Now that the unpopular Fire Prevention Fee that collected $560 million for the state over the past six years has been temporarily halted, Senator Tom Berryhill has introduced SB 1044, that if enacted, would provide refunds from the state to all property owners that have paid the fees.
The annual Fire Prevention Fee bills were first mailed to more than 850,000 rural Californians in 2012. About 17,000 of the bills have been sent to Eastern Madera County residents that generated about $2 million since the bills were first sent.
The fee, $117.33 - $150 a year for habitable structures, was paid by property owners who fall under the mostly rural “State Responsibility Area,” or SRA, that includes much of the Mountain Area including Oakhurst, Bass Lake and North Fork.
The fee was designed for statewide fire prevention activities, such as clearing vegetation and inspecting defensible spaces or homes, along with other programs.
According to Cal Fire, the SRA fee provides grant opportunities for cooperators within Madera and Mariposa counties; $1.7 million has been awarded in Mariposa County and $923,548 has been awarded in Eastern Madera County, since 2014.
Grant projects include: Firewise Communities Evacuation Routes, Cascadel Tree Removal, North Fork Biomass Disposal Facility, reducing threats via removal of downed dead trees for Mariposa County, Mariposa Countywide Chipping of Hazardous Fuels Program, Hazard Reduction Lake Shore Park and Hazardous Fuels Removal along non-county maintained roads.
Last year the legislature passed Assembly Bill 398, which reformed and extended California’s Cap and Trade program by reducing taxes, fees and regulations by $16 billion over the next decade. The extended and reformed version of Cap and Trade will provide California with clean air while minimizing compliance costs for various industries across the state. One of the benefits of the reformed measure was the suspension of the fire fee.
Projects and programs that were previously funded with the “Fire Fee” or “SRA Fee” will now be funded by the Green House Gas Reduction Fund until 2031. The suspension of this fee will provide relief for those who previously paid the annual fee until the program expires in 2031. At that time, it will be up to the Legislature to address the Cap and Trade program, as well as the Fire Fee.
“Since 2012, the state has collected hundreds of millions of dollars in taxes without meeting the requisite two-thirds vote threshold required for all taxes, per the California Constitution, under the guise of a “fee,” Berryhill said in a prepared statement. “Pursuant to Proposition 26, this new “fee” should have been deemed a tax requiring a 2/3 vote because it supports general purpose programs such as public education, fuels management on public land, and the open-ended “other prevention projects.”
The Howard Jarvis Taxpayers Association’s first attempt to have those funds returned to property owners has been denied by a judge and the association filed an appeal on March 1.
Berryhill said that while the courts have yet to confirm the unconstitutionality of this tax, the California Constitution is quite clear on the difference between a tax and a fee.
“Special taxes are like general taxes except that they are levied for a designated purpose upon all property within a certain district. The fact that some property benefits more than other property does not prevent the levy from being a tax. Furthermore, for years the tax revenue has been used in ways that do not benefit the homeowners paying the tax, which is inconsistent with Prop 26 (2010).”
And while the tax was suspended through 2030, and then repealed at the beginning of 2031, Berryhill said there is nothing stopping future legislatures from revoking the suspension.
One of the most outspoken opponents of the Fire Fee was a man who worked for the state agency that collected the funds - George Runner, an elected member of the state Board of Equalization, serving as the board’s vice chairman.
Back in 2015, Runner called the original fee a scheme that Gov. Brown came up with after diverting about $90 million in fire prevention funds to help ‘balance’ the state budget.
“Protecting Californians shouldn’t require new taxes or fees - public safety should be first, not last, in line for spending existing public dollars,” Runner once said. “If the state’s emergency readiness lacks adequate funding, California needs to be a better job of prioritizing the more than $100 billion in taxes that taxpayers are currently sending to Sacramento every year.”
Runner has mixed feelings about the passage of AB 398, the temporarily halts the fee.
“This seeming victory for California taxpayers is bittersweet. A suspension falls short of a full repeal, and it fails to provide refunds to homeowners who were forced to pay this illegal tax,” said Runner. “It’s never too late to do the right thing - Give us our money back.”
Berryhill’s SB 1044 would not only repeal the tax officially, effective Jan. 1, 2019, but it would also task the California Department of Tax and Fee Administration to develop and implement a process for providing for refunds of any fire prevention fees collected by the department, commencing in the 2011-2012 fiscal year until July 1, 2017.
“Passing Senate Bill 1044 will be an uphill battle, even though the state has a large budget surplus,” said the association’s Director of Legal Affairs Timothy A. Bittle. “We encourage people to contact your State Senator and your Assembly member urging them to vote yes on SB 1044.”
SB 1044 has been referred to the Senate Governance & Finance Committee, but has not been assigned a committee hearing date yet.
If enacted, the California Department of Tax and Fee Administration would have until Jan. 1, 2020 to develop and implement the system for providing refunds to individuals. But the bill would need to go through Senate Governance & Finance, then to Senate Appropriations, and the Senate Floor, before going through a similar process in the Assembly. However.
A spokesman for Berryhill said SB 1044 could possibly complete the legislative process before August at the very earliest.
The intent of the bill is to provide refunds regardless of the request/protest by an individual.
Like Berryhill and Runner, Madera County District 5 Supervisor Tom Wheeler has been opposed to the fee from day one.
“If the state was going to do this, it should have been for everyone in the state, not just the 800,000 people in the foothills,” Wheeler said. “ I thought it was smart that the Howard Jarvis group sued the state on behalf of this unfair burden given strictly to foothill residents five years ago. I hope that they appeal the judges decision and that the legislators do not bring it back after the five year reprieve. Wheeler said he also supports Berryhill’s senate bill to refund all the fees to the property owners who have paid into the fund. In the meantime, I am glad that the state has temporarily suspended collection.”