, California Contract Cities Association
AMENDED IN SENATE APRIL 19, 2017
SENATE BILL
No. 231
Introduced by Senator Hertzberg
February 2, 2017
An act to amend Section 53750 of, and to add Section 53751 to, the
Government Code, relating to local government finance.
LEGISLATIVE COUNSEL'S DIGEST
SB 231, as amended, Hertzberg. Local government: fees and charges.
Articles XIII C and XIII D of the California Constitution generally
require that assessments, fees, and charges be submitted to property
owners for approval or rejection after the provision of written notice
and the holding of a public hearing. Existing law, the Proposition 218
Omnibus Implementation Act, prescribes specific procedures and
parameters for local jurisdictions to comply with Articles XIII C and
XIII D of the California Constitution and defines terms for these
purposes.
This bill would define the term "sewer" for these purposes. The bill
would also make findings and declarations relating to the definition of
the term "sewer" for these purposes.
Vote: majority. Appropriation: no. Fiscal committee: no.
State -mandated local program: no.
The people of the State of California do enact as follows:
1 SECTION 1. Section 53750 of the Government Code is
2 amended to read:
3 53750. For purposes of Article XIII C and Article XIII D of
4 the California Constitution and this article, the following words
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I
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1 have the following meanings, and shall be read and interpreted in
2 light of the findings and declarations contained in Section 53751:
3 (a) "Agency" means any local government as defined in
4 subdivision (b) of Section I of Article XIII C of the California
5 Constitution.
6 (b) "Assessment" means any levy or charge by an agency upon
7 real property that is based upon the special benefit conferred upon
8 the real property by a public improvement or service, that is
9 imposed to pay the capital cost of the public improvement, the
10 maintenance and operation expenses of the public improvement,
11 or the cost of the service being provided. "Assessment" includes,
12 but is not limited to, "special assessment," "benefit assessment,"
13 "maintenance assessment," and "special assessment tax"
14 (c) "District" means an area that is determined by an agency to
15 contain all of the parcels that will receive a special benefit from a
16 proposed public improvement or service.
17 (d) "Drainage system" means any system of public
18 improvements that is intended to provide for erosion control, for
19 landslide abatement, or for other types of water drainage.
20 (e) "Extended," when applied to an existing tax or fee or charge,
21 means a decision by an agency to extend the stated effective period
22 for the tax or fee or charge, including, but not limited to,
23 amendment or removal of a sunset provision or expiration date.
24 (f) "Flood control" means any system of public improvements
25 that is intended to protect property from overflow by water.
26 (g) "Identified parcel" means a parcel of real property that an
27 agency has identified as having a special benefit conferred upon
28 it and upon which a proposed assessment is to be imposed, or a
29 parcel of real property upon which a proposed property -related
30 fee or charge is proposed to be imposed.
31 (h) (1) "Increased," when applied to a tax, assessment, or
32 property -related fee or charge, means a decision by an agency that
33 does either of the following:
34 (A) Increases any applicable rate used to calculate the tax,
35 assessment, fee, or charge.
36 (B) Revises the methodology by which the tax, assessment, fee,
37 or charge is calculated, if that revision results in an increased
38 amount being levied on any person or parcel.
39 (2) A tax, fee, or charge is not deemed to be "increased" by an
40 agency action that does either or both of the following:
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1 (A) Adjusts the amount of a tax, fee, or charge in accordance
2 with a schedule of adjustments, including a clearly defined formula
3 for inflation adjustment that was adopted by the agency prior to
4 November 6, 1996.
5 (B) Implements or collects a previously approved tax, fee, or
6 charge, so long as the rate is not increased beyond the level
7 previously approved by the agency, and the methodology
8 previously approved by the agency is not revised so as to result in
9 an increase in the amount being levied on any person or parcel.
10 (3) A tax, assessment, fee, or charge is not deemed to be
11 "increased" in the case in which the actual payments from a person
12 or property are higher than would have resulted when the agency
13 approved the tax, assessment, fee, or charge, if those higher
14 payments are attributable to events other than an increased rate or
15 revised methodology, such as a change in the density, intensity,
16 or nature of the use of land.
