Bixel Associates v. City of Los Angeles

In Bixel Associates v. City of Los Angeles (1989) 216 Cal. App. 3d 1208, plaintiff Bixel developed the Transpacific Center in the City of Los Angeles. As a condition of the issuance of a building permit, Bixel's predecessor in interest paid defendant City a $ 135,000 fire hydrant fee under protest. To arrive at the fee, the City multiplied the value of the new construction by .022 percent. The City derived that percentage by dividing the 1983 cost for fire hydrant and water main improvements by the total value of work authorized by City building permits from 1982 to 1984. In discovery, Bixel learned the City Fire Department and Department of Water and Power had determined that Bixel's new construction would require two new hydrants at a cost of $ 16,800. Bixel later learned the Fire Department had recommended the upgrading of an existing water main to properly service and protect the Transpacific Center at a cost of $ 994,000. Bixel also learned the City had no precise plan to upgrade the main, that the 97-year-old existing main would be replaced by a main of the same size, and that the existing main should have been replaced decades earlier. Bixel sued for a refund of the hydrant fee and the superior court awarded summary judgment to the City. The Second District Court of Appeal reversed, holding the record did not establish that the method used to determine the fire hydrant fee bore a fair and reasonable relation to the developer's benefit from the fee. More specifically, the court held the record did not establish that the .022 percentage figure reflected the cost of new development. Moreover, the hydrant fee ordinances did not contain language limiting the use of the fees to solely those installations and repairs necessitated by new development. Since the ordinances did not contain language embodying the required constitutional safeguards for a valid development fee, the trial court should have awarded summary judgment to plaintiff Bixel as a matter of law.