CITIZENS FOR FAIR REU RATES v. CITY OF REDDINGAmicus Curiae Brief of California Municipal Utilities AssociationCal.August 27, 2015SUPREME COURT COPY IN THE SUPREME COURT OF THE STATE OF CALIFORNIA No. 8224779 CITIZENS FOR FAIR REU RATES,et al. SUPREME COURT Plaintiffs and Appellants, a ie ce S: V. | AUG 27 2015 CITY OF REDDING,etal. ; we Defendants and Respondents Frank A. Mct3uire Clerk Deputy” APPLICATION FOR LEAVE TO FILE AMICUS CURIAE BRIEF AND PROPOSED AMICUS CURIAE BRIEF OF THE CALIFORNIA MUNICIPAL UTILITIES ASSOCIATION IN SUPPORT OF DEFENDANTS AND RESPONDENTSTHE CITY OF REDDING Review of a Published Decision ofthe Third Appellate District, Case No. C071906 Reversing a Judgmentofthe Superior Court of the State of California for the County of Shasta, Case No. 171377 (Consolidated with Case No. 172960) Honorable William D. Gallagher, Judge Presiding C. ANTHONY BRAUN (Bar No. 176113) JUSTIN C. WYNNE(Bar No. 251377) DANIEL E. GRIFFITHS(Bar No. 300923) Braun Blaising McLaughlin & Smith, P.C. 915 L Street, Suite No. 1270 Sacramento, CA 95814 Telephone: (916) 326-5812 Fax: (916) 441-0468 Attorneys for the Amicus California Municipal Utilities Association APPLICATION FOR LEAVE TO FILE AMICUS CURIAE BRIEF The California Municipal Utilities Association (“CMUA”)! requests leaveto file a brief as amicus curiae in this case in support of Respondents, “the City of Redding,et al., pursuant to the California Rules of Court, Rule 8.520(f). . INTEREST OF AMICUS Formed in 1933, CMUArepresents the commoninterests of a coalition of California publicly ownedutilities and provides a forum to develop and discuss statewide policy issues affecting its members. CMUA's diverse membership allowsit to be a persuasive advocate for the advancement ofpublic policies that mutually benefit its members and the people ofthe State of California. CMUA advocates on behalf ofits members by fostering a better understanding of issues relevant to the " CMUAelectric utility members include the Cities ofAlameda, Azusa, Banning, Burbank, Cerritos, Colton, Corona, Glendale, Gridley, Healdsburg, Lodi, Lompoc, Los Angeles, Moreno Valley, Needles, Palo. Alto, Pasadena, Pittsburg, Rancho Cucamonga, Redding, Riverside, Roseville, Santa Clara, Shasta Lake, Ukiah, and Vernon, as well as the Imperial, Merced, Modesto, and Turlock Irrigation Districts, the Northern California Power Agency, Southern California Public Power Authority, ‘Transmission AgencyofNorthern California, Lassen MunicipalUtility District, Power and Water Resources Pooling Authority, Sacramento Municipal Utility District, the Trinity and Truckee Donner Public Utility Districts, and the City and County of San Francisco, Hetch-Hetchy. li se ee ce it ia ns s g t M s State’s publicly ownedutilities and disseminating accurate information regardingits members, whichinclude public agencies that provide electricity to approximately 25 percent of Californians. Many of CMUA’s members are cities that operate electricutilities, similar to Redding. Aselectric utilities are often one-of the largest undertakings operating within a city, these local governments would otherwise collect significant tax revenue if a privately ownedutility (commonly referred to as an “investor-ownedutility”) served the city’s residents, businesses, and property owners. These funds are instrumental to provide other municipal services that are necessary to support the operation of an electric utility, such as streets, law enforcement, fire protection, and emergency medical services. To addressthis disparity in funding capacity betweencities served by investor-owned utilities and those whosevoters have chosen public powerutilities, CMUA’s city members commonly rely on an operating transfer or a paymentin lieu of taxes (“PILOT”’)to the city’s general fund (which finances essential municipal services), which may approximate the revenuethat investor-ownedutilities pay to their host cities and collect unrecoveredcosts the host city incurs as consequence of hostingtheutility. This