BOARD OF SUPERVISORS OF BUTTE COUNTY, Plaintiff and Respondent, v. LINDA McMAHON, as Director, etc., et al., Defendants and Appellants; STEPHANIE ROWE et al., Interveners and Respondents.
No. C003383
Third Dist.
Mar. 29, 1990.
219 Cal. App. 3d 286
John K. Van de Kamp, Attorney General, Charlton G. Hollard III, Assistant Attorney General, Elisabeth C. Brandt and Dennis Eckhart, Deputy Attorneys General, for Defendants and Appellants.
Livingston & Mattesich, Gene Livingston, Melissa M. Meith, Ephraim Margolin, Nicholas C. Arguimbau and Susan Roff for Plaintiff and Respondent.
Max Robinson, County Counsel (Fresno), Pamela A. Stone, Deputy County Counsel, De Witt W. Clinton, County Counsel (Los Angeles), Lawrence B. Launer, Assistant County Counsel, Martha E. Romero, Deputy County Counsel, Lloyd M. Harmon, Jr., County Counsel (San Diego), Terence G. Dutton, Deputy County Counsel, Nancy N. McDonough, Carl G. Borden and Douglas J. Maloney as Amici Curiae on behalf of Plaintiff and Respondent.
Alan Lieberman, Lucy Quacinella, Mark Greenberg and Richard A. Rothschild for Intervener and Respondent.
DAVIS, J.—Linda McMahon, as Director of the Department of Social Services, Gray Davis, as Controller of the State of California, and the State of California (collectively, the State), appeal from a preliminary injunction granted the Board of Supervisors of Butte County (the County). The parties’ dispute involves the State‘s power to require the County to contribute local funds to a state-mandated program. The trial court determined that two constitutional provisions gave the County a reasonable probability of prevailing on its claim for state funding. The court also found that the balance of hardships favored the County. Accordingly, the court‘s preliminary injunction ordered the State to fund the entire nonfederal share of the aid to families with dependent children (AFDC) grants-in-aid program in Butte County.
We shall conclude that the trial court erred by finding that the County would probably prevail on its claim. Neither the two constitutional theories considered post, nor the “home rule” and “impossibility” theories tendered here, support a preliminary injunction. Accordingly, we shall reverse.
BACKGROUND
California has elected to participate in the AFDC program, a federal program funded here 50 percent by the federal government and 50 percent by the state.1 (
On the November 1986 ballot, Butte County voters passed County Measure E, adding subsections (b) and (c) to article III of the Butte County charter. As adopted, Measure E provided that “(b) Except as hereinafter provided in subsection (c), the Board of Supervisors and all other County officials are prohibited from the use of any local funds in programs administered by the Butte County Department of Welfare. [] (c) The Board of Supervisors may provide local funds for the administration of services not to exceed the maximum amount of welfare funds utilized in fiscal year 1978-1979, as adopted in the County of Butte 1978-1979 budget.” In fiscal year 1978-1979, the state picked up virtually 100 percent of the nonfederal share of Butte County‘s AFDC grants in aid program through post-Proposition 13 bailout legislation. (Stats. 1978, ch. 292, § 33; Stats. 1978, ch. 332, § 29.)
Measure E became effective on January 6, 1987, when the Secretary of State accepted and filed it. (See
On January 12, 1987, the Department both petitioned for a writ of mandate and sued for injunctive relief against the County. The Department contended that Measure E violated state law, and it sought to compel the County to continue to fund the Butte County AFDC program in the amounts state law required. On that same date, the County sued the State for declaratory and injunctive relief. The County asserted Measure E‘s validity and sought to compel the State to fund entirely the nonfederal portion of Butte County‘s AFDC grants. Stephanie Rowe, a Butte County AFDC recipient, and Harold Harrison, a Butte County general assistance recipient, intervened in each action. The interveners generally supported the State‘s position.
The court consolidated the actions for hearing. Butte County‘s chief administrative officer, Martin Nichols, testified about various County budgeting matters. Nichols‘s testimony touched on County revenue, state-mandated and local programs, and state AFDC funding. In essence, he testified that state-mandated programs were draining the County budget of funds to carry on local services effectively.
