california legislature—2023–24 regular session
ASSEMBLY BILL No. 2257
Introduced by Assembly Member Wilson
February 8, 2024
An act to add Sections 53759.1 and 53759.2 to the Government Code, relating to local government.
legislative counsel’s digest
AB 2257, as introduced, Wilson. Local government: property-related water and sewer fees and assessments: remedies.
The California Constitution specifies v arious requirements with respect to the le vying of assessments and property-related fees and charges by a local agency. The California Constitution includes a public notice and a majority protest procedure in the case of assessments and procedures for submitting property-related fees and charges for approval by property o wners subject to the fee or char ge or to the electorate residing in the affected area following a public hearing.
Existing law, known as the Proposition 218 Omnibus Implementation Act, prescribes specific procedures and parameters for local jurisdictions to comply with these requirements.
This bill w ould prohibit, if a local agenc y complies with specified procedures, a person or entity from bringing a judicial action or proceeding alleging noncompliance with the constitutional provisions for any new, increased, or extended fee or assessment, as defined, unless that person or entity has timely submitted to the local agency a written objection to that fee or assessment that specifies the grounds for alleging noncompliance, as specified.
This bill w ould provide that local agenc y responses to the timely submitted written objections shall go to the weight of the e vidence
99 supporting the agency’s compliance with the substantive limitations on fees and assessments imposed by the constitutional provisions. The bill would also prohibit an independent cause of action as to the adequacy of the local agency’s responses.
This bill w ould, if the local agenc y complies with the specified procedures, provide that in any judicial action or proceeding to review, invalidate, challenge, set aside, rescind, v oid, or annul the fee or assessment for failure to comply with the constitutional provisions, the court’s review is limited to a record of proceedings containing specified documents, except as otherwise provided. The bill would make related findings and declarations.
Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.
The people of the State of California do enact as follows:
line 1 SECTION 1. The Le gislature finds and declares all of the line 2 following:
line 3 (a) State law requires that establishing or making certain changes line 4 to property-related fees, lik e w ater service rates, occur in line 5 accordance with procedures outlined in Section 6 of Article XIII line 6 D of the California Constitution, commonly referred to as line 7 “Proposition 218. ” Establishing or making certain changes to line 8 special assessments is governed by Section 4 of Article XIII D of line 9 the California Constitution.
line 10 (b) The “exhaustion of remedies” principle is a fundamental line 11 concept of administrative law governing the relationship between line 12 agencies and courts. It requires individuals to raise concerns about line 13 proposed agency actions to the agencies themselv es, in the first line 14 instance, rather than to the courts. Indi viduals that disagree with line 15 agency actions must pursue a vailable agenc y procedures for line 16 addressing those concerns before they may sue the agency in court line 17 (Plantier v. City of Ramona Municipal Water Dist. (2019) 7 Cal.5th line 18 372, 382-383, citing Coachella Valley Mosquito & Vector Control line 19 Dist. v. California Public Emplo yment Relations Bd. (2005) 35 line 20 Cal.4th 1072, 1080; see Abelleira v. District Court of Appeal, line 21 Third Dist. (1941) 17 Cal.2d 280, 292–293).
line 22 (c) The purpose of this act is to create an e xhaustion of line 23 administrative remedies procedure that, if implemented by a local line 24 agency, requires ratepayers to bring an objection re garding a 99 — 2 — AB 2257
line 1 proposed property-related w ater or se wer fee or char ge, or an y line 2 special assessment to the local public agenc y governing body’s line 3 attention prior to the deadline established by the local public agency line 4 as part of the rate or assessment consideration process. The purpose line 5 of the act is also to pro vide an opportunity for the local public line 6 agency to address or resolve the objection or objections before its line 7 governing body makes a final decision on whether to establish a line 8 new, or amend a current, property-related fee or special assessment line 9 pursuant to Proposition 218.
