BILL ANALYSIS                                                                                                                                                                                                    



                                                                AB 418
                                                                Page  1

        CONCURRENCE IN SENATE AMENDMENTS
        AB 418 (Mullin)
        As Amended  February 10, 2014
        2/3 vote.  Urgency
         
         
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        |ASSEMBLY:  |     |(May 9, 2013)   |SENATE: |27-8 |(February 20,  |
        |           |     |                |        |     |2014)          |
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             (vote not relevant)


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        |COMMITTEE VOTE:  |7-2  |(April 2, 2014)     |RECOMMENDATION: |concur    |
        |(L. Gov.)        |     |                    |                |          |
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        Original Committee Reference:    JUD.  

         SUMMARY :  Authorizes the City/County Association of Governments  
        (C/CAG) of San Mateo County to impose a special tax, in compliance  
        with Article XIII C of the California Constitution, or to impose a  
        property related fee, in compliance with Article XIII D of the  
        California Constitution, to implement stormwater management  
        programs consistent with the joint powers agreement of C/CAG's  
        member agencies.  

         The Senate amendments  delete the Assembly version of this bill, and  
        instead:

        1)Authorize C/CAG to impose a special tax, in compliance with  
          Article XIII C of the California Constitution, or to impose a  
          property related fee, in compliance with Article XIII D of the  
          California Constitution, to implement stormwater management  
          programs consistent with the joint powers agreement of C/CAG's  
          member agencies.  

        2)Allow the special tax or property related fee, at the option of  
          C/CAG, to be collected on the tax rolls of the county in the same  
          manner, by the same persons, subject to the same penalties, and  
          at the same time as county ad valorem property taxes.  Allow the  
          county auditor to deduct the amount required to reimburse the  
          county for its actual cost of collection.  









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        3)Contain an urgency clause.  

        4)Find and declare that a special statute is necessary because of  
          the unique circumstances applicable only to C/CAG.  

        5)Find and declare that this bill responds to the specific and  
          unique circumstances of C/CAG and that it is the intent of the  
          Legislature that this act shall not be construed to limit,  
          expand, or otherwise change any local agency's authority to  
          exercise powers under the Joint Exercise of Powers Act.  

        6)Find and declare that this bill will enable C/CAG to do all of  
          the following:

           a)   Protect, in conjunction with its member agencies, the  
             watersheds and natural resources within C/CAG and restore and  
             enhance the environment, including the long-term protection of  
             the waters of local creeks, the San Francisco Bay, and the  
             coastline along the Pacific Ocean;  

           b)   Develop and adopt a countywide stormwater management  
             program designed to coordinate, fund, and implement water  
             pollution prevention programs within the County of San Mateo  
             by C/CAG or its member agencies; and,  

           c)   Impose, consistent with the California Constitution, a  
             special tax or property related fee to fund activities  
             outlined in its joint powers agreement and consistent with  
             municipal stormwater permit requirements mandated by the San  
             Francisco Bay Regional Water Quality Control Board.  

         EXISTING LAW  :

        1)Allows two or more public agencies by agreement, if authorized by  
          their legislative or other governing bodies, to jointly exercise  
          any power common to the contracting parties.  

        2)Requires two-thirds voter approval for a special tax.  

        3)Provides notice, protest, and hearing procedures for the levying  
          of new or increased assessments or property related fees or  
          charges by local government agencies pursuant to Proposition 218  
          (1996).  

         AS PASSED BY THE ASSEMBLY  , this bill required state agencies to  








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        post a specifically described graphical Internet link referencing  
        the State Auditor's Web site location that contains information on  
        how to file a complaint pursuant to the California Whistleblower  
        Protection Act.

         FISCAL EFFECT  :  None

         COMMENTS  :  

        1)Purpose of the bill.  This bill authorizes C/CAG to impose a  
          special tax or a property related fee, in compliance with the  
          California Constitution, to implement stormwater management  
          programs consistent with the joint powers agreement of C/CAG's  
          member agencies.  

        2)Author's statement.  According to the author, "C/CAG is a joint  
          powers agency formed in 1991 to provide a forum for all local  
          governments in San Mateo County to work together on common  
          issues.  C/CAG's member agencies are the County of San Mateo and  
          the 20 cities and towns within the county.  In addition to its  
          primary role as the county's Congestion Management Agency, C/CAG  
          provides numerous other services, including managing the  
          Countywide Water Pollution Prevention Program, which supports  
          member agencies in complying with municipal stormwater  
          regulations issued by the San Francisco Bay Regional Water  
          Quality Control Board under its Municipal Regional Permit.   
          Although C/CAG is not a permittee under the permit, it does  
          implement compliance programs for certain requirements on behalf  
          of its member agencies when it is more efficient or  
          cost-effective to perform those services at a countywide level  
          (e.g. water quality monitoring). 
           
