Tanimura & Antle Fresh Foods, Inc. v. Salinas Union High Sch. Dist.

• Court: California Court of Appeals
• Writing for the Court: Greenwood, P.J.
• Citation: Tanimura & Antle Fresh Foods, Inc. v. Salinas Union High Sch. Dist., 34 Cal.App.5th 775, 246 Cal.Rptr.3d 622 (Cal. App. 2019)
• Decision Date: 26 April 2019
• Docket Number: H045470
• Parties: TANIMURA & ANTLE FRESH FOODS, INC., Plaintiff and Respondent, v. SALINAS UNION HIGH SCHOOL DISTRICT, Defendant and Appellant.

34 Cal.App.5th 775

246 Cal.Rptr.3d 622

TANIMURA & ANTLE FRESH FOODS, INC., Plaintiff and Respondent,

v.SALINAS UNION HIGH SCHOOL DISTRICT, Defendant and Appellant.

H045470

Court of Appeal, Sixth District, California.

Filed April 26, 2019

Davis & Young, Steven B. Dippell, Lozano Smith, Devon Lincoln, Monterey, Counsel for Defendant/Appellant: Salinas Union High School District

Miles J. Dolinger, Counsel for Plaintiff/Respondent: Tanimura & Antle Fresh Foods, Inc.

Atkinson, Andelson, Loya, Ruud & Romo, Martin A. Hom, La Jolla, Jennifer D. Cantrell, Cerritos, Dannis Woliver Kelley, Clarissa R. Canady, San Francisco, Jessika K. Johnson, San Diego, California School Boards Association, Elaine M. Yama-Garcia, D. Michael Ambrose, Amici Curiae on behalf of Defendant/Appellant: Salinas Union High School District

Greenwood, P.J.

In this appeal we consider whether a school district acted reasonably in imposing school impact fees on a new residential development project intended to house adult seasonal farmworkers employed by the company. The trial court found that there was no reasonable relationship between the fee and the project’s impact on school enrollment and so granted the developer’s petition for writ of mandate to refund the fees. The school district contends this was error because the authorizing statute does not require that school districts anticipate and analyze specific use cases for subtypes of residential housing, e.g., adult employees only. Rather, the law requires a reasonable relationship between the fee’s use, the need for the school facilities, and the type of development project—in this case, residential. The district also contends that the potentially discriminatory exclusion of children from a new residential development should not form an escape hatch for the developer to avoid paying mitigation fees under the statute.

We find, as explained herein, that the statutes governing the imposition of school impact fees do not require a school district to separately analyze the impact of a unique subtype of residential construction not contemplated in the statute. To hold otherwise would disrupt the school district’s quasi-legislative authority to impose prospective, districtwide fees based upon development type. In this case, the school district properly determined a reasonable relationship between the fee imposed and new residential construction as the type of development. We conclude that it did not act arbitrarily in imposing the resulting fee on the agricultural employee housing project. We will therefore reverse the judgment.

I. BACKGROUND

This case is situated at the intersection of two statutes. One is the Mitigation Fee Act, codified as Government Code sections 66000 through 66003.¹ This statute requires local agencies seeking to impose fees on private developers as a condition of approval of a development project to determine how there is a "reasonable relationship" between the type of development project, the fee’s use, and the need for the public facilities. ( §§ 66000, subd. (b), 66001, subd. (a)(3) & (4).)

The other statute comprises detailed legislation governing the imposition of school impact fees on private development projects. ( Ed. Code, § 17620 ; Gov. Code, §§ 65995, 65995.5, 65995.7.) The Legislature has declared the financing of school facilities and the mitigation of development-related impacts on the need for school facilities to be "matters of statewide concern." ( § 65995, subd. (e).) State statute authorizes a school district to levy fees on new construction in its service area for school facilities to accommodate a growing student population. To impose a school impact fee, a school district must determine the reasonable relationship required under the Mitigation Fee Act.