line 10 (d) The procedure created by this act is intended to pro vide a line 11 meaningful opportunity for a ratepayer to resolve an objection to line 12 a proposed new or amended property-related w ater or sewer fee line 13 or charge, or any special assessment before resorting to litigation line 14 after the new or amended rate or special assessment is appro ved line 15 (see Plantier v. Ramona Municipal Water Dist., supra, 7 Cal.5th line 16 at p. 338). Even if such an objection is not fully resolved, the local line 17 agency’s considering and responding to the objection can narrow line 18 the dispute and will create a better e videntiary record for court line 19 review in deciding any later litigation (see id.). line 20 (e) This act establishes a “clearly defined machinery for the line 21 submission, evaluation, and resolution of complaints by aggrieved line 22 parties”(see Plantier v. Ramona Municipal Water Dist., supra, 7 line 23 Cal. 5th at p. 384 citing Rosenfield v . Malcom (1967) 65 Cal.2d line 24 559, 566) and is consistent with the intent of Proposition 218, line 25 which is to enhance communication between ratepayers and line 26 agencies (Mor gan v . Imperial Irrig ation Dist. (2014) 223 line 27 Cal.App.4th 892, 911; see also Bighorn-Desert View Water Agency line 28 v. Virjil (2006) 39 Cal.4th 205, 220).
line 29 SEC. 2. Section 53759.1 is added to the Government Code, to line 30 read:
line 31 53759.1. (a) For purposes of this section, the follo wing line 32 definitions apply:
line 33 (1) “Exhaustion of remedies requirement” means the written line 34 objection requirement under subdivision (b).
line 35 (2) “Fee or assessment” means an y property-related w ater or line 36 sewer fee or charge, or any special assessment. line 37 (b) For purposes of an y fee or assessment adopted by a local line 38 agency pursuant to Section 4 or 6 of Article XIII D of the line 39 California Constitution, if the local agenc y complies with the line 40 procedures described in subdi vision (c), a person or entity shall 99 AB 2257 — 3 —
line 1 be prohibited from bringing a judicial action or proceeding alleging line 2 noncompliance with Article XIII D of the California Constitution line 3 for any new, increased, or extended fee or assessment, unless that line 4 person or entity has timely submitted to the local agency a written line 5 objection to that fee or assessment that specifies the grounds for line 6 alleging noncompliance, and shall be subject to the requirements line 7 of Section 53759.2.
line 8 (c) The e xhaustion of remedies requirement authorized by line 9 subdivision (b) applies only if the local agenc y does all of the line 10 following:
line 11 (1) Posts on its internet website and mak es a vailable to the line 12 public a proposed fee or assessment and a written basis for the fee line 13 or assessment no less than 45 days prior to the protest hearing line 14 required by Article XIII D of the California Constitution. line 15 (2) Provides at least 45 days for a property owner to review the line 16 proposed fee or assessment and to timely submit to the local agency line 17 a written objection to that fee or assessment that specifies the line 18 grounds for alleging noncompliance. To be considered timely, any line 19 written objection shall be submitted by a deadline established by line 20 the local agency, which shall be no less than 45 days after the local line 21 agency complies with paragraph (1).
line 22 (3) Considers and responds in writing to any timely submitted line 23 written objections prior to the close of the protest hearing or ballot line 24 tabulating hearing required under Section 4 or 6 of Article XIII D line 25 of the California Constitution. Timely submitted written objections line 26 and agenc y responses required by this subdi vision shall be line 27 presented to the local agency’s governing body for consideration line 28 prior to or during a protest hearing or ballot tab ulation hearing line 29 required under Section 4 or 6 of Article XIII D of the California line 30 Constitution.
line 31 (4) Includes in the written notice, sent pursuant to paragraph line 32 (c) of Section 4 or paragraph (1) of subdivision (a) of Section 6 of line 33 Article XIII D of the California Constitution, a statement that line 34 written objections must be submitted within the written objection line 35 period set by the local agency pursuant to paragraph (2) to preserve line 36 any right to challenge that fee or assessment.
line 37 (5) Concludes the procedures described in paragraphs (1) to (4), line 38 inclusive, prior to the completion of the protest hearing and ballot line 39 tabulating hearing required by Section 4 or 6 of Article XIII D of line 40 the California Constitution.
