City of San Ramon tries to saddle landowners with its employee retirement costs

Like many California cities, San Ramon, in Contra Costa County, is facing budget strains because of the generous retiree benefits that it has promised its public employees.

PLF Podcast

Listen to Damien Schiff discuss this special tax 


Now city officials have concocted a creative ploy to help staunch this “retirement red ink.” They’ve created a special district that’s authorized to annex and impose additional property taxes on as many as 2,500 parcels across the city. These new taxes would be over and above the normal property taxes that landowners already pay.


Instead of providing new services, the new taxes will free up money in the city budget, to help pay for pensions and other retiree costs.


Ingenious? No, illegal – as a lawsuit filed last week by Pacific Legal Foundation drives home. Representing the Building Industry Association-Bay Area, PLF points out that state law (the Mellos Roos Act) requires that new special taxes of this kind on homeowners and other landowners must fund new services for the folks who are footing the bill – and that’s not happening here. Instead, property owners are being forced, literally, to pay something for nothing.


San Ramon’s tax plan also violates Proposition 218, the taxpayer protection measure that voters added to the California Constitution in 1996. Proposition 218 says that if new taxes are earmarked for a community’s general fund (as in this case), the electorate has to sign off. But San Ramon never even took the issue to the polls.


“San Ramon has tried to do an end-run around the voters by creating a new tax for general purposes, but camouflaging it as a special property tax,” says PLF Principal Attorney Damien M. Schiff in announcing the lawsuit.  The case is Building Industry Association – Bay Area v. City of San Ramon.  


Listen to Damien Schiff discuss our lawsuit in a PLF podcast.


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“The power to tax involves the power to destroy,” as Chief Justice John Marshall said.



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