City of San Buenaventura v. United Water Conservation District
226 Cal. Rptr. 3d 51
| Cal. | 2017Background
- United Water Conservation District (District) imposes statutorily authorized groundwater pumping charges to fund recharge and conservation; Water Code §75594 requires nonagricultural rates be at least three times agricultural rates.
- City of San Buenaventura (City) pumps groundwater for municipal distribution and challenged District rates as unconstitutional under California Constitution articles XIII D (Prop 218) and XIII C (Prop 26).
- City argued rates are property-related charges that exceed proportional cost under art. XIII D and alternatively are taxes under art. XIII C because they do not fairly relate to payors’ burdens/benefits and exceed reasonable cost limits (esp. the 3:1 nonagricultural:agricultural ratio).
- Trial court ruled for City, finding the charges subject to art. XIII D and the statutory 3:1 ratio violated proportionality; ordered refunds. Court of Appeal reversed, holding the charges are not property-related under art. XIII D and are exempt from art. XIII C as payor-specific benefits; affirmed aggregate-cost sufficiency.
- California Supreme Court: held the pumping charge is not a property-related fee under art. XIII D (so XIII D proportionality does not apply), but remanded to decide whether the charges satisfy art. XIII C’s separate requirements that (1) total fees be no more than reasonable costs and (2) allocation bear a fair or reasonable relationship to payors’ burdens/benefits.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Are groundwater pumping charges "imposed...as an incident of property ownership" under art. XIII D? | City: Yes — pumping fees function like property-related water service charges and are subject to XIII D limits. | District: No — charge targets the act of pumping/groundwater extraction, not ownership of specific parcels; service is basin-wide. | Held: No — charges are not property-related under art. XIII D. Amrhein and Griffith disapproved insofar as inconsistent. |
| Does Water Code §75594’s 3:1 nonagricultural:agricultural ratio violate art. XIII D proportionality? | City: Yes — ratio forces nonagricultural users to pay disproportionate share. | District: No — ratio distinguishes uses, not parcels; any user can choose agricultural classification. | Held: Not reached under XIII D because XIII D does not apply; trial-court proportionality ruling reversed. |
| Are the charges "taxes" under art. XIII C (Prop 26) or exempt as charges for specific benefits/services? | City: Charges are effectively taxes because allocation and ratio produce disproportionate burdens and may exceed reasonable costs for some payors. | District: Charges are exempt as payor-specific benefits/services (or as non-tax fees) because aggregate charges fund groundwater management and do not exceed reasonable costs. | Held: Article XIII C supplies the correct framework; charges can be non-tax only if total costs are reasonable and allocation bears a fair/reasonable relationship to payors’ burdens/benefits. Remanded to examine allocation question. |
| Did the Court of Appeal err by measuring proportionality only in the aggregate under art. XIII C? | City: Aggregate analysis insufficient — must assess whether allocation among payors fairly relates to their burdens/benefits. | District: Aggregate parity suffices; volume-based charges approximate benefit. | Held: Court of Appeal erred by not fully addressing whether allocation bears a fair or reasonable relationship to payors’ burdens/benefits; remand for that inquiry. |
Key Cases Cited
- Richmond v. Shasta Cmty. Servs. Dist., 32 Cal.4th 409 (Cal. 2004) (connection fees not imposed as incident of property ownership when tied to voluntary act)
- Bighorn-Desert View Water Agency v. Verjil, 39 Cal.4th 205 (Cal. 2006) (ongoing water delivery charges are fees for property-related services)
- Sinclair Paint Co. v. State Bd. of Equalization, 15 Cal.4th 866 (Cal. 1997) (distinguishing taxes from regulatory fees; cost and allocation nexus required)
- Apartment Assn. of Los Angeles Cnty. v. City of Los Angeles, 24 Cal.4th 830 (Cal. 2001) (analysis of Proposition 218 and property-related fee scope)
- California Farm Bureau Fed’n v. State Water Res. Control Bd., 51 Cal.4th 421 (Cal. 2011) (aggregate-cost test and remand when allocation among payors disputed)
- Pajaro Valley Water Mgmt. Agency v. Amrhein, 150 Cal.App.4th 1364 (Cal. Ct. App. 2007) (disapproved in part) (treated pumping charge as property-related under Prop 218)
- Griffith v. Pajaro Valley Water Mgmt. Agency, 220 Cal.App.4th 586 (Cal. Ct. App. 2013) (disapproved in part) (applied water-service exemption)