In July 2023, CSMFO hosted a Webinar on The Taxpayer Protection and Government Accountability Act, and Zolly v. Oakland. The webinar was focused on the proposed Taxpayer Protection and Government Accountability Act, which is targeted for the 2024 ballot and would, if passed, impose new restrictions on government revenues and strongly hamper a government agency’s ability to raise future revenues. Below is a summary of the key provisions of the proposed Act:
- Affirms 2/3 voter requirement for ALL special taxes/reverses Upland case
- Specifies that all parcel taxes are special taxes
- Specifies that all taxes must be limited to specific purposes
- Requires a clear sunset provision for any revenue measures
- Forbids the Measure A/B approach (revenue plus advisory votes)
- Upholds property-based Business Improvement Districts (PBID and TBID)
- Recategorizes business-based BID charges from governing body to “voter” approval
- States fees shall not exceed ‘actual’ costs vs. ‘reasonable’ cost currently
- Puts forth new standard of ‘minimum amount necessary’ for fees/rates
- Limits VMT (Vehicle Mileage Traveled) fees and new development fees
Another emerging issue presented during the webinar was Zolly v. City of Oakland, in which the California Supreme Court created a new legal framework for evaluating the legality of fees or charges paid by waste hauling franchisees to local governments. In its August 2022 decision, the California Supreme Court ruled that the definition of “tax” in Proposition 26 (Art. XIIIC of the California Constitution) applies to franchise fees charged to waste haulers, that the haulers’ customers have standing to challenge the franchise fees, and that Oakland had not established, as a matter law, that any of the exceptions from the definition of “tax” applied.
For a link to the text of the Act, and key takeaways from the webinar, please see attached memorandum from the presenters.
Michael G. Colantuono of the law firm Colantuono, Highsmith & Whatley, PC has specialized in municipal law since 1989. He is certified by the California State Bar as a Specialist in Appellate Law and is a Past President of the California Academy of Appellate Lawyers, an association of a bit more than 100 of the most distinguished appellate lawyers in California. He is an Elected Member of the American Law Institute, the leading independent organization in the United States producing scholarly work to clarify, modernize, and otherwise improve the law. He has argued 14 cases in the California Supreme Court, appeared in all six of the California District Courts of Appeal, as well as trial courts around the State. He serves on the California Judicial Council’s Appellate Advisory Committee and served on its Appellate Caseflow Working Group.Michael has expertise in a broad range of areas of concern to local governments in California, including constitutional law, land use regulation, open meetings, elections, municipal litigation, conflicts of interest, public utilities, LAFCO issues, inverse condemnation, cannabis regulation, and a wide range of public finance issues involving taxes, assessments, fees and charges.Michael is perhaps California’s leading expert on the law of local government revenues, briefing 18 cases on that subject in the California Supreme Court since 2004. The Daily Journal named him a California Lawyer of the Year in inverse condemnation law for his win in City of Oroville v. Superior Court (2019) 7 Cal.5th 1091, government’s first win in that court in this subject area in decades. California Chief Justice Ronald M. George presented him with the 2010 Public Lawyer of the Year Award on behalf of the California State Bar. Two successive Speakers of the California Assembly appointed him to the Board of Trustees of the California Bar, the state agency which regulates the practice of law in California. His fellow Trustees elected him Treasurer and President of the Bar and the California Supreme Court appointed him as Chair of its Board of Trustees.Michael currently serves as City Attorney for the City of Grass Valley and General Counsel for the Grass Valley Redevelopment Agency Successor Agency, the Calaveras County LAFCO, the Oak Tree Park and Recreation District, the Peardale-Chicago Park, Higgins, Ophir Hill, and Penn Valley Fire Districts and the Eden Township Healthcare District. He previously served as City Attorney of Auburn (2005–2019), Barstow (1997–2004), Calabasas (2003–2012), Cudahy (1994–1999), La Habra Heights (1994–2004), Monrovia (1999–2002), and Sierra Madre (2004–2006), as General Counsel to the Auburn (2005–2019), Barstow (1997–2004) and Sierra Madre (2004–2006) Redevelopment Agencies, and as General Counsel of the Big Bear City Community Services District (1994–2001) and the Camarillo Healthcare District.