case is of significant importance to CMUAandits members becausethe positions advocated by Appellants, Citizens for Fair REU Rates, Mr. Michael Schmitz, Ms. Shirlyn Pappas, and Fee Fighter, LLC lil (collectively, “Citizens”), would conflict with Proposition 26 and decades- long legally accepted financial practices of several cities with electric utilities. Citizens’ position would inject greater uncertainty into municipal finances and may substantially impair municipal operations by depriving cities of necessary funding to support suchutilities, which provide reliable, safe, and affordable power without the necessity ofpaying returns to private investors. Beyond the impact to PILOTs,failing to grandfather pre- Proposition 26 policies based on the form ofthe legislation enacting them would disrupt the electric industry. CMUAtherefore requests leave to file this amicus brief in support ofRedding. No party other than CMUAandits counsel authored the proposed amicus brief in whole or in part or made a monetary contributionto its preparation or submission. iv No. 8224779 IN THE SUPREME COURT OF THE STATE OF CALIFORNIA CITIZENS FOR FAIR REU RATES,etal. Plaintiffs and Appellants, Vv. CITY OF REDDING,etal. Defendants and Respondents PROPOSED AMICUS CURIAE BRIEF OF THE CALIFORNIA MUNICIPAL UTILITIES ASSOCIATION IN SUPPORT OF DEFENDANTS AND RESPONDENTSTHE CITY OF REDDING Review of a Published Decision of the Third Appellate District, Case No. C071906 Reversing a Judgmentofthe Superior Court of the State of California for the County of Shasta, Case No. 171377 (Consolidated with Case No. 172960) HonorableWilliam D. Gallagher, Judge Presiding C. ANTHONY BRAUN (BarNo. 176113) JUSTIN C. WYNNE (Bar No. 251377) DANIEL E. GRIFFITHS (Bar No. 300923) Braun Blaising McLaughlin & Smith, P.C. 915 L Street, Suite No. 1270 Sacramento, CA 95814 Telephone: (916) 326-5812 Fax: (916) 441-0468 Attorneys for the Amicus California Municipal Utilities Association TABLE OF CONTENTS INTRODUCTION.ooc.ccsccsscscsssesscssscsesssssscssssescsesesssesscavscacseresvereuscavsusisesscenes 1 ARGUMENT...000occcceeceeeeeesnseesssssessesssesscseeeseeusesssasssssenesoesaseseeeegans 1 I. TRANSFERS TO MUNICIPAL GENERAL FUNDS ARE A COMMONPART OF THE PUBLIC POWER INDUSTRY...eects ree eeeeeneeneaeeneeneeenenseessnneeneseeeenneateaey 1 Il. THE PILOT TRANSFER FROM REDDING’S ELECTRIC UTILITY TO THE CITY’S GENERAL FUND IS NOTA TAX BECAUSE THE PILOT PREDATES PROPOSITION QO... eecececccesssccesccsssesceseaessnecesseeecesceseecseseseseeseeesaeeseseatecssbarasesadenseeeetees6 Ill. THE PILOT TRANSFER FROM REDDING’S ELECTRIC UTILITY TO THE CITY’S GENERAL FUND REFLECTS REASONABLE COSTS OF SERVICE......0...eceeeeeeeee 10 CONCLUSION...ceccecescsceccneseaesesaeceaetaeseseesssesosseeesessensseeesesesassesveeeee 2 ii TABLE OF AUTHORITIES Cases AB Cellular LA, LLC v. City ofLos Angeles (2007) 150 Cal.App.4th 747. .0.0..0.cccccccccccccsceceeeneeseeceeseseensesesseseeneas 8 Barratt American, Inc. v. City ofRancho Cucamonga (2005) 37 Cal. 4th 685.00eeeceeeseceeseeeeeseseseeeessesaesensseesseeeges 9-10 Brooktrails Township Community Services Dist. v. Board ofSupervisors of Mendocino County (2013) 218 CalApp.4th 195.0eeeccsccseecesneceeersneeseseeecnaeseneesseeeesas7 Citizensfor Fair REURates v. City ofRedding (2015) 182 Cal.Rptr.3d 722.00... cccecccenesssecesecteeeeneeenseaeeeeeeesanes 10-11 City ofSan Diego v. Shapiro (2014) 228 Cal.App.4th 756.00... cccsccsccssncessescseesseeseseeresseeseaeeenatenss 9 Evangelatos v. Superior Court (1988) 44 Cal. 3d 1188 oooeecsecsneeceaereecnsseeseesseseenseeaseseasers7 S. Cal. Gas Co. v. Pub. Utilities Com. (1979) 23 Cal. 3d 470.00... cccccseeseesscssecssecsnceseseestesseeenecssecsacesseecseees 5-6 California Constitution Article XTII C, §1, subd. (€) ..... ceceeeeesceencceeseeeeeseeeeeeeeeeeesaeeseeeeneneesseaes 11 Article XIII D, §3, subd. (Db)...eeeeeeeceeseeeeeseeeeeeneeeseeeeseceseeeneetseneeeenees 12 il Statutes _ Cal. Gov. Code § 9605 caeccccccssssesssssssssecssssssssssssecssessssssesssecsssseesssessesseseesecessseeessessen 8-9 § 53750 cccsesssssseccessessecssssssssssssssssssssssensnssseverseeceveeseseceeeeesssnssssnsssssuessee9 § 66000 oescssccscssessseccssscsssssesesseeesssseseeessesseesessessssesssssssssssssesensnaneceesees9 _ Cal. Pub. Util. Code § 201 et SOQ..seseeesecceseecssessssssssessessseeseeseeeececcecetittntnnnnnsnssssessesesssseaseseel California Rules of Court Rule 8.520, subd.