According to Nichols, between fiscal years 1979-1980 and 1985-1986, the proportion of general purpose revenues obligated to welfare costs rose from 7 percent to 15 percent. In that same period, the proportion of general purpose revenues obligated to all state-mandated programs increased from 45 percent to 65 percent. AFDC grant levels alone increased 73 percent, while the County‘s general purpose revenues increased only 31 percent, and the cost of living index increased only 50 percent. Between 1979 and 1986, the County‘s reserves fell from $2.75 million to $330,000.
According to Nichols, these increased welfare costs have forced the County to cut local services such as police and fire protection, road maintenance and libraries. For example, in 1987, Butte County had one sworn sheriff‘s officer per 1,500 residents, one-third the statewide average of one per 500. As a result, Nichols claimed, the County stands “[d]ead last. We have the worst level of protection in any county of California.” Given the present trend in state-mandated welfare costs, Nichols projected that the County will run out of local money for local programs and services halfway through the 1992-1993 fiscal year. As of that time, he claimed, there will be “no police protection, no fire protection, no libraries, in Butte County.”
The trial court voided Measure E as in conflict with state law on a matter of statewide concern. The court ultimately entered a judgment in the Department‘s action directing a writ of mandate to issue. That judgment commanded the County to comply with state law on the funding of all welfare programs irrespective of Measure E‘s provisions.
Although the parties’ pleadings principally disputed Measure E‘s validity, the court saw its ruling not as the matter‘s end but “only the beginning.” In its tentative decision, the court said: “To stop at this point leaves undecided the basic question whether the state can order counties to carry out state-mandated programs without paying for them; leaves untouched any reasonable relief as to the fiscal squeeze the counties find themselves in arising from ever-increasing imposition on the counties of state-mandated financial obligations at the same time as limitations are placed on the counties as to sources of money to pay the increased costs of government; and leaves the unfortunate souls who sorely need financial assistance twisting
The court then considered the County‘s complaint outside of Measure E‘s context. It requested the parties to brief the constitutionality of the state‘s requirement that counties carry out state-mandated programs without complete state funding for such programs. On its own initiative, the court suggested that due process might bar such a requirement.
Following briefing and argument, the court issued a preliminary injunction ordering the State to fund entirely the Butte County AFDC program. The court first concluded the County would likely prevail on the merits on either of two legal theories: “a. The imposition of state mandated costs on Butte County, when the County‘s ability to increase its tax revenues is restricted by virtue of Proposition 13, violates the County‘s or the Board‘s right to due process of the law. [] b. [The] state is required by
The court then found that the balance of hardships favored the County: “Without the protection of a preliminary injunction, the county will bear an ever increasing financial burden to pay for state mandated programs, including AFDC, from limited general purpose revenues. As a consequence, other claims on those funds will be diminished or eliminated with a loss to the citizens of the county of essential county services. [] A preliminary injunction which imposes on the State to pay the entire State‘s share of the AFDC grants for Butte County beneficiaries, from State funds, will cause a nominal increase in the State‘s budget for AFDC grants, but relieve the County of a large obligation which consumes a significant amount of its general purpose revenues. The State is better able to bear the burden and continue functioning during the pendency of this action than is the County.”
The court stayed the injunction “until six months after either the time for appeal expires without the State appealing this order, or after a remittitur is issued by the Court of Appeal or the Supreme Court in this case. The purpose of the delayed effective date is to give the State a reasonable time to arrange for 100% payment of the State‘s share of the AFDC grants in aid for eligible recipients in Butte County.”
DISCUSSION
On appeal, we determine whether the trial court abused its discretion in granting the County the preliminary injunction. “[T]rial courts should evaluate two interrelated factors when deciding whether or not to issue a preliminary injunction. The first is the likelihood that the plaintiff will prevail on the merits at trial. The second is the interim harm that the plaintiff is likely to sustain if the injunction were denied as compared to the harm that the defendant is likely to suffer if the preliminary injunction were issued. [Citations.]’ [Citations.] ‘[By] balancing the respective equities of the parties, [the trial court] concludes that, pending a trial on the merits, the defendant should or that he should not be restrained from exercising the right claimed by him.“’ [Citation.]
