Untitled California Attorney General Opinion

TO BE PUBLISHED IN THE OFFICIAL REPORTS
OFFICE OF THE ATTORNEY GENERAL
State of California
DANIEL E. LUNGREN
Attorney General
______________________________________
OPINION :
: No. 92-506
of :
: March 9, 1993
DANIEL E. LUNGREN :
Attorney General :
:
CLAYTON P. ROCHE :
Deputy Attorney General :
:
______________________________________________________________________________
THE HONORABLE DAVID G. KELLEY, MEMBER OF THE CALIFORNIA
STATE ASSEMBLY, has requested an opinion on the following questions:
1. Is a local agency prohibited from charging building permit and similar fees
which exceed the estimated reasonable costs of providing the services rendered unless the amounts
of the fees are approved by the electorate?
2. May a local agency charge building permit and similar fees based upon the
Uniform Building Code Valuation Tables which are in excess of the estimated reasonable costs of
providing the services rendered unless the amounts of the fees are approved by the electorate?
THE HONORABLE ROBERT PRESLEY, MEMBER OF THE CALIFORNIA
STATE SENATE, has requested an opinion of the following question:
3. If a local agency charges building permit and similar fees based upon the
Uniform Building Code Valuation Tables without supporting evidence regarding the relationship
between the fees and the services rendered, are such fees valid?
CONCLUSIONS
1. A local agency is prohibited from charging building permit and similar fees
which exceed the estimated reasonable costs of providing the services rendered unless the amounts
of the fees are approved by the electorate.
2. A local agency may not charge building permit and similar fees based upon
the Uniform Building Code Valuation Tables which are in excess of the estimated reasonable costs
of providing the services rendered unless the amounts of the fees are approved by the electorate.
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3. If a local agency charges building permit and similar fees based upon the
Uniform Building Code Valuation Tables without supporting evidence regarding the relationship
between the fees and the services rendered, such fees are invalid to the extent they exceed the
reasonable costs of providing the services rendered.
ANALYSIS
We are informed that it is a common practice for cities and counties to follow the
schedule of fees contained in the Uniform Building Code Valuation Tables ("Tables") which set
forth graduated building permit fees based upon the total valuation of the proposed construction as
well as hourly rates for inspections and plan reviews. The three questions concern whether a city
or county may charge building permit, plan inspection, and similar fees based upon those found in
the Tables without an independent investigation as to whether each fee bears a reasonable
relationship to the cost incurred in rendering the particular service. The questions posed also assume
the possibility that if the fees are greater than the costs incurred, California law would require a two-
thirds vote of the electorate to sustain their validity.
A. The California Constitution
"The general rule is that a regulatory fee must not ``exceed the sum reasonably
necessary to cover the costs of the regulatory purpose sought' in order to be considered as a fee
rather than a guise for a tax." (Mills v. County of Trinity (1980) 108 Cal. App. 3d 656, 661; see also
County of Plumas v. Wheeler (1906) 149 Cal. 758, 763; Trend Homes, Inc. v. Central Unified
School Dist. (1990) 220 Cal. App. 3d 102, 114.) Thus, such fees which exceed the reasonable costs
of providing governmental services may constitute "special taxes" within the meaning of article XIII
A of the California Constitution. (See Gov. Code, §§ 50075-50077; City and County of San
Francisco v. Farrell (1982) 32 Cal. 3d 47, 57; Alamo Rent-A-Car, Inc. v. Board of Supervisors
(1990) 221 Cal. App. 3d 198, 200-208; Trend Homes, Inc. v. Central Unified School District, supra,
220 Cal. App. 3d 102, 114; Bixel Associates v. City of Los Angeles (1989) 216 Cal. App. 3d 1208,
1218-1219.) Section 4 of article XIII A permits cities and counties to impose "special taxes" only
after approval of a two-thirds vote of the electorate.1
In this opinion we need not determine whether building permit and similar fees in
excess of the reasonable costs incurred in rendering the services are "special taxes" within the
meaning of article XIII A. However, the constitutional amendment constitutes the historical
background for the statutory schemes governing here, giving strong evidence of the legislative intent
in enacting these provisions. (See, e.g., California Mfrs. Assn. v. Public Utilities Com. (1979) 24
Cal. 3d 836, 844; People v. Henson (1991) 231 Cal. App. 3d 172, 177.) Such intent would be to
ensure that local building permit and similar fees do not conflict in any way with article XIII A.
B. The Government Code
The Government Code provisions most germane to our inquiry are found in sections
66012-66024, setting forth "Fees For Specific Purposes" (§§ 66012-66014), "Procedures For
1
Article XIII A, section 4 provides:
"Cities, Counties and special districts, by a two-thirds vote of the qualified
electors of such district, may impose special taxes on such district, except ad valorem
taxes on real property or a transaction tax or sales tax on the sale of real property
within such City, County or special district."
