CITY OF SAN BUENAVENTURA, Plaintiff, Cross-defendant and Appellant, v. UNITED WATER CONSERVATION DISTRICT et al., Defendants, Cross-complainants and Appellants.
2d Civil No. B251810 (Super. Ct. Nos. VENCI 00401714, VENCI 1414739)
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA SECOND APPELLATE DISTRICT DIVISION SIX
Filed 3/17/15
CERTIFIED FOR PUBLICATION; (Santa Barbara County)
The threshold question before us is whether the District‘s groundwater extraction charges are property-related and thus subject to article XIII D. The trial court, relying on Pajaro Valley Water Management Agency v. Amrhein (2007) 150 Cal.App.4th 1364 (Pajaro), concluded that they are. It found that the District‘s pumping charges violated article XIII D because, pursuant to
We conclude that the pumping fees paid by the City are not property-related and that Pajaro is distinguishable. We reject the City‘s alternative arguments. The pumping fees are not taxes subject to the requirements of
BACKGROUND
I.
Factual and Statutory Background
The District is organized and operated pursuant to the Water Conservation District Law of 1931 (codified as amended in
The District covers approximately 214,000 acres in central Ventura County along the lower Santa Clara River valley and the Oxnard Plain. It comprises portions of several groundwater basins.2 Along the Santa Clara River, from upstream to downstream, the District includes most or all of the Piru, Fillmore, Santa Paula, Oxnard Forebay, Oxnard Plain, and Mound basins. To the east of the Oxnard Plain basin, the District includes the West Las Posas basin and part of the Pleasant Valley basin.
Groundwater recharge in these basins occurs naturally from rainfall as well as from river and stream flow infiltration and percolation. Heavy demand for groundwater throughout the District from both agricultural and urban users causes overdraft, the amount by which extractions exceed natural water recharge. (See
The District‘s water management activities and ongoing operating expenses require a means of funding. The District currently generates revenue from three main sources: property taxes (
The Water Code authorizes districts to impose pump charges in one or more zones within the district “for the benefit of all who rely directly or indirectly upon the ground water supplies.” (
In the 1980s and early 1990s, the District planned and constructed the Freeman Diversion project (Freeman), a major improvement to its surface water diversion facilities along the Santa Clara River near Saticoy. Freeman permanently diverted water from the Santa Clara River to recharge groundwater in the Oxnard Plain
The City overlies nearly the entire Mound basin. At the time the District implemented the pumping charges to fund Freeman, there was a lack of technical agreement as to the degree pumpers in the Mound basin benefited from District‘s activities. The City maintained that its wells would not benefit from Freeman and filed several lawsuits seeking to invalidate both the new Freeman-related charges and the District‘s general pump charges as they applied to City. The parties reached a settlement in 1987. The agreement provided that the Mound basin would be excluded from the Freeman-related charges and a separate billing zone (Zone C) would be established covering the area of the Oxnard Plain basin north of the Santa Clara River. Within Zone C, municipal pumping rates for Freeman were to equal agricultural rates on the Oxnard Plain south of the Santa Clara River. This was accomplished by setting the rates for Zone C equal to a third of the rates for Zone B.
The settlement agreement expired at the end of the 2010-2011 water year when the District paid off its construction loan for Freeman. Beginning in the 2011-2012 water year, Zone C was abolished and incorporated into Zone B, resulting in substantially higher pumping rates for groundwater extractors in the former Zone C. It is this increase in rates to which the City objects.
II.
