BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  SB 553
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          Date of Hearing:   June 26, 2013

                       ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
                           K.H. "Katcho" Achadjian, Chair
                       SB 553 (Yee) - As Amended:  May 24, 2013

           SENATE VOTE  :   39-0
           
          SUBJECT  :   Local government: assessment: elections procedures.

           SUMMARY  :   Imposes additional requirements on local governments  
          when conducting property-related fee ballot proceedings pursuant  
          to Proposition 218.   Specifically,  this bill  :    

          1)Imposes additional requirements on local governments (used  
            interchangeably with 'agency') when conducting elections to  
            impose or increase property-related fees or charges in  
            addition to any other procedures adopted by the local  
            government pursuant to the authority and requirements granted  
            by the California Constitution.  

          2)Requires, if the agency opts to submit the proposed fee or  
            charge for approval by a  two-thirds vote of the electorate  in  
            the affected area, the agency's elections official or his or  
            her designee to conduct an election.  Requires, if the  
            election is conducted by the county elections official, that  
            the local government, if other than the county, reimburse the  
            county for the actual and reasonable costs incurred by the  
            county elections official conducting the election.  

          3)Requires, if the agency opts to submit the proposed fee or  
            charge for approval by a  majority vote of the property owners  
            who  will be subject to the fee or charge, the following  
            procedures in addition to the procedure contained in Section 6  
            of Article XIIID of the Constitution:

             a)   Requires the phrase "OFFICIAL BALLOT ENCLOSED" to be  
               printed, in no smaller than 16-point bold type, on the face  
               of the envelope in which the notice of election and ballot  
               are mailed.  Permits the agency to repeat the same phrase  
               below in a language or languages other than English;  

             b)   Requires the ballot to include the agency's address for  
               return of the ballot, the date and location where the  
               ballots will be tabulated, and a place where the person  








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               returning it may indicate his or her name, a reasonable  
               identification of the parcel, and his or her support or  
               opposition to the proposed fee;  

             c)   Requires the ballots to be tabulated in a location  
               accessible to the public;  

             d)   Requires the ballot to be in a form that conceals its  
               content once it is sealed by the person submitting it;  

             e)   Requires the ballot to be sealed until the ballot  
               tabulation commences;  

             f)   Requires an impartial person designated by the agency  
               who does not have a vested interest in the outcome of the  
               proposed fee to tabulate the ballots submitted in support  
               or opposition to the proposed fee, and provides that an  
               impartial person includes, but is not limited to, the clerk  
               of the agency;  

             g)   States that if the agency uses agency personnel for the  
               ballot tabulation or if the agency contracts with a vendor  
               for the ballot tabulation and the vendor or its affiliates  
               participated in the research, design, engineering, public  
               education, or promotion of the fee, the ballots shall be  
               unsealed and tabulated in public view so as to permit all  
               interested persons to meaningfully monitor the accuracy of  
               the tabulation process;  

             h)   Allows the ballot tabulation to be continued to a  
               different time or location accessible to the public,  
               provided that the time and location are announced at the  
               location where the tabulation commenced and is posted by  
               the agency in a location accessible to the public;  

             i)   Authorizes the impartial person to use technological  
               methods to tabulate the ballots including, but not limited  
               to, punchcard or optically readable (bar-coded) ballots;  

             j)   Requires, during and after tabulation, the ballots and  
               information used to determine the weight of each ballot to  
               be treated as public records, as defined in the Government  
               Code;  

             aa)  Requires ballots to be preserved for at least two years  








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               and references the statutes under which agencies may  
               dispose of the ballots after that time; and,  

             bb)  States the proceeding shall not constitute an election  
               for voting for the purposes of Article II of the  
               Constitution or of the Elections Code.  

          4)Contains an operative date of July 1, 2014.  

          5)Provides that if the Commission on State Mandates determines  
            that this bill contains costs mandated by the state,  
            reimbursement to local agencies and school districts for those  
            costs shall be made pursuant to current law.  

           EXISTING LAW  :

          1)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.  

          2)Defines "agency" to mean any local government including a  
            county, city, city and county, including a charter city or  
            county, any special district, or any other local regional  
            governmental entity.  

           FISCAL EFFECT  :   This bill is keyed fiscal.  

           COMMENTS  :   

          1)Article XIII D of the California Constitution [Proposition  
            218, 1996] distinguishes among taxes, assessments and fees for  
            property-related revenues, and requires certain actions before  
            such revenues may be collected.  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  
            sources.  

