validly levied regulatory fees, do not constitute an unlawful tax

[mark handler]

OPINION of the OFFICE OF THE ATTORNEY GENERAL State of California

http://ag.ca.gov/cms_attachments/opinions/pdfs/o563_09-903.pdf

Health and Safety Code section 18931.6 requires cities, counties, and cities and counties to collect a fee from all applicants for building permits. This fee is “assessed at the rate of $4 per $100,000 in valuation,” as determined by local building officials. The local entity may retain up to 10 percent of the fees it collects to pay for administrative costs and code enforcement education.

"....charges required to be collected by cities, counties, and cities and counties under section 18931.6 of the California Health and Safety Code are validly levied regulatory fees, and do not constitute an unlawful tax...."

 

[conarb]

First of all Attorneys General Opinions are advisory and not law, although they can be persuasive authority.

I don't agree with the opinion since it is based upon Sinclair Paint Co., 15 Cal. 4th at 875, and Sinclair is based upon law prior to the passage of Prop 218, note the disclaimer in Sinclair in Footnote 2.

FN 2. We are not here concerned with issues arising under constitutional amendments effected by a recent initiative measure (Proposition 218) adopted at the November 5, 1996, General Election. That measure contains new restrictions on local agencies' power to impose fees and assessments. ¹

It will be interesting to see how the courts will deal with this, but an assessment of $4 per $100,000 appears arbitrary on it's face, a tax unrelated to any actual costs of providing services.

Also note that the Opinion is limited to fees assessed prior to January 1, 2010 (which these were), in Prop 26 the voters again limited the rights of jurisdictions to levies taxes disguised as fees.

FN15 - 15 Cal. 4th at 874. We note that Proposition 26, the so called Supermajority Vote to Pass New Taxes and Fees Act, which was passed by the voters on the November 2010 ballot, now defines “tax” as “any levy, charge, or exaction of any kind imposed by the State,” except as otherwise provided. Proposition 26, however, pertains to taxes adopted after January 1, 2010, and is, therefore, not applicable to section 18931.6.²

The question in my mind is who will be motivated to challenge this in the courts given the minor nature of this fee at $4 per $100,000 valuation, unless someone sees it's invalidation as a way to invalidate the entire green code.

¹ http://scocal.stanford.edu/opinion/sinclair-paint-co-v-state-bd-equalization-31842

² http://ag.ca.gov/cms_attachments/opinions/pdfs/o563_09-903.pdf

 

[RJJ]

Conarb: Happy New year and glad to see you still here!

 

[gbhammer]

The question in my mind is who will be motivated to challenge this in the courts given the minor nature of this fee at $4 per $100,000 valuation, unless someone sees it's invalidation as a way to invalidate the entire green code.

QUOTE]

:grin: That would be awesome if some brilliant person/group could actually pull that off. I would just say :cheers