San Marcos Water District v. San Marcos Unified School District

It is not entirely clear to me—nor was it to the Court of Appeal—why a fee which is based upon an estimate of prospective use is a “special assessment” rather than a “user fee” because its purpose is to fund capital improvement. I agree with the majority, however, that we should defer to the now well-established precedent to that effect *169 and invite the Legislature, if it sees fit, to establish a different rule. On that basis, I concur.

Bird, C. J., concurred.

Respondent’s petition for a rehearing was denied August 28, 1986.

I. Introduction

Are utility fees for capital funding “special assessments” from which public entities are exempt, or “user fees” which public entities must pay? This case presents the question whether the San Marcos Unified School District (school district) is obligated to pay “sewer capacity right fees” (capacity fees) imposed by the San Marcos Water District (water district). The capacity fees are used by the water district to fund capital improvements. The school district argues that the capacity fee is a special assessment, and that school districts and other public entities are impliedly exempt from paying special assessments unless the Legislature directs otherwise. The water district argues that the capacity fee is not a special assessment, but *158 is a user charge which all utility users must pay. In the alternative, the water district argues that even if we hold that the capacity fee is a special assessment, it is legislatively authorized by either the Education Code or the Water Code. Finally, the water district maintains that the school district should be required by its water use contract or by the doctrine of promissory estoppel to pay the capacity fees…