Griffith v. City of Santa Cruz
2012 WL 2877573, 207 Cal. App. 4th 982, 143 Cal. Rptr. 3d 895 (2012)
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Rule of Law:
A municipal ordinance requiring annual inspections of residential rental properties and imposing fees to cover the program's costs is a valid exercise of a city's police power. Such an ordinance is not preempted by state law if it enforces existing standards, does not violate equal protection if rationally related to a legitimate government purpose, and its fees are permissible regulatory fees rather than unconstitutional taxes if they do not exceed the reasonable cost of the regulatory activity.
Facts:
- The City of Santa Cruz (City) found that the most egregious violations of health and safety codes, as well as problems from overcrowding, occurred in rental housing.
- In response, the City enacted Ordinance No. 2010-17, establishing a program for annual inspections of all residential rental dwelling units not occupied by the owner.
- The ordinance stipulated that inspectors must obtain consent from both the landlord and tenant before an inspection, or secure a warrant or other legal remedy to enter.
- An exception for warrantless entry was made for immediate inspections if an inspector has reasonable cause to believe a unit is so hazardous it poses an immediate threat to public health or safety.
- The City established a fee schedule to fund the program, including annual registration ($45/unit), inspection ($20/unit), and reinspection ($107/hour) fees.
- Harold Griffith, an owner of residential rental properties in the City, became subject to the ordinance's requirements and fees.
Procedural Posture:
- Harold Griffith (petitioner) filed a petition for writ of mandate and complaint for declaratory relief against the City of Santa Cruz (respondent) in the superior court.
- The superior court denied the petition, finding the ordinance was constitutional and not preempted by state law.
- Griffith (appellant) appealed the superior court's judgment to the California Court of Appeal, with the City of Santa Cruz as the respondent.
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Issue:
Does a city ordinance that mandates annual inspections of all residential rental properties and imposes associated fees violate state preemption doctrines, the constitutional rights to privacy and equal protection, or California's constitutional prohibitions on illegal taxes?
Opinions:
Majority - Premo, J.
No. The ordinance requiring annual inspections of residential rental properties and imposing related fees does not violate state preemption, constitutional rights to privacy and equal protection, or prohibitions on illegal taxes. The court reasoned that: 1) The ordinance is not preempted by the State Housing Law because it provides a method for enforcing existing state standards, rather than creating new or conflicting ones. 2) The ordinance does not violate the Fourth Amendment right to privacy because it explicitly requires tenant consent or a warrant for non-consensual entry, except in exigent circumstances, which is constitutionally permissible. Furthermore, the landlord (Griffith) lacks standing to assert the privacy rights of his tenants. 3) The ordinance does not violate the Equal Protection Clause because singling out rental properties for inspection passes the rational basis test. The City had a legitimate purpose in ensuring safe housing, and it could plausibly conclude that inspecting only rental properties—where it had observed the most egregious violations—was a rational and efficient way to achieve that goal. 4) The fees are not illegal taxes under Propositions 218 and 26. Under precedent, Proposition 218 does not apply to fees imposed on the business activity of renting, as opposed to property ownership itself. The fees are also expressly exempt from Proposition 26's expanded definition of a 'tax' because they are charges for the reasonable regulatory costs of performing inspections, and the City provided evidence that the fee revenue was reasonably proportional to the costs of running the program.
Analysis:
This decision solidifies the authority of California charter cities to implement proactive rental housing inspection programs as a valid exercise of their police powers to protect public health and safety. It provides a clear legal framework for municipalities to structure such ordinances to withstand common legal challenges. The case clarifies that focusing on enforcement of existing state standards avoids preemption issues and that distinguishing between rental and owner-occupied properties is permissible under rational basis review. Finally, it reinforces the principle that fees are valid regulatory charges, not taxes, so long as they are reasonably calculated to cover the costs of the government program they fund.
