California Public Records Research, Inc. v. County of Stanislaus ( 2016 )

Filed 4/28/16
CERTIFIED FOR PARTIAL PUBLICATION*
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIFTH APPELLATE DISTRICT
CALIFORNIA PUBLIC RECORDS
RESEARCH, INC., F070601
Plaintiff and Appellant, (Super. Ct. No. 2006090)
v.
OPINION
COUNTY OF STANISLAUS,
Defendant and Respondent.
APPEAL from a judgment of the Superior Court of Stanislaus County. William
A. Mayhew, Judge.
Donald W. Ricketts for Plaintiff and Appellant.
Porter Scott, Terence J. Cassidy and Taylor W. Rhoan for Defendant and
Respondent.
Jennifer B. Henning for California State Association of Counties as Amicus
Curiae on behalf of Defendant and Respondent.
Robert E. Grossglauser III for County Recorders’ Association of California as
Amicus Curiae on behalf of Defendant and Respondent.
-ooOoo-
* Pursuant to California Rules of Court, rules 8.1105(b) and 8.1110, this opinion is
certified for publication with the exception of part IV of the Discussion.
Plaintiff California Public Records Research, Inc. sought a writ of mandate to
compel the County of Stanislaus (County) to reduce the fees it charges for copies of
official records. Plaintiff alleged the fees of $3 for the first page and $2 for each
subsequent page exceeded County’s cost of providing the service and, therefore, violated
Government Code section 27366,1 which states that copying fees “shall be set by the
board of supervisors in an amount necessary to recover the direct and indirect costs of
providing the product or service ….”
The trial court denied the writ, concluding (1) County’s board of supervisors did
not abuse its discretion in setting the copying fees and (2) the fees did not constitute a
special tax requiring voter approval. Plaintiff appealed, contending there is insufficient
evidence to support a finding that the fees charged are based on the actual costs of
providing the copies. For instance, plaintiff contends there was no evidence showing it
costs County $33 to provide a copy of a deed of trust on the standard 16-page form.
The evidence presented shows the board of supervisors based its decision on a
2001 study that estimated staff spent an average of three minutes processing a copy
request and further estimated productive staff time cost County about $0.99 per minute.
Multiplying these two figures, the 2001 study estimated it cost County an average of
$2.97 to process a request for a copy of an official record. Critical to the outcome of this
appeal is the fact that the 2001 study and other evidence presented information on a per
document basis, not a per page basis. Despite the lack of cost-per-page information, the
study recommended charging $3 for the first page copied and $2 for each subsequent
page.
The absence of evidence addressing costs on a per page basis and the estimate that
it costs County $2.97 to process the average copy request leads us to conclude the record
lacks evidence showing that the fees charged per page reflect County’s actual costs.
1 All unlabeled statutory references are to the Government Code.
2.
Indeed, the information in the 2001 study affirmatively shows it does not take five
minutes or cost County $5 to provide a copy of a two-page document. This affirmative
showing is coupled with a complete lack of evidence that (1) it takes 15 minutes or costs
County $15 to provide a copy of a seven-page document; (2) it takes 45 minutes or cost
County $45 to provide a copy of a 22-page document; or (3) it takes over an hour or costs
County $61 to provide a copy of a 30-page document.
Accordingly, County’s board of supervisors abused its discretion when it set the
copying fees. A writ of mandate should issue directing the board to comply with section
27366 by resetting the copying fees “in an amount necessary to recover the direct and
indirect costs of providing the [copies].”
We therefore reverse the judgment and remand for further proceedings.
FACTS
1988 Study
In 1988, County commissioned Northern California Research Associates, with
Peter Lauwerys acting as principal consultant, to study the actual costs related to certain
fees charged by its clerk’s office. The 1988 study did not address the costs of providing
copies of real property records maintained by the clerk-recorder’s office because those
fees were fixed by statute at one dollar for the first page and fifty cents for each
additional page. (See Stats. 1984, ch. 1397, § 6, p. 4907 [former § 27366].)
1994 Study
In 1993, the Legislature amended section 27366 to eliminate the fixed copying
fees and directed counties to set the fee “in an amount necessary to recover the direct and
indirect costs of providing the product or service.” (Stats. 1993, ch. 710, § 3, p. 4039.)
In December 1993, County hired Government Finance Research (GFR) to conduct a cost
recovery and fee study for selected services provided by the clerk-recorder’s office,
including the cost of providing copies of official records.
3.
In January 1994, GFR completed the study and delivered it to County. The
document did not identify the principal consultant or any other person who worked on its
preparation. The study quoted the recently amended section 27366 and section 54985,
which set forth limits for certain fees not covered by section 27366.
The 1994 study’s approach to determining the cost of providing a service was
based on time—that is, the average number of minutes taken by staff to provide the
service was multiplied by an estimate of the per minute cost of staff time. The study
estimated the regular cost for the activities of the clerk-recorder’s office at $0.77 per
minute of productive time. This estimate included staff salary, overhead costs, indirect
costs of supplies and services, supervision costs, administrative support services, building
and facilities costs, amortized costs of computers and certain improvements, and
inflation.
As to providing copies of official records, the 1994 study found: “An average of 8
minutes (rounded to the nearest minute) is allocated per unit of service, including general
and support time. [¶] The cost to the County of processing requests for official copies of
records [is] 8 minutes @ $.77 per minute = $6.16.” The study also concluded “that
additional pages of any document take an average of one minute per document to process
and copy,” representing a cost to County of $0.77. (Italics added.)2 The general process
of copying and certifying official records was divided into 12 steps described in
Appendix B to the 1994 study. The steps included the clerk asking the customer for the
year the document was recorded, the document number or the book and page number; the
clerk directing the customer to the appropriate microfiche or tape to search for the
document; the customer bringing the microfiche or tape to the clerk after locating the
document; and the clerk putting the microfiche or tape into the copy machine.
2 The phrase “per document” is italicized to emphasize that the average of one
minute is the time spent copying all additional pages of a document and is not the time
spent on each additional page.
4.
The 1994 study recommended charging $6 for the first page of a copy of a
recorded document and adjusting the fee for each subsequent page from $0.50 to $1. The
study also estimated the impact of the new fees on revenue. The revenue on 6,600 first
pages duplicated was estimated to increase from $6,600 to $39,600, or a total increase of
$33,000. Revenue from copying 23,200 subsequent pages was estimated to increase
from $11,600 to $23,200. Consequently, the proposed adjustment to copying charges
was predicted to increase revenue by $44,600. The data of 6,600 first pages and 23,200
subsequent pages can be used to calculate that the average length of the documents
copied was 4.52 pages (i.e., [6,600 + 23,200]/6,600 documents).
2001 Study
In 2000, County again hired GFR to study the costs related to selected fees
charged by the clerk-recorder and to recommend cost recovery and fee adjustments. The
study was completed in February 2001 and identified Peter Lauwerys as the principal
consultant. The study addressed 16 categories of charges and fees, including the issuance
and duplication of marriage licenses, fictitious business name filings, notary bond filings,
administrative fees for environmental impact reports, power of attorney filings, and the
copying of official records. The study referred to the requirements in sections 54985
through 54987 and mentioned the 1993 amendment of section 27366.