The Constitutional Overlay
Proposition 13 was adopted by the electorate in 1978. It added A series of judicial decisions diminished Proposition 13‘s import by allowing local governments to generate revenue without a two-thirds vote. (See Schmeer v. County of Los Angeles (2013) 213 Cal.App.4th 1310, 1317-1319 [discussing several such cases].) The watershed case was Knox v. City of Orland (1992) 4 Cal.4th 132, in which the California Supreme Court upheld, as a “special assessment” rather than a “special tax,” a city‘s levy on real property to fund park maintenance. A special assessment under Knox did not require voter approval at all. It was a “‘‘‘‘compulsory charge placed by the state upon real property within a pre-determined district, made under express legislative authority for defraying in whole or in part the expense of a permanent public improvement therein . . . .‘” . . .‘” (Id. at pp. 141-142.) A special tax, while also levied for a specific purpose, differed from a special assessment in that it need not “confer a special benefit upon the property assessed beyond that conferred generally.” (Id. at p. 142, fn. omitted.) The result was that Proposition 13‘s directive of limiting the taxes imposed on property owners, and in particular homeowners, was circumvented through an ever increasing proliferation of special assessments and other property-related fees and charges that were not deemed “taxes.” (See Apartment Assn. of Los Angeles County, Inc. v. City of Los Angeles (2001) 24 Cal.4th 830, 839 (Apartment Association).) In response, the voters in 1996 approved Proposition 218, which added While Proposition 218 sharply limited local governments’ ability to raise revenue from property owners without their consent, it did little to limit the imposition of regulatory fees imposed on a basis other than property ownership. Fees classified as something other than “taxes” were not subject to Proposition 13. For example, in Sinclair Paint Co. v. State Bd. of Equalization (1997) 15 Cal.4th 866, the Supreme Court considered certain “fees” imposed on manufacturers that contributed to environmental lead contamination. Sinclair Paint concluded that the fees funding services for potential child victims of lead poisoning constituted “bona fide regulatory fees, not taxes, because the Legislature imposed the fees to mitigate the actual or anticipated adverse effects of the fee payers’ operations, and [by law] the amount of the fees must bear a reasonable relationship to those adverse effects.” (Id. at p. 870.) Largely in response to the Sinclair Paint decision, California voters approved Proposition 26 in 2010 to close the perceived loopholes in Propositions 13 and 218 that had allowed “a proliferation of regulatory fees imposed by the state without a two-thirds vote of the Legislature or imposed by local governments without the voters’ approval.” (Schmeer v. County of Los Angeles, supra, 213 Cal.App.4th at pp. 1322, 1326.) Proposition 26 broadened the constitutional definition of “‘tax’ to include ‘any levy, charge, or exaction of any kind imposed by’ the state or a local government, with specified exceptions.” (Id. at p. 1326, citing Taken together, Propositions 13, 218, and 26 create a classification system for revenue-generating measures promulgated by local government entities. Any such measure is presumptively a tax. If the revenue is collected for a payor-specific benefit or service (see A measure‘s classification determines the requirements to which it is subject. Taxes cannot be levied by a special purpose district (such as the District) for general revenue purposes. ( In order to levy a property-related fee or charge, a number of procedural and substantive requirements must be met. As relevant here, the fee must not “exceed the proportional cost of the service attributable to the parcel.” ( A fee or charge for a payor-specific benefit or service that is neither property-related nor a tax must “not exceed the reasonable costs to the local government of conferring the benefit[,] granting the privilege,” or “providing the service or product.” After Freeman was paid off and the terms of the 1987 settlement were no longer in force, the District proposed to eliminate Zone C and merge it with Zone B, effectively tripling the City‘s rate per acre-foot of water. In addition, in both the 2011-2012 and 2012-2013 water years, the District proposed increasing the rate charged District-wide (Zone A). The District notified well owners of the proposed changes and invited them to comment. Only a minority of the well owners, including the City, submitted protest letters. Over the City‘s objections, the District eliminated Zone C and adopted the proposed rates. The City filed two lawsuits, which were consolidated. It sought to overturn the District‘s rate decisions through a writ of mandate ( The City challenged the rates on two fronts. First, it asserted that the statutorily-mandated 3:1 ratio between groundwater extraction rates for non-agricultural and agricultural uses constituted an illegal subsidy for agricultural users at the expense of The trial court concluded that the groundwater extraction charges (1) bore a reasonable relationship to the City‘s burdens on and benefits from the regulatory activity and thus were valid regulatory fees rather than special taxes subject to Proposition 13; (2) were