State Water Rights Fees Ruled Illegal

Disputed fees charged to California water rights holders are invalid, a judge’s proposed decision says, because insufficient connection exists between the amount charged, benefits received and burdens imposed on those who pay the bill.
In his proposed decision, Sacramento County Superior Court Judge Raymond Cadei said that the State Water Resources Control Board should not “apply or enforce” the fee, which it has imposed for nearly 10 years.
UNFAIR BURDEN ALLEGED
The California Farm Bureau Federation, Northern California Water Association and other plaintiffs challenged the fee as an unconstitutional tax, because those who pay the fee have been bearing a disproportionate burden of funding the water board’s Division of Water Rights.
Judge Cadei agreed, noting that “no fees are assessed against the holders of approximately 38% of all water rights in California.” He said the fees pay more than a minimal amount “for activities that benefit the public in general.”
He said the fees “do not provide a fair, reasonable, and substantially proportionate assessment of all costs related to the regulation of the affected payors.”
The State Supreme Court had ruled previously that the State Board could impose a fee. The recent decision was about fee allocation.
INJUNCTION
An injunction was entered by the judge, leaving the State Board to sort out what to do to continue receiving revenue upon which the Division of Water Rights has been depending since the state’s fiscal crisis began.
No decision has yet been made on possible refunds to water rights holders.
Judge Cadei also ruled the State Board erred by charging water contractors in the Central Valley Project for the full amount of the federal project’s water permit, rather than the proportion of that water actually made available under CVP contracts, and that the board had charged “arbitrary” fees to other permit holders.
Many state water rights holders have been routinely paying the bills under protest.