[11] Proposition 218 was the first successful initiative constitutional amendment in California history to add more than one article to the California Constitution and to alter the scope of the constitutional initiative power. Prop 218 In November 1996, California voters passed Prop 218, the "Right to Vote on Taxes Act". This is especially the case for presidential general elections where voters tend to be more inclined to support taxes. To the extent such levies may be imposed by the State of California, whether two-thirds legislative approval is required is determined by the provisions of Proposition 26 approved in 2010.[278]. Cal. XIII D, § 4, subd. Persons or entities that make campaign contributions at the local level, including in Proposition 218 tax elections, may also make campaign contributions at the state level that are politically relevant in a local tax election campaign. The public hearing may also be continued from time to time. [233][234], A standby charge has historically been considered an assessment levied upon real property according to the availability of water. Examples of such tools include: restricting specific wasteful uses of water (e.g., hosing down a driveway to clear debris), water usage caps or rationing, or public disclosure of excessive water users. The general strategy is once a temporary tax passes, it will be easier for the local government to either extend or increase an already existing tax in the future. The written notice must include the amount or rate of the property-related fee or charge proposed upon each parcel, the basis upon which the amount or rate of the proposed property-related fee or charge was calculated, the reason(s) for the property-related fee or charge, together with the date, time and location of at least one public hearing on the proposed property-related fee or charge. [165] The required engineering report is ordinarily prepared by a registered civil engineer. [228][229] If utility revenues exceed the cost of providing the service, the excess fees are considered a tax, and are not prohibited outright, but must instead be approved by the voters as a separate tax. The local initiative power under Proposition 218 has been used before to repeal a local groundwater fee. [39], Proposition 218 passed with 56.55% support statewide, representing a margin of victory of 13.1 percentage points. Const., art. All this could generally be done without voter approval. [254] During and after the tabulation, the ballots are treated as public records subject to public disclosure under the California Public Records Act, and must be made available for inspection by any interested person. (2). Prop. For the 2019–20 Legislative Session, Proposition 218 passed in 79% of the legislative districts held by Democrats and in 100% of the legislative districts held by Republicans. (b), par. [61], Property-related fees or charges may only be levied for "property-related services. (a), par. (a). Proposition 13 was a law designed chiefly to protect property taxpayers. (b), par. On February 2, 2017, Senator Robert Hertzberg (Democrat-District 18-Van Nuys) introduced Senate Bill No. [61] The California Legislature adopted a statute interpreting the term "increase" for purposes of Proposition 218[70] although the courts have final say in interpreting the applicable constitutional language. Another example is a state levy imposed solely within the boundaries of a local government in situations where the state has taken partial or complete control over the local government and is exercising powers ordinarily exercised by the local government. Proposition 218 issues arise when a local agency seeks to finance lifeline utility rate programs by increasing utility fees and charges on other ratepayers without voter approval. Most of the performance data about a local government can be obtained directly from the local government itself. [77] The California Supreme Court construed the election consolidation requirement to not apply when a general tax is proposed by the voters exercising the local initiative power.[78]. (b) [assessment imposed upon a parcel for a special benefit conferred]. Const., art. A property-related fee or charge is "increased" for purposes of Proposition 218 when an agency makes a decision that does any of the following: (1) increases any applicable rate used to calculate the property-related fee or charge; or (2) revises the methodology by which the property-related fee or charge is calculated, if that revision results in an increased amount being levied on any person or parcel of property. As an accountability mechanism, a regional governmental levy can generally be reduced or repealed using the local initiative power under Proposition 218, including the significantly reduced signature requirement thereunder. Cal. Because it was so difficult to win a legal challenge, lawyers were candidly urged not to bother even trying to challenge an assessment in court.[198]. [275] As a result, California courts now exercise their independent judgment in determining whether a property-related fee or charge violates Proposition 218. [192] However, Proposition 218 shifted the burden of demonstrating compliance to the local agency in any lawsuit challenging a property-related fee or charge. Some voters may question the appropriateness of local governments spending taxpayer funds on informational campaigns in connection with local tax measures, particularly when the intent and practical effect of such informational campaigns is to increase the chances of a local tax measure being approved by the voters. ... That the voters explicitly imposed a procedural two-thirds vote requirement on themselves in article XIII C, section 2, subdivision (d) is evidence that they did not implicitly impose a procedural timing requirement in subdivision (b).'"