After Losing Water Fee Lawsuit, Homebuilders Plan Appeal
Three Fresno homebuilders are trying to prove the adage that water is for fighting and disprove another adage: You can’t fight City Hall.
A Fresno County Superior Court judge last month sided with the city of Fresno in a lawsuit over the implementation of water fees (also known as capacity fees) on new developments. Now, an attorney for the plaintiffs — Granville Homes, Wathen Castanos Peterson Homes and Lennar Homes — says they will appeal. That should take place in the next few weeks.
New Water Facilities Coming
In April 2017, the Fresno City Council voted unanimously to approve the capacity fees, approximately $4,200 per new home. The city is either building or planning to build two major water treatment facilities. The goal is to comply with state water regulations on reducing underground water pumping.
The two main projects are a new treatment plant in southeast Fresno that should be operational later this year and expanding the existing northeast facility.
The homebuilders sued, saying the charge for the water projects to new developments is unfairly high. They also argued that the city failed to specify how the fees would be spent.
Regarding linking a specific project to the fees, Judge James Petrucelli wrote, “Simply making a reference to future facilities without any actual plan or commitment is sufficient to satisfy the Mitigation Fee Act.”
The Mitigation Fee Act is a state law regulating how government agencies impose fees.
Petrucelli also sided with the city in its argument that funding the new water projects fairly benefits new developments.
“While the cost of the Southeast Water Treatment Facility should be shared by all of the City’s water customers, the cost of expanding the capacity of the Northeast Water Treatment Facility should be paid entirely by development because the expanded capacity was needed to cover the needs of new housing,” the judge wrote in his 39-page opinion.
John Kinsey, attorney for the homebuilders, said that the decision is bad for homebuyers.
“The fee significantly increases the cost of new homes in the City at a time when first-time homebuyers are having difficulty entering the market due to the statewide housing crisis,” Kinsey said an email to GV Wire. “We look forward to demonstrating on appeal that the City lacked the evidence to impose the fees solely on new development.”
The city did not respond to requests for comment.
The lawsuit continues to list The Building Industry Association of Fresno/Madera Counties as a plaintiff, even though the group dropped out.
Disclosure: Granville’s President/CEO Darius Assemi is the publisher of GV Wire.