Stanford Law School - Robert Crown Law Library

Filed 7/14/08

IN THE SUPREME COURT OF CALIFORNIA

SILICON VALLEY TAXPAYERS
ASSOCIATION, INC.,
Plaintiffs
and
Appellants,
S136468
v.
) Ct.App.
6
H026759
SANTA CLARA COUNTY OPEN SPACE )
AUTHORITY, )

Santa Clara County
Defendant and Respondent.
) Super.Ct. Nos. 1-02-CV804474
) and 1-03-CV000705

In 1996, Proposition 2181 limited local government’s ability to impose real
property assessments in two significant ways. An assessment can be imposed only
for a “special benefit” conferred on real property (art. XIII D, § 2, subd. (b)), and
the assessment on any parcel must be in proportion to the special benefit conferred
on the particular parcel. (Art. XIII D, § 4, subd. (a))
In 2001, the Santa Clara County Open Space Authority (OSA) imposed a
countywide assessment to fund a program to acquire, improve, and maintain
unspecified open space lands in the county. Plaintiffs sued, challenging that
assessment on the grounds that it fails to satisfy the special benefit and

1
Article XIII D of the California Constitution (article XIII D).
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proportionality requirements of Proposition 218. To decide whether OSA’s 2001
assessment violates article XIII D, we must first determine the appropriate
standard of judicial review of a local governmental agency’s assessment
determination. We conclude that Proposition 218 requires courts to make an
independent review of local agency decisions that are governed by express
constitutional provisions, as in this case, and that OSA’s assessment does not
comply with the special benefit and proportionality requirements of article XIII D.
I. FACTUAL AND PROCEDURAL HISTORY
A. The Creation of OSA and the 1994 Special Assessment District
In 1992, the Santa Clara County Open-Space Authority Act (Pub. Res.
Code, § 35100 et seq.) created OSA, with the express purpose of acquiring and
preserving open space within the county to counter the conversion of land to urban
uses, to preserve quality of life, and to encourage agricultural activities. (Pub.
Res. Code, § 35101, subd. (a).) The act provides no particular method to fund
open space acquisitions, but it authorizes OSA to levy special assessments under
the Streets and Highways Code. (Pub. Res. Code, § 35173.) OSA’s jurisdiction
included all Santa Clara County lands except those already within the boundaries
of the Midpeninsula Regional Open-Space District.
In 1994, OSA formed an original assessment district under the authority of
the Landscape and Lighting Act of 1972 (LLA).2 (Sts. & Hy. Code, § 22500 et
seq.) OSA levied an annual special assessment on the district’s property owners to
acquire and preserve open space land under the LLA’s procedures. Certain

2
An “ ‘[a]ssessment district’ means the district of land to be benefited by the
improvement and to be specially assessed to pay the costs and expenses of the
improvement and the damages caused by the improvement.” (Sts. & Hy. Code,
§ 10008.)
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taxpayers challenged the 1994 assessment, but the Court of Appeal upheld it. The
1994 assessment raised approximately $4 million annually and allowed OSA to
purchase thousands of acres of open space lands.3
B. The Creation of the 2001 Assessment District and the Passage of
Proposition 218
In 2000, OSA determined that it needed additional annual funding to
purchase open space. To raise these additional funds, OSA considered forming an
additional assessment district. However, in 1996, California voters had passed
Proposition 218 to “significantly tighten the kind of benefit assessments” an
agency can levy on real property (Ballot Pamp., Gen. Elec. (Nov. 5, 1996)
argument in favor of Prop. 218, p. 76) and to “protect[] taxpayers by limiting the
methods by which local governments exact revenue from taxpayers without their
consent.” (Ballot Pamp., Gen. Elec., supra, text of Prop. 218, § 2, p. 108, reprinted
in Historical Notes, 2A West’s Ann. Const. (2008 supp.) foll. Cal. Const., art. XIII
C, p. 85 (Historical Notes).)
To achieve these goals, Proposition 218 tightened assessment requirements
and definitions, imposed stricter procedures on agencies, and shifted traditional
presumptions that had favored assessment validity. (Art. XIII D, §§ 2, subd. (i),
4.) Under Proposition 218’s procedures, local agencies must give the record
owners of all assessed parcels written notice of the proposed assessment, a voting
ballot, and a statement disclosing that a majority protest will prevent the
assessment’s passage. (Art. XIII D, § 4, subds. (c), (d).) The proposed assessment
must be “supported by a detailed engineer’s report.” (Art. XIII D, § 4, subd. (b).)
At a noticed public hearing, the agencies must consider all protests, and they

3
The 1994 special assessment is not at issue in this case.
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“shall not impose an assessment if there is a majority protest.” (Art. XIII D, § 4,
subd. (e).) Voting must be weighted “according to the proportional financial
obligation of the affected property.” (Ibid.)4
OSA explored the possibility of creating a second assessment district that
would comply with the new provisions of Proposition 218. As a first step, the
OSA Board of Directors (OSA Board) authorized a poll of Santa Clara County
property owners to determine whether they would support an assessment to fund
the purchase of additional open space. The poll showed that approximately 55
percent of property owners would likely support up to a $20 per year property tax
increase for acquiring and maintaining open space lands.
The OSA Board hired Shilts Consultants, Inc. (SCI) to prepare the
engineer’s report. That report stated that the assessment would fund the
“[a]cquisition, installation, maintenance and servicing” of open space lands for
recreation, conservation, watersheds, easements, and similar purposes. Although
the SCI report identified areas OSA was considering for potential acquisition and
improvement and outlined general considerations OSA would use to identify and
acquire open space lands, it identified no particular parcels to be acquired and no
particular areas to be prioritized.
The proposed 2001 assessment district included all Santa Clara County
lands that were in the 1994 assessment district. The proposed assessment district
included approximately 314,000 parcels and over 800 square miles containing