[91]:2. Elec. In particular, use of geographic information system (GIS) data files. The term "local government" for purposes of Proposition 218 is very broadly defined to counter a previous narrow interpretation given by the California Supreme Court under Proposition 13[52] which created loopholes allowing some local agencies to circumvent constitutional voter approval requirements for taxes. [281][282], Section 5 of Proposition 218 contains a liberal interpretation provision constitutionally commanding that its provisions be "liberally construed to effectuate its purposes of limiting local government revenue and enhancing taxpayer consent. Cal. City Attorney, Auburn & Calabasas . Proposition 218 includes five requirements that every property-related fee or charge must satisfy. [188], The California Legislature has enacted additional legal procedures relating to property-related fee or charge elections under Proposition 218. GIS data files containing location-based information relating to a proposed assessment for each parcel within an assessment district may also be available. Ballot Pamphlet, California General Election (November 5, 1996), argument in favor of Proposition 218, p. 76. Const., art. Const., art. [65] The applicable electorate for conducting a local tax election is generally the registered voters of the local government. However, a key reform under Proposition 218 is that it significantly tightens what constitutes a "special benefit" for purposes of levying a lawful special assessment. These procedures and requirements are designed to ensure that any property-related fee or charge levied by a local agency is a legitimate fee or charge and not an unlawful tax imposed without voter approval. [109], The fourth requirement is that no property-related fee or charge may be imposed for a property-related service unless that service is actually used by, or immediately available to, the owner of the property in question. (4). [10] The California Legislature adopted a statute interpreting the term "increase" as applied to property-related fees or charges. Ballot argument filing deadlines and requirements can generally be obtained from the local elections official conducting the tax election. If, contrary to the Salinas decision, stormwater drainage services were classified as an election exempt service, local agencies would no longer need voter approval under Proposition 218 to impose new or increased stormwater drainage fees and charges. [190] Property owner elections with weighted voting do not violate the federal constitutional requirement of "one man, one vote" under the limited circumstances of a special-purpose unit of government assigned the performance of functions affecting definable groups of constituents more than others. Sometimes a proposed property-related fee or charge may be controversial and/or have significant opposition but not enough opposition to attain a majority protest. The measure would restrict local government's ability to raise most forms of revenue. "[27] The credit ratings issue became so heated during the Proposition 218 election campaign that the California State Treasurer, in an effort to calm the municipal bond market, took the extraordinary step of warning measure opponents against exaggerating the possible negative impacts on local government credit ratings and bond issuances when discussing Proposition 218. Local governments in California are generally allowed to write the ballot question for tax elections required under Proposition 218. [180] At the public hearing, any person is permitted to present written or oral testimony to the agency. [131], This article is about California Proposition 218 and its various provisions. Cal. Under Proposition 218, any real property within an assessment district that is owned or used by the State of California is generally not exempt from assessment. XIII D, § 2, subd. [159] This means that electrical or gas service fees and charges imposed by local agencies are not subject to the procedures[160] and requirements[161] applicable to property-related fees or charges, including the proportional cost of service requirement. Regional government can also take the form of delivering government services and programs from the state level down to the regional level. [12] The measure was drafted by constitutional attorneys Jonathan Coupal and Jack Cohen. It is generally preferable to obtain the performance data in electronic format to facilitate further study and analysis. Where the number of affected parcels is large, a majority protest is very difficult to attain even for controversial levies. The standard of review issue addresses the level of deference a court will ordinarily give a local agency in reviewing its legislative actions such as the approval of an assessment. The Howard Jarvis Taxpayers Association has published various "taxpayer tools" to assist taxpayers in situations where a tax measure has been placed on the ballot by a local government.