In January, Yolo County Judge Dan Maguire denied the claims of the Yolo Ratepayers for Affordable Public Utility Services (YRAPUS). He wrote, “The water and sewer rates adopted by the City of Davis meet the proportionality standards of the California Constitution, and therefore plaintiffs’ claims are denied.”
However, that ruling was tentative and the parties had 15 days to comment and make objections. After receiving and considering the parties’ responses, the Court will enter a final Statement of Decision and Order.
On February 6, the plaintiffs submitted their response and based on that Judge Maguire ordered the city to submit a written response by February 25.
The issue that will decide this is clear, and it came out during the original arguments: is the test for proportionality based on a parcel by parcel basis as the plaintiffs in this case argue that the statute states – as Judge Maguire during arguments in December seemed to acknowledge – or is the city right in the case law they cite that indicates that proportionality must be class by class?
The plaintiffs argued that the court’s ruling that “proportionality may be established by ‘grouping similar users together’ and then charging members of the group according to their usage” – “is inconsistent with Proposition 218.”
They argue, “Proposition 218 clearly and unequivocally requires a parcel by parcel analysis and not a class by class analysis of the costs to be charged to a property owner.”
The plaintiffs note that the court cites two decisions which in essence rule “that Proposition 218 does not mean what it says.”
They argue, “Plaintiffs do not accept the idea that a Court of Appeal can so cavalierly ignore the plain words of a constitutional provision or that the two cases cited actually support the conclusion that one can ignore the literal mandate not to impose upon any person or parcel more than the proportional cost of service attributable to the parcel.”
They add, “A close reading of the two cases cited by the Court in this case shows that neither actually supports a construction which would justify ignoring the plain words of the constitutional provision at issue.”
As we noted above, during oral arguments in December, Judge Maguire himself would note the discrepancy between case law and the plain language of Prop 218. In the question as to what the relevant level of comparison was – person by person, parcel by parcel, or class by class, Judge Maguire would note, in response to the city’s argument in favor of a class by class comparison, “I understand that argument. I understand the case support for it, and there is case support for it.”
He would add, “What I’m struggling with though is how to square that concept with the language of Section 6 which says, ‘The charge shall not exceed the proportional cost of the service attributable to the parcel.’ So that seems to suggest a more granular analysis than class by class.”
In reconciling that issue, he wrote that the language of Proposition 218 would appear “at first blush” to require the city to demonstrate on a per-parcel basis, that the rates are “proportional to the costs for that parcel.” However, “The Court of Appeal, which this Court must follow, has rejected this interpretation, and found instead that ‘proportionality is not measured on an individual basis,’ but instead is ‘measured collectively, considering all rate payers.’”
The city in their response brief argues, “As this Court recognized in the Tentative Decision, “the Court of Appeal, which this Court must follow, has rejected” an interpretation of Section 6(b)(3)’s proportionality requirement for property-related fees, like those at issue, which would require a parcel-by-parcel analysis.”
The city cites case law that they say “squarely rejected any reading of Section 6 that requires a parcel-by-parcel proportionality analysis.” Citing an appellate court decision in Griffith v. Pajaro Valley Water Management Agency from the fourth appellate district in 2013, the court there wrote, “The question of proportionality is not measured on an individual basis. Rather, it is measured collectively considering all rate payers.”
Harriet Steiner argues, “This court may not ignore such controlling authority.”
She adds, “More importantly, neither Griffith nor this Court’s Tentative Decision in favor of the City are contrary to the plain text of Proposition 218’s proportionality requirement.”
Here, she notes, the proportionality requirement states that the “amount of a fee or charge imposed upon any parcel or person as an incident of property ownership shall not exceed the proportional cost of the service attributable to the parcel.”
She argues, “The City’s rate classes are readily squared with this requirement because the City, after determining its costs of service, analyzed water consumption data, as well as number of customers, customer service, and equivalent meter size amongst customers, which takes into account the characteristics of the parcel being served.”
She continues, “Development of these classes and corresponding rates takes into account the parcel being served. Such parcel characteristics include the type of use on a particular parcel (e.g., single family residential, commercial, multi-family residential) and also the size of the water meter to determine the appropriate rate for that parcel.”
“As explained more fully in the City’s Opposition Brief, the customer class is pertinent to determining how to apportion costs of service amongst parcels with similar characteristics. Customers with similar peaking and usage characteristic were grouped together because customer use correlates to the parcel use and water meter size serving the customer’s parcel.”
The plaintiffs in their most recent response argue that the Griffith decision “simply does not say what the City would have it say, and if it does, it is inconsistent with the plain language of Proposition 218.”
After showing examples from the Griffith decision to demonstrate their point, they note, “Prop 218 uses the word parcel, not class, and the City’s attempt to restrict this Court from considering the proportionality at the parcel, or ‘granular’ level, basically reads out or eliminates the word ‘parcel’ from Prop 218, and substitutes in the word ‘class.’”
“Plaintiffs are not suggesting that mathematical precision be applied to meet the proportionality requirement,” the plaintiffs argue. “However, the distribution of costs among the parcels must at least be reasonable, and this Court must let its opinion and conclusion be governed by Prop 218’s clearly written requirement that parcel means parcel, and no parcel shall be required to pay more than the costs of providing water to that parcel. The ‘class by class’ analysis used by this Court in its Tentative Decision abdicates independent judicial authority to the City, allows the vote of a City Council to change the application of a constitutional amendment, and lets the public agency chose how to label its classes and which subgroups of ratepayers should be in a particular class.”
How Judge Maguire ultimately sorts out the issue at hand will go a long way toward determining the future of the city’s surface water project.
—David M. Greenwald reporting