The 2001 study, like the previous study, estimated the cost of a particular service
by multiplying (1) the amount of staff time used to provide the service by (2) the cost to
County of that staff time. The time figure included an estimate of the average number of
minutes needed by staff to provide the service plus an allocation of general and support
minutes. The consultant determined the average number of minutes by evaluating
tracking forms completed by County’s staff, which estimated the time spent performing
the tasks involved in providing the service.3 The resulting time figure was multiplied by
3 There are no tracking forms for the time spent on copying official records attached
to the 2001 study or otherwise included in the appellate record. In a 2013 deposition
5.
the cost per minute of productive staff time, which produced an estimated average cost
for the service.
The 2001 study updated the per minute estimate of the regular cost of activities of
the clerk-recorder’s office from $0.77 to $0.99. The formula for estimating costs
included eight line items: (1) individual staff salary; (2) County’s indirect costs, which
were referred to as overhead; (3) indirect costs related to services and supplies;4 (4)
management and supervision costs; (5) costs accounting and bookkeeping staff services
provided to the clerk-recorder’s department by County’s financial services section; (6)
costs of automation, services modernization and improvements, including software and
training; (7) the cost of the 2001 study itself;5 and (8) lease and utility costs for the clerk-
recorder’s office not included in the figure for County’s overhead. Aggregating these
items produced an estimate of $101,287 as the annual costs for a single staff member.
When divided by 1,726 productive hours of time per year, the cost per hour figure was
$58.69, which GFR rounded up to $59 per hour and, rounding up again, equated to $0.99
per minute of productive time.
taken in plaintiff’s litigation with the County of Yolo, Lauwerys testified that a tracking
form was not needed to capture the time spent copying official records because “it’s very
straightforward. Three items, three activities, or two activities.” Plaintiff interprets this
testimony to mean no timing was required to determine the time it took to service
requests for copies. We reject this interpretation of the evidence because it does not
support the trial court’s decision and, instead, conclude the trial court impliedly found
that staff informally recorded their time spent on copy requests and did not need a special
tracking form.
4 The 2001 study does not explicitly mention the cost of the paper and toner
cartridges used to provide copies. Thus, it appears those costs were included in the
“services and supplies” line item, which the study described as “those costs other than
actual employee costs and employee benefit costs.”
5 The cost of the study was amortized over three years and was the fourth largest
cost item, adding $3.21 to the per hour cost of staff. This amortization may have been
incorrect because it appears that the cost was allocated to a single employee instead of
being spread among 29 full-time equivalent employees like certain other expenses were.
6.
Part IV of the 2001 study was labeled “Cost-Recovery Estimation” and provided
cost estimates for the 16 categories of charges and fees addressed. As to copying costs,
the study stated that section 23766 allowed “fees for the duplication of official records in
order ‘to recover the direct and indirect costs of providing the product or service.’” The
study then stated:
“The consultants’ study indicated that Stanislaus County staff spends an
average of three minutes for duplication of official records. The costs are
therefore [¶] 3 minutes @ $0.99 per minute = $2.97.”
Part V of the 2001 study recommended adjusting the fees for copying official
records maintained by the clerk-recorder’s officer by lowering the fee for the first page
from $6 to $3 and increasing the fee for subsequent pages from $1 to $2.6 The study did
not explain how the estimated cost of $2.97 for the “average of three minutes for
duplication of official records” related to its per page recommendations. In particular,
the study did not say whether the three-minute average covered pulling the document and
copying all pages or copying just the first page. In addition, the study did not address the
amount of time spent copying subsequent pages of official records, which implies that
activity was included in the “average of three minutes for duplication of official records.”
Part VI of the 2001 study provides, in table format, estimates of the impact on
revenues of the proposed fee adjustments. The table states that the copying fees for the
fiscal year 1999-2000 totaled $55,870 for 18,575 “units” and predicts that the proposed
fees will reduce revenue to $44,725 (about 80 percent of the prior total), resulting in a
loss of $11,145 in revenue. The study did not identify what it meant by a “unit,” but the
figures provided suggest a “unit” is a page, not an entire document. For instance, revenue
6 The proposed change in fees would result in a lower charge for documents of three
pages or less, the same charge (i.e, $9) for four-page documents, and a higher charge for
documents with five or more pages. Under the proposal, the fee for a copy of a deed of
trust on a 16-page form (which plaintiff alleges is the standard length) would increase
from $21 to $33.
7.
of $55,870 for 18,575 units yields an average revenue per unit of approximately $3.01.
With a fee of $6 for the first page of a document, it is mathematically impossible to
average $3.01 in revenue per document. Therefore, lacking further information about a
“unit,” the only rational inference is that a “unit” refers to a page.
Applying basic algebra to the average fee per page (i.e., $55,870/18,575 pages)
and the information contained in the prior fee structure leads to the conclusion that about
7,459 documents were pulled and each document contained, on average, slightly under
two and a half pages.
County’s 2014 Declarations
County’s evidence in this case included May 2014 declarations from its auditor-
controller and its assistant clerk-recorder. The auditor-controller, a certified public
accountant, stated she attempted to verify the figures used in the 2001 study, but the
supporting documents going that far back were not available. She summarized the
consequences by stating: “Thus, we do not know all the specific cost figures from the
financial records that Mr. Lauwerys used to do his line item calculations in the 2001 Fee
Study.”
The auditor-controller’s declaration also addressed the meaning of the terms
“direct costs” and “indirect costs.” She opined that an appropriate definition of indirect
costs would not be limited to the ancillary costs necessarily associated with the retrieval,
inspection, redaction and handling of the document.
County’s assistant clerk-recorder stated that three minutes was still a fair
assessment of the typical amount of time that staff members spend with customers in
providing copies of recorded documents, but some customers require more time than
others. His declaration also stated (1) official documents dating back to 1978 were
digitized; (2) official documents, even if digitized, must be maintained on microfilm or
paper; (3) storing official documents on microfilm is less costly than maintaining paper
versions and, therefore, County spends money to store and maintain all recorded
8.
documents on microfilm; (4) providing a copy of an official record that is not digitized
and is available only on microfilm frequently takes more than three minutes; and (5)
approximately 30 percent of all copies of official records currently produced are made
from microfilm. The process of making copies of a document from microfilm requires
the document “first be physically located, then the microfilm has to be scrolled through
until it reaches the first page of the document, each page is adjusted, focused, and
centered before a copy can be made. It frequently takes multiple adjustments to print a
clear legible copy. If the document is more than one page, staff has to scroll to the next
page and make the same adjustments.”
The assistant clerk-recorder’s declaration included copies of the clerk-recorder’s
office budget from fiscal year 2000-2001 and fiscal year 2013-2014. The 2000-2001
budget was from the year that County’s board of supervisors enacted the fee adjustment,
but it is not the budget relied upon by GFR and Lauwerys in the 2001 study. The 2013-
2014 budget was offered to show that the costs of operating the clerk-recorder’s office
has increased and, therefore, the fees charged are still reasonable under present
conditions.
