California Supreme Court Clarifies Proposition 218’s Provisions for Funding Open Space Acquisition through Special Assessments

In Silicon Valley Taxpayers Association, Inc. v. Santa Clara County Open Space Authority, California Supreme Court Case No. S136468 (July 14, 2008), a unanimous Court decided two key points concerning Prop. 218 assessments. First, the Court held that legal challenges to special assessments are subject to independent judicial review, thus reversing a line of pre-Prop. 218 cases which gave more deference to the public agency's determinations. The Silicon Valley Court noted that Proposition 218 “was intended to make it more difficult for an assessment to be validated in a court proceeding.” The Court’s decision makes it easier for individuals and organizations to challenge the validity of special assessments.

Second, the Court held that assessments, which were to fund open space acquisition in an 800-square mile area containing 314,000 parcels and over one million people, did not meet the substantive requirements of Proposition 218. Public agencies now must clearly identify the particular and distinct benefit (“special benefit”) received by each parcel subject to an assessment, and individual assessments must not exceed the proportional special benefit conferred on each parcel. Public agencies must ensure that engineer’s reports and other documents supporting new or increased special assessments contain a thorough and detailed analysis of special benefits and the proportional distribution of assessments pursuant to Proposition 218. Special assessments that provide a broad benefit to the community and apply evenly to all parcels within a large geographical area may be especially vulnerable to a legal challenge under Silicon Valley.

Posted by: Meyers Nave

July 21, 2008 in Land Use, Public Finance | Permalink