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line 1 (d) The local agenc y’s go verning body , in e xercising its line 2 legislative discretion, shall determine whether the written line 3 objections and the agency’s response warrant clarifications to the line 4 proposed fee or assessment, a reduction in the proposed fee or line 5 assessment, further re view before making a determination on line 6 whether clarification or reduction is needed, or whether to proceed line 7 with the protest hearing or ballot tabulation hearing required under line 8 Section 4 or 6 of Article XIII D of the California Constitution. line 9 (e) The local agenc y’s response to timely submitted written line 10 objections, as required under paragraph (3) of subdivision (c), shall line 11 go to the weight of the e vidence supporting the agenc y’s line 12 compliance with the substantive limitations on fees and assessments line 13 imposed by Section 4 or 6 of Article XIII D of the California line 14 Constitution. There shall be no independent cause of action as to line 15 the adequacy of a local agenc y’s response pursuant to paragraph line 16 (3) of subdivision (c).
line 17 SEC. 3. Section 53759.2 is added to the Government Code, to line 18 read:
line 19 53759.2. (a) For purposes of this section, “fee or assessment” line 20 means any property-related water or sewer fee or char ge, or any line 21 special assessment.
line 22 (b) Notwithstanding any law, if a local agenc y adopts a fee or line 23 assessment and complies with subdivision (c) of Section 53759.1, line 24 any judicial action or proceeding to review, invalidate, challenge, line 25 set aside, rescind, void, or annul the fee or assessment for failure line 26 to comply with Section 4 or 6 of Article XIII D of the California line 27 Constitution shall be subject to the following requirements:
line 28 (1) Except as provided in paragraph (2), the court’s review shall line 29 be limited to the record of proceedings before the local agency for line 30 that fee or assessment as follows:
line 31 (A) Any cost-of-service or rate study or report, any engineer’s line 32 report, agency staff reports, and related documents prepared by line 33 the local agency with respect to the fee or assessment. line 34 (B) Any transcript or minutes of the proceedings at which the line 35 decisionmaking body of the local agency heard testimony or public line 36 comment on the fee or assessment, and any transcript or minutes line 37 of the proceedings before an y advisory body to the local agenc y line 38 that were presented to the decisionmaking body before action on line 39 the fee or assessment.
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line 1 (C) All notices issued by the local agenc y for purposes of line 2 complying with subdi vision (c) of Section 53759.1, to comply line 3 with the requirements of Section 4 or 6 of Article XIII D of the line 4 California Constitution, or with any other law requiring notice. line 5 (D) All timely submitted written objections and any local agency line 6 responses to those objections made pursuant to Section 53759.1. line 7 (E) All written evidence or correspondence related to the fee or line 8 assessment submitted to, or transmitted from, the local agenc y line 9 prior to the completion of the protest hearing or ballot tab ulation line 10 hearing required under Section 4 or 6 of Article XIII D of the line 11 California Constitution.
line 12 (F) Documentation of the local agenc y’s final decision on the line 13 fee or assessment, including an y ordinance, resolution, rule, line 14 regulation, meeting minutes, or other record of the local agency’s line 15 decision.
line 16 (G) All protests, ballots, and records of the tabulation, protests, line 17 or ballots made in connection with the fee or assessment. line 18 (H) All written evidence or documentation supporting the fee line 19 or assessment in the local agency’s files prior to completion of the line 20 protest hearing or ballot tabulation hearing required under Section line 21 4 or 6 of Article XIII D of the California Constitution. line 22 (2) Evidence outside the record of proceedings before the local line 23 agency may be admitted under the following circumstances:
line 24 (A) Where the e vidence is rele vant to issues other than the line 25 validity of the fee or assessment, such as a petitioner’ s standing line 26 and capacity to sue.
line 27 (B) Where the e vidence is rele vant to affirmati ve defenses, line 28 including, but not limited to, laches, estoppel, and res judicata. line 29 (C) Where the e vidence is rele vant to the accurac y and line 30 completeness of the administrati ve record certified by the local line 31 agency.
line 32 (D) Where the e vidence is rele vant to the local agenc y’s line 33 compliance with the procedures set forth in subdi vision (c) of line 34 Section 53759.1.
line 35 (E) Where the evidence is necessary to explain information in line 36 the administrative record to demonstrate compliance with Section line 37 4 or 6 of Article XIII D of the California Constitution.
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