(f).............00 sosnesateeenesa esceeeeceessneesseesseeseesesesenseesscessasoes ii Other Sources American Public Power Association, Payments and Contributions by Public PowerDistribution Systems to State and Local Governments, 2012 Data, February, 2014.0... eeeesecesecssssseseseeseeccesecssscsaecensccsusscsesesessessecereseasvacenees2-3 Fitch Rating Service, Credit Rating Impact Analysis, February, QOS .sreessecsessseccsssssecsssessseesaessscssssessssaseseeeenesecaucsuesneeennecessaesaseesvessnsesneessseen4-5 Moody’s Investor Service, Rating Methodology: U.S. Public Power Electric Utilities with Generation Ownership Exposure, November, 201 1.0... .eecceecccccccsssccsssccsscssececeesssssseccccessseeessenaeesdeseeneessussens4.5 iv U b e B S D ot e t e t INTRODUCTION Atissue in this case is Redding’s longstanding practice of - transferring a specified PILOTfrom theelectric utility to the city. Appellants argue that the adoption ofProposition 26 in 2010 ended Redding’s power to do so. However, Redding’s Briefpersuasively demonstrates that: a) Redding’s PILOT chargeis not a tax as a matter of ‘law; b) Proposition 26’s “reasonable costs of service” exception applies to the PILOT; and c) Redding’s PILOT predates Proposition 26 as Proposition 26 does not apply retroactively to charges legislated before its adoption in November 2010. In this Brief, CMUA demonstrates that: (1) operating transfers and PILOTs are common elements of the publicly owned electric industry; (2) the PILOTis not a taxbecauseit predates Proposition 26; and (3) the PILOTreflects reasonable costs ofservice. | ARGUMENT I. TRANSFERS TO MUNICIPAL GENERAL FUNDS ARE A COMMONPART OF THE PUBLIC POWER INDUSTRY. In general, there are two broad models for providing retail electric service used in California: (1) through investor-ownedutilities subject to the requirements of the Public Utilities Act (Cal. Pub. Util. Code § 201 et seq.) and heavily regulated by the California Public Utilities Commission; or (2) through publicly ownedelectric utilities that are generally subject to less comprehensive statutory regulations and are instead regulated by their local elected officials. As private businesses, investor-ownedutilities are subject to various taxes, including property taxes and franchise fees (fees for the use ofpublic rights-of-way). These taxes and fees fund the wide variety of municipal services that enable a private business, such as an electric utility with a large and extensive economic footprint, to function. Where, however, an electric utility is owned and operated by acity, the utility is exempt from these taxes and fees. Despite this exemption,a city operating a power utility incurs the samecosts to support the operation ofan electric utility, as do neighboring communities served by investor-ownedutilities. Streets, police,fire, and other community services are neededfor public andprivate powerproviders alike. This reality has led to the near universal adoption of some form of transfer from a municipally ownedelectric utility to the host | city’s general fund in order to compensate the host city for these otherwise unrecoverable costs. This is true not only in California, but throughout the. United States. The American Public Power Association (“APPA”), the national trade association for municipally ownedelectric utilities — which includes California utilities — issues a report every two years on the size and types of these contributions. In 2014, APPA released a report titled, “Payments and Contributions by Public Power Distribution Systems to State and Local 2 Governments, 2012 