“The granting or denying of a preliminary injunction does not constitute an adjudication of the ultimate rights in controversy. [Citations.] Generally, the ruling on an application for a preliminary injunction rests in the sound discretion of the trial court. The exercise of that discretion will not be disturbed on appeal absent a showing that it has been abused. [Citations.]” (Cohen v. Board of Supervisors (1985) 40 Cal.3d 277, 286 [219 Cal.Rptr. 467, 707 P.2d 840] [fn. deleted].)
Where, as here, the preliminary injunction mandates an affirmative act that changes the status quo, we scrutinize it even more closely for abuse of discretion.3 “The judicial resistance to injunctive relief increases when the attempt is made to compel the doing of affirmative acts. A preliminary mandatory injunction is rarely granted, and is subject to stricter review on appeal.” (6 Witkin, Cal. Procedure (3d ed. 1985) Provisional Remedies, § 293, at p. 251.) As our Supreme Court noted many years ago, “[t]he granting of a mandatory injunction pending the trial, and before the rights of the parties in the subject matter which the injunction is designed to affect have been definitely ascertained by the chancellor, is not permitted except in extreme cases where the right thereto is clearly established and it appears that irreparable injury will flow from its refusal. [Citations.]” (Hagen v. Beth (1897) 118 Cal. 330, 331 [50 P. 425].) We must reverse the order
Under this abuse of discretion standard, we turn first to the trial court‘s initial conclusion that the County would likely prevail on the merits on either of two theories. First, the court suggested that the State violates due process of law when it makes counties pay for state-mandated programs while simultaneously limiting, under
I. THE COUNTY Has No DuE PROCESS RIGHTS TO CHALLENGE THE STATE‘S AFDC FUNDING STATUTES.
The
“It is well established that ‘[p]olitical subdivisions of a state may not challenge the validity of a state statute under the Fourteenth Amendment.’ [Citations.]” (City of South Lake Tahoe v. California Tahoe (9th Cir. 1980) 625 F.2d 231, 233.) “[S]ubordinate political entities, as ‘creatures’ of the state, may not challenge state action as violating the entities’ rights under the due process or equal protection clauses of the Fourteenth Amendment or under the contract clause of the federal Constitution. ‘A municipal corporation, created by a state for the better ordering of government, has no privileges or immunities under the federal constitution which it may invoke in opposition to the will of its creator. [Citations.]’ [Citations.]” (Star-Kist Foods, Inc. v. County of Los Angeles (1986) 42 Cal.3d 1, 6 [227 Cal.Rptr. 391, 719 P.2d 987].)
Star-Kist noted that the rule‘s application beyond Fourteenth Amendment and contract clause challenges remains unsettled. (Id. at p. 6.) From this, Butte County suggests the possibility of due process protection under the state constitution. But we see no basis to distinguish state and federal due process protections here. Star-Kist noted that the Fourteenth Amendment confers fundamental rights on individual citizens. “Political subdivisions cannot assert ‘constitutional rights which are intended to limit governmental action vis-à-vis individual citizens‘. . .” (Id. at p. 8.) The same reasoning applies to the due process protections afforded under
Moreover, as against the state, the County has no “property” interest in its revenues. “[A]ll property under the care and control of a county is merely held in trust by the county for the people of the entire state. The county is merely a political subdivision of state government, exercising only the powers of the state, granted by the state, created for the purpose of advancing ‘the policy of the state at large, for purposes of political organization and civil administration, in matters of finance, of education, of provision for the poor, of military organization, of the means of travel and transport, and expressly for the general administration of justice.’ [Citations.] The county holds all its property, therefore, not just highway easements, as agent of the state. [Citations.] [] . . . [A]s against the state, the county has no ultimate interest in the property under its care.” (County of Marin v. Superior Court (1960) 53 Cal.2d 633, 638-639 [2 Cal.Rptr. 758, 349 P.2d 526], italics in original; see also Conlin v. Board of Supervisors (1893) 99 Cal. 17, 21 [33 P. 753] [local moneys are public moneys acquired under the authority of the state for public purposes; Legislature thus may direct a local government to make any payment of its funds].)