[84]. (a), par. Although assessments exempt under Section 5 are not subject to the assessment approval process contained in Article XIII D, the local initiative power under Proposition 218, including the significantly reduced signature requirement thereunder, can generally be used to reduce or repeal an exempt assessment since that power expressly applies to assessments. Senate Floor Analysis of SB 231, April 21, 2017. Const., art. In nearly every Proposition 218 appellate court case of significance, local government interests, including the League of California Cities, the California State Association of Counties, and the Association of California Water Agencies have sought to limit the scope and application of Proposition 218 restrictions by arguing in favor of narrow or strict interpretations of the taxpayer protections. Const., art. XIII D, § 6, subd. (a) [initiative power in general]; Cal. [105], The Howard Jarvis Taxpayers Association states that some local governments, in an effort to increase the chances of passing a tax, will propose a temporary tax instead of a permanent tax. App. The amount or rate of the property-related fee or charge proposed for imposition upon each identified parcel must also be calculated by the agency. Cal. Proposition 218 also does not prohibit local agencies from using voluntary donations or securing a voter approved tax increase to pay for lifeline utility rate programs. [199], Under the new standard adopted by the California Supreme Court in the Silicon Valley Taxpayers case, California courts must exercise their independent judgment in reviewing whether an assessment imposed by a local agency violates the constitutional provisions of Proposition 218. Const., art. Some assessment districts may contain many thousands of parcels, and sometimes the assessment calculations for each parcel are only available as an electronic data file. [225], For purposes of determining whether a property-related fee or charge complies with the five requirements, a member of the public may generally make a written request and receive a copy of any local agency supporting documentation pursuant to the California Public Records Act. Cal. [33] Neighborhoods would no longer be safe. Prop 218/ Prop 26 McNeill Law 2019-07-03T11:20:28-08:00. Our Approach. [161] This change in the law makes it significantly easier for taxpayers to win a legal challenge involving a property-related fee or charge under Proposition 218. [169] Some special assessments that may have been permissible prior to Proposition 218 are no longer legally permissible because of a lack of "special benefit" under the tightened definition. [209], The second exemption is for any assessment imposed pursuant to a petition signed by the person(s) owning all of the parcels subject to the assessment at the time the assessment was initially imposed. They involve definitions of revenue purposes and benefits, and detailed procedures of local government. Const., art. The California Supreme Court has ruled that voting secrecy protections under the California Constitution[187] do not apply to assessment ballot proceedings under Proposition 218. 3d 585 (June 1987) the two-thirds voter approval requirement for special taxes under Proposition 13,[99] a different and older constitutional taxpayer protection provision, has previously been applied to a local initiative tax increase proposed by the electorate exercising the local initiative power. Cal. Const., art. Such is the case with assessment districts under Proposition 218. As a result of the two-thirds voter approval requirement for local taxes under Proposition 13 being strictly construed, local governments in California were able to impose many local tax increases with either simple majority voter approval or no voter approval at all. Cal. [7] This gives local voters an available political remedy to compel an election regarding a groundwater fee approved by a local government. XIII D, § 6, subd. [71] The term "methodology" refers to a mathematical equation for calculating taxes that is officially sanctioned by a local government. [34] The initiative would immediately have a devastating effect on local government finance. Relying on various provisions of Proposition 218, including the burden of demonstration provision applicable to assessments,[193] as well as language in the Proposition 218 ballot pamphlet, the California Supreme Court concluded that because Proposition 218's underlying purpose was to limit government's power to exact revenue and to curtail the deference that had been traditionally accorded legislative enactments on fees, assessments, and charges, a more rigorous standard of review was warranted. Research has shown that many local tax increases are concentrated in California communities that have the largest public employee pension problems.[119]. [200] This new standard makes it significantly easier for taxpayers to win lawsuits challenging the validity of assessments under Proposition 218.[201]. The "assessment" definition refers to a levy on real property for a "special benefit" conferred upon the real property. [7] This provides local voters with a legislative remedy to address electrical or gas service utility fees and charges imposed by a local public agency that are considered excessive or unreasonable. Const., art. [7] However, even with the significantly reduced signature requirement, qualifying an initiative for a regional levy will generally be more difficult because of the large number of voters involved. [53] The "local government" definition also expressly states that it includes charter cities having a local charter (similar to a local constitution) as their primary source of power.