Data,” as part of their 2014-15 Annual Directory and | Statistical Report (“APPA Report”). The APPA Report provides the results of a survey of 210 public power systems throughout the country. (/d. at 49). In 2012, the power systems surveyed provided over $1.0 billion to state and local governments. (/d. at 52). Eighty percent ofthe utilities surveyed paid some form oftransfer, which amounted to overfifty-five percent ($606,900,000) of the amount thoseutilities contributed to state and local governments. (Id.). There are a variety of industry-accepted methodsusedto calculate PILOTs. (ld. at 52- 53). Twenty-eight percent of utilities pay a PILOTcalculated as a percentage of gross electric operating revenue, seventeen percent pay flat amount(often termed an “operating transfer’), and thirteen percent pay a property tax equivalent like that in issue here. (/d. at 54). In addition to PILOTs,overfifty-five percent ofthese publicly owned and operated utilities paid some form oftax, such as grossreceipts taxes or property taxes, or franchise fees. (/d. at 53). | These transfers are thoroughly integrated in the municipally-owned electric industry. In 2011, Moody’s Investor Servicereleased its “Rating Methodology: U.S. Public Power Electric Utilities with Generation Ownership Exposure.” Moody’s methodology to rate the credit- worthiness ofAmerica’s public powerutilities is based on five factors: (1) cost recovery framework within service territory; (2). willingness to recover costs with sound financial metrics; (3) management of generation risk; (4) rate competitiveness; and (5) financial strength. (Jd. at 7) One of the key elements of Factor2 is the relationship between the publicly ownedelectric utility and the host local government, which Moody’s explains as follows: A key consideration in Factor 2 is the relationship of the local governmentto theelectric utility ... Moody’s believes an established GFT [General Fund Transfer] transfer policy thatis accepted by both the utility and the local government adds credit strength for both entities asit increases the predictability of.the transfer amount... (/d. at 9-10, emphasis added) Further, after the Third District Court ofAppeal’s opinion was released in this case, Fitch Ratings Service warnedof credit rating sensitivity that would arise as a consequenceofthese legal actions: Electric system transfers account for a significant amount of general fund inflows in a numberofother Californiacities including Glendale, Lodi, Los Angeles, Pasadena and Riverside. Fitch believes a trend of similar legal actionscould . * Moody’s Investor Service, Rating Methodology. U.S. Public Power Electric Utilities with Generation Ownership Exposure (Nov.9, 2011). 4 becomea rating sensitivity in the coming years for those cities.” The publications and opinions rendered by rating agencies such as Moody’s and Fitch Ratings Service affect the cost ofborrowing for public agencies. Therefore, substantial disruptions to established general fund transfer policies have the potential to interfere with the relationship between a local governmentandits electric utility, which could negatively impact both entities’ credit ratings and finances. Such an event puts upward pressure on the electric utility and host city to increase rates for electrical services in order to cover increased costs of bond issuance and other financing expenses. It is also relevant to note that when courts have analyzed the treatmentofstate taxes for investor ownedutilities, these same general types of charges are clearly considered a “cost of service,” which may be passed through to ratepayers via powerrates: Rates of a publicly regulated utility are based on two components: (1) the utility's operating expenses (cost of service), and (2) a fair return onits investment, whichis found by multiplying its authorized rate of return by the value > Fitch Ratings Wire, Ruling May Endanger Key Revenue Sourcefor Some CA Cities (Feb. 11, 2015), available at [last viewed Aug. 18, 2015]. 