Butte County may not challenge the state‘s statutory scheme for AFDC fundings on due process grounds. To the extent the preliminary injunction rests on this ground, we cannot uphold it.
II. CALIFORNIA CONSTITUTION ARTICLE XVI, SECTION 11, DOES NOT REQUIRE THE STATE TO FULLY FUND ALL MANDATED LOCAL PROGRAMS.
Although
To the extent the preliminary injunction rests on
We turn next to two additional theories raised here to support the trial court‘s conclusion that the County would likely prevail on the merits.5 First, the County argues that its payments for state-mandated programs violate its home rule rights when such payments force it to curtail expenditures for local programs and services. Second, the County claims that its financial situation makes it impossible to comply with state law.
III. HOME RULE PRINCIPLES DO NOT PREVENT THE STATE FROM REQUIRING LOCAL CONTRIBUTIONS TO STATE-MANDATED PROGRAMS.
“The principle of home rule involves, essentially, the ability of local government (technically, chartered cities, counties, and cities and counties)
Home rule issues typically arise when the state legislates on matters of purely local concern. Thus, in Sonoma County Organization of Public Employees v. County of Sonoma (1979) 23 Cal.3d 296 [152 Cal.Rptr. 903, 591 P.2d 1], a statute invalidated agreements giving cost of living wage increases to local public agency employees. The court held that the statute violated chartered cities’ and counties’ home rule rights to determine their employees’ compensation. (Pp. 315-317.) In Ector v. City of Torrance (1973) 10 Cal.3d 129 [109 Cal.Rptr. 849, 514 P.2d 433], a statute prohibited charter cities from prescribing residency requirements for their employees. The court held that the statute violated the cities’ home rule right to prescribe their employees’ qualifications. (P. 132.)
State legislation on matters of statewide concern, however, does not implicate home rule rights. On these matters, local government remains subject to state law. (Committee of Seven Thousand v. Superior Court (1988) 45 Cal.3d 491, 505 [247 Cal.Rptr. 362, 754 P.2d 708]; see
Again, we cannot uphold the preliminary injunction on this ground.
IV. THE RECORD DOES NOT DEMONSTRATE IMPOSSIBILITY OF PERFORMANCE.
Finally, the County claims that its financial straits leave it literally unable to comply with the state mandate. It asks us to invoke the equitable doctrine excusing performance where circumstances make such performance impossible.
The traditional equitable maxim, codified in our Civil Code, states: “The law never requires impossibilities.” (
Consistent with this maxim, the law recognizes exceptions to statutory requirements for impossibility of performance. (People v. Lake County (1867) 33 Cal. 487, 492 [impossibility of performance makes mandatory statutory duty directory]; County of San Diego v. Milotz (1953) 119 Cal.App.2d Supp. 871, 883-884 [260 P.2d 282]; see 73 Am.Jur.2d, Statute, § 15, p. 278 [“[W]here strict compliance with the terms of a statute is impossible, compliance as near as can be has been permitted on the principle that the law does not require impossibilities.“].)
The last quotation demonstrates the difficulty in applying the impossibility doctrine to the case before us. The County does not argue here that the injunctive relief granted will allow it to comply substantially with the statutory mandates. The County does not seek mere relief from some onerous detail required by statute. Rather, the County asserts impossibility to excuse entirely its desired nonperformance.
To bolster its claim, the County relies on an encyclopedia passage: “it is very generally held that a public body will not be required to do an act when it is impossible through a want of funds and inability to raise them . . . .” (55 C.J.S., Mandamus, § 14, p. 39.) In addition, the County relies on Sutro Heights Land Co. v. Merced Irr. Dist. (1931) 211 Cal. 670 [296 P. 1088]. We shall distinguish Sutro Heights and conclude that the record before us does not demonstrate impossibility sufficient to justify a preliminary injunction against complete enforcement of the statutory scheme.