4
In 1997, the Legislature codified and detailed the notice, hearing, and
protest procedures in the Proposition 218 Omnibus Implementation Act. (Gov.
Code § 53750 et seq., added by Stats. 1997, ch. 38, § 5.) These statutory
provisions expressly supersede any others that apply to the levy of a new
assessment. (Gov. Code § 53753, subd. (a).) These procedures are incorporated
by reference into the LLA. (Sts. & Hy. Code, § 22588.)
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over 1,000,000 people. The SCI engineer’s report identified the special benefits
that would accrue to the assessed parcels, estimated the proportion of all the
benefits that could be considered special, set the assessment for a single-family
home at $20 per year, and provided a formula for estimating the proportionate
special benefit that other property on the tax rolls would receive. Using the $20
property tax increase per single-family home, the SCI engineer’s report calculated
that the assessment would produce an approximately $8 million increase in OSA’s
budget.
The OSA Board accepted and filed the engineer’s preliminary report and
authorized an assessment ballot proceeding. On September 1, 2001, OSA mailed
an informational pamphlet to all of the approximately 314,000 property owners
within the proposed district. The pamphlet described the assessment district and
OSA’s goal of raising about $8 million annually to acquire open space lands
within the county.
On September 14, 2001, OSA mailed a notice of the proposed assessment
and an official ballot to all affected property owners. On October 25, 2001, OSA
conducted an informational meeting, at which OSA’s general manager and special
counsel and a representative from SCI responded to numerous questions from the
public. The formal public hearing was held on November 8, 2001.
On December 13, 2001, OSA reported the results of the balloting at a
public hearing. Of the approximately 314,000 official ballots mailed, OSA
received only 48,100 responses, a return of approximately 15 percent. Of those
responses, 32,127 (66.8 percent) voted in favor of the assessment, while the rest
voted “no” (33.2 percent). The returned ballots were weighted in proportion to the
amount each parcel was to be assessed, making the final tally 50.9 percent in favor
and 49.1 percent opposed. Plaintiff Silicon Valley Taxpayers Association (SVTA)
objected to the results on procedural grounds no longer relevant to the issues
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raised here. The final engineer’s report, which was before OSA at the December
meeting, contained some changes from the draft report filed in September. In
particular, the final report emphasized that the “overriding” and “most important”
criterion for OSA to use in acquiring open space was that the acquired lands be
distributed throughout OSA’s jurisdiction. At the conclusion of the December
hearing, the OSA Board approved the results, accepted the final engineer’s report,
and established the new assessment district.
A year and a half later, the OSA Board renewed the assessment for 2003-
2004 and added a cost-of-living increase of $0.34 per parcel.
C. Procedural History
SVTA, Howard Jarvis Taxpayers Association, and several individual
taxpayers (collectively plaintiffs) filed this action for a writ of mandate,
declaratory relief, and an injunction seeking to invalidate the 2001 assessment.
Plaintiffs’ second amended complaint contains two causes of action: the first
alleges that OSA’s notice and balloting procedures did not comport with
Proposition 218 and the Government Code; the second challenges the substantive
validity of the assessment under Proposition 218 and the Landscaping and
Lighting Act.
The parties filed cross-motions for summary judgment or, in the alternative,
summary adjudication. The court issued an order granting summary adjudication
in favor of OSA on the second cause of action.
After the OSA Board renewed its assessment for the 2003-2004 fiscal year,
plaintiffs filed a second lawsuit challenging that assessment. The new complaint
contained allegations similar to those in the original lawsuit and added claims
contesting the increase in the new assessment. The two cases were then
consolidated. The court issued an order granting summary adjudication in OSA’s
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favor on the remaining causes of action. Based on that order and the previous
order in the first lawsuit, the court entered judgment in favor of OSA.
In a two-to-one decision, the Court of Appeal affirmed the trial court’s
judgment. The majority held that Proposition 218 had altered the traditionally
deferential standard of review by eliminating the presumption that an assessment
was valid. Nevertheless, the majority held that courts should still accord the final
legislative determination substantial deference, as long as the agency had followed
Proposition 218’s procedural requirements in levying the challenged assessment,
and as long as substantial evidence in the administrative record supported the
agency’s finding that the benefits were special. Using this limited scope of
review, the majority determined that the engineer’s report supported OSA’s
determination of special benefits and proportionality.
In her dissent, Justice Bamattre-Manoukian disagreed with the majority
regarding the standard of review. In her view, the drafters of Proposition 218 had
specifically targeted the deferential standard of review for change. Because the
validity of a post-Proposition-218 assessment is now a constitutional question, she
asserted that courts should exercise independent judgment in determining whether
an assessment complies with article XIII D’s procedural and substantive
requirements. The dissent independently analyzed the engineer’s findings
concerning special benefits and proportionality and concluded that the identified
benefits did not comply with Proposition 218’s legal requirements.
We granted plaintiffs’ petition for review.
II. DISCUSSION
Plaintiffs contend that because state constitutional provisions now govern
assessments, courts should apply an independent standard of judicial review to
determine their validity. They claim that, in this case, the $20 flat-rate levy is an
invalid assessment because it fails to satisfy several provisions of article XIII D,
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section 4, and that the levy is in essence a “special tax.” They argue further that,
because OSA neither sought nor obtained the mandatory two-thirds voter approval
for a special tax as required by Proposition 13, the $20 flat-rate levy violates both
Propositions 13 (Cal. Const., art. XIII A) and 218. In discussing these claims, we
first discuss the nature of special assessments before the enactment of Proposition
218, their relationship to Proposition 13 taxes, and how Proposition 218 changed
the law governing assessments. As explained below, we agree with plaintiffs’
contentions.
We explained the nature of a special assessment in Knox v. City of Orland
(1992) 4 Cal.4th 132, (Knox), a pre-Proposition 218 case. A special assessment is
a “ ‘ “ ‘compulsory charge placed by the state upon real property within a pre-
determined district, made under express legislative authority for defraying in
whole or in part the expense of a permanent public improvement therein . . . .’ ”
[Citation.]’ [Citation.] In this regard, a special assessment is ‘levied against real
property particularly and directly benefited by a local improvement in order to pay
the cost of that improvement.’ [Citation.] ‘The rationale of special assessment[s]
is that the assessed property has received a special benefit over and above that
received by the general public. The general public should not be required to pay
for special benefits for the few, and the few specially benefited should not be
subsidized by the general public. [Citation.]’ [Citation.]. . . .
“A tax, on the other hand, is very different. Unlike a special assessment, a
tax can be levied ‘ “without reference to peculiar benefits to particular individuals
or property.” ’ [Citations.] Indeed, ‘[n]othing is more familiar in taxation than the
imposition of a tax upon a class or upon individuals who enjoy no direct benefit
from its expenditure, and who are not responsible for the condition to be
remedied.’ [Citations.]. . . .
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“Therefore, while a special assessment may, like a special tax, be viewed in
a sense as having been levied for a specific purpose, a critical distinction between
the two public financing mechanisms is that a special assessment must confer a
special benefit upon the property assessed beyond that conferred generally.”
(Knox, supra, 4 Cal.4th at pp. 141-142.)
We explained the history of Proposition 218 in Apartment Assn. of Los
Angeles County, Inc. v. City of Los Angeles (2001) 24 Cal.4th 830 (Apartment
Assn.): “ ‘Proposition 218 can best be understood against its historical
background, which begins in 1978 with the adoption of Proposition 13. “The
purpose of Proposition 13 was to cut local property taxes. [Citation.]” [Citation.]
Its principal provisions limited ad valorem property taxes to 1 percent of a
property’s assessed valuation and limited increases in the assessed valuation to 2
percent per year unless and until the property changed hands. (Cal. Const., art.
XIII A, §§ 1, 2.)
“ ‘To prevent local governments from subverting its limitations,
Proposition 13 also prohibited counties, cities, and special districts from enacting
any special tax without a two-thirds vote of the electorate. (Cal. Const., art. XIII
A, § 4; Rider v. County of San Diego (1991) 1 Cal.4th 1, 6-7 [2 Cal.Rptr. 2d 490,
820 P.2d 1000].) It has been held, however, that a special assessment is not a
special tax within the meaning of Proposition 13. (Knox v. City of Orland (1992)
4 Cal.4th 132, 141 [14 Cal.Rptr.2d 159, 841 P.2d 144], and cases cited.)
Accordingly, a special assessment could be imposed without a two-thirds vote.
“ ‘In November 1996, in part to change this rule, the electorate adopted
Proposition 218, which added articles XIII C and XIII D to the California
Constitution. Proposition 218 allows only four types of local property taxes: (1)
an ad valorem property tax; (2) a special tax; (3) an assessment; and (4) a fee or
charge. (Cal. Const., art. XIII D, § 3, subd. (a)(1)-(4); see also [ id.], § 2, subd.
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(a).) It buttresses Proposition 13’s limitations on ad valorem property taxes and
special taxes by placing analogous restrictions on assessments, fees, and charges.’
(Howard Jarvis [Taxpayers Assn. v. City of Riverside (1999)] 73 Cal.App.4th 679,
681-682.)” (Apartment Assn., supra, 24 Cal.4th at pp. 836-837.)
Proposition 218 restricts government’s ability to impose assessments in
several important ways. First, it tightens the definition of the two key findings
necessary to support an assessment: special benefit and proportionality. An
assessment can be imposed only for a “special benefit” conferred on a particular
property. (Art. XIII D, §§ 2, subd. (b), 4, subd. (a).) A special benefit is “a
particular and distinct benefit over and above general benefits conferred on real
property located in the district or to the public at large.” (Art. XIII D, § 2, subd.
(i).) The definition specifically provides that “[g]eneral enhancement of property
value does not constitute ‘special benefit.’ ” (Ibid.) Further, an assessment on any
given parcel must be in proportion to the special benefit conferred on that parcel:
“No assessment shall be imposed on any parcel which exceeds the reasonable cost
of the proportional special benefit conferred on that parcel.” (Art. XIII D, § 4,
subd. (a).) “The proportionate special benefit derived by each identified parcel
shall be determined in relationship to the entirety of the capital cost of a public
improvement, the maintenance and operation expenses of a public improvement,
or the cost of the property-related service being provided.” (Ibid.) Because only
special benefits are assessable, and public improvements often provide both
general benefits to the community and special benefits to a particular property, the
assessing agency must first “separate the general benefits from the special benefits
conferred on a parcel” and impose the assessment only for the special benefits.
(Art. XIII D, § 4, subd. (a).)
Second, as described above, Proposition 218 established strict procedural
requirements for the imposition of a lawful assessment. (Ante, at pp. 3-4.)
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A. Standard of Review
Before Proposition 218 was passed, courts reviewed quasi-legislative acts
of local governmental agencies, such as the formation of an assessment district,
under a deferential abuse of discretion standard. (Knox, supra, 4 Cal.4th at pp.
145-149; Dawson v. Town of Los Altos Hills (1976) 16 Cal.3d 676, 684-685
(Dawson).) Because it was recognized that “the establishment of a special
assessment district takes place as a result of a peculiarly legislative process
grounded in the taxing power of the sovereign,” the scope of judicial review of
such actions was “quite narrow.” (Dawson, supra, at pp. 683-684; id. at p. 684
[“ ‘The board of supervisors is the ultimate authority which is empowered to
finally determine what lands are benefited and what amount of benefits shall be
assessed against the several parcels benefited . . . .’ ”].)
Accordingly, the standard of review was as follows: “A special assessment
finally confirmed by a local legislative body in accordance with applicable law
will not be set aside by the courts unless it clearly appears on the face of the record
before [the legislative] body, or from facts which may be judicially noticed, that
the assessment as finally confirmed is not proportional to the benefits to be
bestowed on the properties to be assessed or that no benefits will accrue to such
properties.” (Dawson, supra, 16 Cal.3d at p. 685; see also Knox, supra, 4 Cal.4th
at p. 146.) Under the Dawson/Knox standard of review, courts presumed an
assessment was valid, and a plaintiff challenging it had to show that the record
before the legislative body “clearly” did not support the underlying determinations
of benefit and proportionality. (See also Lent v. Tillson (1887) 72 Cal. 404, 429
[judicial interference is warranted only “when the courts can plainly see that the
legislature has not really exercised this judgment at all, or that manifestly and
certainly no such benefit can or could reasonably have been expected to result”].)
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The drafters of Proposition 218 specifically targeted this deferential
standard of review for change. Article XIII D, section 4, subdivision (f), provides:
“In any legal action contesting the validity of any assessment, the burden shall be
on the agency to demonstrate that the property or properties in question receive a
special benefit over and above the benefits conferred on the public at large and
that the amount of any contested assessment is proportional to, and no greater
than, the benefits conferred on the property or properties in question.”
In determining the effect of article XIII D, section 4, subdivision (f), we
apply the familiar principles of constitutional interpretation, the aim of which is to
“determine and effectuate the intent of those who enacted the constitutional
provision at issue.” (Richmond v. Shasta Community Services Dist. (2004) 32
Cal.4th 409, 418.) “The principles of constitutional interpretation are similar to
those governing statutory construction.” (Thompson v. Department of Corrections
(2001) 25 Cal.4th 117, 122.) If the language is clear and unambiguous, the plain
meaning governs. (People v. Lopez (2003) 31 Cal.4th. 1051, 1056.) But if the
language is ambiguous, we consider extrinsic evidence in determining voter intent,
including the Legislative Analyst’s analysis and ballot arguments for and against
the initiative. (People v. Canty (2004) 32 Cal.4th 1266, 1281; People v. Rizo
(2000) 22 Cal.4th 681, 685.)
Article XIII D, section 4, subdivision (f), states that the agency has the
burden of demonstrating special benefit and proportionality in any legal action
contesting the validity of any assessment. Although it is clear that the voters
intended to reverse the usual deference accorded governmental action and to
reverse the presumption of validity by placing the “burden” on the agency, the
provision does not specify the scope of that burden. Because the language
imposing a “burden” on the agency is somewhat imprecise, we look to the ballot
materials as further indicia of voter intent.
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The Legislative Analyst explained to the voters that Proposition 218 was
designed to “constrain local governments’ ability to impose . . . assessments . . . .”
and to “place extensive requirements on local governments charging assessments.”
(Ballot Pamp., Gen. Elec., supra, analysis of Prop. 218 by the Legis. Analyst, p.
73.) Addressing the burden of demonstration language of proposed article XIII D,
section 4, subdivision (f), the Legislative Analyst explained: “Currently, the
courts allow local governments significant flexibility in determining fee and
assessment amounts. In lawsuits challenging property fees and assessments, the
taxpayer generally has the ‘burden of proof’ to show that they are not legal. This
measure shifts the burden of proof in these lawsuits to local government. As a
result, it would be easier for taxpayers to win lawsuits, resulting in reduced or
repealed fees and assessments.” (Ballot Pamp., Gen. Elec., supra, at p. 74.) Or
stated another way, Proposition 218 was intended to make it more difficult for an
assessment to be validated in a court proceeding.
As the dissent below points out, a provision in Proposition 218 shifting the
burden of demonstration was included in reaction to our opinion in Knox. The
drafters of Proposition 218 were clearly aware of Knox and the deferential
standard it applied based on Dawson, supra, 16 Cal.3d 676. The argument in
favor of Proposition 218 referred to a “growing list of assessments imposed
without voter approval” after Proposition 13 that are in fact special taxes. As one
example of several named abuses of the assessment process, it specified that “[i]n
Northern California, taxpayers 27 miles away from a park are assessed because
their property supposedly benefits from that park.” (Ballot Pamp., Gen. Elec.,
supra, argument in favor of Prop. 218, p. 76.) The reference to 27 miles was
based on the facts of Knox, which involved an assessment to raise funds to
maintain five existing parks serving four school districts. We upheld the
assessment, deferring to the City of Orland’s determination that the property
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owners were “uniquely benefited by the proximity of these facilities to their
properties” (Knox, supra 4 Cal.4th at p. 149), although the assessment district
contained 42,300 acres of land and geographically consisted of the entire city and
portions of outlying areas in Glenn County. (Id. at p. 137, fn. 5.)
Also, in Knox, we declined a request to reevaluate the Dawson deferential
standard of review for special assessments, finding “no basis” for requiring the
assessing agency to bear the burden of proof “in the context of benefit
assessments.” (Knox, supra, 4 Cal.4th at p. 147.) The Knox plaintiffs argued that,
as in Beaumont Investors v. Beaumont-Cherry Valley Water Dist. (1985) 165
Cal.App.3d 227, 235, the local agency should bear the burden of proof in
establishing the validity of a special assessment, and we should reassess the
traditional standard of review that we reaffirmed in Dawson. (Knox, supra, 4
Cal.4th at pp. 146-147.) In rejecting the argument, we distinguished benefit
assessments from the development fees in Beaumont, noted the different statutory
contexts, and refused to change the deferential standard of review. (Ibid.) Thus, it
appears that the inclusion of the burden of demonstration language was intended to
supply the “basis” found lacking in Knox, and that the drafters of Proposition 218
particularly targeted Knox.
As further evidence that the voters sought to curtail local agency discretion
in raising funds, Proposition 218’s preamble includes an express statement of
purpose: “The people of the State of California hereby find and declare that
Proposition 13 was intended to provide effective tax relief and to require voter
approval of tax increases. However, local governments have subjected taxpayers
to excessive tax, assessment, fee and charge increases that not only frustrate the
purposes of voter approval for tax increases, but also threaten the economic
security of all Californians and the California economy itself. This measure
protects taxpayers by limiting the methods by which local governments exact
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revenue from taxpayers without their consent.” (Ballot Pamp., supra, text of Prop.
218, § 2, p. 108; Historical Notes, supra, p. 85; People v. Canty, supra, 32 Cal.4th
at p. 1280 [“In considering the purpose of legislation, statements of the intent of
the enacting body contained in a preamble, while not conclusive, are entitled to
consideration”].) In passing Proposition 218, the voters clearly sought to limit
local government’s ability to exact revenue under the rubric of special
assessments.
The Court of Appeal majority below recognized that the voters intended to
change the deferential standard of review: “[B]y placing the burden to
demonstrate special benefit and proportionality on the agency the new law must
now require that which Lent held was not necessary, i.e., that the record contain
affirmative evidence of the two substantive bases for the assessment.”
Nevertheless, the majority maintained that courts should continue to give
deference to the local agency’s assessment decision (an act of a legislative body)
for two reasons. First, “the constitutional separation of powers demands that we
give it deference. (Cal. Const., art. III, § 3; [citations].)” Second, if the
challenged assessment was levied according to Proposition 218’s procedural
requirements, courts will continue to accord the final legislative determination
substantial deference. Otherwise, “invalidating an assessment that received the
support of a majority of the property owners would frustrate the will of those
property owners.” The majority concluded that the scope of judicial review was
“limited.”
Accordingly, the majority stated the new standard of review as follows: “A
special assessment finally confirmed by a local legislative body in accordance
with applicable law will not be set aside by the courts so long as the local
legislative body demonstrates, by reference to the face of the record before that
body, that the property or properties in question will receive a special benefit over
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and above the benefits conferred on the public at large and that the amount of any
contested assessment is proportional to, and no greater than, the benefits conferred
on the property or properties in question. In all other respects, such an assessment
shall not be set aside by the courts unless it clearly appears on the face of the
record before the legislative body, or from facts which may be judicially noticed,
that the assessment constitutes a manifest abuse of discretion.”
Under the majority’s standard, an assessing agency’s determinations
regarding whether benefits are special and proportional under the state
Constitution must be affirmed if substantial evidence supports them. Although the
substantial evidence standard is less deferential than the Dawson/Knox standard of
review, it nevertheless is still highly deferential. (Crawford v. Southern Pacific
Co. (1935) 3 Cal.2d 427, 429 [power of appellate court begins and ends with a
determination as to whether there is any substantial evidence, contradicted or
uncontradicted, to support conclusions below]; Jessup Farms v. Baldwin (1983) 33
Cal.3d 639, 660 [reviewing court views the evidence in the light most favorable to
the prevailing party, giving it the benefit of every reasonable inference and
resolving all conflicts in its favor].) The majority’s choice of the deferential
substantial evidence standard comported with its emphasis on the constitutional
separation of powers doctrine, the legislative character of the assessment
determinations at issue, and the consent of the weighted majority of property
owners in the district.
However, a valid assessment under Proposition 218 must not only be
approved by a weighted majority of owners under the procedural requirements in
article XIII D, section 4, subdivisions (c), (d), and (e), but must also satisfy the
substantive requirements in section 4, subdivision (a). (Art. XIII D, § 4, subds.
(a), (c)-(e).) These substantive requirements are contained in constitutional
provisions of dignity at least equal to the constitutional separation of powers
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provision. (Cal. Const., art. III, § 3.) Before Proposition 218 became law, special
assessment laws were generally statutory, and the constitutional separation of
powers doctrine served as a foundation for a more deferential standard of review
by the courts. But after Proposition 218 passed, an assessment’s validity,
including the substantive requirements, is now a constitutional question. “There is
a clear limitation, however, upon the power of the Legislature to regulate the
exercise of a constitutional right.” (Hale v. Bohannon (1952) 38 Cal.2d 458, 471.)
“ ‘[A]ll such legislation must be subordinate to the constitutional provision, and in
furtherance of its purpose, and must not in any particular attempt to narrow or
embarrass it.’ ” (Ibid.) Thus, a local agency acting in a legislative capacity has no
authority to exercise its discretion in a way that violates constitutional provisions
or undermines their effect.
We “ ‘ “must . . . enforce the provisions of our Constitution and ‘may not
lightly disregard or blink at . . . a clear constitutional mandate.’ ” ’ ” (State
Personnel Bd. v. Department of Personnel Admin. (2005) 37 Cal.4th 512, 523.) In
so doing, we are obligated to construe constitutional amendments in a manner that
effectuates the voters’ purpose in adopting the law. (Howard Jarvis Taxpayers
Assn. v. City of Salinas (2002) 98 Cal.App.4th 1351, 1355.)
Proposition 218 specifically states that “[t]he provisions of this act shall be
liberally construed to effectuate its purposes of limiting local government revenue
and enhancing taxpayer consent.” (Ballot Pamp., supra, text of Prop. 218, § 5, p.
109; Historical Notes, supra, p. 85.) Also, as discussed above, the ballot materials
explained to the voters that Proposition 218 was designed to: constrain local
governments’ ability to impose assessments; place extensive requirements on local
governments charging assessments; shift the burden of demonstrating
assessments’ legality to local government; make it easier for taxpayers to win
lawsuits; and limit the methods by which local governments exact revenue from
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taxpayers without their consent. Because Proposition 218’s underlying purpose
was to limit government’s power to exact revenue and to curtail the deference that
had been traditionally accorded legislative enactments on fees, assessments, and
charges, a more rigorous standard of review is warranted. We construe article
XIII D, section 4, subdivision (f) — the “burden . . . to demonstrate” provision —
liberally in light of the proposition’s other provisions, and conclude that courts
should exercise their independent judgment in reviewing local agency decisions
that have determined whether benefits are special and whether assessments are
proportional to special benefits within the meaning of Proposition 218.
(Redevelopment Agency v. County of Los Angeles (1999) 75 Cal.App.4th 68, 74
[courts exercise independent judgment in matters involving constitutional
interpretation]; see People v. Cromer (2001) 24 Cal.4th 889, 894 [courts use
independent, de novo review for mixed questions of fact and law that implicate
constitutional rights].)
Defendants argue that because a weighted majority of property owners
approved the assessment, it furthers Proposition 218’s emphasis on voter consent,
and we should accord deference to those voting owners’ wishes. However, voter
consent cannot convert an unconstitutional legislative assessment into a
constitutional one. Under Proposition 218, all valid assessments must both clear
the substantive hurdles in article XIII D, section 4, subdivision (a) and be
approved by a weighted majority of owners under section 4, subdivisions (c), (d),
and (e). Moreover, Proposition 218 was designed to prevent a local legislative
body from imposing a special tax disguised as an assessment. (Apartment Assn.,
supra, 24 Cal.4th at p. 839 [“The ballot arguments identify what was perhaps the
drafter’s main concern: tax increases disguised via euphemistic relabeling as
18

