Tenants Have the Right to Protest Water Rate Hikes According to State Law

City May Have Erred on Prop 218 Notice –

The Vanguard has learned that the city likely did not properly notice all required citizens of the water rate hike.  According to the Government Code, both ratepayers and tenants are allowed to protest rate hikes. However, to the best of our knowledge, tenants were not informed of this right by the city.

According to Government Code Section 53755 (b): “One written protest per parcel, filed by an owner or tenant of the parcel, shall be counted in calculating a majority protest to a proposed new or increased fee or charge subject to the requirements of Section 6 of Article XIII D of the California Constitution.”

Either tenant or owner of a parcel is allowed to protest, however, if both protest only one protest counts.  The essence of a Prop 218 protest is that instead of one person one vote, it is one parcel one vote.  Where the city erred, apparently, is that tenants have just as much right as owners to be noticed and to protest.

However, the city’s notice only mentions property owners: “Any property owner whose property will be subject to the imposition of the proposed water, sewer, and solid waste service fees may submit a written protest to the proposed rate increases; provided, however, that only one protest will be counted per identified parcel.”

The Vanguard has obtained a copy of correspondence from Michael Dean of Meyers Nave, the city attorney for the City of Dixon, who acknowledged that he erred when he failed to include tenants in his 2010 notice.

He wrote, “This error was mine.  The notice said that only owners could protest the rate increase, not tenants.  While that was correct in the past, the legislature has adopted new legislation (GC 53755) which now provides that “One written protest per parcel, filed by an owner or tenant of the parcel, shall be counted in calculating a majority protest.”

He acknowledged that he did not pick up that change when the notice went out.  However, at the same time, apparently there is no noticing requirement for tenants.  Nevertheless, erring on the side of caution he decided to advise the city manager to re-notice.

“While the notices were sent correctly (because oddly enough the legislature did not change to whom the notices must be sent — they still need only be sent to the owners even though tenants may protest), I advised the City Manager that the City should renotice and continue the hearing,” he wrote.

The City of Dixon was probably correct to re-issue the Prop 218 notification.  Obviously the failure to include an additional noticing requirement in the new provision that allows tenants to protest water rates is a legislative oversight, but it may be possible for a tenant to challenge in court and get the entire Prop 218 action thrown out.

In a city where the majority of residents are not homeowners, the city would be well advised to follow the lead of the Dixon city attorney who agreed to re-notice on the basis that it was possible “that someone may argue that, had the notice been worded correctly, enough tenants would have protested to cause a majority protest.”

What the new law appears to acknowledge is that tenants, who are in danger of having their rents raised due to water rate increases, have as much at stake as the landowners in the rate hikes.

However, it remains a process that is fundamentally flawed, as each parcel is only permitted one valid protest whether it be from owner or tenant.

It remains to be seen how such a change would affect, for instance, Rancho Yolo residents who own their homes but not the land or parcel that their homes rest on.

As we reported last week, it is also difficult to mobilize a rate protest.

In a normal election, activists can gain access to lists of voters through the County Elections Office.  That gives them the opportunity to contact voters and influence their vote, whether it be through the mail, door-to-door or by phone.

However, the Vanguard has learned that in the case of a Prop 218 vote, citizens are not able to obtain a list of ratepayers to contact and to encourage voters to protest against the water rate hikes.

Government Code Section 6254.16 prohibits the city from giving out information on utility customers.

According to Kimberly Hood, an associate of City Attorney Harriet Stein, the Public Records Act contains a specific exemption for utility customer information.

“Specifically, the Public Records Act exempts from disclosure the name, credit history, utility usage data, home address, or telephone number of utility customers, subject to certain limited exceptions, such as where the information is being made available to a family member to whom the information pertains or upon a court order,” Ms. Hood wrote.

However, she added, “The City can provide a list of the parcels subject to utility rates.”

The Vanguard has learned that, indeed, other cities, such as Dixon, have been more willing to waive that exemption in the Public Records Act and provide Prop 218 protesters the full list of names.

As we reported last week, the city’s policy makes a Prop 218 challenge in any sizable city a virtual impossibility.  Not only are non-homeowners precluded from voting, not only must there be a majority of ratepayers to return the ballots, but it is nearly impossible to seek out and contact would-be voters to get them to turn in their ballots.

If all else fails, the voters are entitled to referendum any city ordinance, including the ordinance that would raise the rates.  Every municipal ordinance can be overturned through the referendum process.

So those who oppose water rate hikes need not focus merely on the September 6 deadline.  By gathering signatures, they can put the ordinance on the ballot.  By placing it on the ballot, the rules change.

Then a majority of voters who turn out to vote get their votes counted.  All citizens eligible to register to vote can participate.

As we noted previously, the Solano County Taxpayers President Earl Heal wrote the Vanguard recently to note that the City of Dixon was able to repeal the tripling of their sewer rate through a simple initiative.

“Our group has been involved and has helped cities with their Prop 218 process and placing initiatives on the ballot. It may be difficult to collect fifty percent (50%) plus one protests needed to stop the water rate increase,” Mr. Heal told the Vanguard.  “But it is very easy to collect signatures of five percent (5%) of the registered voters who voted in the last gubernatorial ballot.”

In addition to the City of Dixon’s successful efforts, Rohnert Park repealed their water rate increase and the City of Rio Vista  held a special election on June 7, 2011, to bring their water rates back to the 2006 fee structure, and a water district in Sacramento is in the process of collecting signatures for an initiative.

Rio Vista’s referendum failed and the resulting water rate hikes drove a number of businesses out of business.

Given the precarious economic times we face, the Davis business community cannot afford these types of rate increases.  Nor can the average city.  And nor can the schools, which are facing tougher times and a potential impediment to the passage of their next parcel tax.

The City of Davis should follow the City of Dixon’s lead and properly notice all residents who are eligible to protest the water rate hikes.  If they do not, they face a potentially costly legal battle.

—David M. Greenwald reporting

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