Legislature repeals illegal tax after Farm Bureau stands up for rural California; Judge's ruling bolsters Farm Bureau position
» July 29, 2004 «
Under legislative and legal pressure from farmers and ranchers, the state Senate today joined the Assembly in repealing an illegal tax, saving taxpayers who live in rural communities an estimated $105 million. At the same time, a judge's tentative ruling upheld the California Farm Bureau Federation's right to proceed with its lawsuit against the tax.
The Farm Bureau challenged the so-called "benefit fee" in court, on grounds that it represented an illegally imposed property tax.
The Senate vote gave final legislative approval to a measure that repeals the tax, which was imposed in 2003.
"We expect that Governor Schwarzenegger will sign the bill and thereby grant immediate tax relief to rural California," California Farm Bureau President Bill Pauli said. "We consistently made the case, before the courts and the Legislature, that this tax is illegal and would cause hardship for rural Californians."
The law to be repealed required a flat "fee" on each real-property parcel located in State Responsibility Areas, an assessment that would have added a new, $105 million tax burden on rural landowners. The Farm Bureau says the levy is actually a property tax and was imposed illegally.
"This illegal tax was rushed through the Legislature last year and hastily signed into law by Governor Davis in the closing days of his administration," Pauli said. "The repeal is just one example of how Governor Schwarzenegger's presence has changed the 'business-as-usual' atmosphere that once prevailed in the state Capitol."
As the Senate was voting on the repeal legislation today, a Sacramento Superior Court judge issued a tentative ruling that upheld the Farm Bureau's right to proceed with its lawsuit.
"We have no doubt that our court action encouraged legislative leaders to revisit the issue," Pauli said. "Assembly Republicans and their leader, Kevin McCarthy, played a crucial role in pursuing the repeal."
McCarthy, in turn, cited the Farm Bureau lawsuit as instrumental in resolving the issue.
"The Farm Bureau lawsuit highlighted the injustice of last year's legislation that subjected rural communities to this illegal tax," said McCarthy, R-Bakersfield. "The Farm Bureau's suit and arguments gave us what we needed to get the job done."
"This is an important battle for Farm Bureau members and all rural Californians," Pauli said. "This tax is not only illegal, it is unfair. Rural California should not have been asked to subsidize the Davis budget deficit, especially when its communities endure some of the highest unemployment rates in the state."
The State Responsibility Area tax was imposed to cover purported "fire suppression costs" on 31 million acres of rural land, or nearly one-third of the total land area in California. Last year's legislation to impose the new tax drew opposition from groups such as the California Fire Chiefs Association and the Regional Council of Rural Counties, as well as the Farm Bureau.
In its court case, the Farm Bureau said the tax was imposed illegally because it did not achieve the two-thirds vote required under the state Constitution
"Farm Bureau took the lead in this fight because we could not allow this injustice to be perpetrated on rural communities," Pauli said. "Repeal of the tax means that more money will stay in our local communities."
The California Farm Bureau Federation is the state's largest farm organization, representing more than 89,000 members statewide.
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