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‘fees,’ ‘charges,’ or ‘assessments’ ”].)5 The judicial invalidation of an assessment
does not thwart the objective of taxpayer consent; under Proposition 13, two-thirds
of the voters must still approve the proposed revenue source (i.e., a special tax).
(Cal. Const., art. XIII A, § 4; art. XIII D, § 3, subd. (a)(2).) Neither the separation
of powers nor property owner consent justifies allowing a local legislative body or
property owners (both bound by the state Constitution) to usurp the judicial
function of interpreting and applying the constitutional provisions that now govern
assessments.
Courts are familiar with the process of determining the constitutionality of
the taxes, fees, and assessments that local governments impose. (See Richmond v.
Shasta Community Services Dist., supra, 32 Cal.4th at pp. 418-428 [determination
whether charge that water district imposed violated article XIII D restrictions
required de novo review]; Howard Jarvis Taxpayers Assn. v. City of Roseville
(2002) 97 Cal.App.4th 637, 647-650 [court found that in-lieu fee that city imposed
was unconstitutional under article XIII D]; Howard Jarvis Taxpayers Assn. v. City
of Riverside, supra, 73 Cal.App.4th 679, 684-690 [question whether existing
streetlight assessment was subject to Proposition 218 limitations involved court’s
de novo interpretation of the constitution and voters’ intent]; Howard Jarvis
Taxpayers Assn. v. City of Salinas (2002) 98 Cal.App.4th 1351, 1354-1359 [court
independently interprets constitutional amendments contained in article XIII D to