A . The Agricultural Employee Housing Project

Tanimura & Antle Fresh Foods, Inc. (T&A), is the developer of a 100-unit agricultural employee housing complex (the project) located within the boundaries of the Salinas Union High School District (the District) in Monterey County.² T&A designed the project to accommodate between 200 and 800 of the company’s seasonal and migrant farmworker employees in two-bedroom, dormitory-like apartment units during the approximately seven-month Salinas Valley growing season. The project description stated that it was designed for " ‘agricultural employees only, without dependents.’ " In May 2015, T&A applied to the County of Monterey for a combined development permit for the project. A report prepared for the county board of supervisors found that the project "for employees without dependents" would "not have an adverse impact on schools."

The county board of supervisors approved the project in September 2015. The board issued a resolution to adopt a mitigated negative declaration under CEQA³ and to approve a combined development permit consisting of a general development plan, administrative permit, and design approval "to allow the construction of a 100 unit agricultural employee housing complex comprised of two bedroom apartment units and related facilities ...." The project was approved subject to enumerated conditions, which in relevant part described the development for "agricultural employees only without dependents" and advised that any use "not in substantial conformance with the terms and conditions of this permit" would violate county regulations and require the approval of additional permits, including an amendment to the general development plan. As a condition of project approval, T&A executed an agreement with the county specifying in relevant part the developer’s obligation to comply with the conditions of approval. The agreement was recorded in the county recorder’s office on September 3, 2015, to be construed as a covenant running with the land.

B . Adoption of School Impact Fees

Around the same time that T&A applied for project approval, the governing board of the District adopted a "Level 2" school impact fee on new residential construction in its service area. A Level 2 fee requires the school district to demonstrate need based on statutory prerequisites.⁴ ( § 65995.5, subd. (b).) Here, the District’s consultant prepared a school facilities needs analysis (SFNA or needs analysis) under the statutory guidelines and concluded that the District was authorized to collect Level 2 fees of $3 per square foot of residential development, based on a projection of the residential units to be built in the district over five years. The District voted to adopt the SFNA and to establish the Level 2 fee on residential construction within the grade 7 through 12 service area of the District for the 2015-2016 fiscal year.

The parties disputed the applicability of the Level 2 fee to the project. T&A eventually tendered the fee amount of $294,210 to the District under protest. (§ 66020, subd. (a) [procedures to protest imposition of fees].)

C . Petition for Writ of Mandate and Court Trial

T&A filed a petition for writ of mandate in the Monterey County Superior Court seeking declaratory relief and a refund of the fee paid, plus interest. T&A challenged the Level 2 fee under section 66001 as not reasonably related to the need for school facilities. It stressed that the project’s design and approval for agricultural employees only, without dependents, meant that it would not generate new students for the district. Since the employees-only designation was among the conditions recorded on title, T&A argued that the project was "not the typical type of residential project" covered by the District’s needs analysis.

In support of its position that the project would not impact local schools, T&A filed the declaration of vice president Wesley Van Camp. Van Camp, charged with managing the planning, permitting, construction, and occupancy of the agricultural employee housing project, declared that the "vast majority" of T&A’s seasonal/migrant farmworker employees "have families and permanent homes outside of Monterey County." Van Camp explained that employees leave their children at home when they come to work for T&A during the Salinas Valley growing season, from April through the end of October, and sometimes both parents come to work for T&A and leave children at home with other relatives. T&A also filed the excerpted deposition testimony of Kevin Sullivan, the designated PMK (person most knowledgeable) for the consulting firm that performed the District’s SFNA, to show that the student generation rate analysis for the SFNA did not consider any kind of residential development that does not allow children.

The District responded that the reasonable relationship requirement applies to the type of development project on which the fee is imposed, not to a specific development. School districts otherwise would have "to somehow anticipate and separately analyze ... every conceivable variation of residential development that might be proposed, including even legally questionable permutations, during the year-long life-span of a district’s developer fee." The District argued that school districts are not required to anticipate alternate housing types or to determine whether a project actually generates enrollment at the rate anticipated by the needs analysis. The District pointed to express statutory exemptions for government-financed migrant worker housing (§ 65995.1, subd. (b)) as support for the argument that nonexempt housing types are included within the general class of residential development.

The District also contended based in part on a passage in the board’s resolution and on the deposition testimony of the county’s resource manager that the "adult employees only" designation was not a condition of the project. According to the District, the county recognized the potentially discriminatory ramification of excluding children and so determined that T&A would submit the occupancy limitation in its project description, which the county would merely approve. T&A objected to the District’s references to...