Santa Barbara County Taxpayer Assn. v. Board of Supervisors

• Citation: 209 Cal.App.3d 940,257 Cal.Rptr. 615
• Decision Date: 18 April 1989
• Docket Number: No. B036348,B036348
• Court: California Court of Appeals
• Parties: SANTA BARBARA COUNTY TAXPAYERS ASSOCIATION, Plaintiff and Appellant, v. BOARD OF SUPERVISORS FOR the COUNTY OF SANTA BARBARA, Defendant and Appellant. Civ.

Page 615

257 Cal.Rptr. 615

209 Cal.App.3d 940

SANTA BARBARA COUNTY TAXPAYERS ASSOCIATION, Plaintiff and Appellant, v. BOARD OF SUPERVISORS FOR the COUNTY OF SANTA BARBARA, Defendant and Appellant.

Civ. No. B036348.

Court of Appeal, Second District, Division 6, California.

April 18, 1989.

Review Denied July 13, 1989.

Ronald A. Zumbrun, Anthony T. Caso, Jonathan M. Coupal, Jeffrey T. Even, Sacramento, for plaintiff and appellant.

Kenneth L. Nelson, County Counsel, Marvin Levine, Acting County Counsel, Don H. Vickers, Stephen Shane Stark, Deputy County Counsel, Santa Barbara, for defendant and appellant.

John W. Witt, City Atty. (San Diego), Curtis M. Fitzpatrick, Asst. City Atty., as amici curiae on behalf of defendant and appellant.

Channel Counties Legal Services Ass'n and Kirk Ah Tye, Santa Barbara, as amici curiae on behalf of defendant and appellant.

GILBERT, Associate Justice.

The Santa Barbara County Taxpayers Association (TPA) poses two questions regarding county actions under article XIII B of the California Constitution: 1. May the Santa Barbara County Board of Supervisors (Board) recalculate its article XIII B base year (1978-1979) appropriations limitation using an accepted accounting method that is different from the one it originally used? Yes, it may. 2. Do franchise fees fall within the definition of " 'proceeds of taxes' " under article XIII B, section 8, subdivision (c), to be counted towards the appropriations limit? No, they do not.

FACTS

TPA filed this suit to challenge the Board's recalculation of the county's 1978-1979 base year appropriations limit under article XIII B of the California Constitution, which is also known as Proposition 4 or as the Gann Initiative. TPA also challenges the Board's determination that franchise fees, received for the use of rights of way, do not constitute " 'proceeds of taxes' " under article XIII B, section 8, subdivision (c).

Article XIII B limits the amount of tax revenues a government entity may spend each year. Annual appropriations which are subject to limitation may not exceed an appropriations limit based on a calculated limit for fiscal year 1978-1979, adjusted annually for population and cost of living increases. (Cal. Const., art. XIII B, §§ 1, 8, subd. (h).) Appropriations subject to limitation are authorizations to spend "the proceeds of taxes levied by or for that entity...." ( § 8, subd. (b).) Proceeds of taxes include, but are not restricted to, "all tax revenues and the proceeds to an entity of government, from (i) regulatory licenses, user charges, and user fees to the extent that such proceeds exceed the costs reasonably borne by such entity in providing the regulation, product, or service, and (ii) the investment of tax revenues." ( § 8, subd. (c).)

When the Board established the initial 1978-1979 appropriations limit, it used one of two standard accounting methods recommended by the County Accounting Standard and Procedures Committee to calculate that limit. The first accounting method the Board used until 1988 considers the ratio of proceeds of taxes to revenues that are not proceeds from taxes using the actual revenue obtained for the 1977-1978 fiscal year.

When the county amended its appropriations limits for 1986-1987 and for 1987-1988, it recalculated the base year appropriations limitation using the other accounting method, which the county determined to be more accurate. This second method involves analysis of specific revenue sources to ascertain which funds are proceeds of taxes and which are not.

This recalculation was precipitated by our opinion in Santa Barbara County Taxpayers Assn. v. County of Santa Barbara (1987) 194 Cal.App.3d 674, 239 Cal.Rptr. 769, which held that employer retirement contributions were subject to the limit. The instant recalculation resulted in a higher appropriations limit for 1987-1988 than would have resulted under the initial accounting method.

In recalculating the base year (1978-1979) limitation to determine the new limit, the county auditor controller reviewed the calculations previously used to determine the initial limitation. Those calculations concerned funds generated from a variety of county revenues, only some of which are proceeds of taxes. For such funds, it is necessary to distinguish which portion of each fund is attributable to proceeds of taxes and which is not to determine the proper base appropriations limit.

Utilizing the second accounting method, the county auditor controller concluded that the county had understated amounts attributable to proceeds of taxes in both the fund balance carry-over from 1977-1978 and interest earnings from 1978-1979.

