Venice Residents File Suit Against City of L.A. Over Venice Beach BID!! Arguments Underlying Petition Will Have Broad Progressive Implications If Successful

There’s no place on earth like Venice, so why shouldn’t the destruction of BIDs in California begin in Venice?
A couple weeks ago, a group of brave and determined residents of Venice filed a writ petition against the City of Los Angeles and the Venice Beach BID asking the court to set aside the ordinance that created it, to force the City to redraw the BID’s boundaries in accordance with the law, and, most interestingly, to order the City to contest the assessments levied against City-owned properties in the BID. You can read a copy of the initial petition:

  • Here — direct download
  • Or here — on the new dedicated page, also available through the menu structure above.
  • Or here — directly from static storage; see the titles better!

They argue that their residential properties will get no special benefits from the BID, which violates the California Constitution. They argue that many of the proposed activities of the BID, specifically the security program, are inherently incapable of providing special benefits. And most interestingly from the point of view of general anti-BID theory, they argue that the City has a duty to its citizens to scrutinize the BID plan to be sure that City-owned parcels included in the BID actually benefit from being in the BID, and that by rubber-stamping the BID proposal, the City has abdicated this duty. If this argument succeeds it will shake the very foundations of BIDs in Los Angeles, which rely to various extents on the automatic yes votes provided by City-owned property. This automatic approval, by the way, was set up in 19981 via Council File 96-1972 which, in pertinent part, includes a directive to:

REQUIRE the City Clerk to sign off on Proposition 218 ballots and support petitions for property-based BIDs, unless the Council directs otherwise.

Anyway, this is an exciting and welcome development, and all of us here at MK.Org thank the plaintiffs and their lawyers for filing this petition. There are a few excerpts that caught my eye along with my usual uninformed and amateur commentaries after the break if you’re interested.

Safety, while a laudable goal, is a quintessentially general benefit. Safety benefits all — the owners of properties situated in the District, the non-property-owning residents of the District and visitors to the District — in the same manner. Safety cannot be tied in a quantifiable manner to a particular property. Nor can the proportionate benefit of safety be calculated and assessed to a specific property, as Proposition 218 requires.

I think this is exactly right, and, additionally, a quite ingenious argument. However, I think it’s also doomed to fail, since the Legislature seems to have anticipated and vitiated it with Section 36601(h)(2) of the BID law, which states pretty clearly that:

Activities undertaken for the purpose of conferring special benefits upon property to be assessed inherently produce incidental or collateral effects that benefit property or persons not assessed. Therefore, for special benefits to exist as a separate and distinct category from general benefits, the incidental or collateral effects of those special benefits are inherently part of those special benefits. The mere fact that special benefits produce incidental or collateral effects that benefit property or persons not assessed does not convert any portion of those special benefits or their incidental or collateral effects into general benefits.

But I’m not a lawyer. I could well be wrong. In this case, I really really want to be wrong. We’ll see.

The “District Identity & Special Projects” accounts for seven percent of the annual budget. This initiative is aimed at promoting the neighborhood as an appealing place to shop, dine and do business through newsletters and media relations. The Plan acknowledges that “some government owned/occupied parcels and facilities will not specially benefit from this program element and thus, shall not be assessed for these programs.” That same rationale applies with equal force to any non-commercial parcel, including residential properties (however zoned). Under the Plan, each property owner would be assessed for this commercial enterprise, even if the property is being used for non-commercial purposes.

I think this is right, and I don’t see any reason why it shouldn’t succeed.2 The issue is that the law allowing BID creation says explicitly that properties that are zoned residential are conclusively presumed not to benefit from BID activities. The theory of the City and of the BID proponents, is that this statement somehow means that properties which are zoned commercial but used for residential purposes only, are required to be assessed. This seems exactly backwards. In other words, that it’s zoning rather than use that determines whether or not a parcel receives a benefit. Even if this has been the practice, it doesn’t seem possible that it’s actually correct. The Legislature must be basing its reasoning on the use of the property, since that’s what the constitutional requirements about special benefits rely on.

