BB&K In the News Apr 21, 2015

San Juan Capistrano Tiered Water-Use Rates Decision

BB&K Partner Kelly Salt Interviewed on Capistrano Taxpayers Association v. City of San Juan Capistrano

The Fourth District Court of Appeal’s decision finding that San Juan Capistrano’s tiered water-use rates structure violated Proposition 218 generated a lot of news coverage, as these structures are likely to be a tool water agencies will use to address conservation regulations. Best Best & Krieger Partner Kelly Salt, who appeared amicus curiae on behalf of the defendant, discussed the ruling with news reporters. Here are some of those reports:

State Court Balks at Tiered Water Pricing (San Diego Union-Tribune)

“’They said you have to prove costs, but they don’t say how you’ve got to do it,’ said Kelly Salt, an attorney with Best Best & Krieger, LLP, a San Diego-based law firm that is defending the Sweetwater Authority….

“’It’s so disheartening to me to find the whole idea of structuring rates to promote conservation being (challenged as) improper under the constitution,’ Salt said. ‘Those who place greater demands on a water system should have to pay for it.’

“Figuring out how to assign and justify costs could be time-consuming at an urgent juncture, she said.

“’The timing couldn’t be worse given the fact that we’re in a major drought,’ Salt said. ‘Generally, to conduct a cost of service study it takes about six months, and on top of that, you have a 45-day period for mail notice before holding a public hearing to adopt the rate. So if agencies have concerns about their rates in light of this decision and are now being asked to cut back 10 to 36 percent, it will be more difficult to meet those mandates without a pricing signal to conserve.’”

Appeals Court Throws Out San Juan Capistrano’s Tiered Water-Use Rates (Los Angeles Times)

“Kelly Salt, a Proposition 218 expert based in San Diego who wrote an amicus brief defending the city of San Juan Capistrano, called the decision a ‘cause for concern.’

"’Tiered water rates provide an important price signal for conservation,’ Salt said. ‘With this ruling in hand, public agencies are going to want to make certain that their rate structures conform.’

“That, she said, could require agencies to spend months studying rates while trying to comply with new state conservation demands.

"’In this case, the court said [agencies] have to calculate the incremental cost of providing water at the level of use represented by each tier,’ she added. ‘That's difficult to do. Not impossible, but difficult.’”

Jerry Brown Calls Tiered-Water Ruling “A Straitjacket” for Conservation Efforts (The Sacramento Bee)

“Attorney Kelly Salt, with Best Best & Krieger in San Diego, said the ruling appears to be narrow enough that it could allow some agencies to maintain tiered pricing. Salt filed an amicus brief in the case for the California State Association of Counties, League of California Cities and Association of California Water Agencies.

“She said the court ruled that the city of San Juan Capistrano did not do enough to show that its pricing structure is based on the cost to the city to provide water, but some other water agencies may feel that they can show, if challenged, their pricing structure meets Proposition 218’s ‘nexus’ requirements.

“’It’s hard to say at this point,’ she said. ‘The court didn’t provide a great deal of guidance.’

“’Many water agencies may feel they already meet the standard stated in the court’s opinion. Others may want to take a second look’ at their pricing structure, she said. Salt added: ‘It is unfortunate that this decision came down during the worst drought in California history.’”

Water Pricing to Spur Conservation Ruled Unconstitutional (Associated Press via Miami Herald)

“The ruling will make it difficult for agencies with tiered pricing who get water from a single source, said Kelly Salt, a lawyer who filed court papers supporting San Juan Capistrano on behalf of the Association of California Water Agencies.

“Salt said she hoped the decision wouldn't have an impact beyond the city because tiered pricing is important to promote water savings.”

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