On the basis of this recalculation of proceeds of taxes for the base year, and with the inclusion of retirement contributions, the Board adjusted the 1987-1988 appropriations limit by resolution. The trial court determined the Board acted legally in this recalculation. We agree and affirm on this issue.

The court also found that franchise fees, paid for the use of rights of way, are proceeds of taxes, as defined by article XIII B, section 8, subdivision (c). We disagree and reverse on this issue. Such fees need not be included in the appropriations limit.

DISCUSSION

TPA asserts the recalculation is improper because it is not one of the specifically enumerated circumstances for adjusting the appropriations limit under article XIII B.

Section 1 of article XIII B states that the total appropriations subject to limitation shall not exceed the appropriations limit except as provided in article XIII B. Article XIII B enumerates certain exceptions permitting increases to the limit: 1. to reflect changes in population and inflation ( § 1), 2. to reflect transfers in responsibilities or in funding of services between entities ( § 3, subds. (a), (b)), 3. to provide for an emergency ( § 3, subd. (c)), 4. to carry out voter approval of an increase ( § 4), and 5. to comply with a court order ( § 11).

TPA argues that because recalculation is not one of these enumerated bases provided in article XIII B to increase the appropriations limit, the Board has acted illegally in doing so. TPA also claims that the doctrine of expressio unius est exclusio alterius--express exceptions bar exceptions not stated--precludes the Board from recalculating the base year limit. (Wildlife Alive v. Chickering (1976) 18 Cal.3d 190, 132 Cal.Rptr. 377, 553 P.2d 537.) We disagree. The Board's use of another proper accounting method for recalculating the appropriations limit does not constitute an exception to article XIII B at all. Nor is it an illegal act. Rather, it is a distinct, statutorily authorized action of the Board.

Government Code section 7910 supports the determination of the Board to change its accounting method. It states, in pertinent part: "Each year the governing body of each local jurisdiction shall, by resolution, establish its appropriations limit and make other necessary determinations .... The determinations made pursuant to this section are legislative acts." (Emphasis added.)

It is the Board's prerogative, as a legislative body, to alter its method of calculating the limit, provided it uses a proper accounting method to do so, as was done here. "The amendment of a legislative act is itself a legislative act." (Johnston v. City of Claremont (1958) 49 Cal.2d 826, 835, 323 P.2d 71, disapproved on other grounds in Associated Home Builders Etc., Inc. v. City of Livermore (1976) 18 Cal.3d 582, 596, fn. 14, 135 Cal.Rptr. 41, 557 P.2d 473.) "The power to legislate includes by necessary implication the power to amend existing legislation ..."--in this case by a resolution changing the accounting method utilized to determine the appropriations limit. (Ibid.; also see Blotter v. Farrell (1954) 42 Cal.2d 804, 811, 270 P.2d 481, generally on the power of a city to make, repeal or amend ordinances; and see Gov.Code, § 25207 which enables counties to act pursuant to laws such as Gov.Code, § 7910.)

The authority to approve a change in the accounting method is distinct from the authority to approve an adjustment under the statute. Both types of actions, however, are within the Board's power. (Gov.Code, §§ 7910, 25207; Johnston v. City of Claremont, supra, 49 Cal.2d at p. 835, 323 P.2d 71; Blotter v. Farrell, supra, 42 Cal.2d at p. 811, 270 P.2d 481.)

In 1986, the voters approved county initiative Measure A which provided a 9 percent increase in the appropriations limit. In 1987, the voters rejected initiative Measure W in which the Board sought authority to raise additional funds amounting to several million dollars.

TPA contends that because a resolution is not ordinarily equivalent to an ordinance or a legislative act, such as an initiative, the electorate's passage of Measure A is paramount to the Board's resolution enabling the recalculation. This argument is faulty.

Legislative acts may be repealed by enactments of equal dignity. (45 Cal.Jur.3d, Municipalities, § 213, p. 333.) Here, the Board passed a resolution to amend the original resolution. Although a resolution is not ordinarily considered a legislative act, it operates as such when the resolution in substance and effect is an ordinance, and a statute expressly accords the resolution the status of a legislative act. That is the situation in the instant case. Government Code section 7910 states, in pertinent part: "[T]he governing body of each local jurisdiction shall, by resolution, establish its appropriations limit and make other necessary determinations for the following fiscal year pursuant to Article XIII B.... The determinations made pursuant to this section are legislative acts." The name attached to the act is immaterial. (See 5 McQuillin, Municipal Corporations (rev. 3d ed. 1981) § 15.02, pp. 37-39; Gov.Code, § 7910.)

Measure A in no way restricts the Board from altering its accounting methods nor do we think it could. Our Supreme Court has stated that this...