By KEVIN McCALLUM
THE PRESS DEMOCRAT
Santa Rosa will not appeal the ruling of a judge who found a special city property tax on new homes unconstitutional.
City Attorney Caroline Fowler announced Tuesday that the City Council met in closed session and voted 7-0 to give up the legal fight. The city will scrap the 2008 ordinance and draft another that will address the legal concerns raised by the judge, Fowler said.
Paul Beard, the attorney for the builders, applauded the move. “Santa Rosa property owners who want to build can now rest assured that their voting rights will be respected,” he wrote in an e-mail.
The city in 2008 passed a tax surcharge on most new home construction in Santa Rosa as a way to pay for the additional cost of public services, particularly police and fire protection. It was put forward at a time of plunging city revenues, severe budget cuts and layoffs.
The Homebuilders Association of Northern California sued, claiming the law unfairly forced property owners to give up their voting rights in exchange for the right to subdivide their property.
Sonoma County Superior Court Judge Mark Tansil agreed, saying the law “unfairly tampers with the elective process” by forcing a property owner to vote to annex their property into a special district if they want to develop it.
The cost was to be passed on to new home buyers with an annual surcharge of $430 for new homes and $310 for units in multifamily buildings.
Such tax revenues were to be set aside in the event the city lost the case and had to reimburse the money, but Fowler said she did not believe the city had collected any of special taxes that would need to be repaid.
“It should not have any direct financial impact to the city,” Fowler said.
The new ordinance will be drafted in such a way that property owners seeking the right to subdivide land have options for how to pay the impact fees, instead of requiring them to vote to annex their property into the special taxing district, Fowler said.