January, 2006
The 9-111 Report is one-sided
To jump-start the campaign against the Fair Payment for Public Benefit Act (Measure A), the Napa County Board of Supervisors (the BOS) commissioned Seifel Consulting to prepare a report of Measure A’s potential negative impacts, as allowed under California Elections Code Section 9-111. Since Section 9-111 has no requirement that such a report be fair or balanced, Seifel Consulting was free to exaggerate negative impacts and costs and to understate benefits in accordance with its client’s wishes.
Costs can be held near zero
Despite its negative bias, the 9-111 Report contains some key elements of a true understanding of Measure A’s impacts. For instance, under “Fiscal Impacts” the 9-111 Report states, “No successful claims for monetary compensation would occur unless the Board of Supervisors took an action that further limits or restricts the use of property and the value of that property suffers an established decrease in value....Compensation would be a function of the number and type of new land use regulations enacted by the Board, the number of property owners and parcels affected, in addition to other factors.” This is true, and it is the primary reason that most of the rest of the 9-111 Report can be disregarded. The Board of Supervisors will have complete control over these costs, to an even greater degree than they can control other County discretionary expenses. By exercising reasonable restraint, regulating responsibly by tailoring new regulations to minimize collateral damage to property owners, and by settling any claims fairly through selective waivers of damaging restrictions or through other compromise solutions allowed by Measure A, the BOS can hold the costs of Measure A very close to zero.
Shows how damaging regulations can be
According to the 9-111 Report, compensable damage to property values stemming from three hypothetical new regulations could range from $77.5 million to $116 million.” If the BOS were to enact all three of these regulations in the absence of Measure A, this would be a $77.5 million to $116 million penalty imposed on property owners. The regulatory financial burden described in the 9-111 Report is huge and it would be unfair to continue imposing that burden on property owners. Measure A will ensure that future regulations will be more thoughtfully designed to be less damaging.
Overstates administrative costs
The 9-111 Report projects that annual administrative costs of Measure A will be “between $1.34 million and $2.95 million.” These numbers are based on the assumption that the BOS will enact 17 property value-damaging new land use restrictions each year, as they apparently did in 2004. However, in 2005 they did not enact any. If Measure A passes, the annual number of such ordinances will remain low and administrative costs will be low. However, the cost should not be zero. One of the purposes of Measure A is to require the BOS to evaluate in advance the collateral damage that might be caused by its new regulations, and these evaluations will cost something, although it will be far less than the 9-111 Report suggests.
Demonstrates the need for Measure A
The 9-111 Report is apparently the County’s first attempt ever to evaluate the collateral damage that might be caused by its new regulations, and it clearly illustrates why the County should have been doing so all along. For example, the 9-111 Report indicates that property owners in the Milliken-Sarco-Tulocay basin probably took a $26 million to $52.1 million hit to their property values when the County Groundwater Ordinance was enacted. Was this collateral damage even considered before the ordinance was enacted? Was any rational decision made regarding whether this would be a reasonable cost to pay for the expected benefits? Was any consideration given to who should bear this cost?
Until now, the BOS and others have focused only on the anticipated benefits of new regulations, and ignored the costs, perhaps because the costs could be foisted off onto someone else. By holding the County accountable for the damage it does from now on, Measure A will ensure that prudent cost/benefit analyses are performed before damaging ordinances are enacted. The 9-111 Report provides a convenient model for performing these analyses, and the relatively small administrative cost of performing them will be money well spent.
Legal expenses are justified
The 9-111 Report points out that if the voters enact Measure A, the County might incur some legal costs in defending the will of the voters against a court challenge. Although that potential expense would not be welcome, the will of the voters is certainly worth defending, and the cost is therefore justified.
Costs are costs. The question is who should pay
The 9-111 Report wraps up its fiscal impact analysis with the statement, “The Initiative could have a significant fiscal impact to the County’s General Fund.” But it could equally well have said, “Failure to pass Measure A could have a significant fiscal impact on property owners,” because the vast majority of the hypothetical costs analyzed in the Report are for paying restitution to property owners damaged by thoughtless new land use regulations. Failure to pass Measure A would mean property owners would have to pay these costs themselves. If a citizen damages someone’s property, he is liable for the damage. Why shouldn’t government be held to the same standard? Why should property owners have to bear the cost?
Measure A encourages responsible government
By holding government accountable for the damage it does, Measure A will help minimize those costs. Under “Other impacts”, the 9-111 Report says, “This analysis assumes that if the Initiative passes, the Napa County Board of Supervisors would attempt to avoid adopting any new resolution or ordinance which could be defined as a ‘New Napa County Land Use Restriction’ in order to avoid the fiscal impacts.” We would add that only those new restrictions that would damage property values would likely be of concern, but that the result would probably be a BOS that regulates responsibly and in a manner calculated to minimize collateral damage.
