59 Cal.App.5th 546
Cal. Ct. App.2021Background
- The Los Angeles Regional Water Quality Control Board issued a municipal stormwater permit (No. 01-182) imposing (a) a requirement to place and maintain trash receptacles at all transit stops and (b) inspection obligations for restaurants, industrial sites, and construction sites.
- Several Los Angeles County local governments filed test claims with the Commission on State Mandates seeking reimbursement under Cal. Const. art. XIII B, § 6 for costs imposed by those permit conditions.
- The Commission found the trash-receptacle requirement to be a reimbursable state mandate but concluded the inspection requirements were not reimbursable because local governments could lawfully levy fees to pay for inspections.
- State agencies (Dept. of Finance, State Water Resources Control Board, and the Regional Board) sought writ relief in superior court to overturn the Commission’s finding on the trash-receptacle requirement; local governments cross-petitioned the Commission’s inspection ruling.
- After prior appellate and Supreme Court review on a federal-mandate issue, the trial court ruled neither requirement was a state-mandated program; the court of appeal reversed, holding trash receptacles require subvention and inspection costs do not because local governments have fee authority.
Issues
| Issue | Plaintiff's Argument (State agencies) | Defendant's Argument (Local govts / Commission) | Held |
|---|---|---|---|
| Whether the trash-receptacle permit condition is a reimbursable state mandate under Art. XIII B, § 6 | Not a reimbursable mandate because it enforces pollution prohibitions and local governments chose a management-style permit | It is a new program / higher level of service imposed by the state requiring subvention | The court held it is a reimbursable state mandate and requires subvention (Commission correct) |
| Whether the inspection requirements are reimbursable state mandates | Same as above: not reimbursable because they enforce pollution bans and local governments elected the permit approach | They are new programs/higher level of service, but subvention not required because local governments can levy fees | The court held inspections are not reimbursable because local governments have authority to levy regulatory fees sufficient to fund them (Commission correct) |
| Whether local governments have authority to levy fees/charges to pay for inspections (Gov. Code § 17556(d)) | State argued limits/overlap with state fees may preclude local fee authority | Commission/local govts: police-power regulatory fees are available and can be fashioned to cover inspection costs | Held: Local police-power authority supports regulatory fees for inspections; Water Code fee overlap does not preempt local fees; inspections are not reimbursable |
| Whether local governments can levy fees/assessments sufficient to pay for trash-receptacle costs (Gov. Code § 54999.7, Health & Safety § 5471, Prop 218 constraints) | State argued local fees could be imposed on transit agencies, adjacent property owners, or via statutory fee authority | Local govts/Commission: statutory fee routes are limited; Prop 218/constitutional limits and statutory context prevent reliable fee coverage for public-transit receptacles | Held: State failed to prove local fee authority sufficient for trash receptacles; constitutional and statutory limits (and user/beneficiary mismatches) mean trash-receptacle costs require subvention |
Key Cases Cited
- Department of Finance v. Commission on State Mandates, 1 Cal.5th 749 (Cal. 2016) (analyzed federal-mandate exception and procedural posture of earlier appeals)
- County of Los Angeles v. State of California, 43 Cal.3d 46 (Cal. 1987) (defines “program” and tests for new program or higher level of service under Art. XIII B § 6)
- San Diego Unified School Dist. v. Commission on State Mandates, 33 Cal.4th 859 (Cal. 2004) (treats public services that increase public safety as reimbursable higher level of service)
- Kern High School Dist. v. Department of Finance, 30 Cal.4th 727 (Cal. 2003) (distinguishes voluntary program participation from compelled mandates)
- San Marcos Water Dist. v. San Marcos Unified School Dist., 42 Cal.3d 154 (Cal. 1986) (limits on charging public entities for utility-related capacity fees)
- Utility Cost Management v. Indian Wells Valley Water Dist., 26 Cal.4th 1185 (Cal. 2001) (interpreting the San Marcos statutory scheme for public-utility fees)