Rock Creek Water District v. County of Calaveras

CARTER, J.

Plaintiff, Rock Creek Water District, recovered judgment against defendant Calaveras County for taxes paid under protest.

Plaintiff is a public agency organized in April, 1941, under the California Water District Act (Stats. 1913, p. 815; 3 DBering’s Gen. Laws, Act 9125), and embraces territory lying wholly within Stanislaus County, the some 1,800 acres being owned by four persons. Plaintiff owns property situated in defendant taxing county consisting of a dam, reservoir, water rights and easements for ditches, canals and pipe lines. Defendant levied a property tax on that property which plaintiff paid under protest.

Plaintiff claims its property is exempt from taxation under section 1 of article XIII of the Constitution of California. After providing that all property is subject to taxation the Constitution declares that: “further provided, that property ... [1] such as may belong to this State or to any county, city and county, or municipal corporation within this State shall be exempt from taxation, [2] except such lands and the improvements thereon located outside of the county, city and county or municipal corporation owning the same as were subject to taxation at -the time of the acquisition of the same by said county, city and county, or municipal corporation; provided, that no improvements of any character whatever constructed by any county, city and county, or municipal corporation shall be subject to taxation.’’ (The clauses are numbered for convenience in reference.) (Cal. Const., art. XIII, § 1.) Plaintiff urges that it falls within clause 1 and its property is thus exempt whereas defendant asserts that plaintiff

[9]

falls within clause 2 and hence the property is excluded from the exemption.

Plaintiff district’s chief function, like irrigation districts, is to supply water for irrigation to landowners within its boundaries. It operates substantially the same as an irrigation district under the California Irrigation District Law (Water Code, §§20500 et seq.).

It is quite apparent that in order for plaintiff to benefit by clause 1 the property owned by it in defendant county must either belong to the state or plaintiff must be classified as a municipal corporation. It is not claimed by either defendant or plaintiff that the latter is a county or city and county, and it is conceded that the property in question was acquired from a public utility supplying water to the persons who formed plaintiff district and was subject to taxation at the time of its acquisition. If the property held by plaintiff belongs to the state it is clearly exempt and the second clause does not exclude it from the exemption. Likewise if it is within the scope of the term “municipal corporation” as used in the first clause conferring the tax exemption, it is also embraced in that term as used in the second clause and hence its property which lies outside its territorial limits is subject to taxation.