property related fees and charges subject to article XIII D (Prop. 218); and (3) were not, as property related fees, taxes under Proposition 26. The court did not determine whether the San Marcos legislation or the common law of utility rate-making applied to the extraction charges but found that, if they did, the charges did not exceed the reasonable cost to the District of providing the service and were reasonable, fair, and equitable. Analyzing the extraction charges under article XIII D, the trial court similarly found that the charges in the aggregate were reasonably proportional to the District‘s costs and comported with Proposition 218. However, it found that the 3:1 ratio between rates for non-agricultural and agricultural water use mandated by The District appeals the trial court‘s conclusion that Proposition 218 applies to its groundwater extraction charges. In the alternative, it appeals the court‘s ruling that to satisfy Proposition 218, the District must present quantitative evidence justifying the 3:1 rate disparity rather than pointing to qualitative differences between agricultural and other water users that impact the relative cost of conservation services. The District also appeals the court‘s decision to award a partial refund rather than to remand to the District so that it can conduct further proceedings to determine whether the 3:1 ratio is justified under article XIII D. Finally, the District contends that the court‘s refund calculation is incorrect. The City cross-appeals, seeking declaratory relief. First, it asks us to hold that We conclude that the pump charges paid by the City are neither property-related fees nor taxes, that they do not exceed the District‘s reasonable costs of maintaining the groundwater supply, and that the District allocates those costs in a fair or reasonable relationship to the City‘s burdens on this resource. Accordingly, we reverse the judgment in favor of the City and direct the trial court to vacate its writs of mandate. We review de novo a trial court‘s determinations whether taxes, fees, and assessments imposed by a local governmental entity are constitutional, exercising our independent judgment. (Silicon Valley Taxpayers’ Assn., Inc. v. Santa Clara County Open Space Authority (2008) 44 Cal.4th 431, 448-450.) In the trial court, the governmental entity has the burden of showing, by reference to the face of the record before it, that its charges satisfy the Constitution. (See “[W]e exercise our independent judgment in reviewing the record,” but “we do not take new evidence or decide disputed issues of fact.” (Morgan v. Imperial Irrigation District, supra, 223 Cal.App.4th at p. 912.) Instead, we review the resolution of factual conflicts by the trial court under the substantial evidence standard. (Id. at p. 916.) “Under this standard, ‘the power of an appellate court begins and ends with the determination as to whether there is any substantial evidence, contradicted or uncontradicted, which will support the finding of fact.’ [Citation.]”7 (Ibid.; see Schmeer v. County of Los Angeles, supra, 213 Cal.App.4th at p. 1316.) When construing a provision of the state Constitution brought about by voter initiative, we apply the same interpretive principles governing statutory construction. (Professional Engineers in California Government v. Kempton (2007) 40 Cal.4th 1016, 1037.) “[O]ur paramount task is to ascertain the intent of those who enacted it.” (Greene v. Marin County Flood Control & Water Conservation Dist. (2010) 49 Cal.4th 277, 290California Redevelopment Assn. v. Matosantos (2011) 53 Cal.4th 231, 265), giving words their ordinary meaning and construing them in the context of the measure as a whole and its overall scheme. (Professional Engineers, at p. 1037.) “‘Absent ambiguity, we presume that the voters intend the meaning apparent on the face of an initiative measure . . . and the court may not add to the statute or rewrite it to conform to an assumed intent that is not apparent in its language.’ [Citation.] Where there is ambiguity in the language of the measure, ‘[b]allot summaries and arguments may be considered when determining the voters’ intent and understanding of a ballot measure.’ [Citation.]” (Ibid.) Proposition 218 instructs courts to liberally construe its provisions “to effectuate its purposes of limiting local government revenue and enhancing taxpayer consent.” (Prop. 218, § 5.) At the same time, repeal of existing legislation by implication is strongly disfavored. (Pacific Palisades Bowl Mobile Estates, LLC v. City of Los Angeles (2012) 55 Cal.4th 783, 807; St. Cyr v. California FAIR Plan Association (2014) 223 Cal.App.4th 786, 799.) We presume the validity of a legislative act, resolving all doubts in its favor, and must uphold it unless a “‘. . . conflict with a provision of the state or federal Constitution is clear and unquestionable . . . .