BILL ANALYSIS �
AB 2446
Page 1
Date of Hearing: May 7, 2014
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
K.H. "Katcho" Achadjian, Chair
AB 2446 (Waldron) - As Amended: April 28, 2014
SUBJECT : Standby charges: San Luis Rey Municipal Water
District.
SUMMARY : Extends the San Luis Rey Water District's authority
to levy standby assessments or availability charges from January
1, 2015, to January 1, 2020.
1)Extends the authority for the San Luis Rey Water District
(District) to levy standby assessments or availability charges
from January 1, 2015, to January 1, 2020.
2)Specifies that the proceeds from any standby assessment or
availability charge are to be used for the purposes of
management of local water supply and its quality.
3)Makes other technical and conforming changes.
EXISTING LAW :
1)Authorizes a municipal water district (MWD) by ordinance,
pursuant to the notice, protest, and hearing requirements put
in place by Proposition 218, to establish a water standby
assessment or availability charge in the District or in any
improvement district each fiscal year, to which water is made
available by the District, whether the water is actually used
or not.
2)Prohibits the standby assessment or availability charge from
exceeding $10 per acre per year for each area of land the
charge is levied or $10 per year for a parcel less than one
acre.
3)Establishes a section of law only applicable to the District,
until January 1, 2015, because
of the unique and special water management problems of those
areas included within the District, as follows:
a) Prohibits, for any improvement district in the District,
the standby assessment for availability charge from
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exceeding $30 per acre per year for land on which the
charge is levied or $30 per year for a parcel less than one
acre; and,
b) Requires, in the improvement district, the proceeds from
any standby assessment or availability charge in excess of
$10 per acre per year or $10 per year for a parcel less
than one acre to only be used for the purposes of that
improvement district.
4)Establishes the same exception as 3), above, to the $10 limit
for any improvement district within the Eastern MWD, Western
MWD of Riverside County, ElsinoreValley MWD, Rincon Del Diablo
MWD, Ramona MWD, Rainbow MWD, Lake Hemet MWD, and the Otay
MWD, except with no sunset date.
5)Requires the ordinance fixing a standby assessment or
availability charge to be adopted by the board pursuant to the
notice, protest, and hearing procedures put in place by
Proposition 218.
6)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.
FISCAL EFFECT : None
COMMENTS :
1)Current law and purpose of this bill . Current law establishes
for the District until January 1, 2015, a higher cap on
standby assessments and availability charges at $30 per acre
per year for land on which the charge is levied or $30 per
year for a parcel less than one acre, instead of the $10 cap
in place for most other MWDs. Current law also requires that
the proceeds from any standby assessment or availability
charge in excess of $10 per acre per year or
$10 per year for a parcel less than one acre are only to be used
for the purposes of that improvement district.
This bill extends the District's authority to levy standby
assessments or availability charges from January 1, 2015, to
January 1, 2020. This bill also specifies that the proceeds
from any standby assessment or availability charge only are to
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be used for the purposes of management of local water supply
and its quality. This bill is sponsored by the District.
2)San Luis Rey Municipal Water District . The District covers
approximately five square miles in the unincorporated north
San Diego County area and has an elected five-member Board of
Directors. According to the San Diego Local Agency Formation
Commission's 2013 Special Districts' Directory, "The District
was formed in 1958 to assist property owners who benefit from
the water resources of the San Luis Rey River and the Pala and
Bonsall Drainage Basins. The District funds legal activities
to protect water and water storage rights of district
landowners. The District is not authorized to provide potable
or untreated water service. The District has neither
water-related infrastructure nor access to local or imported
water resources. Landowners in the District rely on private
wells. The area is developed primarily with agricultural uses
and the only source of water for agricultural or domestic use
is the San Luis Rey River and the groundwater basins, which
the River supplies. The District levied a property tax rate
before the tax limitations of Proposition 13 were imposed;
however, the increment of property tax revenue is insufficient
to fund the District's services and the District Board has
imposed a water availability charge to generate revenue."
According to the District, "?District functions are at an
all-time high level of importance, given ongoing and
record-breaking drought conditions. Historical and ongoing
examples
of the District taking action in furtherance of its functions
for landowner interests include:
(i) water-quality testing; (ii) analysis of projects with
environmental impacts that may relate to water supply and
quality; and, (iii) encouraging landowners to comply with
State requirements regarding water diversion measurements and
reporting."
3)Author's statement . According to the author, "Every year the
District imposes water availability charge, by providing
written mailed notice to every landowner and providing the
opportunity at a District meeting open to the public to
protest or express any thoughts about the water availability
charge. All these years, the District has not had any such
protests or objections. Folks understand that this charge
helps the District help them as landowners to protect the
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water supply and the quality of that supply. These landowners
also have wells for producing their own water, both for
domestic household purposes and for irrigating their crops and
orchards. This bill is needed to protect land owners for
their special circumstances they face in the District."
4)Previous legislation . SB 1157 (Bergeson), Chapter 662,
Statutes of 1989, put in place the original authorization for
the District to levy higher standby assessments and
availability charges until January 1, 2000. SB 807 (Committee
on Agriculture and Water Resources), Chapter 779, Statutes of
1999, extended the authority from January 1, 2000, to January
1, 2005. AB 2733 (Strickland), Chapter 535, Statutes of 2004,
extended the authority from January 1, 2005, to January 1,
2015. The Legislature has extended this sunset date twice,
and has granted several other municipal water districts the
same authority to charge up to $30 permanently.
5)Proposition 218 . Proposition 218 (1996) amended the
California Constitution to limit local officials' powers to
levy benefit assessments and classified standby charges as
benefit assessments. Current law requires the District to
comply with Proposition 218 when doing a standby or
availability charge. Notice, protest, and hearing
requirements for new, extended, or increased assessments are
governed by Proposition 218, which involves mailed protest
ballots to all assessed property owners, a 45-day protest
period, and a public hearing at which protests are counted and
the presence or absence of a majority protest is determined.
After complying with notice, protest, and hearing
requirements, if a majority protest is not received from
property owners, the legislative body may adopt a resolution
to establish the assessment district and levy the assessment.
6)Policy considerations . Supporters of this bill argue that
there has never been protest in the District to the
availability charges the District has levied. The Committee
may wish to consider if the additional language which states
that the proceeds from any standby assessment or availability
charge should only be used for the purposes of "management of
local water supply and its quality" instead of keeping it at
the improvement district which will potentially open the
District up to litigation. Case law under Proposition 218 is
constantly evolving and closely examining and redefining
AB 2446
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relevant definitions. If the author and sponsor intend to
make changes to this provision of law that only applies to the
District for the purposes of being more specific about what
services the District provides, the Committee may wish to
recommend that those changes are made to a different section
of the bill that discusses the unique and special water
management problems in the District instead of the section
that permits them to levy a higher standby assessment or
availability charge.
7)Arguments in support . Supporters argue that this bill extends
the District's long-standing fiscal integrity by renewing the
existing authority that will sunset in 2015 and that the
District will be able to continue to provide important
services on behalf of landowners.
8)Arguments in opposition . None on file.
REGISTERED SUPPORT / OPPOSITION :
Support
San Luis Rey Municipal Water District [SPONSOR]
California Special Districts Association
Opposition
None on file
Analysis Prepared by : Misa Yokoi-Shelton / L. GOV. / (916)
319-3958