The 2001 Fee Ordinance
The agenda for the June 12, 2001, meeting of County’s board of supervisors
included an item for the approval of the setting of a public hearing on July 10, 2001, to
consider the adoption of an ordinance adjusting existing fees charged by the clerk-
recorder’s office. The action agenda summary prepared for this item referred to sections
54985 and 54986, stating they authorized the board to increase or decrease any fee or
charge “‘in the amount reasonably necessary to recover the cost of providing any product
or service.’” A week later, County issued a notice of public hearing stating that the
proposed ordinance relating to clerk-recorder’s fees would be considered at the board’s
July 10, 2001, meeting.
9.
On July 10, 2001, County’s board of supervisors unanimously enacted Ordinance
No. C.S. 763, which set the clerk-recorder’s copy fees at $3 for the first page and $2 for
each subsequent page.
PROCEEDINGS
In February 2014, plaintiff filed a verified petition for writ of mandate alleging the
copying fees charged by County were excessive relative to the costs allowed by law.
Plaintiff’s causes of action alleged the copying fees (1) violated section 27366, (2)
constituted an illegal special tax that violated the voter approval requirement in article
XIII C of the California Constitution,7 and (3) were adopted as the result of County
abusing its limited discretion to set fees.
Later in February 2014, plaintiff filed an ex parte application of issuance of an
alternative writ. The trial court issued an alternative writ of mandate directing County to
file a return and appear at a hearing to show cause as to why a peremptory writ of
mandate should not issue.
On August 21, 2014, following briefing and argument, the trial court filed a six-
page ruling on the petition for writ of mandate. The court concluded (1) section 54985
did not apply to the copying fees charged by County; (2) the meaning of the term
“indirect cost” used in section 27366 was a significant issue; and (3) the Legislature had
not limited the definition of “indirect costs,” which had a broad meaning when used in
business and accounting. The court found the board of supervisors had not abused its
discretion in setting a fee of $3 for the first page and $2 for each subsequent page. As to
the constitutional claim, the court found the copying fees were not a special tax.
In September 2014, the trial court filed an order that denied the petition for writ of
mandate, discharged the alternative writ, directed judgment to be entered in favor of
County, and awarded County its costs.
7 Unlabeled references to articles are to the California Constitution.
10.
Plaintiff timely appealed.
DISCUSSION
On appeal, plaintiff contends the board of supervisors abused its discretion when it
enacted the copying fees because (1) there was no substantial evidence supporting the fee
amounts enacted; (2) the board based its decision on the wrong statute; and (3) it sought
to recoup costs that were not allowed by the correct statute, section 27366. Plaintiff also
contends the trial court erred in determining the copying fees were not a special tax
imposed in violation of the voter approved requirements of article XIII C.
I. PETITION FOR WRIT OF ORDINARY MANDATE
A. The Writ
Code of Civil Procedure section 1085, subdivision (a) provides that a writ of
ordinary mandate “may be issued by any court to any inferior tribunal, corporation,
board, or person, to compel the performance of an act which the law specially enjoins, as
a duty resulting from an office, trust, or station .…”
“Mandamus … is the traditional remedy for the failure of a public official to
perform a legal duty.” (Common Cause v. Board of Supervisors (1989) 49 Cal. 3d 432,
442.) Mandamus will not lie to control a public agency’s discretion—that is, to force the
exercise of discretion in a particular manner—but it will lie to correct abuses of
discretion. (Klajic v. Castaic Lake Water Agency (2001) 90 Cal. App. 4th 987, 995
(Klajic).)
B. Standards of Review
When a court reviews a public entities’ decision for an abuse of discretion, the
court may not substitute its judgment for that of the public entity, and if reasonable minds
may disagree as to the wisdom of the public entity’s discretionary determination, that
decision must be upheld. (Klajic, supra, 90 Cal.App.4th at p. 995.) Thus, the judicial
inquiry in an ordinary mandamus proceeding addresses whether the public entity’s action
11.
was arbitrary, capricious or entirely without evidentiary support, and whether it failed to
conform to procedures required by law. (Neighbors in Support of Appropriate Land Use
v. County of Tuolumne (2007) 157 Cal. App. 4th 997, 1004.)
When an appellate court reviews a trial court’s judgment on a petition for a
traditional writ of mandate, it applies the substantial evidence test to the trial court’s
findings of fact and independently reviews the trial court’s conclusions on questions of
law, which include the interpretation of a statute and its application to undisputed facts.
(Klajic, supra, 90 Cal.App.4th at p. 995.) The substantial evidence test applies to both
express and implied findings of fact. (Rey Sanchez Investments v. Superior Court (2016)
244 Cal. App. 4th 259, 262; see Madera Oversight Coalition, Inc. v. County of Madera
(2011) 199 Cal. App. 4th 48, 66 [under presumption that trial court’s order is correct,
appellate court infers trial court made implied findings of fact consistent with its order,
provided such findings are supported by substantial evidence].)
II. SUFFICIENCY OF EVIDENTIARY SUPPORT FOR FEE SCHEDULE
A. Scope of the Evidence
Plaintiff’s contention that there is no substantial evidence to support the board of
supervisors’ decision to charge $3 for the first page and $2 for each additional page for
copying official records presents the threshold question of what evidence this court may
consider in conducting its review. As a result, before analyzing the sufficiency of the
evidence, we address what evidence may be considered and what evidence should be
excluded from our review.
1. Evidence Before the Board
Plaintiff argues our review of the sufficiency of the evidence should be limited to
the evidence actually before the board when it approved the new copying fees. Plaintiff
contends that the sole information provided to the board was the staff recommendation.
Under this view of the evidence, the 2001 study, Lauwerys’s 2013 deposition transcript,
12.
and the May 2014 declarations of County officials were not part of the record of the
board’s proceedings and, therefore, should be omitted from our evaluation of the
sufficiency of the evidence.
In response, County contends that plaintiff’s assertion about the information
before the board of supervisors is factually incorrect. County cites the declaration of the
assistant clerk-recorder, which states that when the board of supervisors approved the
copying fees it relied upon the 2001 study, the board memo/agenda minutes
recommending the adoption of the fee schedule by ordinance, and the resolution
approved by the board after the hearing.
In the trial court, plaintiff objected to the assistant clerk-recorder’s declaration on
the ground that he was not “in the office in 2001 and his testimony is incompetent
hearsay.” The trial court did not explicitly rule on this objection. Therefore, we infer the
trial court impliedly denied the objection. (See Denham v. Superior Court (1970) 2
Cal. 3d 557, 564 (Denham) [trial court’s judgment is presumed correct and appellate
courts indulge all presumptions in its favor].) On appeal, plaintiff has not challenged this
implicit evidentiary ruling. Accordingly, we accept County’s factual assertion that the
2001 study was relied upon by the board of supervisors when it adopted the new copying
fees.
2. Deposition and Declarations
As to the admissibility of evidence not before the board of supervisors in 2001, we
are aware of the well-settled general rule that extra-record evidence is inadmissible in a
traditional mandamus actions challenging quasi-legislative administrative decisions.
(Western States Petroleum Assn. v. Superior Court (1995) 9 Cal. 4th 559, 574.) This
general rule might apply to Lauwerys’s 2013 deposition transcript, the May 2014
declarations of County officials, and the clerk-recorder’s office budgets for fiscal years
13.
2000-2001 and 2013-2014. Alternatively, an exception or exceptions to the general rule
might apply.