5
The argument in favor of Proposition 218 stated: “After voters passed
Proposition 13, politicians created a loophole in the law that allows them to raise
taxes without voter approval by calling taxes ‘assessments’ and ‘fees’. . . . [¶] . . .
[¶] Proposition 218 will significantly tighten the kind of benefit assessments that
can be levied.” (Ballot Pamp., Gen. Elec., supra, argument in favor of Prop. 218,
p. 76).) It also declared that “Proposition 218 simply give taxpayers the right to
vote on taxes and stops politicians’ end-runs around Proposition 13.” (Ballot
Pamp., Gen. Elec., supra, rebuttal to argument against Prop. 218, p. 77.)
19

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determine whether water fee was a property-related fee requiring property owners’
vote]; Graber v. City of Upland (2002) 99 Cal.App.4th 424, 429 [question whether
local ordinance violated constitutional provisions relating to tax increment
financing was subject to de novo review].)
Accordingly, courts should exercise their independent judgment in
reviewing whether assessments that local agencies impose violate article XIII D.6
B. The 2001 Special Assessment
We apply this standard of review to the special assessment in this case to
determine whether OSA met its burden of demonstrating that the assessed
properties received a special benefit and that the assessment is proportional to that
special benefit.
1. Special Benefits
“Under Proposition 218, only special benefits are assessable. (Cal. Const.,
art. XIIID, § 4, subd. (a).) Local governments may not impose assessments to pay
for the cost of providing a general benefit to the community. . . .” (City of
Saratoga v. Hinz (2004) 115 Cal.App.4th 1202, 1223.) If a proposed project will
provide both general benefits to the community and special benefits to particular
properties, the agency can impose an assessment based only on the special
benefits. It must separate the general benefits from the special benefits and must
secure other funding for the general benefits. (Art. XIII D, § 4, subd. (a); Hinz,
supra, 115 Cal.App.4th at p. 1223.)

6
In Not About Water Com. v. Board of Supervisors (2002) 95 Cal.App.4th
982), the Court of Appeal held that courts review the creation of a special
assessment district under an abuse of discretion standard (Id. at pp. 994-995), but
at another point it references a substantial evidence standard (Id. at p. 986). We
disapprove Not About Water Com. v. Board of Supervisors, supra, 95 Cal.App.4th
982, to the extent it is inconsistent with this opinion.
20

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Both before and after Proposition 218 passed, special assessments were
distinguished from special taxes through the concept of special benefits. (Knox,
supra, 4 Cal.4th at p. 142; Ventura Group Ventures, Inc. v. Ventura Port Dist.
(2001) 24 Cal.4th 1089, 1106 (Ventura Group Ventures).) In Knox, we referred to
a special benefit as a benefit “ ‘over and above that received by the general
public.’ ” (Knox, supra, 4 Cal.4th at p. 142.) There, we presumed (in the absence
of evidence to the contrary) that the presence of well-maintained open park land
contributed to the district’s attractiveness and thus was a special benefit because it
enhanced the desirability of the residential properties in that district. (Knox,
supra, 4 Cal.4th at p. 149.)
Proposition 218 made several changes to the definition of special benefits.
First, Proposition 218 defines a special benefit as “a particular and distinct benefit
over and above general benefits conferred on real property located in the district
or to the public at large,” with the additional italicized requirement. (Art. XIII D,
§ 2, subd. (i), italics added.) Correspondingly, it emphasizes that “[g]eneral
enhancement of property value does not constitute ‘special benefit.’ ” (Ibid.)
Since the “[g]eneral enhancement of property value” is a “general benefit[]
conferred on real property located in the district” (ibid.), Proposition 218 clearly
mandates that a special benefit cannot be synonymous with general enhancement
of property value. Thus, Proposition 218 tightened the definition of special
benefits and broadened the definition of general benefits to include benefits
conferred generally “on real property located in the district.” (Art. XIII D, § 2,
subd. (i).)7

7
OSA suggests that it can classify general benefits to parcels within the
district as special benefits because benefit-to-property language is omitted from
article XIII D, section 4, subdivision (f). That subdivision requires the agency “to

(footnote continued on next page)
21

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Relying on Harrison v. Bd. of Supervisors (1975) 44 Cal.App.3d 852
(Harrison), the Court of Appeal majority below commented that “[i]f there is a
significant difference between the two definitions [of special benefits before and
after Proposition 218], we do not detect it.” Harrison simply held that an increase
in property value alone did not amount to a special benefit. (Harrison, supra, 44
Cal.App.3d at pp. 858-859.) This holding did not preclude a determination of
special benefit based in part on the general enhancement of property value.
Moreover, while pre-Proposition 218 case law makes clear that assessments
may not be levied for purposes of conferring purely general benefits, courts did
not invalidate assessments simply because they provided general benefits to the
public in addition to the requisite special benefits, and did not demand a strict
separation of special and general benefits. (See e.g., Knox, supra, 4 Cal. at pp.
137, 149 [upheld validity of assessment for park maintenance despite fact city did
not separate general benefits to people outside area and to community at large
from special benefits to residential parcels]; Allen v. City of Los Angeles (1930)
210 Cal. 235, 238 [“It would be well within the power of the city council to make

(footnote continued from previous page)

demonstrate that the property or properties in question receive a special benefit
over and above the benefits conferred on the public at large and that the amount of
any contested assessment is proportional to, and no greater than, the [special]
benefits conferred on the property or properties in question.” (Art. XIII D, § 4,
subd. (f).) OSA disregards the fact that section 4, subdivision (f), requires OSA to
prove a proportional “special benefit” to each property as that term is defined in
section 2, subdivision (i), which includes the benefit-to-property component. The
additional reference in section 4, subdivision (f), to the “public at large” is
surplusage, because that language is already included in section 2, subdivision
(i)’s definition of “special benefit.” (See Voters for Responsible Retirement v.
Board of Supervisors (1994) 8 Cal.4th 765, 772-773.)
22

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the cost of the entire proceeding rest upon the shoulders of the property owners of
a given district especially benefited thereby”]; Federal Construction Co. v. Ensign
(1922) 59 Cal.App. 200, 210 (Ensign) [“To invalidate the assessment the general
public benefit must be the only result of the improvement”; 100 percent of cost of
new sewage treatment plant fully assessable notwithstanding general benefits]; 51
Cal.Jur.3d (2003) Public Improvements, § 19, p. 900 [“For an assessment to be
invalid because it confers a general public benefit, the general benefit must be the
only result of the assessment”].)
Consequently, the pre-Proposition 218 cases on which the Court of Appeal
majority below and OSA relied are not instructive in determining whether a
benefit is special under Proposition 218. Instead, under the plain language of
article XIII D, a special benefit must affect the assessed property in a way that is
particular and distinct from its effect on other parcels and that real property in
general and the public at large do not share.8 (Art. XIII D, § 2, subd. (i).)

8
OSA observes that Proposition 218’s definition of “special benefit”
presents a paradox when considered with its definition of “district.” Section 2,
subdivision (i) defines a “special benefit” as “a particular and distinct benefit over
and above general benefits conferred on real property located in the district or to
the public at large.” (Art. XIII D, § 2, subd. (i), italics added.) Section 2,
subdivision (d) defines “district” as “an area determined by an agency to contain
all parcels which will receive a special benefit from a proposed public
improvement or property-related service.” (Art. XIII D, § 2, subd. (d), italics
added.) In a well-drawn district — limited to only parcels receiving special
benefits from the improvement — every parcel within that district receives a
shared special benefit. Under section 2, subdivision (i), these benefits can be
construed as being general benefits since they are not “particular and distinct” and
are not “over and above” the benefits received by other properties “located in the
district.”