When they say that residential zoning implies conclusively that there’s no benefit, the only way that this can make sense is it’s possible to argue that properties that are zoned commercial but used residentially don’t get a benefit and are therefore exempt from assessment. It’s not surprising that everyone on the BID formation side lies about this. For instance, here is an email from Tara Devine to William Kuel, another property owner with residential property assessed in the BID.3 She tells him explicitly that it’s zoning rather than use that determines assessment. As the plaintiffs argue here, though, this can’t actually be true. What’s more, Tara Devine either knows it’s not true or else she’s not competent to be a BID consultant.4

And finally, and most interesting as far as future implications, we have this lovely bit of argument:

The City has a duty to its taxpayers to evaluate whether the proposed Venice BID will actually confer any special benefits on the City-owned properties. It appears, however, that the City has abdicated this responsibility. The City simply rubber-stamps its approval of whatever the Venice BID proponents put in front of them. The City has done nothing to evaluate whether the proposed Venice BID provides any special benefits to the taxpayer-owned properties. If it had, the City would have reached the conclusion that they will be wasting taxpayer money on the services that the Venice BID proposes to provide to the City-owned properties.

The City also violated the law and abused its discretion when it agreed to pay assessments on the City-owned properties. Its payment of these assessments is a waste of taxpayer resources. The City abdicated its responsibility to scrutinize the assessments proposed in the Venice BID Management District Plan and simply rubber-stamped its approval.

This also seems right to me, and there seems to be no reason why this argument shouldn’t prevail. Unlike, e.g., the plaintiffs’ argument against BID security in general, this weird rubber-stamping policy seems to be a Los Angeles exclusive.5 Thus there’s much more of a chance that it’s wrong, or at least that a judge will be willing to put a stop to it. Voiding this L.A. policy isn’t going to cause statewide chaos or make bunches of people outside of the court’s jurisdiction revise their plans and change their lives around. This is a purely local matter and therefore it seems that a County judge will feel more willing to consider the matter fairly. If the plaintiffs prevail on this issue, even if on nothing else, they will have irrevocably changed our City for the better. We’ll see what happens!

Image of Venice walk street is released by its creator, Giuseppe Milo, under the CC By-NC 2.0 and is available from his Flickr stream.

  1. We reported on this in September.
  2. Don’t ever forget that I don’t actually know what I’m talking about when it comes to legal matters.
  3. She actually tells him that neither she nor the engineer have the power to remove his property. According to her, it’s a fait accompli and he should just suck it up. This is also a lie. Anyone who’s been following the process knows that no one reads the engineer’s report, that everyone involved just makes up whatever they want and there’s no oversight, and they could certainly put properties in or out, or at least determine that there’s no special benefit for them and so even if they’re in the BID they don’t get assessed. But anyway…
  4. Or, of course, both.
  5. I don’t know for sure that this is true, but whether or not it’s true, it’s certainly the case that state law absolutely does not require a municipal BID rubber-stamping process.

2 thoughts on “Venice Residents File Suit Against City of L.A. Over Venice Beach BID!! Arguments Underlying Petition Will Have Broad Progressive Implications If Successful”

  1. Michael,
    Bravo for announcing this. I and a few others have agreed to be a plaintiffs in this lawsuit which I do gladly. We still are up against a wall in that the lawyers will want up to $75,000.00 to see the case through. Many of us are exhausted taking it this far. Howard Jarvis supports us but they are short handed and in several suits pending. They are willing to advise but that’s about all. They say we have a very strong case. So it comes down to money as usual. Two solutions would be fund raising and or a pro bono team to fight this which would take an estimated year of court actions but could bring publicity and possibly credibility to the justice system.

    1. John, thanks to you and your compatriots for pushing this issue. If you do end up fundraising, we will be happy to promote your efforts here, for what it’s worth. You all are doing this City a great service by not backing down.

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