I love the way this opinion is written, which is not surprising once I reached the end of the opinion and saw that it's author was Justice Bedsworth. What I also loved about it was that it highlights a creative way to potentially circumvent the requirements of Proposition 218 -- the amendment to the California Constitution that requires voters to vote to approve any taxes imposed by local governments -- that I hadn't at all thought about previously.
(That's not intended to be a normative statement, by the way; I'm not saying that I love or hate the idea of getting around Prop. 218, just that it's always interesting to think about ways that people might try to do so and whether they'd legally succeed or fail.)
The basic scoop is that voters have to approve taxes, but not fees. With electricity, one of the things that the electricity company pays for is using public right of ways: transmission lines above sidewalks, power lines under streets, etc. So the City definitely gets to charge the electricity company (and gas company, cable company, internet provider, etc. etc.) fees for that access.
But, of course, the company just turns around and charges its customers those same costs. And with most of these entities, it's not like you have a choice whether to pay. What are you going to do, after all: live without electricity, or water, or sewage, or (gasp!) internet at your home?
So if a city wants to raise taxes without voter approval notwithstanding Proposition 218, why not just jack up the rates we charge the various service providers for public access? Regardless of how high a city sets those charges, it's not like SDG&E (or PG&E, or whomever) is going to say: "Screw it, we're going to get of the monopoly market in that city and no longer provide power." Nope; they're just going to raise their own rates on customers in return. And we're going to pay it. Every single time.
So the City gets whatever money it wants and the public pays it. Without voter approval. Neat, huh?
Now, in the present case, that's not a problem -- nor one that Justice Bedsworth is required to address -- because in Anaheim, there are already parts of that city's particular charter that are designed to prevent various types of electricity rate increases. But for other cities, or for situations (potentially like here) where those provisions don't apply, that's an interesting potential way around Proposition 218, no?
Of course, even if that's true, that doesn't necessarily mean that Proposition 218 is meaningless. Cities would still have to get voter approval if they wanted to (effectively) raise taxes in other ways. Moreover, there might well be reasons why cities would be somewhat more unlikely to raise, say, electricity rates (via public access charges) as a means of obtaining revenue than, say, imposing taxes on high-income earners, so we might be less worried about this particular "loophole" than some others.
Still, it'd have been a much harder sell for Proposition 218 if the pitch was: "Good news: passage of this law means that we'll have a harder time taxing the rich (since voters might strike that down), but fear not, cities can still totally soak the rest of us -- anyone who uses water or electricity, anyway -- at their total leisure." Which, effectively, might turn out to be really how the thing works. Though you might have to replace "rich" with "businesses, landlords, etc." to actually capture all the different ways that contemporary taxes get imposed, with or without voter approval.
Anyway: A neat little thought experiment about how cities might be able to get around Proposition 218 if they feel like it.
