CAT PARTNERSHIP v. County of Santa Cruz

Respondent cable operators filed actions seeking a property tax refund. (Rev. & Tax. Code, § 5141.) They challenged the decision of the Santa Cruz Assessment Appeals Board (AAB) to tax certain rate protection provisions included as part of the cable operators’ franchise agreements with local governments. The trial court determined that the rate protection provisions were enforceable restrictions and therefore not subject to taxation. It excised the rate protection provisions from the AAB’s calculations but left the rest of the AAB’s determination intact.

On appeal, the County of Santa Cruz argues that (1) the cable operators did not exhaust their administrative remedies; (2) the rate protection provisions were not enforceable restrictions but “in kind” payments; and (3) the trial court erred in failing to remand the matter to the AAB.

We will conclude that (1) the exhaustion requirement was satisfied; (2) the rate protection provisions were enforceable restrictions; (3) the trial court did not err in failing to remand the matter to the AAB. Accordingly, we will affirm the judgment.

Factual Background

This case concerns the cable television system serving the Cities of…