County Files 2nd Suit Seeking More Money From State

Opening a second front in their battle to gain more funding from the state, San Diego County officials on Wednesday filed suit seeking to change the way property taxes are allocated under state law.

The suit, ordered by the Board of Supervisors, is the second filed this year by San Diego County in its attempt to upset the state funding apple cart.

If successful, the suit would put an additional $57 million to county coffers each year, Supervisor George Bailey said. A separate suit filed July 10 could bring as much as $24 million a year to the county.

The lawsuits allege that county residents’ rights to obtain certain public services are being violated by the way the state allocates general tax money and by the way it mandates that local property taxes be split among the various agencies within each county.

The county’s complaint in the suit filed Wednesday stems from the way the state reacted to Proposition 13 in 1978, which reduced property taxes statewide to 1% of assessed valuation and gave the Legislature the right to decide how that 1% would be divided within each county.

Before Proposition 13, counties, schools and special districts set their own tax rates, so the breakdown of the property tax dollar among these agencies was different in each county. In one county, for instance, 25 cents out of each property tax dollar might have gone to the county government, 70 cents to the schools and 5 cents to cities and special districts. In another, the county might have gotten 75 cents, the schools 15 cents and the cities and special districts 10 cents.

After Proposition 13, the Legislature more or less froze those distributions in each county. The relative winners were the county governments that were taxing and spending the most before 1978. The losers were rapidly growing counties like San Diego and Orange, where urban problems were only beginning to take hold and government officials had not yet reacted by raising taxes to pay for new programs.

At the same time, the state was implementing a 1976 California Supreme Court ruling calling for equal opportunity in education. It did so by giving more state funds to school districts that were collecting less in local property taxes.

The result, San Diego officials argue, is that San Diego taxpayers are subsidizing schools in other counties at the expense of local health, social services and criminal justice programs.

“We’re not saying we want to take money away from those counties that are getting more,” said Dianne Jacob, an aide to Supervisor Bailey. “We just want to be brought up to the average.”

The average county in the state gets 36% of local property tax dollars, Jacob said. San Diego County gets 27%, while Los Angeles County gets 46% and the City and County of San Francisco gets 89%.

San Diego County’s suit seeks a declaration from the Superior Court that the state’s funding scheme violates citizens’ rights to due process and equal protection under the law. The complaint also asks the court to block the state from enforcing its system.

Named as defendants in the suit are the State of California, Gov. George Deukmejian, and four state officials who oversee financing of counties and schools.

Times staff writer Barry M. Horstman contributed to this report.