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Alameda Parcel Tax Case Headed for California Supreme Court, Proposed Legislation Still Pending

By Jeff Hudson - March 28, 2013

The month of March has produced several developments concerning the Alameda Unified School District’s parcel tax – Measure H, approved by Alameda voters by a greater-than-two-thirds majority in 2008.

Back on December 6, 2012, an appeals court ruled in favor of a legal challenge by Alameda property owner George Borikas and several others, who contended that Measure H was unlawful because it charged residential homeowners at one rate, and commercial property owners at a different rate, and therefore does not meet the “uniformity” standard for parcel taxes under state law.

The Alameda Unified School district had argued that since each type of parcel would pay the same tax, there is adequate uniformity to comply with the state’s statutory requirements under equal protection clause principles.

After the December decision, the appeals court agreed to rehear aspects of the case. On March 6, the California Court of Appeal ruled for the second time in favor of the legal challenge brought by Borikas, et al. That ruling validated parts of Measure H and declared invalid other parts of Measure H. The Court of Appeal sent the case back to the original trial court to determine whether plaintiffs are entitled to any further remedies.
Alameda Unified says that approximately $7.4 million in district revenues for educational programs and teachers in the District are at risk if the trial court orders refunds.

On March 12, the Alameda Unified School District’s Board of Education voted 4-1 to appeal the case to the California Supreme Court – a move that had been widely expected.
The case has implications for several other California school districts where local voters have approved school parcel tax measures that have two-tiered rate structures. Some of these parcel tax measures charge one rate for residential property and another rate for commercial property, others charge one rate for single family homes and a different rate for apartments and other multi-unit dwellings.

The Alameda Unified Board of Education is hoping that the California Supreme Court will take the same view as the original trial court that heard the Borikas challenge. The original trial court in Borikas ruled in favor of the school district, concluding that so long as like parcels are treated in a like way and the division of parcels into different classes has a rational basis, Government Code section 50079's requirement of uniformity and equal protection of the law is satisfied. The trial court also found that the statute allowed the Measure H exemptions for some senior and disabled taxpayers.

It is not yet clear when the California Supreme Court might hear the Alameda parcel tax case.

Meanwhile there has been no legislative action thus far on AB 59 – a proposed bill by Assemblymember Rob Bonta (D-Oakland/Alameda), which was introduced in January. AB 59 would clarify existing law by stating that school districts are allowed to assess parcel taxes in accordance with rational classifications among taxpayers or types of property within a district, as long as the taxes are applied uniformly within those classifications. The bill has been referred to the Assembly Revenue and Taxation Committee.

Editor's Note:  Jeff Hudson is the editor of EdBrief and an award-winning education reporter and writer in print, radio and television media.