Furey v. City of Sacramento

• Decision Date: 21 January 1986
• Docket Number: No. 84-2429,84-2429
• Citation: 780 F.2d 1448
• Parties: Lawrence E. FUREY, Trustee, Plaintiff-Appellant, v. CITY OF SACRAMENTO, A Chartered City, County of Sacramento and Natomas Sanitation District of Sacramento County, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1448

780 F.2d 1448

Lawrence E. FUREY, Trustee, Plaintiff-Appellant, v. CITY OF SACRAMENTO, A Chartered City, County of Sacramento and Natomas Sanitation District of Sacramento County, Defendants-Appellees.

No. 84-2429.

United States Court of Appeals Ninth Circuit.

Argued June 12, 1985.

Submitted Dec. 13, 1985.

Decided Jan. 21, 1986.

Steven F. Brockhage, Thelen, Marrin, Johnson, & Bridges, San Francisco, Cal., Craig C. Thompson, Deputy Atty. Gen., Sacramento, Cal., for plaintiff-appellant.

Henry Crowle, Memering & DeMers, Lee Savage, Hyde, Miller, & Savage, Sacramento, Cal., for defendants-appellees.

Appeal from the United States District Court for the Eastern District of California.

Before SNEED and BEEZER, Circuit Judges, and STEPHENS ^*, District Judge.

SNEED, Circuit Judge:

Plaintiff Lawrence Furey appeals a grant of summary judgment in favor of defendants City of Sacramento and other municipal government entities. Furey claims that his property was taken in violation of the United States Constitution when his land was assessed to pay for the construction of a sewer system and the defendants subsequently prevented him from developing his land and thereby making use of the sewer. We affirm the judgment of the district court. ¹

I. STATEMENT OF FACTS

Plaintiff Lawrence Furey owns, as a trustee, approximately 1,157 acres in the Natomas area of Sacramento County. (The term "plaintiff" shall hereinafter be used to refer to Furey and/or his predecessor trustees). The Natomas area was unincorporated until October 1961, when it was annexed by the City of Sacramento. The land has, at all relevant times, been zoned and used solely for agricultural purposes. Nonetheless, the "Metropolitan Airport/Natomas Area Plan" adopted by the Sacramento County Board of Supervisors in 1962, the "Natomas General Development Plan" adopted by the Sacramento City Council in 1962, and the "General Plan" adopted by the Sacramento City Planning Commission in 1966 all envisioned California's Improvement Act of 1911, California Streets and Highways Code Secs. 5000-6794 (Deering 1978 & Supp.1985), authorizes city councils and county boards of supervisors to create special assessment districts within their jurisdictions to finance the construction of public improvements, including sewers, see id. Sec. 5101(c). The improvements are paid for by assessments on property within the districts, rather than out of general tax revenues. See id. Sec. 5343. The law requires that the assessment on each parcel of land be proportional to the benefit conferred on the parcel by the improvement. Id. See generally Note, New Developments in Special Assessment Law, 11 U.C.D.L.Rev. 43, 44 n. 4 (1978) (summarizing procedures); Comment, The Use of Special Assessment Districts and Independent Special Districts as Aids in Financing Private Land Development, 53 Calif.L.Rev. 364, 367-73 (1965) (same).

extensive residential and commercial development of the area, including plaintiff's land.

A.

In 1959, three landowners in the Natomas area, not including the plaintiff, contacted Logan Muir, a private engineer, and requested that he initiate arrangements to provide sewer service to their land. Muir consulted with county government personnel regarding the prerequisites for forming a sewer assessment district. He was informed that the county's policy was not to form sewer assessment districts of less than 2500 acres. Because the holdings of the three landowners totalled only about 800 acres, Muir attempted to enlist the support of neighboring landowners to form a district of the requisite size. He sent out letters soliciting expressions of interest, and those landowners who responded were sent copies of a petition, addressed to the Sacramento County Board of Supervisors, requesting the formation of a sewer assessment district. Plaintiff Furey received, signed, and returned one such petition.

Under California's Majority Protest Act of 1931 (Protest Act), the creation of a sewer assessment district requires elaborate procedures. See California Streets and Highways Code Secs. 2820-2830, 2850-2859, 2880-2885 (Deering 1978 & Supp.1985). However, the procedural requirements may be waived by petition of the owners of sixty percent of the land in a proposed district. See id. Sec. 2804(3). The requirements can also be waived by a recommendation from the county health officer that a sewer system is "necessary as a health measure," followed by a four-fifths vote of the county board of supervisors. See id. Sec. 2808.