‘” (Amwest Surety Ins. Co. v. Wilson (1995) 11 Cal.4th 1243, 1252.) The trial court determined that it was constrained by Pajaro and, as a result, concluded that the pump fees at issue constituted property-related fees or charges. Before explaining why Pajaro is distinguishable, we must discuss the trio of Supreme Court cases underlying its holding: Apartment Association; Richmond v. Shasta Community Services District (2004) 32 Cal.4th 409 (Richmond); and Bighorn-Desert View Water Agency v. Verjil (2006) 39 Cal.4th 205 (Bighorn). Apartment Association involved a municipal housing code provision that imposed an annual $12 fee on residential rental property owners to finance the city‘s cost of inspection and enforcement. (Apartment Association, supra, 24 Cal.4th at p. 833.) The Supreme Court held that the fee was not subject to Proposition 218 because it was “imposed on landlords not in their capacity as landowners, but in their capacity as business owners.” (Id. at p. 840.) It thus was “more in the nature of a fee for a business license than a charge against property.” (Ibid.) The Court explained that regulatory fees and property-related fees are not mutually exclusive. (Apartment Association, supra, 24 Cal.4th at p. 838 [“[T]he mere fact that a levy is regulatory . . . or touches on business activities . . . is not enough, by itself, to remove it from article XIII D‘s scope“].) The hallmark of a property-related fee is that “it applies only to exactions levied solely by virtue of property ownership.” (Id. at p. 842.) In other words, Proposition 218 applies to “exactions . . . that are directly associated with property ownership” and that “burden landowners as landowners” rather than on “levies linked more indirectly to property ownership.” (Id. at pp. 839, 842, first italics added.) Richmond again considered the scope of a property-related fee or charge. The district that supplied water to residential and commercial users imposed a connection fee for new water service, one component of which was a fire suppression charge used to While agreeing with the plaintiffs’ contention “that supplying water is a ‘property-related service’ within the meaning of article XIII D‘s definition of a fee or charge,” Richmond rejected their broader argument “that all water service charges are necessarily subject to the restrictions that article XIII D imposes on fees and charges.” (Richmond, supra, 32 Cal.4th at pp. 426-427.) The Supreme Court distinguished “[a] fee for ongoing water service through an existing connection” from “a fee for making a new connection to the system.” (Id. at p. 427.) The former “requires nothing other than normal ownership and use of property” whereas the latter “results from the owner‘s voluntary decision to apply for the connection.” (Ibid.) Because the charge on the owner‘s voluntary decision to apply for a service connection was not a charge on the property-related service itself, it was not subject to Proposition 218. (Id. at p. 428.) Finally, in Bighorn, a case that Pajaro ultimately found dispositive, the Supreme Court reiterated that rates and other charges for water delivery were “property-related” within the meaning of Proposition 218. Bighorn involved a local agency that provided domestic water service to residents within its special district. A resident in the district sought to place an initiative on the ballot that would have limited the agency‘s rates and other water delivery charges. (Bighorn, supra, 39 Cal.4th at pp. 209-210.) The Court of Appeal held that The Supreme Court disagreed, finding it obvious that section 3 applied to “fees and charges.” The only issue was whether the meaning of “fees and charges” in article XIII C, which does not define the phrase, is coextensive with its meaning in article XIII D, where it is limited to property-related fees and charges. (See Relying on dictum in Apartment Association that “it is unclear . . . whether a fee to provide gas or electricity service is the same as a fee imposed on the consumption of electricity or gas” (Apartment Association, supra, 24 Cal.4th at p. 844), the agency in Bighorn argued that its volumetric charges were based on consumption rather than property and were not subject to Proposition 218. In its view, only the fixed monthly charge that it imposed on all customers regardless of usage was property-related. The court rejected this argument. Pointing out that article XIII D “‘includ[es] a user fee or charge for a property related service‘” ( Like the District here, the Pajaro Valley Groundwater Basin faced problems of overdraft and seawater intrusion from decades of groundwater overuse. The Pajaro Valley Water Management Agency was created by special statute to combat these problems, in part by supplementing the area‘s water supply with sources other than groundwater. To that end, the agency was authorized to impose groundwater augmentation charges on the extraction of groundwater. (Pajaro, supra, 150 Cal.App.4th at pp. 1370-1372.) The agency adopted a groundwater management plan that included the construction of a 23-mile pipeline to import water from a neighboring county. It planned to fund the project in part through higher groundwater augmentation charges against all The agency brought an action to validate the increased groundwater augmentation charges. The trial court declared the charges valid but the Court of Appeal reversed, holding that they constituted a charge incidental to property ownership. Because the agency had not complied with Proposition 218‘s procedural requirements for imposing such a charge, the augmentation charge was held invalid. (Pajaro, supra, 150 Cal.App.4th at pp. 1374-1375, 1393.) The appellate court characterized the augmentation fee as being “charged in return for the benefit of ongoing groundwater extraction and the service