Court sets aside new La Jolla tax district (MAD): Some property owners contend they were being taxed twice for services
A judge has ruled against a new taxing authority designed to spruce up local streets and sidewalks in La Jolla, finding that the City of San Diego failed to show the district would provide special benefits distinct from those already provided as part of general municipal services.
The Nov. 30 ruling by San Diego Superior Court Judge Randa Trapp essentially sets aside the new La Jolla Maintenance Assessment District (MAD), through which the City had planned collect more than $500,000 in tax revenue in 2018, according to court records.
The money was supposed to pay for services including trash collection, litter pickup, power-washing sidewalks and landscape maintenance in the area covered by the special district.
Some La Jolla property owners sued the City late last year, arguing that the special tax district was unconstitutional because it funded some services that the City Charter already requires the City to provide to the general public.
Trapp wrote that the City had “not shown that the special benefits were over and above the general benefits conferred by the general facilities of the City. As such, it has not shown it imposed the assessment only for the special benefits.”
City officials did not respond to requests for comment Monday afternoon.
Some 56 percent of voters approved the creation of the La Jolla MAD last November, imposing extra assessments to pay for the additional maintenance.
Maria Severson, an attorney with the San Diego-based law firm Aguirre & Severson LLP, which filed the lawsuit on behalf of La Jolla property owners, said voters indicated when they approved the special tax district that they wanted the City to provide more general maintenance.
But the district would have amounted to double taxation for regular maintenance services the City was already supposed to provide, Severson said. And that is not allowed under the state constitution.
“It’s unconstitutional to tax people again for what they’re already taking for general services,” Severson said by telephone on Monday. “While some may have wanted (the district), the record before the court showed there was insufficient basis to do it.”
Severson said the ruling was a huge win for her clients. She said it could also send an important message to the City that it must be careful to make sure maintenance assessment districts do not fund charter-mandated duties under the guise of “special” benefits.
President and general manager of La Jolla Light Phyllis Pfeiffer, a board member for Enhance La Jolla, a nonprofit that was the driving force behind the special tax district, said in an e-mail Monday that her group just heard about the court’s decision and “will be carefully reading the ruling and considering all options.”
Lincoln Foster, a commercial property owner in La Jolla who was one of the plaintiffs in the lawsuit, said in a telephone call Monday that he was pleased with the ruling.
Foster said he wanted capital improvements and more general maintenance services in La Jolla, too, but he has already paid taxes for them, and he did not want to pay for them twice through the special tax assessment.
“They’re going back to citizens who have been denied the services they’ve paid for and assess them a second time to do the city’s job for it,” Foster said. “That’s just obscene.”
Foster noted that a court had thwarted another maintenance assessment district in Golden Hill on similar grounds in 2012. In that case, the California Court of Appeal upheld a Superior Court ruling that the City had failed to adequately separate the special benefits for the tax district from the general benefits to the public, invalidating the assessments.
This year’s tax bill for at least one of Foster’s properties showed a line item for the La Jolla MAD, Foster said. He planned to pay the bill as required and would hope to get a refund at some point in the future.
The City has more than 60 maintenance districts.
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