We do not believe that the voters intended to invalidate an assessment
district that is narrowly drawn to include only properties directly benefitting from
an improvement. Indeed, the ballot materials reflect otherwise. Thus, if an
assessment district is narrowly drawn, the fact that a benefit is conferred

(footnote continued on next page)
23

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Our examination of the engineer’s report supporting the assessments
reveals that OSA has failed to meet its burden of demonstrating that the
assessment is based only on the special benefits conferred on the particular parcel
and is in proportion to those benefits. Various studies supported the listed benefits
in the engineer’s report. But, as discussed below, the report’s designation of these
listed benefits as “special” failed to satisfy the constitutional requirements for
assessments that fund open space acquisitions.
The engineer’s report enumerates seven “special benefits” that the
assessment will confer on all residents and property owners in the district: (1)
enhanced recreational activities and expanded access to recreational areas; (2)
protection of views, scenery, and other resources; (3) increased economic activity;
(4) expanded employment opportunity; (5) reduced costs of law enforcement,
health care, fire prevention, and natural disaster response; (6) enhanced quality of
life and desirability of the area; and (7) improved water quality, pollution
reduction, and flood prevention.
The report states that the benefit of “[e]nhanced recreational opportunities
and expanded access to recreational areas” will be conferred on “all property
owners, residents, employees and customers throughout the OSA” and that “[a]ll
properties will benefit from the assessments . . . .” It explains that residential
properties will benefit because “[t]hese improved open space areas will be

(footnote continued from previous page)

throughout the district does not make it general rather than special. In that
circumstance, the characterization of a benefit may depend on whether the parcel
receives a direct advantage from the improvement (e.g., proximity to a park) or
receives an indirect, derivative advantage resulting from the overall public benefits
of the improvement (e.g., general enhancement of the district’s property values).
24

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available to residents and guests of property owners within the OSA, thereby
making these properties more valuable,” and that nonresidential properties will
benefit because additional recreation areas available to employees will “enhance
an employer’s ability to attract and keep quality employees.” The “enhanced
economic conditions benefit the [nonresidential] property by making it more
valuable.” The report therefore acknowledges that all people in OSA’s territory
will benefit broadly, generally, and directly from the assessment, resulting in all
properties receiving a derivative, indirect benefit.
Similarly, the report describes the second listed “special benefit” as
benefiting everyone in the district generally (“[p]rotection of views, scenery and
other resources values and environmental benefits enjoyed by residents,
employees, customers and guests”). The report concludes that “[t]hese benefits
ultimately accrue to properties because properties are more desirable in areas that
offer environmental and economic benefits.” The report makes no attempt to tie
this benefit to particular properties. Instead, it concludes that all properties
throughout the district will receive this benefit equally.
“Increased economic activity” and “[e]xpanded employment opportunity”
are also listed in the report as “special benefits.” Again, the report states that
increased economic activity and expanded employment opportunity will result
from the acquisition of additional open space because increased recreational
opportunities will likely attract more people to the county. These people, in turn,
will patronize county services and businesses, thereby fostering economic growth
and “additional employment opportunities for OSA residents.” The report broadly
concludes that the increased economic activity in the area is “a benefit ultimately
to residential, commercial, industrial and institutional property.” However, it
simply assumes that the resultant increased economic activity will affect people
25

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and property throughout the county equally, but makes no direct connection to any
particular properties.
The remaining listed “special benefits” do not satisfy the constitutional
requirements either. Relying on various studies, the report claims that because
open space and parks promote good health and reduce crime and vandalism, the
county can expect a reduction in health care and law enforcement costs. It reasons
that “[s]uch cost reduction frees public funds for other services that benefit
properties,” and “[a]ll of these factors ultimately benefit property by making the
community more desirable and property, in turn, more valuable.” The report also
asserts that, because open space helps protect water quality and reduce flooding,
the costs of public utility services for properties in the district will decrease.
Finally, the report emphasizes that open space areas will “enhance the
overall quality of life and desirability of the area.” All the listed benefits are
general benefits in this case, shared by everyone — all 1.2 million people — living
within the district. The report does not even attempt to measure the benefits that
accrue to particular parcels. Indeed, the report describes OSA’s mission, which is
“[t]o preserve, protect and manage, for the use and enjoyment of all people, a well-
balanced system of urban and non-urban areas of scenic recreational and
agricultural importance.” (Italics added.) OSA is responsible, as the report
explains, “for preserving and maintaining open space for approximately 1.2
million people residing within its boundaries, representing over two-thirds of the
population within Santa Clara County.” Although it is reasonable to conclude that
quality-of-life benefits to people living in, working in, and patronizing businesses
in the district will, in turn, benefit property in the district, such derivative benefits
are only “general benefits conferred on real property located in the district or to
the public at large.” (Art. XIII D, § 2, subd. (i).) Moreover, to the extent that the
value of property located in a desirable community is enhanced, this is a “[g]eneral
26

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enhancement of property value,” and is thus, by definition not a special benefit.
(Ibid.)
In addition, the report’s description of general benefits fails to comport with
the Constitution. The engineer’s report acknowledges that the acquisition,
maintenance and preservation of open spaces “provide a degree of general benefit
to the public at large.” But it then asserts that the ratio of general and special
benefit that will be derived from OSA’s open space acquisition program will be 10
percent general benefit and 90 percent special benefit, based on its determination
that general benefit is measured only as the benefit conferred on “individuals who
are not residents, employees, customers or property owners” (italics added) in the
assessment district. This distinction finds no support in the Constitution.
Under article XIII D, general benefits are not restricted to benefits
conferred only on persons and property outside the assessment district, but can
include benefits both “conferred on real property located in the district or to the
public at large.” (Art. XIII D, § 2, subd. (i), italics added.) “At large” means
“[n]ot limited to any particular . . . person” or “[f]ully; in detail; in an extended
form.” (Black’s Law Dict. (8th ed. 2004) p. 136.) By its plain language, section
2, subdivision (i), does not permit OSA to choose one segment of the “public at
large” to measure general benefit. The “public at large” thus means all members
of the public — including those who live, work, and shop within the district —
and not simply transient visitors. The report assumes that people and property
within the district — an area covering over 800 square miles, with a population of
approximately 1.2 million people — will receive no general benefit at all, only
special benefits, from OSA’s acquisition of open space. But under these
circumstances, “[i]f everything is special, then nothing is special.” (Ventura
Group Ventures, supra, 24 Cal.4th at p. 1107.)
27

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Further, we note the validity of this assessment would be questionable even
under the pre-Proposition 218 cases on which OSA relies. (See e.g., Knox, supra,
4 Cal.4th 132 [assessment valid for maintenance of five existing parks in four
school districts in city]; City of San Diego v. Holodnak (1984) 157 Cal.App.3d 759
[assessment valid to fund parks and other public facilities located in new
development]; Ensign, supra, 59 Cal.App. 200 [assessment valid to fund new
sewer system].) Unlike the assessment here, the assessments in the pre-
Proposition 218 cases involved specific, identified improvements that directly
benefited each assessed property and whose costs could be determined or
estimated and then allocated to the properties assessed. Also, in Knox and
Holodnak, the properties assessed received special benefits from the particular
park because of their proximity to park facilities. (Knox, supra, 4 Cal.4th at p.
149; Holodnak, supra, 157 Cal.App.3d at p. 763.)
Here, with a district of 314,000 parcels, OSA shows no distinct benefits to
particular properties above those which the general public using and enjoying the
open space receives. The special benefits, if any, that may arise would likely
result from factors such as proximity, expanded or improved access to the open
space, or views of the open space. (See Ensign, supra, 59 Cal.App. at p. 217
[property which is specially benefited is “ ‘real property adjoining, or near the
locality of the improvement’ ”].) But, because OSA has not identified any specific
open space acquisition or planned acquisition, it cannot show any specific benefits
to assessed parcels through their direct relationship to the “locality of the
improvement.” The improvement is only to OSA’s budget for open space
acquisitions.
Based on the undisputed facts in OSA’s record (the engineer’s report), OSA
has failed to demonstrate that the properties in the assessment district receive a
28

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particular and distinct special benefit not shared by the district’s property in
general or by the public at large within the meaning of Proposition 218.
2. Proportionality
For an assessment to be valid, the properties must be assessed in proportion
to the special benefits received: “No assessment shall be imposed on any parcel
which exceeds the reasonable cost of the proportional special benefit conferred on
that parcel.” (Art. XIII D, § 4, subd. (a).) “The proportionate special benefit
derived by each identified parcel shall be determined in relationship to the entirety
of the capital cost of a public improvement, the maintenance and operation
expenses of a public improvement, or the cost of the property-related service being
provided.” (Ibid., italics added.) Capital cost is defined as “the cost of
acquisition, installation, construction, reconstruction, or replacement of a
permanent public improvement by an agency.” (Art. XIII D, § 2, subd. (c), italics
added.)
To satisfy the proportionality requirement, the engineer’s report assigned
all single-family homes in the district one single family equivalent (SFE) unit and
assigned other types of property greater or lesser SFE’s, depending on the
estimated number of people using those properties. Condominiums received a
lesser SFE because the average number of people per unit was estimated to be
fewer than in an average single-family residence. Commercial properties received
a higher SFE than single-family residences because greater numbers of people use
them. Each SFE corresponded to an annual assessment of $20, an amount a
majority of property owners surveyed would be willing to pay.
Because all single-family homes were assessed the same $20 amount, the
engineer’s report assumed that all single-family homes throughout the 800-square-
mile district would receive an equal special benefit, regardless of their proximity
29

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to open space areas that might be acquired at some time in the future. The report
contains no detailed analysis on how specific properties, blocks, school districts,
or even cities would benefit from their proximity to open space. OSA contends
that its assessment is nonetheless valid because it plans to acquire space equally
throughout the district, and all properties will be equally close to and benefit from
open space areas. The engineer’s report lists 30 priority acquisition areas and
identifies a number of other “potential acquisition and improvement areas.” This,
OSA claims, is sufficient to satisfy Proposition 218’s proportionality requirement.
We disagree.
The report’s proportionality analysis fails to satisfy Proposition 218 largely
because the special assessment is based on OSA’s projected annual budget of $8
million for its open space program rather than on a calculation or estimation of the
cost of the particular public improvement to be financed by the assessment. The
figure of $8 million was derived from the additional $20 per year in property taxes
multiplied by the number of properties on the tax rolls in the district. The $8
million collected for the assessment annually — with an automatic cost-of-living
increase — provides a continuing source of revenue for OSA’s budget. However,
the purpose of an assessment is to require the properties which have received a
special benefit from a “public improvement” “to pay the cost of that
improvement,” and not to fund an agency’s ongoing budget. (Ventura Group
Ventures, supra, 24 Cal.4th at p. 1106, italics added; Knox, supra, 4 Cal.4th at p.
142)
The engineer’s report generally describes a program to acquire various
properties throughout the county, as well as to provide maintenance and servicing
of these public areas. Such future acquisitions include, but are not limited to,
“greenbelts, hillsides, viewsheds and watersheds, baylands, riparian corridors,
urban open space, parklands, agricultural lands, development rights on agricultural
30

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lands and other land-use types, conservation easements, other property rights,
wetlands, utility right-of-ways, surplus school sites, [and] quarries.” OSA argues
its goal is to acquire open space land that is evenly distributed throughout the
district. Although the report lists 30 general priority acquisition areas, it further
notes this list is not exclusive. The report identifies no particular parcels or
specific area within the district that OSA plans to acquire for open space or parks.
Further, the engineer’s report notes that OSA “should” complete at least one
acquisition of open land every five years. Notably, OSA is not required to do so.
Thus, the report fails to identify with sufficient specificity the “permanent
public improvement” that the assessment will finance, fails to estimate or calculate
the cost of any such improvement, and fails to directly connect any proportionate
costs of and benefits received from the “permanent public improvement” to the
specific assessed properties. As the dissent below observed, “an assessment
calculation that works backward by starting with an amount taxpayers are likely to
pay, and then determines an annual spending budget based thereon, does not
comply with the law governing assessments, either before or after Proposition
218.”
As with its determination of special benefits, OSA has failed to demonstrate
proportionality. Accordingly, we conclude that the assessment is invalid for
failing to meet the requirements of Proposition 218. In light of this disposition, we
need not reach the other arguments plaintiffs raise.
31

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III. DISPOSITION
We reverse the judgment of the Court of Appeal and remand the matter to
that court for further proceedings consistent with our opinion.
CHIN, J.
WE CONCUR:

GEORGE, C.J.
KENNARD, J.
BAXTER, J.
WERDEGAR, J.
MORENO, J.
CORRIGAN, J.
32

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See last page for addresses and telephone numbers for counsel who argued in Supreme Court.