of securing the water supply for everyone in the basin.” (Pajaro, supra, 150 Cal.App.4th at p. 1381, fn. omitted.) Ultimately, though, Pajaro concluded that whether the agency‘s fee was for a “service” was immaterial because it was “imposed as an incident of property ownership.” (Id. at p. 1389.) Water extraction, the court posited, is “an activity in some ways more intimately connected with property ownership than is the mere receipt of delivered water.” (Id. at p. 1391.) Pajaro recognized that the conceptually similar Apartment Association undermined its conclusion, insofar as that case held that “as an incident of” property ownership means “solely by virtue of” property ownership rather than “on an incident of” property ownership. (Pajaro, supra, 150 Cal.App.4th at p. 1389.) However, Pajaro dismissed Apartment Association as being of questionable vitality given that Bighorn “did not mention the case at all.” (Ibid.) Pajaro found no material distinction, for article XIII D purposes, between a charge on groundwater extraction and a charge on delivered water. (Id. at pp. 1388-1389.) Although the court speculated that the extraction charge might survive scrutiny under Bighorn if it were imposed only on non-residential users, the fact that a large majority of pumpers were using the water for residential or domestic uses was dispositive. (Id. at p. 1390.) The level of abstraction at which we should analyze the constitutional text is unclear. Do we determine whether groundwater extraction fees in general are imposed as an incident of property ownership? Or do we focus on the specific fee imposed by the District? And if the latter, do we consider the District‘s fee without regard to the payor at issue or do we consider the City‘s purpose in pumping groundwater? The Pajaro court implied that the result could differ at least from district to district if not from user to user when it suggested that a charge on groundwater extracted for nonresidential purposes might fall within the rationale of Apartment Association. (Pajaro, supra, 150 Cal.App.4th at pp. 1389-1390.) But this is far from certain. Our Constitution applies statewide. It would be anomalous to assign its provisions different meanings in different locations. (See We need not resolve this issue. Whether we consider this specific pump fee or pump fees in general, we conclude that the fee is not property-related and that article XIII D does not apply. Pajaro was based upon a unique set of facts—“that the vast majority of property owners in the Pajaro Valley obtained their water from wells, and that alternative sources were not practically feasible.” (Pajaro, supra, 150 Cal.App.4th at p. 1397 (conc. opn. of Bamattre-Manoukian, J.).) That is far from the case here. While the record does not disclose the exact number of residential customers who pump water in lieu of connecting to an existing water delivery network, it is evident that this number is Pajaro also found it significant that the agency‘s pump charge did not serve a regulatory purpose. (See Pajaro, supra, 150 Cal.App.4th at p. 1381 [concluding that fee charged to smaller, unmetered wells based on estimated usage was not “justified on regulatory grounds” but that a regulatory purpose “might still be readily invoked with respect to metered extractions“].)9 According to Pajaro, Bighorn “le[ft] open the possibility that delivery of water for . . . nonresidential purposes is not a property-based service, and that charges for it are not incidental to the ownership of property. A finding that such a fee is not imposed as an incident of property ownership might be further supported by a clearly established regulatory purpose, e.g., to internalize the costs of the burdened activity or to conserve a supplied resource by virtue of structuring the fee in a manner intended to deter waste and encourage efficiency.” (Id. at pp. 1389-1390, fn. omitted.) Here, as the trial court found, the groundwater extraction fees serve the valid regulatory purpose of conserving water resources. ( We agree with Farnsworth that a pump fee is better characterized as a charge on the activity of pumping than a charge imposed by reason of property ownership. Given this characterization, the facts here are not materially different from those in Apartment Association. “The [pump] fee is not imposed solely because a person owns property. Rather, it is imposed because the property is being [used to extract groundwater]. It ceases along with the business operation, whether or not ownership remains in the same hands. For that reason, the [District] must prevail.” (Apartment Association, supra, 24 Cal.4th at p. 838.) That Bighorn did not cite Apartment Association is unsurprising. Richmond squarely stood for the proposition that charges for domestic water delivery service are property related, even though other charges less directly associated with the provision of water, namely connecting a property to the delivery system, are not. Bighorn, like Richmond, dealt with “a public water agency‘s charges for ongoing water delivery.” (Bighorn, supra, 39 Cal.4th at p. 216.) It merely clarified that the charges for this service were subject to Proposition 218 whether they were volume-based “consumption” charges or flat-rate charges “imposed regardless of water usage.” (Id. at pp. 216-217.) Apartment Association was far