We focus first on the evidentiary basis for the County‘s impossibility claim. Despite the County‘s reliance on its administrative officer‘s “uncontradicted” evidence, Nichols‘s testimony demonstrates no literal impossibility of County funding for the AFDC program at the heart of this dispute. Nichols‘s revenue projections do not show that the County will ever be unable to make the AFDC payments at the heart of the dispute. Indeed, from the record before us, we can assume that County revenues will be sufficient to meet state-mandated AFDC payments for the foreseeable future.
Rather, the County‘s “impossibility” argument rests on the purported inadequacies of County revenues to pay for both state mandated programs, including AFDC, and local programs. According to the County, this inadequacy excuses it from funding state-mandated programs. We disagree.
To the extent that this dispute involves a conflict between statewide priorities and local priorities, the statewide priorities must prevail. As the
Beyond the theoretical limitations upon a county‘s power to refuse to fund a state mandate, three separate reasons required denial of the preliminary injunction. First, we note the time frame involved in Nichols‘s testimony. He testified that, as of the time of the court‘s hearing below, the County had at least five years before projected increases in state-mandated program costs would halt local County programs completely. While the wheels of government turn slowly at times, Nichols‘s window gave the County and the Legislature some time to address the County‘s problems.6
Second, the record contains absolutely no evidence suggesting that the County has done anything to increase its own locally generated revenues. While Proposition 13 severely limited the County‘s ability to raise new taxes, it did not eliminate that ability entirely. For example,
Despite the record‘s inadequacies, the County argues that Sutro Heights Land Co. v. Merced Irr. Dist., supra, 211 Cal. 670 compels us to affirm. In that case, a landowner within the district‘s boundaries sought to compel it to perform its statutory duty to drain the landowner‘s property. The court held that, under the circumstances presented, equity would prevent the mandate from issuing.
The court noted that if it ordered the district to drain plaintiff‘s land, then the district‘s other landowners would also seek such an order. “The evidence shows that the district is in no position to meet the cost of such extensive additions to its present drainage system. . . . To compel the district to immediately install the facilities and works necessary to drain all the land in the district requiring drainage would bring financial ruin upon the district and irreparable injury to the land owners in the district, including the plaintiffs. We do not believe that, under this state of facts, it was ever intended by those responsible for the enactment of the Drainage Act of 1907, that an irrigation district, situated as is the defendant in this action, should be compelled to work its own destruction by undertaking to provide drainage facilities for the district, the expense of which is beyond its financial ability to meet or pay for. In fact, before a writ of mandate will issue to compel a public corporation or agency to perform an act involving the expenditure of money, it must affirmatively appear that there are funds available for that purpose. [Citations.]” (211 Cal. at pp. 703-704; see also Flora Crane Service, Inc. v. Ross (1964) 61 Cal.2d 199, 209 [37 Cal.Rptr. 425, 390 P.2d 193] [“mandate does not lie to compel a public officer to authorize expenditures when the proper funds are lacking“].)
We distinguish Sutro Heights. That court noted that each such case “depend[s] upon the facts of that particular case.” (211 Cal. at p. 700.) That case presented the reviewing court with an extensive record. (Id. at p. 705.) In light of that record, the Supreme Court concluded that “the defendant district recognizes the duty imposed upon it by the statute and is
In summary, we cannot conclude that, on the record before the trial court, the County demonstrated a reasonable probability of prevailing on its “impossibility” claim. No other grounds exist to support the trial court‘s conclusion that the County would likely prevail on the merits.10 We thus conclude that the court abused its discretion in
Puglia, P. J., concurred.
EVANS, J., Concurring and Dissenting.—I concur in parts I, II, III, and the general factual summary set forth in the majority opinion. However, I respectfully disagree with the analysis of the facts and law in part IV in the context of the doctrine of impossibility of performance and will dissent from that part of the opinion.