As to the transcript of Lauwerys’s 2013 deposition, that transcript was submitted
to the court as an exhibit to plaintiff’s verified petition. Thus, plaintiff has not objected to
its admissibility. Therefore, we will treat the transcript as part of the evidentiary record.
As to the declarations and related attachments submitted by County, plaintiff’s
opening brief does not challenge the trial court’s implicit denial of objections relating to
those documents. Therefore, we will treat those declarations and attachments as part of
the evidentiary record.
3. Dictionary Definitions
Plaintiff’s opening brief challenges the part of the trial court’s written ruling
stating that “County has presented this court with admissible evidence that the term
‘indirect costs’ is a broad term when used in business or accounting.” Plaintiff interprets
this statement as an erroneous “finding that dictionary definitions are ‘admissible
evidence.’”
We conclude the trial court did not err in stating County presented admissible
evidence about the meaning of “indirect costs.” The declaration of the auditor-controller
addressed the meaning of the term “indirect costs” and could have been the admissible
evidence to which the court referred.
Furthermore, even if the trial court considered and relied on the dictionary
definitions submitted by County, that reliance was not error. When interpreting a statute,
courts “appropriately refer to the dictionary definition” to ascertain the ordinary, usual
meaning of a word. (Wasatch Property Management v. Degrate (2005) 35 Cal. 4th 1111,
1121-1122.) Moreover, mandatory language in Evidence Code section 451, subdivision
(e) requires judicial notice be taken of “[t]he true signification of all English words and
phrases.” (See Sierra Club v. Superior Court (2013) 57 Cal. 4th 157, 171 [Supreme Court
14.
took judicial notice of dictionary definition of “program”]; Golden Security Thrift &
Loan Assn. v. First American Title Ins. Co. (1997) 53 Cal. App. 4th 250, 256 [“‘true
signification’” of a word is best derived from dictionary definitions].)
Accordingly, plaintiff has not demonstrated that relying on dictionary definitions
constituted error.
4. Summary
Plaintiff has not shown the trial court committed evidentiary error and, therefore,
we will consider all of the evidence presented to the trial court. As to the evidence that
was not before the board of supervisors when it adopted the new fee schedule in 2001, it
is relevant to the question whether the fee schedule is out-of-date and its continued
application to present day copy requests offends the statutory and constitutional
parameters for such fees.
B. Correlating Costs to Fees
Section 27366 states that fees shall be set in an amount necessary to recover the
direct and indirect costs of providing the copies of the official record. Consequently, the
copying fees of $3 for the first page and $2 for each subsequent page of an official record
must be based on the costs of providing the copies.
1. Framing the Issue
Plaintiff’s insufficiency of the evidence argument presents the following issue.
Does the evidence support a finding that County incurred $3 in costs to copy the first
page of an official document and $2 in costs to copy each subsequent page?
For purposes of analyzing this issue, we assume that (1) County’s time-based
method of determining the costs of copying official records complied with applicable law
and (2) the specific items of costs included in County’s application of that method were
direct and indirect costs under section 27366. Stated another way, plaintiff’s claims of
legal error are separated from our analysis of the sufficiency of the evidence.
15.
2. Method for Calculating Costs of a Service
We accept the implied finding that County’s board of supervisors relied on the
2001 study when it adopted the new copying fees. The 2001 study used a time-based
approach or method for calculating the costs of a particular service. Specifically, that
method combined various costs of the clerk-recorder’s office and then spread those costs
across the amount of time staff spent doing their work. These steps yielded a cost per
minute for staff time. Next, the cost per minute of staff time was multiplied by an
estimate of the average number of minutes it took a staff member to complete a service.
This multiplication yielded the study’s estimate of the cost of a particular service.
The 2001 study determined that the costs of the clerk-recorder’s office totaled
$58.69 per hour of productive staff time and rounded this amount to $0.99 per minute.
As to the time spent copying official records, the study estimated “staff spends an
average of three minutes for duplication of official records.” Multiplying three minutes
by the per minute cost, the study concluded the costs were $2.97.
3. Apportioning Costs to Pages Copied
As described earlier, the study did not explain how the $2.97 in costs related to the
per page recommendations. For instance, the study did not state whether the average of
three minutes included only the time spent to obtain a copy of the first page or,
alternatively, included the time spent copying all pages of the requested document.
Furthermore, unlike the 1994 study, the 2001 study did not separately address the amount
of time spent copying subsequent pages of official records. Consequently, there is no
reasonable basis in the 2001 study for inferring that the “average of three minutes for
duplication of official records” was limited to the time spent copying the first page.
Therefore, the cost of $2.97 identified in the 2001 study appears to be an average cost of
providing a copy of the entire official record and does not provide information about
costs per page.
16.
This interpretation of the three-minute average in the 2001 study as relating to the
entire document is not contradicted by the study’s attachments, the 2013 deposition of
Lauwerys, or the declarations submitted by County. For instance, the assistant clerk-
recorder’s declaration stated, “I believe that three minutes is still a fair assessment of the
typical amount of time that staff members spend with customers in providing copies of
recorded documents.” This statement supports the interpretation that the three-minute
average is for the time spent providing a copy of the document, not just the first page.
Similarly, the other documents in the record provide no evidence of the amount of time
County staff spent in 2001 (1) obtaining a copy of only the first page of a document or (2)
copying the second and subsequent pages of a document, either on a per page basis or for
all pages after the first.
To illustrate this point, we consider the charges of (1) $5 for a two-page copy; (2)
$15 for a seven-page copy; (3) $45 for a 22-page copy; and (4) $61 for a 30-page copy.
If these fees are truly based on the amount of staff time spent providing the copies, one
could calculate the amount of time staff would have to spend to justify the fee for a
particular length document by dividing the fee charged by the cost figure of $0.99 per
minute. Performing this calculation leads to the conclusion that staff would have to take
five minutes to provide a copy of an official record with two pages in order to justify the
$5 charged for the copy. Similarly, the fees charged would reflect the time-based
approach to costs if it took 15 minutes to provide a copy of a seven-page document, 45
minutes for a 22-page document, and over one hour for a 30-page document.
However, the record contains no evidence that documents with these page lengths
require that much staff time to copy and process. The absence of evidence about the
amount of time spent copying the second and subsequent pages of a document renders it
impossible to apply the time-based methodology set forth in the 2001 study to calculate
the costs to County of providing copies of those pages. Therefore, we have eliminated
17.
the time-based methodology as a way to support the fees charged for copies of the second
and subsequent pages of an official document.
Next, we next address whether the record contains evidence of an alternate method
for calculating County’s cost of providing copies of those pages. County’s briefing does
not argue an alternate method exists and plaintiff’s reference to the fees of $0.15 per page
charged by commercial copying services such as Kinko’s was found inapplicable to the
more complex services provided by the clerk-recorder’s office.8 Furthermore, our
independent review of the record has not uncovered an alternate method. Therefore, we
conclude there is no evidentiary support for an alternative to the time-based approach for
calculating the costs to County of providing copies of the second and subsequent pages of
an official record.
4. Conclusions: The Evidence Was Insufficient
We conclude that the record lacks evidence, substantial or otherwise, that the cost
to County of providing copies of the second and subsequent pages of an official record is
$2 per page. In other words, that portion of the fee schedule is “entirely without
evidentiary support” for purposes of the abuse of discretion standard of review.