17 (i) "Notice by mail" means any notice required by Article XIII C
18 or XIII D of the California Constitution that is accomplished
19 through a mailing, postage prepaid, deposited in the United States
20 Postal Service and is deemed given when so deposited. Notice by
21 mail may be included in any other mailing to the record owner
22 that otherwise complies with Article XIII C or XIII D of the
23 California Constitution and this article, including, but not limited
24 to, the mailing of a bill for the collection of an assessment or a
25 property -related fee or charge.
26 0) "Record owner" means the owner of a parcel whose name
27 and address appears on the last equalized secured property tax
28 assessment roll, or in the case of any public entity, the State of
29 California, or the United States, means the representative of that
30 public entity at the address of that entity known to the agency.
31 (k) "Sewer" includes
32 systems, all real estate, fixtures, and personal property owned,
33 controlled, operated, or managed in connection with or to facilitate
34 sewage collection, treatment, or disposition for sanitary or drainage
35 purposes, including lateral and connecting sewers, interceptors,
36 trunk and outfall lines, sanitary sewage treatment or disposal plants
37 or works, drains, conduits, outlets for surface or storm waters, and
38 any and all other works, property, or structures necessary or
39 convenient for the collection or disposal of sewage, industrial
40 waste, or surface or storm waters. "Sewer system" shall not include
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1 a sewer system that merely collects sewage on the property of a
2 single owner.
3 (l) "Registered professional engineer" means an engineer
4 registered pursuant to the Professional Engineers Act (Chapter 7
5 (commencing with Section 6700) of Division 3 of the Business
6 and Professions Code).
7 (m) "Vector control" means any system of public improvements
8 or services that is intended to provide for the surveillance,
9 prevention, abatement, and control of vectors as defined in
10 subdivision (k) of Section 2002 of the Health and Safety Code and
11 a pest as defined in Section 5006 of the Food and Agricultural
12 Code.
13 (n) "Water" means any system of public improvements intended
14 to provide for the production, storage, supply, treatment, or
15 distribution of water from any source.
16 SEC. 2. Section 53751 is added to the Government Code, to
17 read:
18 53751. The Legislature finds and declares all of the following:
19 (a) The ongoing, historic drought has made clear that California
20 must invest in a 21 st century water management system capable
21 of effectively meeting the economic, social, and environmental
22 needs of the state.
23 (b) Sufficient and reliable funding to pay for local water projects
24 is necessary to improve the state's water infrastructure.
25 (c) Proposition 218 was approved by the voters at the November
26 5, 1996, statewide re_era Eleetion. general election. Some court
27 interpretations of the law have constrained important tools that
28 local governments need to manage storm water and drainage runoff.
29 (d) Storm waters are carried off in storm sewers, and careful
30 management is necessary to ensure adequate state water supplies,
31 especially during drought, and to reduce pollution. But a court
32 decision has exelude found storm water4iontfhoz subject to the
33 voter -approval provisions of Proposition 218 that apply to
34 property -related fees for ..,.__ er and fees, preventing many
35 important projects from being built.
36 (e) The court of appeal in Howard Jarvis Taxpayers Ass'n v.
37 City of Salinas (2002) 98 Cal.App.4th 1351 concluded that the
38 term "sewer," as used in Proposition 218, is "ambiguous" and
39 declined to use the statutory definition of the term "sewer-sy: —'
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1 system," which was part of the then -existing law as Section 230.5
2 of the Public Utilities Code.
3 (f) The court in Howard Jarvis Taxpayers Ass'n v. City of
4 Salinas (2002) 98 Cal.AppAth 1351 failed to follow long-standing
5 principles of statutory construction by disregarding the plain
6 meaning of the term "sewer." Courts have long held that statutory
7 construction rules apply to initiative measures, including in cases
8 that apply specifically to Proposition 218 (see People v. Bustamante
9 (1996) (1997) 57 Cal.AppAth-69 ,, 693; Keller v. Chowchilla
10 Water Dist. (2000) 80 Cal.App.4th 1006). When construing
11 statutes, courts look first to the words of the statute, which should
12 be given their usual, ordinary, and commonsense meaning (People
13 v. Mejia (2012) 211 Cal.AppAth 586, 611). The purpose of
14 utilizing the plain meaning of statutory language is to spare the
15 courts the necessity of trying to divine the voters' intent by
16 resorting to secondary or subjective indicators. The court in
17 Howard Jarvis Taxpayers Ass'n v. City of Salinas (2002) 98
18 Cal.AppAth 1351 asserted its belief as to what most voters thought
19 when voting for Proposition 218, but did not cite the voter pamphlet
20 or other accepted sources for determining legislative intent. Instead,
21 the court substituted its own judgment for the judgment of voters.