less relevant than Richmond to this issue. Nor do we think it overly important that pumping may not always be a “business operation.” (See Pajaro, supra, 150 Cal.App.4th at p. 1391, fn. 18 [discussing the distinction set forth in Apartment Association between “[a] charge . . . imposed on a person because he owns land” and one “imposed because he engages in certain activity on his land” and doubting “that it is satisfactorily captured by a distinction between business and domestic uses or purposes“].) In the City‘s case, of course, it is. The City pumps water for the municipal supply, which it then sells to residential customers. (See City of South Pasadena v. Pasadena Land & Water Co. (1908) 152 Cal. 579, 593 [“In administering a public utility, such as a water system, even within its own limits, a city does not act in its governmental capacity, but in a proprietary and only quasi-public capacity“].) But even with respect to the individual household that elects to pump water for its own consumption, the Supreme Court made clear in Richmond that residential business operations are not the only household activities exempt from article XIII D. That article applies only to charges on an activity that “requires nothing other than normal ownership and use of property.” (Richmond, supra, 32 Cal.4th at p. 427, italics added.) Voluntarily generating one‘s own utilities arguably is not a normal use of property, and in any event, it is a “business operation” in the sense that it affects the demand for municipal services. (Cf. Wickard v. Filburn (1942) 317 U.S. 111.) We also disagree with Pajaro that the groundwater extraction charge need not constitute a fee for “service” provided by the District in order to fall within article XIII D‘s scope. (See Pajaro, supra, 150 Cal.App.4th at p. 1389 [“The Agency contends that the charge is not a ‘service fee,’ but that proposition seems beside the point if the charge is imposed as an incident of property ownership“].) That is simply an untenable construction of the constitutional text, particularly taken in context. Article XIII D provides that “[t]he amount of a fee or charge imposed upon any parcel or person as an incident of property ownership shall not exceed the California Constitution, article XIII D, section 3 confirms this interpretation. It provides in relevant part that “[n]o tax, assessment, fee, or charge shall be assessed . . . upon any parcel of property or upon any person as an incident of property ownership except . . . [f]ees or charges for property related services as provided by this article.”10 We think it self-evident that in charging property owners for pumping groundwater, the District is not providing a “service” to property owners in the same way that the Bighorn agency provided a service by delivering water through pipes to residences. The conceptual difficulty with a contrary conclusion is apparent from Pajaro‘s attempt to define what the “service” at issue is. In its view, the District‘s service is “securing the water supply for everyone in the basin.” (Pajaro, supra, 150 Cal.App.4th The recently enacted Sustainable Groundwater Management Act (Stats. 2014, chs. 346, 347, 348) (SGMA) bolsters our conclusion that the groundwater extraction fees here are not subject to article XIII D. Although the SGMA‘s amendments to the Water Code do not apply to the District because it is not currently part of a groundwater sustainability agency, the SGMA‘s treatment of groundwater extraction fees is instructive. The Legislature authorized such fees in two separate sections. In section 10730.2, the Legislature expressly required that fees “to fund costs of groundwater management,” including the “[s]upply, production, treatment, or distribution of water,” be adopted in accordance with article XIII D. ( We thus conclude that groundwater extraction charges are not property-related charges or fees. Even if they were, however, we see no conflict between Proposition 218‘s substantive requirements and That the City‘s desired use for the water it pumps is subject to a higher regulatory fee than agricultural use is a policy decision made by the Legislature, not the District. The trial court found that the pump charges did not constitute “taxes” under Proposition 26‘s broader definition because they fell into the exception for property-related fees and charges under article XIII D. Since we hold otherwise, we must address the City‘s alternative contention that the pump charges are taxes that were imposed in violation of Proposition 26. Pursuant to Proposition 26‘s presumption that “any levy, charge, or exaction of any kind imposed by a local government” is a tax, the pump fees must be taxes unless The third exception contains an exhaustive list of regulatory activities for which a local government can recover its reasonable costs through fees: “issuing licenses and permits, performing investigations, inspections, and audits, enforcing agricultural marketing orders, and the administrative enforcement and adjudication thereof.” ( The District‘s strongest argument that the groundwater extraction fees are not taxes is that they fall within the first exception for payor-specific benefits and privileges. Pumpers receive an obvious benefit—they may extract groundwater from a managed basin. The City complains that pumpers are merely exercising their existing