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Adopting Various Fees" (§§ 66016-66018.5), and provisions regarding "Protests, Legal Actions,
And Audits" (§§ 66020-66025).2 The primary section to which we direct our attention is section
66014. Subdivision (a) of section 66014 provides:
"Notwithstanding any other provision of law, when a local agency charges
fees for zoning variances; zoning changes; use permits; building inspections;
building permits; filing and processing applications and petitions filed with the local
agency formation commission . . . ; the processing of maps . . . ; or planning services
. . . ; those fees shall not exceed the estimated reasonable cost of providing the
service for which the fee is charged, unless a question regarding the amount of the
fee charged in excess of the estimated reasonable cost of providing the services or
materials is submitted to, and approved by, a popular vote of two-thirds of those
electors voting on the issue."
The introductory phrase "Notwithstanding any other provision of law" makes the rules set forth in
the statute exclusive as to the fees enumerated therein, which include those germane to our inquiry.
(See In re Marriage of Dover (1971) 15 Cal. App. 3d 675, 678, fn. 3; State of California v. Superior
Court (1965) 238 Cal. App. 2d 691, 695; 63 Ops.Cal. Atty.Gen. 660, 661-662 (1981).) Applying this
rule of "exclusivity," we find that fees such as building permit fees or fees for plan checking and
approval (1) "shall not exceed the estimated reasonable cost of providing the services" for which
they are issued or performed (2) "unless . . . the amount of the fee charged in excess of the estimated
reasonable cost . . . is . . . approved by . . . popular vote . . . ."
Moreover, sections 66016-66018.5 mandate that (1) prior to levying new fees or
service charges, or increasing existing ones, the local agency must hold a public hearing after giving
interested parties access to the data relating to the estimated costs of the services to be provided, and
(2) no fees shall be levied exceeding the reasonable estimated costs of the services without the
requisite two-thirds vote of the electorate.
Finally, sections 66020-66025 provide a procedure for interested parties to protest
the imposition of fees, and also to bring court actions to set aside or annul existing or newly adopted
fees as unreasonable, or to determine whether they constitute "special taxes" within the meaning of
article XIII A, section 4, of the Constitution.
The basic question at issue herein is whether a city or county may validly adopt the
fee schedules found in the Tables (1) without investigating whether the fees set forth therein are
"reasonable" under the requisite criteria set forth is section 66014 and (2) without a vote of the
electorate.
The Tables are contained in a private publication issued annually by the International
Conference of Building Officials ("ICBO"), applicable not only in California, but nationally. We
have been presented with no evidence that the fees set forth therein would approximate the estimated
costs of the specified services in any particular local jurisdiction in California. Nor have we been
presented with evidence that any cost analysis has been made by the ICBO in this respect.
Accordingly, a local agency may not, under the statutory scheme provided in the
Government Code, adopt the fee schedules set forth in the Tables, since it must have the requisite
data "available to the public . . . indicating the amount of cost, or estimated cost, required to provide
the service for which the fee or service charge is levied." (§ 66016, subd. (a).) As to jurisdictions
2
All references hereafter to the Government Code prior to footnote 3 are by section number only.
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which already have adopted the fee schedules of the Tables, such current fees would be subject to
protest (§ 66021) and judicial action (§ 66022). (See § 66014, subd. (b).)
Thus, the statutory scheme set forth in the Government Code leads to the conclusion
that a city or county may not adopt or charge the fees set forth in the Tables. Nothing in the
Government Code raises a presumption of reasonableness for such schedule of fees. As already
indicated, the Tables are contained in a private publication of a nongovernmental association.
C. The Health and Safety Code
Despite the mandate of the Government Code regarding a local agency's adoption of
fees, it has been suggested that certain provisions of the State Housing Law (Health and Saf. Code,
§§ 17910-17995.5)3 permit cities and counties to adopt the fee schedules found in the Tables as an
alternative to the requirements set forth in the Government Code. We reject the suggestion for a
number of reasons.
Under the State Housing Law, the Department of Housing and Community
Development ("Department") is directed to adopt building standards for "hotels, motels, lodging
houses, apartment houses, and dwellings and structures accessory thereto" (§ 17921) that are
"substantially the same requirements as are contained in . . . [T]he Uniform Building Code . . . ."
(§ 17922, subd. (a); see 72 Ops.Cal.Atty.Gen. 180, 184-186 (1986); 55 Ops.Cal.Atty.Gen. 157, 158-
159 (1972)). With certain exceptions not relevant here, "the provisions published in the State
Building Standards Code or the regulations promulgated pursuant to section 17922 shall be
applicable to" every city and county. (§ 17958; see Briseno v. City of Santa Ana (1992) 6
Cal. App. 4th 1378, 1382-1383; 72 Ops.Cal.Atty.Gen. 180, 184 (1989).)
Since the fee schedules contained in the Tables are part of the Uniform Building
Code, why are they not applicable to cities and counties under the provisions of sections 17922 and
17958?
