Public Revenues & Rate-Making

California’s leading expert on local government revenues

Colantuono, Highsmith & Whatley, PC is California’s leading expert on our complex laws governing local government revenues, including Propositions 13, 62, 218 and 26. Our attorneys argued 10 government revenue cases to the California Supreme Court:

• Richmond v. Shasta CSD (2004) (water connection charges not subject to Prop. 218)
• Bonander v. Town of Tiburon (2009) (statute of limitation for challenge to 1911 Act assessment)
• Greene v. Marin County Flood Control & Water Conservation District (2010) (property‑owner elections on fees not subject to election secrecy that applies to registered-voter elections)
• Ardon v. City of Los Angeles (2011) (Government Claims Act allows class action claims for tax and fee refunds in cities without contrary local claiming ordinances)
• Alhambra & 46 Other Cities v. County of Los Angeles (2012) (calculation of property tax administrative fees with respect to property taxes paid to cities in lieu of sales taxes and VLF under Triple Flip and VLF Swap)
• McWilliams v. City of Long Beach (2013) (Government Claims Act preempts local claiming ordinances as to tax and fee refund claims; class actions permitted)
• Greene v. Marin County Flood Control & Water Conservation District (2010) 49 Cal.4th 277 (property owner ballots on property related fees under Prop. 218 not subject to ballot secrecy)
• Jacks v. City of Santa Barbara (2017) 3 Cal.5th 248 (supplemental franchise not a tax even though passed through to utility customers if reasonably related to value of right of way made available)
• City of San Buenaventura v. United Water Conservation District (2017) 3 Cal.5th 1191 (groundwater augmentation charge subject to Proposition 26, not 218)
• Citizens for Fair REU Rates, Feefighter, LLC v. City of Redding (argued May 30, 2018), (Is transfer from electric utility to City’s general fund grandfathered by Proposition 26?)

Public finance laws

We have been leaders in speaking, writing, advising and litigating matters under California’s initiative public .finance laws since 1995. Our experience includes:

Proposition 26

• Chair, League of California Cities Proposition 26 Task Force
• Contributor, League of California Cities Proposition 26 Implementation Guide
• Counsel for Defendant City of Redding in Citizens for Fair REU Rates v. City of Redding, among the first-filed Prop. 26 cases. The Supreme Court’s decision is due by August 2018. The case challenges a payment in lieu of taxes (PILOT) by Redding Electric Utility to the City’s general fund. The trial court was persuaded by our argument that Prop. 26 is not retroactively applicable to local government fees of this sort.
• Counsel for local government amici in Schmeer v. County of Los Angeles (2013) which found the 10‑cent fee Los Angeles County required retailers to charge for paper bags in its plastic‑bag‑ban ordinance not to violate Proposition 26 because the revenue from the fee does not flow to government
• Counsel for the City of San Buenaventura in a challenge to groundwater augmentation charges under Propositions 26 and 218. The Supreme Court ruled that Proposition 26 controls the case and remanded it to the Court of Appeal where we await further argument.

Proposition 218

• Chair, League of California Cities Proposition 218 Task Force
• Editor and Contributor, League of California Cities Proposition 218 Implementation Guide (1996, 1997, 1997, and 2000 editions)
• Contributor, California Municipal Law Handbook discussion of Proposition 218
• Counsel for local government associations as amici in Bighorn-Desert View Water Agency v. Verjil (2006) 39 Cal.4th 205 (Prop. 218 applies to metered water rates; initiative to reduce domestic water rates prohibited to extent it would require voter approval of subsequent rate increases).
• Counsel for five local government associations as amici in Concerned Citizens for Responsible Government v. West Point Fire Protection District (application of Prop. 218’s requirements regarding special benefit and proportionality to fire suppression benefit assessment) (Supreme Court dismissed appeal as moot)
• Counsel for successful local government in Greene v. Marin County Flood Control & Water Conservation District (2010) 49 Cal.4th 277 (property owner ballots on fees subject to Prop. 218 not subject to ballot secrecy requirement)
• Counsel for successful local government in Richmond v. Shasta Community Services Dist. (2004) 32 Cal.4th 409 (increased capacity charge and fee for fire suppression imposed on applicants for new service connections not an “assessment” subject to Proposition 218)
• Counsel for amici in Mission Springs Water District v. Verjil (2013) 218 Cal.App.4th 892 (allowing pre-election judicial review of initiative to repeal water rate hikes because District could show the measure would set rates unlawfully low)
• Counsel for numerous cities, counties and special districts in Court of Appeal cases arising under Proposition 218.
• We provide Proposition 218 advice to local governments of all kinds on advisory matters and in litigation.

Proposition 62

• Counsel for local government associations as amici in Howard Jarvis Taxpayers Ass’n v. City of La Habra (2001) (continued imposition and collection of a utility user’s tax without voter approval was an ongoing or continuous violation of Proposition 62, with statute of limitations beginning anew with each collection)
• Application of Proposition 62’s remedy of reducing property taxes dollar-for-dollar of allegedly illegal taxes is at issue in the Redding case described above.
• We provide advice to local governments of all kinds in complying with Proposition 62, including requirements for proposing general taxes to voters.
• We are frequent speakers, writers, and commenters in the press on issues arising under Proposition 62.

Proposition 13

Although Proposition 13 was approved in 1978, well before our practice leaders were active lawyers, we are active in current developments under the measure and similar property tax and post-redevelopment disputes, as follows:

• Counsel for 47 Cities in City of Alhambra, et al. v. County of Los Angeles, et al. (2012) 55 Cal.4th 707 (calculation of property tax administration fees on taxes received in lieu of Vehicle License Fees and sales taxes under the VLF Swap and Triple Flip)
• Counsel for the League of California Cities as amicus in City of Scotts Valley v. County of Santa Cruz (2011) 200 Cal.App.4th 97 (calculation of no- and low-property tax city subvention) (counsel for amici)
• Counsel for local government amici in Arcadia Redevelopment Agency v. Ikemoto (1993) 16 Cal.App.4th 444 (agency challenge to application of property tax administration fees to tax increment)
• Counsel for local government amici in Neilson v. City of California City (2005) 133 Cal.App.4th 1296 (flat-rate parcel tax not an unconstitutional general tax, but rather a special tax dedicated to specific purposes; equal protection does not entitle absentee landowners to vote)
• Counsel for respondent local government in Griffith v. Pajaro Valley Water Management Agency (2013) 220 Cal.App.4th 586 upholding groundwater augmentation charges under Props. 13 and 218)
• We provide advice to local governments of all kinds in complying with Proposition 13.
• We are frequent speakers, writers, and commenters in the press on issues arising under Proposition 13.

In short, Colantuono, Highsmith & Whatley, PC and its lawyers have unmatched experience and expertise in the complex laws governing municipal revenues under California’s constitution and related laws. Whether you seek new revenues, advice about maintaining those you have or representation in litigation, we have the skill to provide the most sophisticated representation possible.