property rights and that the District “does not grant the City a right or privilege to use groundwater any more than the County grants a homeowner the right to live in his or her home when collecting the property tax.” This analogy is inapt. A pump fee is more like the entrance fee to a state or local park, which is not a tax (see “A regulatory fee does not become a tax simply because the fee may be disproportionate to the service rendered to individual payors. [Citation.] The question of proportionality is not measured on an individual basis. Rather, it is measured collectively, considering all rate payors. [Citation.] [¶] Thus, permissible fees must be related to the overall cost of the governmental regulation. They need not be finely calibrated to the precise benefit each individual fee payor might derive. What a fee cannot do is exceed the reasonable cost of regulation with the generated surplus used for general revenue collection. An excessive fee that is used to generate general revenue becomes a tax.” (California Farm Bureau Federation v. State Water Resources Control Bd., supra, 51 Cal.4th at p. 438; accord The trial court found that “the basins within the [District‘s] boundaries are [hydrogeologically] interconnected in complex and incompletely explained ways.” We agree. The record contains substantial evidentiary support for this finding. The City does not dispute that the actions of one pumper in the District affects every other pumper to some degree; rather, it criticizes the District for “impos[ing] District-wide rates that assume an equal degree of service to pumpers throughout its basins and three times the service to [municipal and industrial users] as to agriculture.” Yet, by imposing fees based upon the volume of water extracted, the District largely does charge individual pumpers in proportion to the benefit they receive from the District‘s conservation activities. The District ensures water availability District-wide. Large-scale users such as the City receive a far greater benefit from individual landowners who pump water for personal consumption. That is more than is required. The District need only ensure that its charges in the aggregate do not exceed its regulatory costs. Contrary to the City‘s assertion, the recreation activities subfund is actually supported by revenue from the concessionaire at Lake Piru and the ad valorem property taxes collected by the District. Likewise, the District pays for its State water allocation primarily from an annual voter-approved property assessment. More generally, the City is incorrect that the District‘s costs associated with the acquisition, treatment, transport, and delivery of State and surface water are unrelated to its groundwater management goals. The District sells water to customers who use the delivered water in lieu of water pumped from the ground, particularly in coastal areas where the problem of seawater intrusion is most acute. Although the City‘s wells are not located in these critical areas, it pumps the majority of its water from wells in the Oxnard Plain basin, which contributes to the problem by removing water that would otherwise flow to the critical areas near the coast. In any event, providing pumpers with a substitute to groundwater use eases the overall burden on the resource in the District. On independent review we conclude that the District‘s pump fees do not exceed the reasonable cost of regulating the District‘s groundwater supply. Accordingly, these regulatory fees are not taxes and are not subject to approval by the voters. We agree with the trial court that, insofar as the San Marcos legislation applies, the District complied with it. The San Marcos legislation requires that when a public agency provides a “public utility service” to another public agency, the service fee cannot “exceed the reasonable cost of providing the public utility service.” ( The judgment is reversed insofar as it granted mandamus and declaratory relief to the City. The matter is remanded to the superior court with directions to vacate its writs of mandate in case numbers VENCI 00401714 and VENCI 1414739. The judgment is affirmed in all other respects. The District shall recover its costs on appeal. CERTIFIED FOR PUBLICATION. PERREN, J. We concur: GILBERT, P. J. YEGAN, J. Thomas P. Anderle, Judge Superior Court County of Santa Barbara Ariel Pierre Calonne, former City Attorney, Keith Bauerle, Assistant City Attorney; Colantuono & Levin; Colantuono, Highsmith & Whatley, Michael G. Colantuono, David J. Ruderman, Michael R. Cobden, for Appellant City of San Buenaventura. Musick, Peeler & Garrett, Anthony H. Trembley, Gregory J. Patterson, Cheryl A. Orr, for Appellants United Water Conservation District and Board of Directors of United Water Conservation District. Nancy N. McDonough and Christian C. Scheuring for California Farm Bureau Federation as Amicus Curiae on behalf of Appellant United Water Conservation District.III.
Procedural Background
I.
Standard of Review
Construction of a Voter Initiative
The Pump Fees Are Not Property-Related Fees or Charges
A.
Supreme Court Authority Regarding “Property-Related Fees and Charges”
B.
Pajaro
Analysis
IV.
The Pump Fees Are Not Taxes
A.
The Pump Fees Are for Payor-Specific Benefits
The Pump Fees Do Not Exceed the District‘s Reasonable Costs
V.
San Marcos Litigation
DISPOSITION