8 The cost of copying documents has come before this court in a variety of legal
contexts. In water management litigation, a copy company charged an average of 16.93
cents per page to provide 16 copies of the 17,766-page administrative record of
proceedings. (Friends of the Santa Clara River v. Castaic Lake Water Agency (2004)
123 Cal. App. 4th 1, 8, fn. 9.) In environmental litigation, this court upheld an award of
costs for photocopying and binding the administrative record that equated to 17.92 cents
per page. (Wagner Farms, Inc. v. Modesto Irrigation Dist. (2006) 145 Cal. App. 4th 765,
777.) This figure was based on the amount charged by the copy company plus tax.
(Ibid.) In an unfair competition case, this court affirmed an award of $30,495 in costs for
photocopying business documents admitted into evidence as exhibits—an average cost
per page of about 19 cents. (El Dorado Meat Co. v. Yosemite Meat & Locker Service,
Inc. (2007) 150 Cal. App. 4th 612, 618.) These copying costs might provide a relevant
comparison to a county’s cost of duplication, but do not include other aspects of the
service provided by counties, such as organizing, storing, and pulling the official record
requested by a customer.
18.
(Neighbors in Support of Appropriate Land Use v. County of Tuolumne, supra, 157
Cal.App.4th at p. 1004.) Accordingly, County’s board of supervisors abused its
discretion when it approved a fee schedule that charged $2 per page for subsequent
pages.
Furthermore, the record lacks evidence, substantial or otherwise, that the cost to
County of providing a copy of the first page of a requested document was $3. Instead,
the 2001 study demonstrates that (1) it cost County an average of approximately $3 to
provide a copy of the entire document requested and (2) the average length of a requested
document was about two and a half pages. Consequently, one cannot rationally conclude
that it costs County as much to provide the first page alone as it costs to provide a copy of
all pages of an average length document. Accordingly, County’s board of supervisors
abused its discretion when it approved the portion of the fee schedule that charged $3 for
the first page of a requested document.
In short, there was an apples-versus-oranges type disconnect between the 2001
study’s application of the time-based methodology to estimate per document costs and its
recommendation to impose copying fees on a per page basis.
C. Prejudice
1. Basic Principles
When a party seeking a writ of traditional mandamus has established an abuse of
discretion, the issuance of the writ is not automatic. That party also must show prejudice
resulted from the public agency’s action. (Gordon v. Horsley (2001) 86 Cal. App. 4th 336,
351; art. VI, § 13 [miscarriage of justice required for reversal].)
2. Showing of Prejudice
Plaintiff’s verified petition alleges it purchased a copy of a two-page document on
October 23, 2013, and was charged $3 for the copy of the first page and $2 for the copy
of the second page. A receipt attached to plaintiff’s petition shows plaintiff paid County
19.
this $5 photocopy fee. Plaintiff’s attachments also show that in December 2013 it
submitted a written claim for the overcharges and County rejected the claim in January
2014.
We conclude plaintiff has shown prejudice in the form of an overcharge for the
copy of the two-page document. The 2001 study constitutes evidence that it cost the
clerk-recorder’s office an average of approximately $3 to process a request for a copy of
an official record and the average length of a requested document was two and a half
pages. Thus, the charge of $5 for a copy of a document of below average length
exceeded the costs of providing that copy and the overcharge is sufficient to establish the
requisite prejudice.
The question of the appropriate appellate relief for the prejudicial abuse of
discretion shown by plaintiff is addressed in part III.E, post.
III. DIRECT AND INDIRECT COSTS
Our review of the sufficiency of the evidence proceeded on the assumption that
County applied the correct legal definition of costs when it adopted its fee schedule. Our
next step is to examine that assumption and plaintiff’s contention that the trial court and
the board of supervisors committed legal error by construing the phrase “direct and
indirect costs” too broadly. Plaintiff argues that County’s erroneous interpretation
allowed for the recoupment of more costs than authorized by section 27366.
A. Sections 27360 and 27366
As background, we note that section 27360 states that “the county recorder shall
charge and collect the fees fixed in this article.” The use of the word “shall” in the phrase
“shall charge and collect” means it is mandatory for counties to charge the referenced
fees. (See § 14 [“shall” is mandatory].) Section 27366 appears later in that article of the
Government Code and addresses copying fees by stating:
“The fee for any copy of any other record or paper on file in the office of
the recorder, when the copy is made by the recorder, shall be set by the
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board of supervisors in an amount necessary to recover the direct and
indirect costs of providing the product or service .…”
Section 27366 has not been changed since the enactment of Assembly Bill No.
130 (1993-1994 Reg. Sess.), which replaced the fixed fees of one dollar for the first page
and 50 cents for each additional page with a cost-based approach. (See Stats. 1993, ch.
710, § 3, pp. 4039-4040.)
The primary issue of statutory construction involves the phrase “direct and indirect
costs.” Before addressing the meaning and application of this phrase, we address three
other issues that establish part of the legal context or foundation for the interpretation of
that phrase.
B. Foundational Issues
1. Constitutional Right of Access
First, we address the constitutional foundation for plaintiff’s view of how section
27366 should be interpreted. Plaintiff argues copying fees affect the people’s right of
access and, therefore, the statutory provisions addressing such fees must be narrowly
interpreted to lessen its restrictions on the right of access. We reject this argument, but
conclude the constitutional provision will play a role in how our interpretation of section
27366 is applied to the facts of this case on remand.
In 2004, California voters approved Proposition 59—known as the “Sunshine
Initiative”—and amended article I, section 3 by adding subdivision (b). (POET, LLC v.
State Air Resources Bd. (2013) 218 Cal. App. 4th 681, 750 (POET).) Subdivision (b)(1) of
section 3 of article I currently reads:
“The people have the right of access to information concerning the conduct
of the people’s business, and, therefore, the meetings of public bodies and
the writings of public officials and agencies shall be open to public
scrutiny.”
Subdivision (b)(2) of section 3 of article I currently states:
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“A statute, court rule, or other authority, … shall be broadly construed if it
furthers the people’s right of access, and narrowly construed if it limits the
right of access. A statute, court rule, or other authority adopted after the
effective date of this subdivision that limits the right of access shall be
adopted with findings demonstrating the interest protected by the limitation
and the need for protecting that interest.”
Plaintiff contends this provision requires a narrow construction of the costs that
may be recouped under section 27366. This contention implies that County’s recovery of
the costs of providing copies of official records “limits the right of access.” (Art. I, § 3,
subd. (b)(2).) This implication appears to be based on the idea that higher fees limit
access and lower fees improve access. We recognize that the fees charged to a person
requesting a copy of an official record are an important factor relating to access, but fees
are not the exclusive factor relevant to access.
The evidence presented in this case shows that (1) “access” has a monetary
component, an elapsed time component and a convenience component and (2) there are
tensions or tradeoffs among these components. For instance, charging low fees might
improve access by reducing financial barriers, but also could adversely affect the ease
and speed of access. For instance, low fees could lead to a reduction in the number of
hours the clerk-recorder’s office takes requests for copies and an increase in the time that
elapses between the submission of the request and the delivery of the copy to the
customer. Therefore, reducing the fees charged ultimately could make obtaining copies a
more time consuming, less convenient process for the customer. The tension between the
different factors relevant to access lead us to conclude that the constitutional provision
designed to further the people’s right to access should be interpreted in a way that
balances the different components and does not overemphasize cost.