Name of Opinion Silicon Valley Taxpayers’ Association v. Santa Clara County Open Space Authority
__________________________________________________________________________________

Unpublished Opinion

Original Appeal
Original Proceeding
Review Granted XXX 130 Cal.App.4th 1295
Rehearing Granted

__________________________________________________________________________________

Opinion No.

S136468
Date Filed: July 14, 2008
__________________________________________________________________________________

Court:

Superior
County: Santa Clara
Judge: William J. Elfving

__________________________________________________________________________________

Attorneys for Appellant:

Law Offices of Tony J. Tanke, Tony J. Tanke; Law Offices of Gary Simms, Gary L. Simms; Howard Jarvis
Taxpayers Association and Timothy Arthur Bittle for Plaintiffs and Appellants.

Aaron L. Katz as Amicus Curiae on behalf of Plaintiffs and Appellants.

James Sherman Burling and Harold E. Johnson for Pacific Legal Foundation as Amicus Curiae on behalf of
Plaintiffs and Appellants.

Pahl & Gosselin, Fenn C. Horton III and Karen Kubala McCay for California Apartment Association as
Amicus Curiae on behalf of Plaintiffs and Appellants.

Bell, McAndrews & Hiltachk and Thomas W. Hiltachk for Apartment Association of Greater Los Angeles,
Apartment Association of Greater Inland Empire, Burbank Chamber of Commerce and Lodi Association of
Realtors as Amici Curiae on behalf of Plaintiffs and Appellants.

Jack Cohen for Jonathan M. Coupal as Amicus Curiae on behalf of Plaintiffs and Appellants.

Eric Grant for Alameda County Taxpayers Association, Association of Concerned Taxpayers, League of
Placer County Taxpayers, Pomona Coalition for Better Government, Sacramento County Taxpayers
League, Solano County Taxpayers Association, United Organization of Taxpayers, Valley Taxpayers
Coalition, Ventura County Taxpayers Association and Yolo County Taxpayers Association as Amici
Curiae on behalf of Plaintiffs and Appellants.

__________________________________________________________________________________

Attorneys for Respondent:

Nielsen, Merksamer, Parrinello, Mueller & Naylor, James R. Parrinello, John E. Mueller, Christopher E.
Skinnel and Sean P. Welch for Defendant and Respondent.

---

Page 2 – S136468 - counsel continued

Attorneys for Respondent:

Hopkins & Carley and Jay M. Ross for San Jose Silicon Valley Chamber of Commerce and Silicon Valley
Manufacturing Group as Amici Curiae on behalf of Defendant and Respondent.

McMurchie Law Firm and David W. McMurchie for The Mosquito and Vector Control Association of
California and California Special Districts Association as Amici Curiae on behalf of Defendant and
Respondent.

Steven M. Woodside, County Counsel, Sue Andra Gallagher and Kathleen Larocque, Deputy County
Counsel; and Elizabeth Strauss for California State Association of Counties and League of California Cities
as Amici Curiae on behalf of Defendant and Respondent.

Timothy N. Washburn for Sacramento Area Flood Control District as Amicus Curiae on behalf of
Defendant and Respondent.

Willoughby, Stuart & Bening and Bradley A. Bening for San Jose Silicon Valley Chamber of Commerce
and Silicon Valley Leadership Group as Amici Curiae on behalf of Defendant and Respondent.

Shute, Mihaly & Weinbergeer, Ellen J. Garber and Winter King for Committee for Green Foothills,
Greenbelt Alliance, Planning and Conservation League and Sierra Club as Amici Curiae on behalf of
Defendant and Respondent.

Ann Miller Ravel. County Counsel (Santa Clara) and Katherine Harasz, Deputy County Counsel, for
County of Santa Clara as Amici Curiae on behalf of Defendant and Respondent.

Heller Ehrman White & McAuliffe, Vanessa Ottilie Wells, Ingrid S. Leverett and David A. Thomas for
The Trust for Public Land as Amicus Curiae on behalf of Defendant and Respondent.

---

Counsel who argued in Supreme Court (not intended for publication with opinion):

Tony J. Tanke
Law Offices of Tony J. Tanke
2050 Lyndell Terrace, Suite 240
Davis, CA 95616
(530) 758-4530

James R. Parrinello
Nielsen, Merksamer, Parrinello, Mueller & Naylor
591 Redwood Highway, Bldg. 4000
Mill Valley, CA 94941
(415) 389-6800

---

Petition for review after CA affirmed civil judgment. Issues: (1) In a legal action contesting validity of an assessment under Cal. Constitution article XIIID, what standard of review should apply in reviewing agency determination that properties on which assessment is to be imposed will "receive a special benefit over & above benefits conferred on public at large & the amount of any contested assessment is proportional to & no greater than benefits conferred on the property(s)," as required by the constitutional provision? (art. XIII D(4)(f).) (2) Can the benefit that future purchases of unidentified open space will confer upon everyone who lives or works in the assessment district be characterized as a "special benefit" to each parcel in district within the meaning of art. XIIID? (3) Under art. XIIID, may the agency impose an identitical assessment on all similar district properties (e.g, all single-family residences) or must it calculate benefit/cost to each individual parcel?

Opinion Information

Date:	Citation:	Docket Number:	Category:	Status:	Cross Referenced Cases:
Mon, 07/14/2008	44 Cal. 4th 431, 187 P.3d 37, 79 Cal. Rptr. 3d 312	S136468	Review - Civil Appeal	closed; remittitur issued	DAHMS v. DOWNTOWN POMONA PROPERTY AND BUSINESS (S143165)

