4DCA Division 2 Oral Argument 2025/10/07 Morning Session First Case only: E081996 - Oct 07, 2025

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4DCA Division 2 Oral Argument 2025/10/07 Morning Session First Case only: E081996

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What is the purpose of the Howard Jarvis Taxpayers oral argument and who are the parties involved?

Manuel Ramirez 0:12
Please be seated. Good morning. Welcome. It's always a pleasure and indeed an honor to introduce my colleagues appearing before you. Seated on my right is Justice McKinster. Good morning, everyone.
Josh Stambaugh 0:27
Seated on your
Manuel Ramirez 0:28
right, my left, is Justice Raffel. Good morning. My name is Manuel Ramirez, and I will preside over a few of these cases this morning. So with that, let's go ahead and get started. It is a lengthy calendar that we have before us. Let's have counsel in case number one, the Howard Jarvis Taxpayers Case. Step forward, please. It is case number one. And we need the appearances for the record with the spelling, please, of the last name.
Michael Colantuno 0:57
Yes. Good morning, Your Honor. Michael Colantuno, C-O-L-A-N-T-U-O-N-O, appearing for appellant, Coachella Valley Water District.
Manuel Ramirez 1:06
And that's pronounced Colantuno. It is,
Josh Stambaugh 1:08
sir. Thank you. Good morning, Your Honors. Josh Stambaugh on behalf of the plaintiff, respondent, and cross-appellant, Howard Jarvis Taxpayers Association. Also on the line today is Jeffrey Costell, C-O-S-T-E-L-L, on behalf of the plaintiff.
Manuel Ramirez 1:25
And I assume he is just online for purposes of hearing oral argument but not participating. But if he is, you've decided to split the time with him.
Josh Stambaugh 1:33
I'll be handling the argument this morning. You will be
Manuel Ramirez 1:35
handling the argument. I did want to address, and I invite my colleagues to respond or jump in as well, to the footnote on the asterisk footnote and the publication issue. So there's a little bit of confusion on that. We're going to go ahead and correct it so we have the proper sections that are identified for publication. However, both councils may argue that the entire case needs to be published, or
Josh Stambaugh 2:02
you
Manuel Ramirez 2:02
may argue that none of it needs to be published. And you can take it anywhere you want from there. But we would like to hear comments that you may have, regardless of what it is, whether or not we need to publish it or not. So with that, Mr. Colantuno, you're welcome to get started.
Michael Colantuno 2:21
Thank you. And I would like to reserve three minutes for Buttle, if I might. Thank you. One sort of housekeeping item. The tentative observes appropriately at footnotes five that the parties stipulated that fiscal year 23 rates would be governed by the outcome of the litigation of fiscal year 22 rates because they were the same rates made on essentially the same record. So it was never really litigated. So the two places in which the opinion appears to question the absence of data about fiscal year 2023 might not be necessary. And those are at page 20 and also at footnote 15. A preliminary point, you have the good fortune, I suppose, of having a recent Supreme Court decision on all fours with respect to the standard of review, both procedural and substantive, and that, of course, is the Ventura v. United Water Conservation District case.
Michael Colantuno 3:14
I just want to remind myself, as well as the court, before I dive into the hydrogeology of this case, what we're looking for. In pursuing a constitutionally and statutorily mandated water conservation program, cost allocations for services provided are to be judged by a standard of reasonableness with some flexibility permitted to account for system-wide complexity. And that's within your opinion at page 1213. So we're not looking for perfection or precision. We're looking for reasonableness.

How does counsel address the publication footnote and the need to correct the record?

Michael Colantuno 3:46
And the reason for that, of course, is that the language that Prop 26 uses is that we have to show that the apportionment of the cost among the payers is fair or reasonable. One or the other, not both. So there is a degree of flexibility that's intended. And then one point I'd like to clear up before I get into the hydrogeology, which I think really is the heart of the case, is I think we failed to explain well what we mean when we say that the fact that it is admitted that we subsidize rates below the cost of service for all pumpers in both basins is dispositive of both prongs of the Prop 26 test. It's agreed, and the opinion says that we're not exceeding total cost, but why do I deduce from the fact of subsidies that we're achieving the proportionality requirement as well?

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