5 ofproperty devoted to public use (rate base). (See City and County ofSan Francisco v. Public Utilities Com. (1971) 6 Cal.3d 119, 129, 98 Cal.Rptr. 286, 490 P.2d 798 (hereafter City of San Francisco).) As taxes are part of a utility's cost of service, this expense is borne by the ratepayers.’ It is clear that PILOTs andothersimilar transfers to city general funds are an integral part of the electric industry. Restrictions on this ability could have wide-ranging impacts on city finances. If existing PILOTs were — eliminated or severely restricted, it could have the paradoxical impact of requiring municipal governments to either find alternative sources of revenue, accept a lower standard ofmunicipal services, or even abandon the municipal utility model. This option would create further economic dislocation since municipalutilities provide powerat lowerrates than _ investor-ownedutilities.” II. THE PILOT TRANSFER FROM REDDING’S ELECTRIC UTILITY TO THE CITY’S GENERAL FUND IS NOT A TAX BECAUSE THE PILOT PREDATES PROPOSITION 26 There can belittle argumentthat Proposition 26 is not retroactive with respect to local agencies and municipalities. “It is a widely recognized 4S Cal. GasCo. v. Pub. Utilities Com. (1979) 23 Cal. 3d 470, 474 (emphasis added). . > See, e g., IV AR,Tab 166, pp. 1074, 1080-1085 (portion of the record | showing Redding’s rate in comparison to PG&E’s rates). legal principle, specifically embodiedin section 3 of the Civil Code, that in the absenceofa clearlegislative intent to the contrary statutory enactments apply prospectively.” Evangelatos v. Superior Court (1988) 44 Cal.3d 1188, 1193-1194. A plain reading of Proposition 26 evidences that the sole retroactive application wasto the State. (See Brooktrails Township Community Services Dist. v. Board ofSupervisors ofMendocino County (2013) 218 Cal.App.4th 195, 205-06 [addressing Proposition 26 application].) There is also no question that the formula for adjusting the amount ofthe PILOTto bepaid in any given year waslast modified by Reddingin 2005, approximately 5 years prior to thepassage ofProposition 26. The question then becomes, whatspecific act or conduct on the part ofRedding occurred such that any protection it obtained due to the prospective nature of Proposition 26 somehow transmuted the otherwise valid PILOT charge into an unlawful tax? Citizens point to two actions by Redding that they allege increased or extended the PILOT for purposesoftriggering a review under Proposition 26: (a) Redding’s increase ofits electrical rates in December 2010; and/or (b) the adoption ofRedding’s budget in 2011. However, as discussed in detail below, these legislative acts neither extended nor increased the PILOT. Citizens provide no authority by which Redding’s increaseofits electrical rates in 2010 or its adoption ofits budget in 2011 would convert the PILOT post-Proposition 26 into a tax. Under AB Cellular LA, LLCv. City ofLos Angeles (2007) 150 Cal.App.4th 747, 755, a tax increase occurs under California Constitution Article XIII C if the methodology by which a tax is calculatedis revised. Aslong as a methodology is “frozen in time,” there is no tax increase. (See id. at 761-62). Since the underlying methodology for the PILOT has not been changed since 2005 the PILOT has not been increased underthis standard. Similarly, there was no “extension” ofRedding’s PILOT. Citizens havenot alleged that therewas a sunset provision ofthe PILOT for whichit could be extended by any action ofRedding, nor could it, as the PILOT itself has been in effect since 1988. As madeclear by the record, the express intent of the Redding City Council was to maintain the PILOTin its current form — there wasnoact made on behalf ofRedding to extendit. In an attemptto resolve their statutory dilemma, Citizens rely on a very narrow exception to the general rule espoused in Government Code section 9605. The generalrule states: Wherea section or part of a statute is amended,it is not to be considered as having been repealed and reenacted in the amended form. The portions which are notaltered are to be considered as having been the law from the time when they were enacted; the new provisions are to be considered as 8 having been enacted at the time of the amendment; and the omitted portions are to be considered as having been repealed at the time of the amendment.