In the present case, the evidence before the trial court supports an implied finding
that the reduction of the copying fees would adversely affect the timeliness and
convenience of access. The declaration of the assistant clerk-recorder explicitly
addressed potential consequences of changing the fees charged for copies by stating:
22.
“The diminution in revenue without the current copy fees could result in
negative outcomes: The wait times that an individual would experience in
seeking assistance of the Clerk-Recorders’ Office staff would be
significantly increased and/or the daily hours of the Recorder’s Office
could be reduced for production of copies. I do not anticipate that the
amount of work requested would diminish proportionately, rather, I would
expect that it would simply take much longer for the public to obtain the
same services that they now receive from the Clerk-Recorder’s Office.”
Plaintiff has not addressed this evidence, the implied finding it supports, or the
multifaceted nature of access. The declaration constitutes substantial evidence
supporting the trial court’s implied finding. Therefore, we accept that finding and reject
the view that higher copying fees only have the effect of limiting access to official
records. As a result, we conclude that the phrase “direct and indirect costs” in section
27366 is not required to be as “narrowly construed” as is reasonably possible to comply
with subdivision (b)(2) of section 3 of article I. Instead, the statute should be interpreted
in a manner that recognizes costs are a significant, but not the only, factor that affects the
public’s access to documents. The interpretation adopted below bears this mind.
Furthermore, on remand when the trial court applies the statutory interpretation to
the evidence presented to determine whether specific items qualify as indirect costs that
can be factored into the cost calculation, the court should keep in mind the conflicting
factors relevant to access and the constitutional goal of furthering access.
2. Fees Exceeding Costs
Next, we address a basic question about section 27366 and the leeway or
discretion it might provide a board of supervisors. Does its phrase “an amount necessary
to recover direct and indirect costs of providing the product or service” prohibit a board
of supervisors from setting fees in excess of the costs of providing copies? This issue is
not vigorously contested because County does not argue it may collect fees that exceed
its costs. Nonetheless, we address this issue of statutory interpretation because it
23.
provides part of the foundation for analyzing the meaning of the phrase “direct and
indirect costs,” which is the primary source of controversy in this appeal.
Section 27366 does not appear to be ambiguous on the issue of fees that exceed
costs, but we will assume for the sake of discussion that it is reasonably possible to
interpret the phrase “an amount necessary to recover” as setting a minimum and not a
ceiling. Under this assumption, the text can be reasonably interpreted as authorizing fees
in “an amount necessary to recover or exceed” the costs of providing copies.
However, we reject the interpretation that section 27366 sets a minimum without
establishing a maximum for the fees. Such an interpretation is contrary to the intent of
the Legislature. A Senate floor analysis states the amendments proposed by Assembly
Bill No. 130 “replace the current statutory fee limits, but permit supervisors to supersede
them, so long as fees do not exceed the cost of the service provided.” (Off. of Sen. Floor
Analyses, 3d reading analysis of Assem. Bill No. 130 (1993-1994 Reg. Sess.) as amended
Aug. 23, 1993, p. 1.) Based on this legislative history, we resolve any ambiguity in
section 27366 by interpreting it to prohibit fees in excess of the direct and indirect cost of
providing copies of official records.
3. Discretion to Set Fees
Another question about section 27366 is whether it grants a board of supervisors
any discretionary authority when setting copying fees. The statute provides that copying
fees “shall be set by the board of supervisors.” (§ 27366.) The use of the mandatory
term “shall” means that boards of supervisors have a mandatory obligation to set copying
fees. However, the use of the word “shall” does not necessarily mean setting fees
involves no discretion. (See State Dept. of State Hospitals v. Superior Court (2015) 61
Cal. 4th 339, 348-349 [mandatory obligation to perform a function does not establish how
the function should be performed where the function itself involves the exercise of
24.
discretion]; Common Cause v. Board of Supervisors, supra, 49 Cal.3d at p. 446
[mandamus will lie where governmental entity fails to exercise discretion].)
The statutory obligation to set copying fees requires a board of supervisors to
determine “an amount necessary to recover” costs. This determination requires an
exercise of judgment and is not simply a matter of performing a mathematical calculation
that produces a single correct answer. (See Thompson v. County of Alameda (1980) 27
Cal. 3d 741, 748-749 [ministerial act leaves no choice, but a discretionary obligation
involves comparisons, evaluations, choices and judgments].) Consequently, we conclude
section 27366 grants a board of supervisors some discretionary authority when setting
copying fees. That discretion, however, is limited by the phrase “direct and indirect
costs.” (See People ex rel. Dept. of Corporations v. SpeeDee Oil Change Systems, Inc.
(1999) 20 Cal. 4th 1135, 1144 [“discretion is limited by the applicable legal
principles”].)9
C. Direct and Indirect Costs
1. Ambiguity
Our analysis of the meaning of the phrase “direct and indirect costs” begins with
the usual threshold question of whether these words are ambiguous—that is, reasonably
susceptible to more than one interpretation. (Kirby v. County of Fresno (2015) 242
Cal. App. 4th 940, 967; Coburn v. Sievert (2005) 133 Cal. App. 4th 1483, 1494-1496.)
We conclude the term “direct costs” is not ambiguous. Both parties appear to
accept the definition of “direct costs” adopted in North County Parents Organization v.
Department of Education (1994) 23 Cal. App. 4th 144. That case addressed the meaning
9 Plaintiff contends the trial court erred in finding that County had unlimited
discretion to set the fees. The trial court did not explicitly state County had unlimited
discretion, but did state “[t]he case turns on the definition of ‘indirect costs’ in § 27366.”
Under the principles of appellate review that guide our interpretation of trial court orders,
we conclude the trial court correctly decided the statutory phrase “indirect costs” limited
County’s discretion in setting the amount of the fees.
25.
the phrase “direct costs of duplication” used in section 6257. (North County Parents
Organization, supra, at pp. 147-148.) The court concluded the “direct cost of duplication
is the cost of running the copy machine, and conceivably also the expense of the person
operating it.” (Id. at p. 148.) The limiting prepositional phrase “of duplication” caused
the court to conclude the direct cost of ancillary tasks, such as document retrieval,
inspection and handling were excluded. (Ibid.) In contrast, the limiting prepositional
phrase in section 27366 is “of providing the product or service,” which encompasses
more than the cost of duplication. Therefore, we conclude that the direct costs of
providing copies of official records is the cost of operating the equipment used to satisfy
the request and the cost of the employee time taken to provide the service, and the cost of
the paper and toner used to make the copies.
In contrast, we conclude the term “indirect costs” is ambiguous because it does not
have a single, plain meaning. Among other things, the variety of dictionary definitions of
“indirect costs” presented by County establish that there is no single definition that can be
classified as the ordinary, usual meaning.
2. Role of Common Law
Plaintiff addresses the ambiguity in the term “indirect costs” by arguing it must be
interpreted consistent with the common law. Specifically, plaintiff argues that (1) the
common law imposes mandatory limits on the costs that ordinary user fees may recoup
and (2) copying fees are ordinary user fees, not regulatory user fees. Plaintiff contends
that ordinary user fees are charged only to those who use the goods or services and the
amount charged may recoup only those costs reasonably related to the actual goods or
services provided.