Disposition
Jul 14 2008	Opinion: Reversed

Dockets
Aug 12 2005	Petition for review filed   by counsel for appellants (filed in Sac.) c/a rec req
Aug 23 2005	Received Court of Appeal record   two file jackets/briefs/accordian file
Sep 1 2005	Answer to petition for review filed   by resp
Sep 13 2005	Reply to answer to petition filed   by appellants (40.1b)
Sep 16 2005	Received:   letter from counsel for aplt
Sep 26 2005	Record requested   memainder of c/a case record
Sep 27 2005	Received Court of Appeal record   two boxes
Sep 27 2005	Received:   letter from resp counsel
Sep 28 2005	Time extended to grant or deny review   to 11-10-05
Oct 12 2005	Petition for review granted (civil case)   Votes: George, C.J., Kennard, Baxter, Werdegar, Chin, and Moreno, JJ.
Oct 17 2005	Certification of interested entities or persons filed   By counsel for appellant.
Oct 28 2005	Certification of interested entities or persons filed   by resp
Nov 4 2005	Request for extension of time filed   for aplts to file the opening brief on the merits, to 12-19-05.
Nov 8 2005	Filed:   Resps' notice of non-opposition to extension request.
Nov 8 2005	Extension of time granted   to 12-19-05 for aplts to file the opening brief on the merits.
Dec 19 2005	Request for extension of time filed   appellants, Silicon Valley asking to January 18, 2006 to file the opening brief on the merits.
Dec 22 2005	Extension of time granted   to and including January 18, 2006 for appellant to file the opening brief on the merits.
Jan 19 2006	Request for extension of time filed   appellant, Silicon Valley Taxpayers Association Inc., asking to extend 8 days until January 26, 2006.
Jan 24 2006	Extension of time granted   to January 26, 2006, to file appellant's (Silicon Valley Taxpayers Association) opening brief on the merits.
Jan 26 2006	Received:   appellants Silicon Valley Taxpayers opening brief on the merits, application to file brief in excess of the word count, seperate request for judicial notice.
Jan 30 2006	Opening brief on the merits filed   Appellants Silicon Valley Taxpayers Tony J. Tanke, counsel
Feb 24 2006	Request for extension of time filed   to April 13, 2006 to file answer brief on the merits. Santa Clara County Open Space Authority, respondent by James R. Parinello, counsel
Feb 28 2006	Extension of time granted   to April 13, 2006 to file respondent's answer brief on the merits.
Apr 13 2006	Request for extension of time filed   to April 21 2006 to file respondent's answer brief.
Apr 18 2006	Extension of time granted   to April 21, 2006 to file respondent's answer brief on the merits.
Apr 21 2006	Request for judicial notice filed (granted case)   Santa Clara County Open Space Authority, respondent James R. Parinello, counsel
Apr 21 2006	Received:   Received respondents (Santa Clara County Open Space Authority) applicaiton to file oversize answer brief on the merits.
Apr 24 2006	Answer brief on the merits filed   Santa Clara County Open Space Authority, respondent by James R. Parinello, counsel
May 3 2006	Request for extension of time filed   to June 15, 2006 to file appellant's reply brief on the merits.
May 8 2006	Extension of time granted   to June 15, 2006 to file appellant's reply brief on the merits.
Jun 14 2006	Request for extension of time filed   to June 22, 2006 to file reply brief on the merits by attorneys for appellants Silicon Valley Taxpayers Assn., Inc. et al.
Jun 21 2006	Received:   appellants (Silicon Valley Taxpayers Assn., Inc., et al) application to file reply brief on the mertis in excess of word limits.
Jun 27 2006	Reply brief filed (case fully briefed)   Silicon Valley Taxpayers Associaton, Inc., et al., appellants Tony J. Tanke, counsel with permission
Jul 10 2006	Request for extension of time filed   to August 31, 2006 to file appellant's response to Amcici Curiae Briefs by Tony J. Tanke
Jul 11 2006	Extension of time granted   to August 31, 2006 to file appellant's response to Amici Curiae Briefs.
Jul 26 2006	Received application to file Amicus Curiae Brief   for Aaron L. Katz in support of appellant's position on review by Aaron L. Katz, counsel
Jul 26 2006	Received application to file Amicus Curiae Brief   of Apartment Association of Greater Los Angeles, Apartment Association Greater Inland Empire, Burbank Chamber of Commerce, Lodi Association of Realters on behelf of appellants Silicon Valley Taxpayer Associations, Inc. et al. by Thomas W. Hiltachk, counsel
Jul 26 2006	Received application to file Amicus Curiae Brief   of plaintiffs and appellants Silicon Valley Taxpayers Association, Inc., et al. (Jonathan M. Coupal) by Jack Cohen, counsel
Jul 27 2006	Received application to file Amicus Curiae Brief   Pacific Legal Foundation in support of plaintiffs and appellants Silicon Valley Taxpayers Association, inc. et al. by James S. Burling
Jul 27 2006	Received application to file Amicus Curiae Brief   for California State Associaton of Counties and The League of California Cities, in support of respondent by Kathleen Larocque
Jul 27 2006	Received application to file Amicus Curiae Brief   of Mosquito and Vector Control Association of California and California Specvial districts Associaton, in suport of respondent. by David W. McMurchie
Jul 27 2006	Received application to file Amicus Curiae Brief   of Alameda County Taxpayers Association, Association of Concerned Taxpayers, League of Palcer County Taxpayers, Pomona Coalition for Better Government, Sacramento County Taxpayers League, Solano County Taxpayers Association, United Organization of Taxpayers, Valley Taxpayers Coalition, Ventura County Taxpayers Association, Yolo County Taxpayers Association in support of appellants. by Eric Grant
Jul 27 2006	Received application to file Amicus Curiae Brief   The California Apartment Associaton in support of appellants' position. by Fenn C. Horton , counsel
Jul 27 2006	Received application to file Amicus Curiae Brief   of Sacramento Area Flood Control Agency in support of defendant and respondent Santa Clara County Open Space by Timothy Washbun, counsel
Jul 27 2006	Received application to file Amicus Curiae Brief   for Green Foothills, Greenbelt Alliance, Planning and Conservation League, and Sierra Club in support of defendant and respondant Santa Clara County Open Space Authority by Winter King, counsel
Jul 28 2006	Received application to file Amicus Curiae Brief   for San Jose Silicon Valley Chamber of Commerce, and Silicon Valley Leadership Group in support of defendant and respondent Santa Clara County Open Space Authority by Bradley A. Benning, counsel
Jul 28 2006	Received application to file Amicus Curiae Brief   for County of Santa Clara in support of defendant and respondent Santa Clara County Open Space Authority by Katherine Harsz, counsel
Jul 31 2006	Permission to file amicus curiae brief granted   California Apartment Association, in support of appellant. Answer due within twenty days.
Jul 31 2006	Amicus curiae brief filed   California Apartment Associaiton in support of appellants
Jul 31 2006	Permission to file amicus curiae brief granted   County of Santa Clara, in support of respondent. Answer due within twenty days.
Jul 31 2006	Amicus curiae brief filed   County of Santa Clara in support of respondent
Jul 31 2006	Amicus curiae brief filed   County of Santa Clara in support of respondent
Jul 31 2006	Permission to file amicus curiae brief granted   San Jose Silicon Valley Chamber of Commerce and Silicon Valley Leadership Group, in support of respondent. Answer due within twenty days.
Jul 31 2006	Amicus curiae brief filed   San Jose silicon Valley Chamber of Commerce and Silicon Valley Leadership Group, in support of respondent.
Jul 31 2006	Permission to file amicus curiae brief granted   Green Foothills, Greenbelt Alliance, Planning and Conservation League, Sierra Club, in support of respondent. Answer due within twenty days.
Jul 31 2006	Amicus curiae brief filed   Gren Foothills, Greenbelt Alanice, Planing and Conservation League, Sierra Club, in support of respondent.
Jul 31 2006	Permission to file amicus curiae brief granted   Sacramento Area Flood Central Agency, in support of respondent. Answer due within twenty days.
Jul 31 2006	Amicus curiae brief filed   Sacramento Area Flood Central Agency, in support of respondent.
Jul 31 2006	Permission to file amicus curiae brief granted   Pacific Legal Foundation, in support of appellants. Answer due within twenty days.
Jul 31 2006	Amicus curiae brief filed   Pacific Legal Foundation in support of appellants.
Jul 31 2006	Permission to file amicus curiae brief granted   California Stsate Association of Counties and The League of California Cities, in support of respondent answer due within twenty days.
Jul 31 2006	Amicus curiae brief filed   California State Association of Counties and The League of California Cities, in support of respondent.
Jul 31 2006	Permission to file amicus curiae brief granted   The Apartment Association of Greater Los Angeles, Apartment Association Greater Inland Empire, Burbank Chamber of Commerce, and Lodi Association of Realtors, in support of appellant. Answer due within twenty days.
Jul 31 2006	Amicus curiae brief filed   The Apartment Association of Greater Los Angeles, Apartment Association Greater Inland Empire, Burbank Chamber of Commerce, and Lodi Association of Realtors, in support of appellant.
Jul 31 2006	Permission to file amicus curiae brief granted   Jonathan M. Coupal, in support of appellant. Answer due within twenty days.
Jul 31 2006	Amicus curiae brief filed   Jonathan M. Coupal, in support of appellant
Jul 31 2006	Received application to file Amicus Curiae Brief   Aaron L. Katz, in support of appellant. Answer due within twenty days.
Jul 31 2006	Amicus curiae brief filed   Aaron L. Katz, in support of appellant.
Aug 3 2006	Permission to file amicus curiae brief granted   Alameda County Taxpayers Association, Associaton of Concerned Taypayers, League of Placer County Taxpayers, Pomona Coalition for Better Government, Sacramento County Taxpyers League, Solano County Taxpayers Associaiton, United Organization of Taxpayers, Valley Taxpayers Coalition, Ventura County Taxpyers Association, Yolo County Taxpayers Association, in support of appellants. Answer due within twenty days.
Aug 3 2006	Amicus curiae brief filed   Alameda County Taxpayers Associaiton, Association of Concerned Taxpayers, League of Placer County Taxpayers, Pomona Coalition for Better Government, Sacramento County Taxpayers League, Solano County Taxpayers Association, United Organization of Taxpayers, Valley Taxpayers Coalition, Ventura County Taxpayers Association, Yolo County Taxpayers Associaiton, in support of appellant.
Aug 3 2006	Permission to file amicus curiae brief granted   Mosquito and Vector Control Association of California and California Special Districts Association, in support of respondent. anwer due within twenty days.
Aug 3 2006	Amicus curiae brief filed   Mosquito and Vector Control Association of California and California Special Districts Association, in support of respondent.
Aug 9 2006	Note: Mail returned (unable to forward)   to Katherine Harasz
Aug 31 2006	Application filed to:   File a Consolidated Response to all Amicus Briefs in support of Appellant by James Parrinello, counsel for Respondent {Santa Clara County Open Space Authority).
Sep 1 2006	Response to amicus curiae brief filed   Santa Clara County Open Space Auhtority, Respondent by James R. Parrinello, counsel
Sep 6 2006	Application filed to:   file a Consolidated Reponse to all Amicus Curia Briefs in support of Respondent by Tony J. Tanke, counsel for appellant (Silicon Valley Taxpayers Association).
Sep 8 2006	Response to amicus curiae brief filed   Silicon Valley Taxpayers Associaiton, Inc., appellant by Tony J. Tanke, counsel
Sep 8 2006	Received:   notice of errata
Sep 11 2006	Request for judicial notice filed (granted case)   Silicon Valley Taxpayers Association, Inc., appellant by Tony J. Tanke, counsel
Sep 26 2006	Opposition filed   Santa Clara County Open Space Authority, respondent by James R. Parrinello, counsel
Oct 18 2006	Filed:   Silicon Valley Taxpayers Association, Inc., appellants reply to respondent's opposition to appellants' second motion and request for judicial notice by Tony J. Tanke, counsel
Jan 12 2007	Filed:   respondent Santa Clara County open space authority's provisionally-submitted supplemental request for judicial notice. by James R. Parrinello, counsel
Aug 22 2007	Received:   appellants' notice of unavailabililty of counsel by Tony J. Tanke, counsel for appellants
Apr 9 2008	Case ordered on calendar   to be argued on Tuesday, May 6, 2008, at 9:00 a.m. in San Francisco
Apr 21 2008	Note: Mail returned (unable to forward)   Gary L. Simms, counsel
Apr 25 2008	Note: Mail returned (unable to forward)   Gary L. Simm, counsel
May 6 2008	Cause argued and submitted
May 6 2008	Request for judicial notice denied   The requests for judicial notice filed on April 21, 2006, and September 26, 2006, are denied. The provisionally-submitted supplemental request for judicial notice filed on January 12, 2007 is denied.
May 30 2008	Note: Mail returned (unable to forward)   Gary L. Simms, counsel
Jul 11 2008	Notice of forthcoming opinion posted
Jul 14 2008	Opinion filed: Judgment reversed   We reverse the judgment of the Court of Appeal and remand the matter to that court for further proceedings consistent with our opinion. Opinion by Chin, J. -----joined by George, C.J., Kennard, Baxter, Werdegar, Moreno & Corrigan, JJ.
Aug 14 2008	Remittitur issued (civil case)
Aug 18 2008	Received:   Receipt for remitittur from Court of Appeal - Sixth District
Aug 21 2008	Note: Mail returned (unable to forward)   Fenn Clark Horton, counsel for California Apartment Association
Aug 26 2008	Note: Mail returned (unable to forward)   Gary L. Simm, counsel for appellant