° Citizens cite to Barratt American, Inc. v. City ofRancho Cucamonga (2005) 37 Cal.4th 685 for the proposition that, despite the plain language of Government Code section 9605 and Redding’s resolution, the PILOT was renewed after November 2010. In sO doing, Citizens fail to note that Barratt dealt solely with a very specific provision of the Mitigation Fee Act (Gov. Code § 66000, ef seq.), which concerns developmentand permit fees in accordancewith its own statutory framework. Citizens also failed to note the single finding by the court in Barratt that allowedit to apply the reenactment rule to its specific set of facts: it found the resolution adopted by the City ofRancho Cucamonga modified or amended(as those termsare defined within the Mitigation Fee Act) its entire fee structure because the City’s resolution “...changed the duration ofthe fee by extendingits applicability.” [Emphasis in original] (Id. at 728). Redding did not increase or extend the PILOT per Government Codesection 53750. ° Whetherthe inquiry goesto a city’s legislative act as opposed to state statutes is ofno consequence with respect to the interpretation ofthe underlying language. (See, e.g., City ofSan Diego v. Shapiro (2014) 228 Cal.App.4th 756, 789 (Generally, the sameprinciples of construction applicable to statutes apply to the interpretation ofmunicipal charters.”]). 9 The ‘reenactment’ principle has never been applied in the context of budget adoptions, and this Court should decline to extend that narrow principle here. Ill. THE PILOT TRANSFER FROM REDDING’S ELECTRIC UTILITY TO THE CITY GENERAL FUND REFLECTS REASONABLECOSTS OF SERVICE Even if Proposition 26 applies to the pre-existing PILOT, the PILOT reflects the utility’s reasonable costs of service and is therefore not a tax. Like other municipal general fund transfers throughout California, the City’s PILOTrecoverscosts for street maintenance, fire and police protection, administration, and other important benefits the City provides to the electric utility. | Importantly, the City’s PILOT is intended to approximate taxes a private utility such as Pacific Gas & Electric would pay to the City if it servedits residents.’ A city operating a utility incurs the samecosts to support operation of an electric utility as one served by an investor-owned utility and therefore a general fund transfer mechanism such as a PILOT avoids foregoing revenue required to support those services. The City’s long standing PILOT is fixed at 1% ofthe value of the utility’s assets and mirrors the rate private utilities pay other cities where they operate. PILOTsare common andintegral to the public powerutility model (see ’ Citizensfor Fair REURatesv. City ofRedding (2015) 182 Cal.Rptr.3d 722, 738 (dis. opn. ofDuarte, J.)). 10 Section I above), providing revenue certainty needed by municipalities to recoup service costs and ensure sound business operations. Justice Duarte in her dissent to the Third District Court ofAppeal’s opinion in this case acknowledged the many factors that make up a utility rate structure, finding that the PILOTis reasonable as a matter of law becauseit equaled whata private utility would pay in property taxes to the City. (Citizens, supra, 182 Cal.Rptr.3d at 738 (dis. opn. of Duarte, J.)).This court should do the same by recognizing that the universal application of property taxes on private utilities justifies the reasonableness of the PILOT as a cost of service. As Justice Duarte noted, the PILOT “does not result in an unreasonable charge for providing electric service” because the PILOT is consistent with Proposition 13 and implementinglegislation. (/d.) Accordingly, application of