Bldg. Indus. Ass'n of the Bay Area v. City of San RamonAnnotate this Case
A developer sought approval from the City of San Ramon to build 48 townhouses on two parcels. Because an analysis showed that the cost to the city of providing services to the new development would exceed the revenue generated by the project, the city conditioned its approval on the developer providing a funding mechanism to cover the difference. Using California’s Mello-Roos Act, the developer petitioned the city to create a “community facilities district” and then, as landowner, voted to approve a tax within the district to raise the necessary revenue. Building Industry Association-Bay Area unsuccessfully challenged the validity of the tax. The court of appeal affirmed. The tax will provide “additional services” to meet increased demand for existing services resulting from the townhouse development and meets the requirements of the Mello-Roos Act; the tax is a special (and not a general) tax because it is imposed for specific purposes and not for general governmental purposes, and therefore meets the requirements of the California Constitution; and the property owners’ constitutional and statutory rights are not burdened by an ordinance explaining that the services funded by the special tax will not be provided by the city if the tax is repealed.