“The law never requires impossibilities.” (
Thus, in Sutro Heights Land Co. v. Merced Irr. Dist. (1931) 211 Cal. 670 [296 P. 1088], a landowner within the irrigation district‘s boundaries sought to compel the district to perform its statutory duty to furnish drainage to
Admittedly, this is not an action for writ of mandate seeking to compel Butte County (County) to perform its statutory duty to fund a portion of aid to families with dependent children (AFDC) grants in that county. Nonetheless, the principle stated is an equitable one (Sutro Heights, supra, 211 Cal. at pp. 704-705), and injunctive relief is an equitable remedy (6 Witkin, Cal. Procedure (3d ed. 1985) Provisional Remedies, § 240, p. 209). If, as a matter of equity, impossibility of performance would be a defense to a petition for writ of mandate by the state against the County, I see no reason the County may not make a preemptive strike by seeking to enjoin enforcement of the statute in the first instance.
In similar fashion, there is no principled reason why the County should not be permitted to enjoin enforcement of the statutory funding scheme for AFDC in that County for financial inability to comply when financial inability would be a defense to an action against the County‘s Board of Supervisors (Board) for contempt should it have refused to comply. Thus, in Ross v. Superior Court (1977) 19 Cal.3d 899 [141 Cal.Rptr. 133 [569 P.2d 727], the Board of Supervisors of Plumas County was found guilty of contempt for refusing to pay certain welfare benefits as ordered by the Department of Benefit Payments (now the Department of Social Services [Department]). The court affirmed the judgment, reasoning, in part, that the unchallenged evidence established beyond question that Plumas County
I recognize that an injunction may not be granted “[t]o prevent the execution of a public statute by officers of the law for the public benefit.” (
I also acknowledge that, in the context of the state-mandated general assistance program (
Finally, I acknowledge that, even in the context of AFDC, it has been held that counties, as agents of the state, are bound to comply with state statute and that relief from state mandates must come from the Legislature
With this in mind, I examine the County‘s likelihood of success on the merits at trial. The uncontroverted evidence adduced at the hearing below disclosed that Butte County is on the verge of bankruptcy because of state-mandated programs, in particular the AFDC program. County has the lowest tax base in the state, with the consequence that per capita general purpose revenues in the county are $139, compared to the statewide average of $268. State-mandated expenses are rising considerably faster than the County‘s revenues, with the result that essential local services must be curtailed. Butte County has “the worst level of [police] protection in any county in California.” And by 1993, it is estimated that state-mandated expenses will consume the entire county budget. On these facts, I do not perceive an abuse of discretion in ruling that the County will likely succeed on the merits at trial.
For the same reason I believe the County is likely to succeed on the merits, the County would suffer more harm should the injunction not issue
I conclude that the issuance of the preliminary injunction in this case is supported by equitable principles established by decisional authority. The relief if granted, however, must be limited to enjoining the Department from requiring the County to contribute 5.4 percent increase of the cost for AFDC grants in the County. To extend the injunction to mandate the state to supply that 5.4 percent share would pose a severe separation of powers problem. The courts may not mandate the Legislature to appropriate money for specific purposes. (See City of Sacramento v. California State Legislature (1986) 187 Cal.App.3d 393 [231 Cal.Rptr. 686].)
Additionally, and I believe more importantly, I would affirm the issuance of the preliminary injunction against a requirement that County fund any increases in the AFDC program required after November 6, 1979, as a violation of the provisions of
It appears obvious to me that the state requirement that the County fund the increase in AFDC mandated by the state is a program within the meaning of
The term “program” in the constitutional context has a dual meaning. One encompasses programs that carry out the government function of providing services to the public, in this instance AFDC. The second are laws that implement state-mandated policy and impose unique requirements on local governments and do not apply generally to all residents in the state. Either finding will trigger the reimbursement requirement. In this case, the
The application of
I would reverse the preliminary injunction to the extent it would require the state to fund Butte County‘s share of the County‘s AFDC program, but would affirm it to the extent it preliminarily forbids the state from requiring Butte County to increase its contribution to the AFDC program in that county and remand the matter for further appropriate proceedings in the trial court.
A petition for a rehearing was denied April 30, 1990, and the opinion was modified to read as printed above. Evans, J., was of the opinion that the petition should be granted. The petition of respondent Board of Supervisors of Butte County for review by the Supreme Court was denied June 27, 1990.