            The Constitution defines a fee (or charge) as any levy other  
            than an ad valorem tax, special tax, or assessment that is  
            imposed by a local government on a parcel or on a person as an  
            incident of property ownership, including a user fee for a  
            property-related service.  The fee imposed on any parcel or  








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            person cannot exceed the proportional cost of the service that  
            is attributable to the parcel.  Additionally, a  
            property-related fee cannot be imposed for general  
            governmental services like police, fire, and library services.  
             Prior to imposing or increasing a property-related fee, the  
            local government is required to identify the parcels, mail a  
            written notice to all the property owners subject to the fee  
            detailing the amount of the fee, the reason for the fee, and  
            the date, time, and location of a public hearing on the  
            proposed fee.  No sooner than 45 days after mailing the notice  
            to property owners, the agency must conduct a public hearing  
            on the proposed fee.  If a majority of owners of the  
            identified parcels provide written protests against the fee,  
            it cannot be imposed or increased by the agency.  

            Article XIII D, Section 6, subdivision (c) of the California  
            Constitution, provides, "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."  

            The election for the fee is required to be conducted no less  
            than 45 days following the public hearing.  Proposition 218  
            did not establish specific procedures for property-related fee  
            elections, but the Constitution does permit local governments  
            to adopt ballot procedures that are similar to those required  
            by law for assessments.  

          2)This bill applies many of the requirements in current law for  
            assessment ballot procedures to the elections for  
            property-related fees submitted to  property owners  .  This bill  
            requires specified information to be printed on the ballot and  
            establishes requirements for ballot tabulation, including that  
            the ballots are tabulated in a location accessible to the  
            public and by an impartial person with no vested interest in  
            the outcome.  Additionally, this bill requires that the  
            ballots and information used to calculate a weighted vote (if  
            applicable) are to be treated as public records, preserved for  
            at least two years.  

            This bill requires that a local government's elections  
            official, or his or her designee, conduct an election for  








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            property-related fees submitted to the  electorate  .  Under this  
            bill local governments (excluding counties) are required to  
            reimburse the county for the costs of conducting the election  
            if it is conducted by the county elections official.  This  
            bill is sponsored by the Howard Jarvis Taxpayers Association.   


          3)According to the author, "Under current law, individuals who  
            wish to monitor fee ballot elections have neither access to  
            the tabulation process nor the ability to inspect retained  
            ballots after an election, thus eliminating the ability of  
            voters to dispute the results.  By extending the same security  
            and accountability to fee ballot measures that have worked  
            very successfully for assessment ballot elections, this bill  
            will enhance the local democratic process by ensuring fair and  
            transparent community elections.  This bill would address a  
            lack of transparent guidelines in local elections that  
            generated concern among voters about notification and  
            tabulation procedures, and the ability of voters to dispute  
            elections results."

          4)This bill contains provisions similar to AB 2218 (Gaines) of  
            2008, which would have imposed new restrictions on local  
            governments when conducting property-related fee and  
            assessment ballot proceedings pursuant to Proposition 218.  AB  
            2218 would have required an agency, by a vote of the governing  
            board, to determine whether to submit a fee for approval by a  
            majority of property owners subject to the fee or by a  
            two-thirds vote of the electorate residing in the area of the  
            affected property.  If submitted to the electorate for a  
            two-thirds vote, AB 2218 would have authorized a mailed ballot  
            election and required the election to be conducted by a city  
            or county elections official.  If submitted to the owners of  
            property for a majority vote, AB 2218 would have required a  
            mailed ballot proceeding, and would have prohibited the  
            ballots from being weighted.  AB 2218 was held on the Senate  
            Appropriations Suspense File.  

            SB 321 (Benoit), Chapter 580, Statutes of 2009, imposed  
            additional requirements on local governments when conducting  
            assessment ballot proceedings pursuant to Proposition 218.  AB  
            1260 (Caballero), Chapter 280, Statues of 2007, clarified how  
            a public agency may provide notice when proposing a new, or  
            increasing an existing property-related fee.  









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          5)The Committee may wish to consider if requiring local  
            governments to adopt these procedures takes away flexibility  
            granted under the Constitution to allow locals to determine  
            their own processes.  

           6)Support arguments  :  Supporters argue that this bill will  
            ensure more transparency in the conduct of local elections by  
            providing the public with greater access into the process.  
             
            Opposition arguments  :  Opposition argues that portions of the  
            bill are too vague and lack clear definitions and guidance for  
            elections officials.  

           REGISTERED SUPPORT / OPPOSITION  :

           Support 
           
          Howard Jarvis Taxpayers Association [SPONSOR]
          California Common Cause
          California Taxpayers Association
          
            Opposition 
           
          California Association of Clerks and Election Officials

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