Golden State Water Co. v. Casitas Municipal Water District

Residents of Ojai, fed up with sky-high water bills, voted to oust appellant Golden State Water Company (Golden State), the private utility that held a monopoly of water service to their city, and replace it with respondent Casitas Municipal Water District (Casitas), a municipal utility that they hoped would be more responsive to their concerns. They planned to finance this transaction by selling bonds pursuant to the Mello-Roos Community Facilities Act of 1982 (Mello-Roos Act or Act) (Gov. Code, § 53311 et seq.).

Golden State was unwilling to sell its business. Casitas therefore planned to acquire the assets by eminent domain. Golden State contends that the Mello-Roos Act cannot be used to finance eminent domain actions or to acquire intangible property. We disagree. The Act facilitates the purchase of property regardless of whether the seller consents to the sale or is compelled under force of law. Moreover, financing the acquisition of intangible property incidental to the real or tangible property being purchased is consistent with the Act’s text and purpose. Accordingly, we affirm.

FACTS AND PROCEDURAL HISTORY

Casitas is a publicly owned water utility encompassing…