22 (g) Neither the words "sanitary" nor "sewerage" are used in
23 Proposition 218, and the common meaning of the term "sewer
24 services " is not "sanitary sewerage." In fact, the phrase "sanitary
25 sewerage " is uncommon.
26 (h) Proposition 218 exempts sewer and water services from the
27 voter -approval requirement. Sewer and water services are
28 commonly considered to have a broad reach, encompassing the
29 provision of clean water and then addressing the conveyance and
30 treatment of dirty water, whether that water is rendered unclean
31 by coming into contact with sewage or by flowing over the built -out
32 human environment and becoming urban runoff.
33 (-g)
34 (i) Numerous sources predating Proposition 218 reject the notion
35 that the term "sewer" applies only to sanitary s, sewers and
36 sanitary sewerage, including, but not limited to:
37 (1) Section 230.5 of the Public Utilities Code. Code, added by
38 Chapter 1109 of the Statutes of 1970.
39 (2) Section 23010.3, whieh was added by Chapter 1193 of
40 the Statutes of 1963.
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1 (3) The Street Improvement Act of 1913 (repealed by Chapter
2 . 1913.
3 (4) L.A.
4 County Flood Control Distriet Dist. v. Southern-Galifomia Southern-GCal.
5 Edison Co. (1958) 51 Ca1.2d 331, where the California Supreme
6 Court stated that "no distinction has been made between sanitary
7 sewers and storm drains or sewers"
8 (5) TL.��Many other cases where the term "sewer" has
9 been used interchangeably to refer to both sanitary and storm
10 sewers in , ' , include, but are not limited
11 to, County of Riverside v. Whitlock (1972) 22 Cal.App.3d 863,
12 Ramseier v. Oakley Sanitary Dist. (1961) 197 Cal.App.2d 722,
13 and Torson v. Fleming (1928) 91 Cal.App. 168.
14 (6) Dictionary definitions of sewer, which courts have found to
15 be an objective source for determining common or ordinary
16 meaning, including V Webster's (1976), American Heritage
17 (1969), and Oxford English Dictionary (1971).
18 (11)
19 6) Prior legislation has affirmed particular interpretations of
20 words in Proposition 218, specifically Assembly Bill 2403 of the
21 2013-14 Regular Session (Chapter 78 of the Statutes of 2014).
22 (k) In Crawley v Alameda Waste Management Authority (2015)
23 243 Cal.App.4th 396, the Court of Appeal relied on the statutory
24 definition of "refuse collection services " to interpret the meaning
25 of that phrase in Proposition 218, and found that this interpretation
26 was further supported by the plain meaning of refuse. Consistent
27 with this decision, in determining the definition of "sewer" the
28 plain meaning rule shall apply in conjunction with the definitions
29 of terms as provided in Section 53750.
30 (i)
31 (l) The Legislature reaffirms and reiterates that the definition
32 found in Section 230.5 of the Public Utilities Code is the definition
33 of"sewer" or "sewer service" that should be used in the Proposition
34 218 Omnibus Implementation Act.
35 (m) Courts have read the Legislature's definition of "water"
36 in the Proposition 218 Omnibus Implementation Act to include
37 related services. In Griffith v Pajaro Valley Water Management
38 Agency (2013) 220 Cal.App.4th 586, the Court ofAppeal concurred
39 with the Legislature's view that "water service means more than
40 just supplying water" based upon the definition of water provided
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1 by the Proposition 218 Omnibus Implementation Act, and found
2 that actions necessary to provide water can be funded through
3 fees for water service. Consistent with this decision, "sewer"
4 should be interpreted to include services necessary to collect, treat,
5 or dispose of sewage, industrial waste, or surface or storm waters,
6 and any entity that collects, treats, or disposes of any of these
7 necessarily provides sewer service.
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