           "C/CAG and about half of its member agencies have existing  
          pre-Proposition 218 assessments dedicated to stormwater pollution  
          prevention programs.  In some cases, member agencies that  
          currently don't have a dedicated stormwater assessment are  
          funding stormwater compliance activities through other sources,  
          including their local general funds.  C/CAG has two existing  
          countywide stormwater assessments imposed through the San Mateo  
          County Flood Control District under the Board of Supervisors.   
          Those two assessments generate approximately $1.5 million  
          annually.  

          "In 2010, San Mateo County voters approved C/CAG's Measure M,  
          authorizing a $10 vehicle registration fee that primarily funds  








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          congestion management-related activities, but is also used for  
          stormwater pollution prevention programs by both C/CAG and its  
          member agencies.  C/CAG's member agencies have been required to  
          implement increasingly expensive programs to address a variety of  
          ubiquitous stormwater pollutants and others that are challenging  
          to address, including trash, pesticides, mercury, and  
          polychlorinated biphenyls, existing revenues are now insufficient  
          to meet regulatory demands.  C/CAG estimates countywide funding  
          deficits exceed $15 million per year for C/CAG and its member  
          agencies to provide compliant stormwater programs over the next  
          five year-term of the Municipal Regional Permit.

          "C/CAG believes it is the most appropriate agency to pursue  
          countywide funding in its role as the Countywide Water Pollution  
          Prevention Program administrator, given that any decision to  
          place a special tax or property-related fee before voters or  
          property owners would be subject to approval by C/CAG's Board of  
          Directors, which includes an elected official from each of the 21  
          local agencies.  C/CAG is pursuing enabling legislation because  
          there are no other viable means already codified for a joint  
          powers agency to propose special taxes or property-related fees  
          for stormwater pollution prevention programs."

        3)Proposition 218.  The California Constitution distinguishes among  
          taxes, assessments and fees for property related revenues, and  
          requires certain actions before such revenues may be collected.   
          This bill requires C/CAG to comply with the provisions of  
          Proposition 218 (1996) which require a two-thirds voter approval  
          for a special tax.  For a property related fee Proposition 218  
          requires local officials to identify the parcels, calculate the  
          fee for each parcel, and conduct a majority protest proceeding 45  
          days after mailing notice of a new fee to all fee payers.   
          Additionally, Article XIII D, Section 6, subdivision (c) of the  
          California Constitution provides that "Except for fees or charges  
          for sewer, water, and refuse collection services, no property  
          related fee or charge shall be imposed or increased unless and  
          until that fee or charge is submitted and approved by a majority  
          vote of the property owners of the property subject to the fee or  
          charge or, at the option of the agency, by a two-thirds vote of  
          the electorate residing in the affected area."  
           
           Counties and other local agencies with police powers may impose  
          any one of these options on property owners, after completing the  
          Proposition 218 process.  Special districts created by statute,  
          however, must have specific authority for each of these revenue  








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          sources.

        4)Joint Exercise of Powers Act.  The Joint Exercise of Powers Act  
          provides the statutory authority for public entities to create  
          and use a joint powers agreement, which is a legal framework for  
          state and local governments to exercise common powers and even  
          create new public entities.  They are an attractive tool for  
          local governments because they facilitate more efficient service  
          provision through collaboration, and because they permit local  
          entities to issue bonds without voter ratification.  Current law  
          authorizes joint powers authorities (JPAs) to jointly exercise  
          any power common to the contracting parties, if authorized by  
          their legislative or governing body.  However, current law is  
          silent on a JPA's explicit authority to impose a special tax,  
          assessment, or property related fee.  

          AB 2170 (Mullin) of the current legislative session, pending in  
          the Assembly, addresses this issue by explicitly authorizing two  
          or more public agencies by agreement to jointly exercise any  
          power common to the contracting parties including, but not  
          limited to, the authority to levy a fee or tax.  AB 2170 finds  
          and declares that a JPA has all powers common to the contracting  
          parties, so long as those powers are specified in the joint  
          powers agreement, therefore, the bill does not constitute a  
          change in law, but is declaratory of existing law.  

        5)Previous legislation.  In 2004, AB 1546 (Simitian), Chapter 931,  
          Statutes of 2004, granted C/CAG the authority to impose an annual  
          fee on motor vehicles for programs to manage traffic congestion  
          and stormwater pollution.  This authority was extended until  
          January 1, 2013, by SB 348 (Simitian), Chapter 377, Statutes of  
          2008.  SB 613 (Simitian) of 2007, would have extended the  
          authority until January 1, 2019, but was vetoed by Governor  
          Schwarzenegger.   

        6)Arguments in support.  Supporters argue while ultimate approval  
          of any new funding stream still rests with the voters and  
          property owners within our jurisdictions pursuant to the  
          Constitution that this bill will enable a coordinated countywide  
          approach to funding stormwater pollution prevention programs  
          consistent with the consolidated regional regulations issued by  
          the San Francisco Bay Regional Water Quality Control Board.  

        7)Arguments in opposition.  Opposition argues that this bill is  
          unnecessary because San Mateo County, its cities, and some of its  








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          special districts already have authority to fund stormwater  
          programs using existing revenue tools.  

         
        Analysis Prepared by  :    Misa Yokoi-Shelton / L. GOV. / (916)  
        319-3958 


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