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Business Taxes Law Guide—Revision 2024
Transactions and Use Tax Court Decisions
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Monterey Peninsula Taxpayers Association v. County of Monterey … (1992)
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The Imposition of a Sales Tax by the Monterey County Public Repair and Improvement Authority after Approval of the Tax by a Simple Majority of the Voters Violated Proposition 13
The Monterey Peninsula Taxpayers Association (MPTA) filed an action against the County of Monterey and the Monterey County Public Repair and Improvement Projects Authority challenging the validity of a sales tax that was approved by only a simple majority of the voters. MPTA claimed, among other things, that article XIII A, section 4 of the California Constitution, commonly known as Proposition 13, required that the tax be approved by two-thirds of the voters. The Authority was governed by four active members of the County Board of Supervisors. It was authorized to impose a sales tax increase and its purpose was to spend certain amounts of the new tax revenue on 27 specific improvement and repair projects throughout the County. The court of appeal concluded that the Authority was a "special district" and that stacking of several special projects was camouflage and did not suddenly convert a multi-specific-purpose tax into a "general tax" for "general governmental purposes." Therefore, the appellate court concluded that MPTA’s tax violated Proposition 13. Monterey Peninsula Taxpayers Assn. v. County of Monterey (1992) 8 Cal.App.4th 1520.