Measure A does not preclude new regulations
The 9-111 Report states that a “static regulatory environment” would be seen by many as a benefit, and we concur. However, Measure A would not ensure a static regulatory environment. While it would hopefully discourage reckless new regulations enacted without any cost/benefit analysis, it does not preclude new regulations. It merely requires that the costs of any new restrictions enacted by the BOS be allocated fairly. Measure A does not even preclude unfair regulations, because just as the voters can enact measure A, they can at any time override it. Any new land use regulation passed by the voters is exempt from Measure A. The real effect of Measure A will be to ensure that only fair regulations are enacted by the BOS, and that any unfair regulations deemed necessary despite their unfairness must be approved by the voters. And that is the way it should be.
The general plan must be fair unless voters approve it
The same argument applies to the General Plan. The General Plan should be updated in a manner that is fair to everyone. But if some unfair provisions are deemed necessary despite their unfairness, the voters can approve them with no Measure A consequences. At least this gives voters, rather than just any three Supervisors, control over any unfair provisions, and gives potential victims an opportunity to campaign against them.
Impact fees are not land use restrictions
The 9-111 Report tries to argue that the County’s transportation impact fee and similar fees could not be increased under measure A, but this is false because measure A claims can only stem from “New Napa County Land Use Restrictions”, and impact fees are not “land use restrictions”. They are more like taxes. As the 9-111 Report itself states, “action that reduces the property’s value (such as a tax increase) without restricting its use would not support a claim.”
Measure A allows for state and federal mandates
The 9-111 Report states, “Napa County would find it difficult or impossible to meet … requirements imposed on the County by the State and Federal Governments,” but in fact Measure A provides exceptions for this. Mandates that leave the BOS no discretion as to how to implement them are clearly exempt from measure A. Mandates that give the BOS discretion on how to implement them are exempt if the implementation is approved by the voters. If voters reject the BOS proposed implementation, it will be because they believe there is a better way to satisfy the mandate, in which case the BOS should choose the better way.
Nothing is permanent
The 9-111 Report tries to argue that once passed, Measure A would remain in effect forever. That is nonsense. Nothing is forever. Whatever can be enacted by the voters can be rescinded by the voters. If Measure A is someday found not to be serving the best interests of the citizens of Napa County, the voters will simply repeal it.
Measure A is legal
The 9-111 Report suggests that Measure A “is likely to be invalidated by the courts,” but NVLSA’s attorneys have advised that Measure A is on solid legal ground and will very likely withstand any court challenge.
Measure A does not jeopardize Measure J
Measure J is an existing voter-approved restriction on the authority of the BOS to rezone Ag property to other uses or to decrease minimum parcel sizes in Ag zones. Measure J sunsets in the year 2020. In the main body of the 9-111 Report (but missing from the executive summary) is a deeply flawed argument that renewal of Measure J could trigger claims under Measure A. That argument reveals a fundamental misunderstanding of Measure J on the part of the consultant, and a fundamental misunderstanding of Measure A, as well.
Measure J is a voter-approved restriction on the authority of the BOS. To have any meaning at all, Measure J must be extended by the voters, not the BOS. After all, anything the BOS can pass, it can modify, overrule, or rescind at will, so it makes no sense at all to have the BOS extending a law restricting its own authority. Only the voters can do that if we expect it to have any effect, and actions by the voters are exempt from Measure A.
Furthermore, Measure A specifically exempts renewals of existing regulations, so even if Measure J were to be renewed by the BOS, it would still be exempt.
Finally, only “land use restrictions” are covered by Measure A, and Measure J is not a land use restriction, it is a restriction on BOS authority, so its renewal could not trigger a Measure A claim in any case.
Budget analysis misses the point
Much of the main body of the 9-111 Report is dedicated to reviewing County finances and budget projections in an effort to show that any new expenses would strain County budgets and jeopardize essential services. However, the 9-111 Report reveals that Napa County is in very sound financial condition and has good reserves. The worst scenario the 9-111 Report could project for Napa County is that County reserves might decline in future years. Nevertheless, the whole budget analysis is just a distraction, because affordability is not the real issue.
The real issues are fairness, honesty, and integrity
New land use restrictions are imposed to secure benefits to the general public. Those public benefits may include slow growth, environmental protections, quality of life, view protection, or any number of things. It is not fair to force a few people to bear the burden of securing those benefits for everyone else. The burden should be fairly allocated, which means the people who receive the benefits should bear the burden of acquiring them. If the benefits can only be acquired by damaging someone’s property value, that person should be compensated by those who benefit.
Affordability is an issue we all face constantly, and the county should face it just as the rest of us do. Within the limits of affordability our County government should buy only those benefits we consider worth the price. The County shouldn’t steal benefits we cannot afford or which we consider too expensive. Those who advocate stealing from property owners “because we cannot afford to be fair” are asking us to sacrifice our integrity for their convenience.
Vote “YES” on the Fair Payment for Public Benefit Act, which will maintain our integrity by establishing a fair and reasonable policy for handling regulatory takings.