We conclude the cases discussing the common law limits on ordinary user fees are
not authority for the meaning of the term “indirect costs” used in section 27366. The
legislative history referenced in plaintiff’s appellate brief does not show the Legislature
26.
intended common law principles would define the scope of the term “indirect costs.”
Therefore, we conclude the ambiguity in the term “indirect costs” used by section 27366
is not resolved by using common law principles relating to ordinary user fees.
3. Unfair Practices Act: Reasonably-Related-To Test
California’s Unfair Practices Act (Bus. & Prof. Code, § 17000 et seq.) prohibits a
business from selling “any article or product at less than the cost thereof” for the purpose
of injuring competitors or destroying competition. (Bus. & Prof. Code, § 17043.) The
Unfair Practice Act also defines “cost,” “cost of doing business” and “overhead expense.”
(Bus. & Prof. Code, §§ 17026, 17027, 17029.)
In Turnbull & Turnbull v. ARA Transportation, Inc. (1990) 219 Cal. App. 3d 811
(Turnbull), the court addressed the appropriate cost standard for determining whether a
sale violated the Unfair Practices Act by being below cost. (Turnbull, supra, at pp. 819-
820.) The court stated the statute defined cost to include all variable and fixed costs and,
consequently, employed a fully allocated cost or fully distributed cost standard. (Id. at p.
820.) Plaintiff cites this case for the principle that “there are many ways of fully
allocating costs, [but] the possibilities are not without limitation. To be legally
acceptable, the allocation of indirect or fixed overhead costs to a particular product or
service must be reasonably related to the burden such product or service imposes on the
overall cost of doing business.” (Id. at p. 822.)
County’s brief does not address Turnbull or the approach to costs used under the
Unfair Practices Act. Moreover, the approach County takes to indirect costs does not
impliedly contradict the “reasonably related to” principle from Turnbull. Indeed, County
quotes a Judicial Council document that states the full cost recovery of services includes
“an appropriate share of indirect costs that can be attributed reasonably to the activity or
service provided.”
27.
Based on plaintiff’s reliance on Turnbull and the definitions of indirect costs
presented by County, we conclude that the ambiguity in the term “indirect costs” is
resolved by a general test that requires such costs to be reasonably attributed to (i.e.,
reasonably related to) providing copies and excludes costs that cannot be reasonably
attributed to the service of providing copies. The application of this test presents a
question of fact, which must be decided by a county’s board of supervisors when it sets
the fee for copying official documents.
4. Role of Section 54985
Neither party contends section 54985 is the statute that controls the copying fees
County must charge. Similarly, the trial court explicitly concluded that section “54985
does not apply.” We conclude section 27366 applies to the copying fees and, therefore,
we join the parties and the trial court in concluding section 54985 has no direct
application in this case. Nonetheless, section 54985 is part of the overall statutory
scheme governing cost recoupment by county and, therefore, it must be considered when
interpreting section 27366. (POET, supra, 218 Cal.App.4th at p. 749 [ambiguous
statutory provision must be construed in context and with reference to the entire statutory
scheme].) In other words, section 27366 must be construed in a manner that avoids
disharmony with section 54985.
Section 54985 is set forth in the chapter of the Government Code addressing
county fees and it provides in relevant part:
“(a) Notwithstanding any other provision of law that prescribes an amount
or otherwise limits the amount of a fee or charge that may be levied by a
county, … a county board of supervisors shall have the authority to
increase or decrease the fee or charge, that is otherwise authorized to be
levied by another provision of law, in the amount reasonably necessary to
recover the cost of providing any product or service or the cost of enforcing
any regulation for which the fee or charge is levied. The fee or charge may
reflect the average cost of providing any product or service .… Indirect
costs that may be reflected in the cost of providing any product or service
28.
… shall be limited to those items that are included in the federal Office of
Management and Budget Circular A-87 on January 1, 1984. [¶] … [¶]
“(c) This chapter shall not apply to any of the following: [¶] … [¶]
“(6) Any fee charged or collected by a county recorder or local
registrar for filing, recording, or indexing any document, performing any
service, issuing any certificate, or providing a copy of any document
pursuant to Section … 27366 of the Government Code .…” (Italics added.)
Plaintiff contends the board of supervisors erred by relying on section 54985 to
adopt an expansive definition of “indirect costs.” Plaintiff argues the Legislature chose to
address copying fees in a separate statute and this legislative decision demonstrates an
intent for section 27366 to take a narrower approach to indirect costs than that taken in
section 54985. In contrast, County draws the opposite inference about the legislative
intent underlying the decision to address copying fees in a separate statute, arguing that it
is reasonable to infer that the costs included in the definition by federal Office of
Management and Budget Circular A-87 are included in the definition of “indirect costs”
under section 27366, but counties are not limited to recouping the costs covered by
Circular A-87. Consequently, County argues that section 54985 and its reference to
Circular A-87 is helpful in defining a minimum for the indirect costs recoverable under
section 27366.
The record before this court does not contain a copy of the 1984 version of
Circular A-87. The record does contain a copy of the version of Circular A-87 as revised
by a May 20, 2004, notice. (70 Fed.Reg. 51910 (Aug. 31, 2005) [relocating Circular A-
87 to 2 C.F.R. Part 225]; see 60 Fed.Reg. 26484 (May 17, 1995) [adoption of revisions to
Circular A-87].)10
Based on the sparse record before this court, we are reluctant to establish any hard
and fast rules about the role of section 54985 and, more particularly, Circular A-87 in
10 It appears that “45 CFR part 75 superseded OMB Circular A-87.” (80 Fed.Reg.
48200, 48221 (Aug. 11, 2015).)
29.
defining the meaning of “indirect costs” for purposes of section 27366. For example, it
would be imprudent to find, as a matter of law, that the various categories of indirect
costs identified in a particular version of Circular A-87 always constitute costs that are
reasonably attributed to (i.e., related to) to a county’s providing copies of official records
and, therefore, satisfy the “reasonably attributed to” test approved in part III.C.3, ante.
Instead, we conclude that versions of Circular A-87 might provide useful guidance, but
cannot provide definitive answers under the reasonably-attributed-to test that defines
“indirect costs” for purposes of section 27366 because that test presents a question of fact
dependent upon the surrounding circumstances.
5. Summary
We conclude the term “direct costs” is unambiguous, but the term “indirect costs”
is reasonably susceptible to more than one interpretation. We further conclude that the
ambiguity in the term “indirect costs” is resolved by requiring such costs be reasonably
attributed to (i.e., reasonably related to) the service of providing copies and by excluding
costs not reasonably attributed to the service of providing copies. The application of this
test is dependent upon the board of supervisors making legislative findings of fact under
the reasonably-attributed-to standard.
D. Specific Applications of Test
1. Cost-of-Service Methodology
Plaintiff’s appellate briefing suggests the time-based method of calculating costs
used in the 1994 and 2001 studies was inappropriate. Because this case requires further
proceedings, we briefly address this suggestion to provide guidance on remand.