[53]. [103] The legal authority to levy a local government tax (known as enabling authority) must come from an independent legal source such as a statute enacted by the California Legislature, and may be subject to additional statutory restrictions. App. A property-related fee is a fee or charge imposed upon a parcel "as an incident of property ownership." The state Supreme Court held in 2001 in Apartment Ass’n v. City of Los Angeles that a fee is not subject to Prop. (a) [counties and general law cities]; Cal. The majority protest provision for property-related fees and charges requires an absolute majority of the owners of the identified parcels to protest against a proposed property-related fee or charge to legally preclude imposition of the levy. Local agencies generally prefer to legally overcharge ratepayers to pay for lifeline utility rate programs because no voter approval would be required and because it would free up existing local agency funds that could be spent on other purposes. "[145] A "property-related service" is defined as "a public service having a direct relationship to property ownership. Const., art. Proposition 218 does not expressly require an agency to prepare a detailed report in support of a property-related fee or charge. The California Supreme Court has held that a local government must comply with any applicable statutory requirements as well as the constitutional requirements under Proposition 218.[104]. Opinion polls may also be conducted in connection with other revenue sources requiring an election under Proposition 218 such as for a property-related fee or charge[10] or an assessment on real property.[9]. In addition, when local politicians vote to place a local tax measure on the ballot, they are also approving that tax on the merits. In some instances, it may be necessary to make written requests under the California Public Records Act. Cal. As a result of the absolute majority requirement, majority protests for proposed property-related fees and charges occasionally occur but not that often. Should an assessment reduction or repeal initiative qualify for the ballot, the election would be by the registered voters and the ballots would not be weighted. Prop 218 requires the traditional voting procedure, notice, a ballot and an election measure. [43][44][45], Proposition 218 received 62% support in the 26 California counties with a Republican voter registration advantage and 54% support in the 32 California counties with a Democratic voter registration advantage during the November 1996 statewide election.[46]. "[144] A "property-related service" is a public service having a direct relationship to property ownership. [180] The assessment ballots are weighted by the amount of the proposed assessment to be imposed upon the identified parcel for which each assessment ballot was submitted.[189]. However, so far California appellate courts have generally allowed local agencies greater latitude in charging property owners for potential or future use of a property-related service. Const., art. [163], Once an agency has identified the parcels subject to assessment, the agency must then calculate the amount of the proposed assessment for each identified parcel and must give the record owner of each identified parcel written notice by mail of the proposed assessment. Proposition 218 expressly applies to regional governments in California under its broad "local government" constitutional definition. 2004: 32 Cal. Few stormwater quality utilities in the mid-1990s. Additional information that is generally of value to voters includes public employee salary data, public employee benefits data (including pensions), annual audited financial reports, historical (prior years) budgetary data within the local government, and budgetary projections in future years. SGMA (Groundwater) Westside San Joaquin River Watershed Coalition; USBR Program to Meet Standards; Water Management Plan; Data. The California Secretary of State has released a publication on the procedures for recalling elected officials in California.[223]. Metered rates for water (sewer & gov’t-provided trash) are property related fees under Prop. If a property owner does not properly return an assessment ballot, that fact will not count for or against the proposed assessment. [106] The Howard Jarvis Taxpayers Association also states that local governments rarely allow temporary taxes to expire on their own without at least an effort to extend and/or increase the tax, and that voters should assume that any proposed temporary tax will not end at the specified expiration date, but will instead either be extended for an additional period of years or be made permanent.[107]. Cal. An agency may not impose a proposed assessment if there is a majority protest. XIII D, § 5, subd. "[146], Initially, the California Supreme Court in 2001 narrowly interpreted what constitutes a "property-related" fee or charge in concluding that a residential rental inspection fee was not "property-related. [140] Since permissible assessments are limited to special benefits conferred upon real property, in addition to separating the general benefits conferred on a parcel, benefits to persons or to personal property must also be excluded from assessment. A tax is not "increased" under Proposition 218 when a local government does either or both of the following: (1) adjusts the amount of a tax in accordance with a schedule of adjustments, including a clearly defined formula for inflation adjustment that was adopted by the local government prior to the effective date of Proposition 218 (November 6, 1996); or (2) implements or collects a previously approved tax so long as the tax rate is not increased beyond the level previously approved by the local government, and the methodology previously approved by the local government is not revised so as to result in an increase in the amount being levied on any person or parcel of property. 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