the PILOTis “fair” and “reasonable” under Proposition 13 and Proposition 26. | An overly restrictive interpretation of “reasonable cost” would threaten the public power model. Citizens’ attempt to apply the more stringent Proposition 218 “proportional” cost of service principles to this case would invalidate lawful charges under Proposition 26. Proposition 26 is not as exacting as Proposition 218, requiring, instead, a “fair or reasonable”allocation of costs among ratepayers (Cal. Const., art. XIII C, § 1 subd. (e)(2) & final, unnumbered para.). Conflating Proposition 218 — and Proposition 26 would set a dangerous precedentfor the public power 1] utility industry in California. Even though someelectric utilities also provide water service, electric service and water service are separate and distinct, each with their own costs and revenue requirements and — most importantly _ rate structures. Electric and gas service fees are not subject to Proposition 218’s standard (Cal. Const,, art. XI D,§ 3, subd. (b)), and to hold otherwise would jeopardize PILOTsandhave wide-ranging impacts on theelectric utility industry. CONCLUSION Forall these reasons,CMUA respectfully requests that the Court reject the arguments raised by the Appellants and affirm the trial court’s . findings on the issues presented for review. Dated: August 18, 2015 Respectfully submitted, C. ANTHONY BRAUN (BarNo. (176113) JUSTIN C. WYNNE (Bar No. 251377) DANIEL E. GRIFFITHS (Bar No. 300923) ak€. Yibfitle _ DANIELE. GRIFFITHS Braun Blaising McLaughlin Smith, P.C. 915 L Street, Suite No. 1270 Sacramento, CA 95814 Telephone: (916) 326-5812 Fax: (916) 441-0468 Attorneys for Amicus Curiae California Municipal Utilities Association 12 CERTIFICATE OF WORD COUNT The text ofAPPLICATION BY THE CALIFORNIA MUNICIPAL UTILITIES ASSOCIATION TO FILEA BRIEF AS AMICUS CURIAE AND PROPOSED BRIEF IN SUPPORT OF PLAINTIFFS AND RESPONDENTS, THE CITY OF REDDING consists of 2,803 words (including footnotes but excluding the table of contents,the table of authorities, and certificates) as counted by Microsoft Word 2011 word-processing program. Dated August 18, 2015 DANIEL E. GRIFFITHS(Bar No. 300923) Braun Blaising McLaughlin Smith, P.C. 915 L Street, Suite No. 1270 Sacramento, CA 95814 Telephone: (916) 326-5812 Fax: (916) 441-0468 CERTIFICATE OF SERVICE I hereby certify thatI am a citizen ofthe United States, over the age of 18 years, with business address at 915 L Street, Suite No. 1270, Sacramento, California and am neither a party nor interested in the within action. On August 18, 2015, in Sacramento, California, I caused to be served the following: APPLICATION BY THE CALIFORNIA MUNICIPAL UTILITIES ASSOCIATION TO FILE A BRIEF AS AMICUS CURIAE AND PROPOSED BRIEF IN SUPPORT OF . DEFENDANTS AND RESPONDENTS, THE CITY OF REDDING,ET AL. XOVERNIGHT MAIL:I caused such true copy of the above documentto be delivered to UPSfor overnight courier service to the office of the party as set forth below: SEE ATTACHEDLIST X I declare under penalty ofperjury under the lawsofthe.State of California that the foregoing is true and correct. Dated August 18, 2015 fut.be -Paula Palomo SERVICE LIST Citizensfor Fair REURates v. City ofRedding Third District Court ofAppeal Case No. C071906 California Supreme Court Case No. S224779 Clerk, Shasta County Superior Court Walter P. McNeill Honorable William D. Gallagher Shasta County Courthouse 1500 Court Street, Rm 319 Redding, CA 96001 ~ Clerk’s Office California Court ofAppeal Third Appellate District 914 Capitol Mall, 4th Floor Sacramento, CA 95814 California Supreme Court 350 McAllister Street San Francisco, CA 94102 [13 copies] McNeill Law Offices 280 Hemsted Drive, Suite E Redding, CA 96002 Counselfor PlaintiffandAppellant Barry DeWalt Office of the City Attorney 777 Cypress Avenue, 3rd Floor Redding, CA 96099 Counselfor Defendant and Respondent Michael G. Colantuono Colantuono, Highsmith & Whatley, PC 420 Sierra College Drive, Ste. 140 Grass Valley, CA 95945 Counselfor Defendant andRespondent