Napa Sanitation District is disputing a lawsuit’s claim that the sewage service bills charged to condominium and townhouse owners has for four decades really been an illegal tax.
“The district has embedded this fatal tax error into all of its ‘rate setting’ that has occurred since at least 1975,” the plaintiff’s attorney, Geoffrey Willis, wrote in the recent lawsuit.
Raja Development Co., Cashel Inc. and Carter Randall Callahan filed the lawsuit in Napa County Superior Court. They claimed NapaSan hasn’t done the same fee justifications for condominiums as it has for houses and apartments. If their view prevails, it might cost the district an undetermined amount of money.
But NapaSan in court papers reached a different conclusion. Attorney Kenneth Pritikin wrote on behalf of the district that “the complaint is wholly improper and should be dismissed in its entirety.”
Judge Victoria Wood is scheduled to consider NapaSan motions on Aug. 23.
NapaSan provides sewage disposal and treatment for the city of Napa and nearby areas. As of July 1, it is charging $710.20 annually to serve homes, condominiums and townhouses. It charges apartments 60 percent of the home rate.
The plaintiffs collectively own 82 condominiums within the district that they rent. They are asking for a three-year wastewater charge refund and a court declaration that the charges for condominiums and townhouses are an illegal special tax that can no longer be collected.
In brief, the plaintiffs’ argument is that wastewater charges to qualify as fees must cover only the cost of providing service to the user. NapaSan, they claim, has never done the state-required “nexus” study for condominiums and townhouses, as it has for houses and apartments.
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“Instead, the district improperly simply appears to be using an ‘equation’ that totals the number of users, calculates its budget and then simply apportions that budget across user groups without ever calculating actual demand or use,” the lawsuit stated.
That makes the condominium charge a tax. But the district has never put the tax to voters as required under California’s voter-approved Propositions 13, 62 and 218, according to the lawsuit.
NapaSan answered with more than 600 pages of court filings, much of it exhibits such as the NapaSan code and the district formation papers from 1945.
The plaintiffs present no evidence they followed the required procedure of filing a claim with the district within a year of the disputed action. That must be done before filing a lawsuit, the district court papers said.
Also, the district took actions regarding its policy for condominium rates in 1986 and 2010. Even if one assumes the district could be sued over the actions, the plaintiffs needed to file within 120 days, the court papers state.
“In either case, the cause of action is now time-barred,” the district’s filing said.
The NapaSan sewer charges aren’t subject to Propositions 13, 62 and 218 voting requirements as described in the lawsuit, the district’s filing said, giving various legal rationale. That attacks the heart of the plaintiff’s arguments.