The choice of methodology for calculating a county’s cost of providing copying
services is a matter committed to the discretion of the board of supervisors because there
is no single legally correct methodology. Examples of different methodologies include
the cost of service approach used for setting rates of public utilities, which includes a
30.
reasonable rate of return on the “rate base”—that is the value of the property devoted to
public use. (City and County of San Francisco v. Public Utilities Com. (1971) 6 Cal. 3d
119, 122.) Also, antitrust and unfair competition law present different approaches to
calculating the cost of providing a good or service. (Turnbull, supra, 219 Cal.App.3d at
p. 820 [fully allocated cost equated with average total cost, which included both fixed and
variable costs attributable to each unit of output].) Therefore, we conclude a board of
supervisors’ choice of method for determining direct costs and allocating indirect costs is
subject to review under the abuse of discretion standard. Consequently, the choice must
not be arbitrary, capricious or entirely without evidentiary support. (Neighbors in
Support of Appropriate Land Use v. County of Tuolumne, supra, 157 Cal.App.4th at p.
1004.)
Based on the record before us, we are not able to decide whether the use on
remand of the time-based method of allocating costs would constitute an abuse of
discretion. For instance, we cannot predict whether the evidence before the board of
supervisors when it makes its decision will be sufficient to support using the time-based
method. Consequently, if the time-based method is used on remand, we cannot decide
whether the use of the concept of productive staff time will be supported by sufficient
evidence.
2. Items or Categories Plugged into Method
Once the method for calculating County’s cost of providing copying services has
passed scrutiny under the abuse of discretion standard, the specific categories and items
of cost that are plugged into the method must satisfy the tests for direct and indirect costs.
For example, if the cost of staff overtime is included as an indirect cost, there must be
evidence in the record to support a finding that overtime can be reasonably attributed to
(i.e., reasonably related to) providing the service of copies of official records.
31.
E. Appellate Relief and the Contents of the Writ of Mandate
The appellate briefing has devoted little space to addressing the specific
instructions that should be included in the writ of mandate issued to County’s board of
supervisors.
1. Need for Interim Fee Schedule
The first question we address is whether the current fee schedule should be
invalidated and replaced with another schedule while the board of supervisors considers
resetting the copying fees.
We conclude there is no need for an interim fee schedule under the facts of this
case. First, any overcharges to plaintiff that occurred during the period within the statute
of limitations can be remedied by an award of damages that acts as a refund of the
amount overcharged. In other words, there is a legal remedy available and, therefore, it is
not necessary for the writ of mandate to attempt to remedy past or continuing
overcharges, if any. Second, the record before this court lacks sufficient information for
us to adopt a fee schedule that complies with section 27366 and sets those fees in an
amount necessary to recover direct and indirect costs of providing copies in 2016.
2. Directions for Resetting the Copying Fees
The second question concerning the contents of the writ of mandate relates to the
level of detail in our instructions about the direct and indirect costs that must be
recovered through the charging of fees. The prayer in plaintiff’s petition for writ of
mandate requested a writ directing County “to demand and collect fees for copies of
records on file in the office of the County Recorder that are limited to the recoupment of,
only, the costs of paper, ink and toner to print and copy the documents; the photocopier
used to make the copy and the cost of its operation and maintenance; the salary and
benefits of the person making the copy; and the costs necessarily associated with the
retrieval, inspection, redaction and handling of the document being copied.”
32.
County has not addressed the directions the writ of mandate should give for the
resetting of the copying fees. However, County’s arguments about the appropriate
definition of direct and indirect costs suggest it would not object to a writ stating that (1)
recoverable direct costs include the amounts paid for (a) the paper, ink and toner used to
make the copy, (b) the photocopier, including its operation and maintenance, and (c) the
salary and benefits of the person making the copy; and (2) recoverable indirect costs are
the overhead cost of operating the clerk-recorder’s office and are not tied to any one
particular customer or copy and include (a) salary and benefits of all staff necessary for
operating the clerk-recorder’s office, (b) lease payments for the building and equipment,
(c) costs of utilities, services contracts, computers, equipment, and furniture; (d)
maintenance and depreciation of office equipment; (e) office cleaning; and (f) insurance,
office supplies and necessary travel expenses.
Based on the factual nature of reasonably-attributed-to standard (see pt. III.C.3,
ante) for determining the indirect costs of providing copies of official records, we
conclude that the writ of mandate should direct the board of supervisors to apply this
standard in determining the indirect costs that must be recovered in the fees charged.
IV. SPECIAL TAXES AND THE CLAIM OF TRIAL COURT ERROR*
Plaintiff’s claim that the trial court committed constitutional error need not be
discussed in detail because this matter is being remanded with directions for the board of
supervisors for further proceedings on the statutory claim.
Article XIII C states that local governments may not impose a “special tax”
without the electorate approving that tax by a two-thirds majority vote. (Art. XIII C, § 2,
subd. (d).) It also defines the term “tax” to include charges that “exceed the reasonable
costs to the local government of providing the service or product.” (Art. XIII C, § 1,
subd. (e)(2).)
* See footnote, ante, page 1.
33.
We conclude that copying fees limited to the recovery of direct and indirect costs
in accordance with section 27366 will not “exceed the reasonable costs to the local
government of providing the [copies]” for purposes of article XIII C, section 1,
subdivision (e)(2). Conversely, copying fees that fail to satisfy the statutory requirement
cannot be regarded as reasonable for purposes of article XIII C.
Based on our conclusions about the relationship between the constitutional and
statutory provisions, we further conclude that (1) plaintiff’s constitutional cause of action
overlaps with its claim under section 27366; (2) the reversal and reinstatement of the
statutory claim results in the constitutional claim also being “at large” after remand; and
(3) the writ of mandate need not provide the board of supervisors with separate
instructions for how to comply with article XIII C because of the overlap between the
statutory and the constitutional claim.
DISPOSITION
County of Stanislaus’s request for judicial notice, filed August 26, 2015, is granted
as to Exhibits A and B (controller’s manual and handbook) and denied as to Exhibits C
through E (judgments from other superior court proceedings).
County of Stanislaus’s request for judicial notice, filed September 17, 2015,
relating to the legislative history for section 54985 of the Government Code is granted.
The judgment is reversed and the matter remanded for further proceedings. The
superior court is directed to vacate its August 21, 2014, ruling on the petition for writ of
mandate and enter a new order that grants the petition for writ of mandate.
The superior court shall issue a peremptory writ of mandate compelling County’s
board of supervisors to (1) consider the matter of fees charged by the clerk-recorder’s
office for copying official records; (2) make findings under section 27366, supported by
substantial evidence, as to the fee amount necessary to recover the direct and indirect
costs of providing the copies; (3) determine what constitutes an “indirect cost” by using
the general test that requires such costs to be reasonably attributed to (i.e., reasonably
34.
related to) the service of providing copies and rejects costs not reasonably attributed to
the service of providing copies; and (4) set the copying fees charged by the clerk-
recorder’s office in accordance with its findings under section 27366.
The superior court shall retain jurisdiction over the proceedings by way of a return
to the writ, which jurisdiction shall include the authority to hear and decide plaintiff’s
claim for damages in the event that the new fee schedule sets amounts less than the
schedule currently in effect.
Plaintiff shall recover its costs on appeal.
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FRANSON, J.
WE CONCUR:
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KANE, Acting P.J.
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PEÑA, J.
35.