Briefs
Jan 30 2006	Opening brief on the merits filed
Apr 24 2006	Answer brief on the merits filed
Jun 27 2006	Reply brief filed (case fully briefed)
Jul 31 2006	Amicus curiae brief filed
Jul 31 2006	Amicus curiae brief filed
Jul 31 2006	Amicus curiae brief filed
Jul 31 2006	Amicus curiae brief filed
Jul 31 2006	Amicus curiae brief filed
Jul 31 2006	Amicus curiae brief filed
Jul 31 2006	Amicus curiae brief filed
Jul 31 2006	Amicus curiae brief filed
Jul 31 2006	Amicus curiae brief filed
Jul 31 2006	Amicus curiae brief filed
Jul 31 2006	Amicus curiae brief filed
Aug 3 2006	Amicus curiae brief filed
Aug 3 2006	Amicus curiae brief filed
Sep 1 2006	Response to amicus curiae brief filed
Sep 8 2006	Response to amicus curiae brief filed

Brief Downloads
Text of Proposition 13.pdf (36682 bytes) - Text of Proposition 13
Text of Proposition 218.pdf (98748 bytes) - Text of Proposition 218

If you'd like to submit a brief document to be included for this opinion, please submit an e-mail to the SCOCAL website

Feb 25, 2010 Annotated by Erika Wayne

Summary: A unanimous California Supreme Court ruled that courts must substantively review special tax assessments to determine if they pass a special benefits test and proportionality test, because Proposition 218 put those tests into the California Constitution explicitly. Because Proposition 218 was distinctively anti-tax, the government bears a very high burden of proving that the tax assessment passes the special benefits test and proportionality test. The government does not have a presumption of constitutionality; it must present detailed analysis with particularity to specific parcels of land. Impact: High impact. Local municipalities will face stricter standards when passing tax assessments. They must gather more detailed information explaining how specific parcels of land benefit specifically from projects. Since the case, Oakland cancelled a scheduled tax assessment to avoid running afoul of this ruling. Stockton and Tiburon also faced challenges immediately following the ruling. Facts: SCOSA was created as a tax district to pay for open-space. SCOSA planned to raise $8 million to pay for open-space. SCOSA imposed a special tax assessment of $20 per single household in the district (the “Tax Assessment”). It held an election which approved the plan by a 50.9 to 49.1 margin. SCOSA stated that the open-space would confer a special benefit for the district. The engineers report listed seven benefits conferred by the open-space projects: (1) enhanced recreational activities and expanded access to recreational areas; (2) protection of views, scenery, and other resources; (3) increased economic activity; (4) expanded employment opportunity; (5) reduced costs of law enforcement, health care, fire prevention, and natural disaster response; (6) enhanced quality of life and desirability of the area; and (7) improved water quality, pollution reduction, and flood prevention. Also, SCOSA planned to distribute the open-space throughout the district. Therefore, a flat $20 fee was appropriate. Arguments: Taxpayers challenged the tax: • The SCOSA Tax Assessment violates the California Constitution. • Proposition 218 states that the government may only impose a special tax assessment if it meets the following two tests: o Special Benefit Test: Confers a special benefit on the property beyond a general benefit. o Proportional Test: Is proportional to the value of the special benefit conferred. • The SCOSA Tax Assessment violated the Constitution in both ways o It did not confer a special benefit on the households in question, only a general benefit. o It charged a fixed fee without tying the fee to the special benefit conferred or the costs of supplying the special benefit. SCOSA responds: • Because it is a tax issue, judges should be very deferential to the legislature and the democratic process. The Tax Assessment passed with popular support. • Judges should only perform procedural review, not substantive review of the tax assessment. Proposition 218 does not explicitly require the court to substantively review the tax assessment. Therefore, the courts should keep their deferential standard. The SCOSA followed constitutionally required procedures; therefore the OSA Tax Assessment is constitutionally valid. • Even if the California Supreme Court does substantively review the decision, the benefits listed pass the special benefits test and imposing a $20 regular rate pass the proportionality test. Issue: Can the court substantively review a special tax assessment under Proposition 218? Did the Santa Clara OSA Tax Assessment meet the requirements of a special benefit and proportionality required by Proposition 218? Holding: Yes, the court can and must substantively review tax assessments. No, the Santa Clara OSA Tax Assessment did not meet either the special benefit or the proportionality requirement. Therefore, the Tax Assessment was invalid. Rule: Courts must substantively review special tax assessments to determine if the government actually meets the special benefit and proportionality requirements of Proposition 218, because Proposition 218 altered the California Constitution. To meet the special benefit test in Proposition 218, the government must provide evidence and analysis demonstrating how each parcel benefits in particular. Simple broad claims are insufficient. To meet the proportional test in Proposition 218, the government must demonstrate how each particular parcel benefits from the special project and by how much. Moreover, it must demonstrate specifically how much the special project costs and how it apportioned the cost by household. Simply charging all households a flat rate is insufficient. Reasoning: Prior to Proposition 218, Proposition 13 governed the constitutionality of local property taxes. Proposition 13 allowed local governments to impose special tax assessments to pay for those special benefits. In Knox v. City of Orland, 4 Cal. 4th 132, (Cal. 1992) the California Supreme Court defined a special tax assessment as a “compulsory charge placed by the state upon real property within a predetermined district [.]” It further explained that “[t]he rationale of special assessments is that the assessed property has received a special benefit over and above that received by the general public.” However, Proposition 13 did not define either a special benefit or proportionality. Thus, there was no constitutional definition to guide courts. Legislatures made these determinations. Prior to Proposition 218, the courts reviewed the legislature’s determination of a special tax assessment under a deferential abuse of discretion standard. Courts were very deferential to the government when determining whether a public project conferred a special benefit or whether it was proportional. In Knox, the Court set the standard of review as follows: “A special assessment finally confirmed by a local legislative body in accordance with applicable law will not be set aside by the courts unless it clearly appears on the face of the record before the body or, from facts which may be judicially noticed, that the assessment as finally confirmed is not proportional to the benefits to be assessed or that no benefits will accrue to such properties.” Proposition 218 directly challenged and reversed this deference. First, it formally defined special benefit and proportionality in the California Constitution. Therefore, there is far less room for deference to the legislature. Additionally, Proposition 218 changed the court’s standard of review. While not explicitly creating a new standard of review, Proposition 218 clearly meant to limit the taxation power of local governments. According to the Court, “Because Proposition 218’s underlying purpose was to limit government’s power to exact revenue and to curtail the deference that had been traditionally accorded legislature enactments on fees, assessments, and charges, a more rigorous standard of review is warranted.” Accordingly, the Court held that “[We] conclude that courts should exercise their independent judgment in reviewing local agency decisions that have determined whether benefits are special and whether assessments are proportional to special benefits within the meaning of Proposition 218.” Therefore, the California Supreme Court would decide for itself whether the special tax assessment met the special benefit or proportionality test. The Santa Clara OSA Tax Assessment failed both tests. First, the Court found that the Santa Clara government did not provide any rigorous evidence on whether a special benefit was conferred. As the Court states: "Proposition 218 clearly mandates that a special benefit cannot be synonymous with general enhancement of property value." In the Court’s unanimous opinion, all of the listed benefits from open-space were general benefits, not special benefits. Second, it failed the proportionality test. The Tax Assessment charged all single family homes a $20 per year fee, irrespective of whether they were close to the open-space or received any special benefit. Since the fee was not tailored to any special benefit or to the actual costs of building the special projects, but imposed evenly amongst all parties in the district, it could not be proportional. Student's perspective: This is a powerful case with significant impact in California. Prior to this ruling, the government enjoyed a de facto presumption in favor of a tax assessment’s constitutionality. As such, it was very difficult to challenge the tax assessment’s validity. Only procedural errors or clear abuse hurt the government’s chances. Courts made a clear policy decision to limit their review to procedural issues only. This is a powerful case with significant impact in California. Prior to this ruling, the government enjoyed a de facto presumption in favor of a tax assessment’s constitutionality. As such, it was very difficult to challenge the tax assessment’s validity. Only procedural errors or clear abuse hurt the government’s chances. Courts made a clear policy decision to limit their review to procedural issues only. After this ruling, the government faces far stricter standards. First, the courts now must review the tax assessment for special benefits and proportionality. Their analysis must expand beyond simple procedural issues. Second, the special benefits and proportionality tests are enforced with strong particularity. Simply asserting that land “benefits” is no longer sufficient to claim a special benefit. The government must provide specific analysis explaining how specific parcels of land benefit in particular. Moreover, the government must detail, in particular, exactly how much the special project costs and apply those costs proportionally to the special benefits provided. Ultimately, this opinion will have significant impact on local finance. California municipalities had been using special tax districts to pass de facto property tax increases to pay for environmental projects, such as open-space. Because these governments had a presumption of validity, they did not perform specific, detailed analyses. Now these special tax assessments are under challenge and the government’s assertions face a much stronger burden of proof. Some special tax districts already reversed themselves. For example, Oakland reversed a special tax assessment after this case. Challenges were filed against tax assessments in the cities of Stockton and Tiburon. Projects will become more expensive and may cease altogether. Special tax districts will lose favor and hurt public projects. It is unlikely that the California Supreme Court will alter this ruling much in the future. All seven justices ruled unanimously; there were no separate concurring opinions or dissents. New appointments will not likely alter the result, especially now that it has the strength of stare decisis. Moreover, the agreed upon logic is fairly straightforward. Because the special benefits and proportionality tests are explicitly defined in detail in the California Constitution, courts must enforce those tests, even at the cost of green-space. As such, there is little room to modify the ruling through litigation. The only way to reverse this ruling would be to alter the California Constitution itself. However, this would prove difficult. The only thing that Californians like more than open-space is low property taxes. Authored by Blake Bailey

Related Media	• Chris Amico, “Open space case goes before California SC today,” LegalNewsline.com, May 6, 2008
	• California Taxpayers’ Association, “Courts: State Supreme Court Strikes Down Santa Clara Property Assessment as Violation of Proposition 218,” Cal-Taxletter
	“Big Legal Win for Taxpayers: Santa Clara Open Space Tax Struck Down,” Howard Jarvis Taxpayers Association, July 14, 2008
	Harold E. Johnson, “Property Owners Singled Out To Pay Illegal Tax Disguised as “Special Benefit Assessment,” Pacific Legal Foundation, July 2008