The petition that plaintiff signed, in addition to requesting the formation of a sewer assessment district, also waived the procedural requirements of the Protest Act. Identical petitions were signed by all of the landowners in the proposed district except one, and Muir presented the petitions to the county Public Works Department. The petitions were reviewed by the county's bond counsel, who concluded that they were legally insufficient to waive the requirements of the Protest Act because the law required that all signatures be on a single petition. Therefore, the Public Works Department did not transmit the petitions to the Board of Supervisors. Another approach was employed. An official of the Public Works Department, after a discussion with the bond counsel and Muir, requested that the county health officer recommend that construction of sewers was necessary as a health measure. The health officer inspected the area and, on June 16, 1960, signed a letter prepared by the Public Works Department making such a recommendation to the Board of Supervisors. On April 26, 1961, an identical letter was submitted to the Board of Supervisors by the succeeding county health officer. These recommendations, which sufficed to waive the requirements of the Protest Act, see id. Sec. 2808, were approved by resolutions of the Board.

On June 22, 1961, the Sacramento City Council adopted a resolution consenting to the creation of a sewer assessment district The sewer system and the treatment plant were designed by Muir's firm, Packard, Muir, & Train, Inc. Construction of the system began in 1961 and was completed in 1965. Upon completion of the system, the cost of construction and design was allocated among the landowners in the district, with assessments roughly proportional to acreage. The assessment on plaintiff's property was approximately $840,000.

by the county Board of Supervisors. After a hearing on July 17, 1961, at which no landowner protested, the Board created the Natomas Sewer Assessment District and authorized the levying of assessments and the letting of a contract for construction of sewers and a sewage treatment plant. No property was included in the assessment district unless the owner had either signed a petition requesting creation of the district or, in one case, personally requested that his property be included. One couple that had signed a petition were permitted to withdraw their property from the district when they changed their minds.

The county then raised the money to pay for the construction by issuing bonds, secured by the assessed property, in the amount of the assessments. See California Streets and Highways Code Secs. 6400-6632 (Deering 1978 & Supp.1985). The landowners are responsible for the payment of principal and interest on the bonds. To date, the plaintiff has paid more than $825,000 in principal and interest.

In the period from 1965 to 1973, plaintiff's property remained zoned "agricultural" and was used for agricultural purposes. Plaintiff did not attempt to rezone or develop the property.

On June 7, 1973, the Sacramento City Council adopted an ordinance creating a new zoning classification called "Agriculture--Open Space." On the same day, the Council added the Open Space Element to its General Plan. The Open Space Element zoned plaintiff's land as "Agriculture--Open Space" and required that it remain so zoned.

The zoning classification prevents the plaintiff from developing his land for either commercial or residential purposes. The parties agree that plaintiff has not received any benefit from the sewer system, and, as long as plaintiff's land remains zoned "Agriculture--Open Space," plaintiff will not receive any benefit from the sewer system. Plaintiff's land continues to be used profitably for agriculture. ²

B.

In 1974, plaintiff brought suit in both the California Superior Court for Sacramento County and the United States District Court for the Eastern District of California, alleging that his property had been taken without just compensation, in violation of article I, section 19 of the California Constitution and the Fifth and Fourteenth Amendments to the United States Constitution. The federal court abstained pending resolution of the state constitutional claim in the state court.

Plaintiff's state court action sought relief under three principal theories:

(1) The designation of plaintiff's land as open space constituted a partial taking of plaintiff's land, for which plaintiff was entitled to be compensated in the amount of the difference between the value of the land when used for agricultural purposes and the value of the land when used for residential and commercial purposes.

(2) The designation of plaintiff's land as open space constituted a taking without just compensation of plaintiff's right of access to the sewer system.

(3) In the absence of any benefits to plaintiff from the sewer system, the assessment of $840,000 to pay for the sewer system constituted a taking of plaintiff's property (money) without just compensation.

The defendants in the state court action entered a demurrer. The state court sustained the demurrer and dismissed the action, and the plaintiff appealed.

On appeal, the California Supreme Court affirmed the dismissal with respect to plaintiff's first two theories, but reversed the dismissal with respect to the third theory and remanded the case to the state trial court....