First, the Tables have not been adopted by the Department under section 17922's
grant of authority. The obvious reason is that the Tables are not "building standards" which the
statute directs the Department to adopt. A building standard "regulates, requires, or forbids the
method of use, properties, performance, or types of materials used" and includes requirements for
the "architectural and design functions of a building." (§ 18909, subds. (a), (b); see also §§ 18940-
18942; 75 Ops.Cal.Atty.Gen. 131, 132-136 (1992).)
In 55 Ops.Cal.Atty.Gen. 157 (1972), we concluded that the building standards
adopted by the Department pursuant to section 17922 were to be substantive in nature rather that
administrative. We stated:
"Although the Department is limited in adopting rules and regulations by the
provisions of the specified model or uniform codes, this limitation applies only to
substantive regulations. The statutes, when read as a whole, demonstrate that the
reference in section 17922 to the "same requirements" was not intended to include
requirements of an administrative nature.
". . . . . . .
3
All references hereafter to the Health and Safety Code are by section number only.
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"It is . . . the substantive criteria contained in the specified uniform codes,
which criteria have been set forth for the propose of promoting safety and stability
in building activities, to which the Department's attention is properly directed.
"That the Legislature did not intend to incorporate by reference the
administrative provisions of the specified uniform codes is also evident from the fact
that the State Housing Act includes sections which specifically designate procedures
for administrative actions such as enforcement of the regulations and appeals from
allegedly erroneous or unlawful applications of those regulations. See sections
17921, 17930, 17931, 17932, 17952 and 17965. These procedures may differ from
those contained in the uniform codes. See sections 204 and 303(a) of the Uniform
Building Code, 1970 editions." (Id., at p. 161.)
Consistent with our 1972 opinion, the Department has not adopted the fee schedules
contained in the Tables but instead views the language of Government Code section 66014 ["fees
shall not exceed the estimated reasonable cost of providing the service for which the fee is charged"
without electorate approval] as controlling. "Unless unreasonable or clearly contrary to the statutory
language or purpose, the consistent construction of a statute by an agency charged with
responsibility for its implementation is entitled to great deference." (Dix v. Superior Court (1991)
53 Cal. 3d 442, 460.)
The language of section 17922 is not the only reason compelling the Department to
omit the Tables from its adoption of the Uniform Building Code. As indicated in 55
Ops.Cal.Atty.Gen. 157, 161 (1972), the State Housing Law itself has its own administrative
provisions that "may differ from those contained in the uniform codes." Here, section 17951
expressly allows cities and counties to charge building permit and similar fees but only if the fees
are "imposed pursuant to Section 66016 of the Government Code." (§ 17951, subd. (c).) Hence,
all such fees imposed under the State Housing Law must not exceed, without voter approval, "the
estimated amount required to provide the service." (Gov. Code, § 66016, subd. (a).) The applicable
rules of statutory construction are: "``The mode prescribed is the measure of the power'" (People v.
Zamora (1980) 28 Cal. 3d 88, 98; see Danville Fire Protection Dist. v. Duffel Financial & Const.
Co. (1976) 58 Cal. App. 3d 241, 247; 72 Ops.Cal.Atty.Gen. 180, 188, fn. 7 (1989)), and the specific
limitations of section 17951 regarding the imposition of fees control over the more general language
contained in sections 17922 and 17958 (see Agricultural Labor Relations Bd. v. Superior Court
(1976) 16 Cal. 3d 392, 420).
Accordingly, our construction of section 17951 harmonizes the State Housing Law
with the requirements of Government Code section 66016. The latter statute expressly refers to
section 17951 and vice versa. "[S]tatutes should be construed in harmony with other statutes on the
same general subject." (Building Material & Construction Teamsters' Union v. Farrell (1986) 41
Cal. 3d 651, 665.)
We have also examined the legislative history of the relevant provisions of the State
Housing Law, particularly sections 17922, 17951, and 17958. (Stats. 1981, ch. 914; Stats. 1979, ch.
1152; Stats. 1970, ch. 1436; Stats. 1961, ch. 1844.) We find an evident legislative intent to prohibit
building permit and similar fees imposed under the State Housing Law from violating the "special
taxes" provision of article XIII A of the Constitution. "A statute should be construed whenever
possible so as to preserve its constitutionality." (Dyna-Med, Inc. v. Fair Employment & Housing
Com. (1987) 43 Cal. 3d 1379, 1387.)
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Finally, our construction of sections 17922 and 17951 effectuates the Legislature's
purpose in enacting Government Code section 66014 with its introductory phrase "[n]otwithstanding
any other provision of law."
In sum, under both the Government Code and the Health and Safety Code, a local
agency is required to limit its building permit and similar fees to the estimated costs of providing
the services rendered. Any excess above such reasonable estimated costs requires approval by a
two-thirds vote of the electorate.
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