GRIDLEY, CA (MPG) – On the first day of March 2021, a lawsuit was filed by McNeil Law Offices with the Butte County Superior Court against the City of Gridley.

The Walter P. McNeil, McNeil Law Offices are representing plaintiffs, Scott McMillan, Michael McMillan, Allison Woolbert and Tyrell Ford, all four of whom are, and have been, residents of Gridley throughout the time in question and are behind the initial filing of the complaint.

The language of the lawsuit lists 4 main complaints, which are outlined as follows:

1). PETITION FOR WRIT OF MANDATE – Adoption and Imposition of Taxes in Violation of California Constitution Article XIIIZ 1 and 2 (b)(d), and Government Code 50076, 53722 and 53723 (CCP 1085).

2). COMPLAINT FOR DAMAGES - Unconstitutional “Taking” and Confiscation of Money/Property For Public Use Without Just Compensation in Violation of the 5^th and 14^th Amendments to the U.S. Constitution and Art I 19 of the Ca. Constitution.

3). COMPLAINT FOR UNJUST ENRICHMENT AND REFUNDS, With Ancillary Equitable Remedies.

4). COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF (Code Civ. Pro. 1060, 526).

The complaint attempts to establish as fact the following information in paragraphs 1-21. The language of the complaint states that City of Gridley, as electric utility provider, is constrained by the state of California Constitution Article XIII C to set rates that shall “not exceed the reasonable costs to the local government of providing the service.” (paragraph 13). Following paragraph 13, the complaint attempts to establish the City’s electric rate is “designed and levied in whole or in part ‘for general revenue purposes’” and not strictly electric services, causing the complaint to “have found unequivocally that fees “levied for general revenue purposes” are “taxes” (paragraph 14). With that, the complaint reminds that “In California a ‘tax’ must be approved by a vote of the electorate,” continuing, “The imposition of an illegal tax that hasn’t been approved by the voters, through excessive electric rates greater than the reasonable cost of electric service, or designed merely to extract funds for unrelated general revenue purposes, is an illegal tax and an unconstitutional condition placed on the receipt of electric services that residential customers simply can’t do without.”

Included as supporting evidence are minutes from past City Council Meetings, slides from a power point presentation made at a City Council Meeting in December 2 of 2019, and confirmation of transfer amounts from City Budget and financial records from the last 5 fiscal years.

Paragraph 19 alleges that “Plaintiffs estimate (without the benefit of discovery that will make the numbers more precise) that at a minimum the residential customers are paying what amounts to a “General Fund Tax” that is in a range of 15% to 20% of the electric rates charged in their monthly bills.” The complaint goes on to allege that percentage could be higher, with, “data from the City would indicate the Electric Program is over-collecting beyond the Total Electric Program Costs in amount that roughly average at 30%” plus or minus.

The complaint reads “the persons in the class are so numerous, consisting of approximately 2,250 household accounts, that the joinder of all such persons is impracticable and that the disposition of their claims in a class action rather than in individual actions will benefit the parties and the court.” “Plaintiffs are informed and believe that the damage to each Plaintiff is relatively small [ annualized damages to individual Plaintiffs estimates to be in a range of $500 to $1,000 per household account] making it economically unfeasible to pursue remedies other than a class action.”

Mayor Bruce Johnson has said that he and his fellow Councilmembers cannot comment on the suit now due to that it has been officially filed with the Butte County Superior Court.  At the time of this article, a hearing date had not been set.