Court Rescinds Tax for Schools in Santa Clarita

Stiff taxes on developers to pay for schools in the fast-growing Santa Clarita Valley--imposed by voters in June, 1987--have been declared unconstitutional by the state Court of Appeal.

In a unanimous decision, three justices of the court’s 2nd Appellate District concluded that the five school districts in which the election was held had no constitutional authority to impose such special taxes because they were not authorized to do so by the Legislature.

Attorneys for the school districts said Thursday they will meet next week with their clients to decide whether to appeal the decision to the state Supreme Court.

The appellate court ruling, issued Tuesday, was in response to an appeal by the California Building Industry Assn. and the Building Industry Assn. of Southern California of a decision by Los Angeles Superior Court Judge Jerome K. Fields, who refused in August, 1987, to declare results of the election invalid.

In the election, the William S. Hart, Newhall, Saugus, Castaic and Sulphur Springs school districts were authorized by more than two-thirds of the voters to immediately begin charging taxes ranging from $5,439 to $6,300 on each new home, depending on the needs of individual districts.

Terry Dixon, attorney for four of the school districts, said that property tax-cutting Proposition 13, approved by voters in 1978, specifically gave special districts and public agencies the power to hold tax elections.

Alvin S. Kaufer, attorney for the developer organizations, argued that the school districts’ power to conduct the election was stripped by Proposition 62, the final ballot initiative of the late tax crusader Howard Jarvis, which was approved by voters in November, 1986.

Kaufer said the measure gave that power to school districts and other special districts only with legislative approval.

“If that were the law, then every little district in the state, and there are many of them, would be able to impose taxes on any new development so long as they got a two-thirds vote,” he said.

Kaufer argued that a statewide financing plan approved by the Legislature and voters in 1986 set a maximum of $1.50 a square foot on charges school districts could impose on developers. But Dixon said the state financing plan did not preclude districts, with the approval of voters, from levying more taxes to build schools.

Appellate Justices Joan Dempsey Klein, Armand Arabian and Walter H. Croskey sided with Kaufer.

Croskey, who wrote the opinion, said that the districts’ submission of the taxes “to voters who would not be called upon to pay them, was a poorly disguised and ineffectual attempt to avoid the statutory limitations to which development fees are subject.”

Building industry representatives praised the ruling, while school administrators said they were disappointed by it.

“We’re glad to see that the courts have finally recognized how unfair it is for the majority to impose a tax, which they themselves don’t have to pay, on a minority--new homeowners who don’t even get to vote on it,” said Bart Doyle, Southern California BIA general counsel.

“This decision confirms that local governments cannot use the initiative process to impose special fees or taxes not otherwise authorized by the Legislature.”

“My gut reaction is to appeal,” said Newhall District Superintendent J. Michael McGrath. “We think Proposition 13 clearly states we have the right to impose the fees.”

“I’m disappointed,” Hart Superintendent Clyde Smyth said. “This has done nothing to help us build schools.”

He said the area will need at least four new high schools, four new junior high schools and 25 elementary schools, costing several hundred million dollars, by 2010 if present growth trends continue. County planners projected last year that the area will grow from a population of 120,000 to 270,000 by 2010, Smyth noted.

“We’re just trying to educate the kids,” he said. “And we don’t have the money to do it.”

Kaufer said developer groups have also mounted a court challenge to a developer tax imposed on new homes by the Chino Unified School District.