Court Opinion

ID: 4668983
Source: CourtListenerOpinion
Date Created: 2021-03-17 23:02:18.05174+00
Date Added: 2024-06-11T07:50:29.579460
License: Public Domain

Filed 3/17/21 Food & Water Watch v. Metropolitan Water Dist. Etc. CA2/3

  NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

 California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                        SECOND APPELLATE DISTRICT

                                     DIVISION THREE

 FOOD & WATER WATCH et al.,                                       B297553

       Plaintiffs and Appellants,                                 Los Angeles County
                                                                  Super. Ct. No.
          v.                                                      BC720692
 METROPOLITAN WATER
 DISTRICT OF SOUTHERN
 CALIFORNIA et al.,

       Defendants and Respondents.

      APPEAL from a judgment of the Superior Court of Los
Angeles County, Randolph M. Hammock, Judge. Affirmed.
      Law Office of Adam Keats, Adam Keats; Law Office of
Roger B. Moore and Roger B. Moore for Plaintiffs and Appellants.
      Hanson Bridgett, Adam W. Hofmann; Marcia Scully and
Patricia J. Quilizapa for Defendant and Respondent Metropolitan
Water District of Southern California.
      Procopio, Cory, Hargreaves & Savitch, Gregory V. Moser
and P. Jacob Kozaczuk; Mark J. Hattam for Respondent San
Diego County Water Authority.
             _______________________________________
                           INTRODUCTION

       Food & Water Watch and Center for Food Safety
(collectively, plaintiffs) are non-profit organizations who brought
this reverse validation action challenging two resolutions adopted
by Metropolitan Water District of Southern California
(Metropolitan) concerning the agency’s plan to purchase an
interest in and help finance the since abandoned “California
Waterfix” project. In the operative first amended complaint,
plaintiffs assert the resolutions violate Propositions 13 and 26, as
well as Metropolitan’s contract with the State Water Project,
because the resolutions might in the future require Metropolitan
to raise water rates and property taxes without voter approval.
Plaintiffs also assert the resolutions exceed the limits on
Metropolitan’s authority under the agency’s District Act (Wat.
Code Appen., § 109 et seq.) and the Joint Exercise of Powers Act
(Gov. Code, § 6500 et seq.).
       Plaintiffs appeal from a judgment of dismissal entered after
the trial court sustained without leave to amend Metropolitan’s
and San Diego County Water Authority’s (SDCWA) demurrers to
the first amended complaint.1 We affirm.

           FACTS AND PROCEDURAL BACKGROUND

1.      The Challenged Resolutions
      In mid-2018, the California Department of Water
Resources (DWR) planned to construct the Waterfix project
(Project), which would create new intakes on the east bank of the
Sacramento River in the northern California Delta, new tunnels
connecting those intakes to a new forebay, and two new 30-mile
tunnels carrying water from that forebay to a new water

1   SDCWA demurred to the first cause of action only.

                                    2
pumping plant. Various water contractors throughout California
had subscribed to about 67 percent of the Project’s anticipated
capacity. Metropolitan planned to purchase the Project’s
unsubscribed capacity interest.
       In July 2018, Metropolitan’s board of directors adopted
Resolutions 9243 and 9244 (collectively, Resolutions). Resolution
9243 authorized Metropolitan to enter into a master agreement
with DWR and a joint powers authority formed by Metropolitan
(Capacity Interest JPA) to purchase the unsubscribed capacity
interest in the Project. As part of the agreement, the Capacity
Interest JPA would make payments to DWR to fund the Project’s
construction. To finance its payments to DWR, the Capacity
Interest JPA would issue “one or more series of revenue bonds.”
       Metropolitan, in turn, would enter into an “installment
purchase agreement” with the Capacity Interest JPA through
which the joint powers authority would transfer its interest in
the Project to Metropolitan in exchange for a series of installment
payments. Metropolitan would secure its obligation to the
Capacity Interest JPA through a lien on the agency’s water
revenues. As part of the resolution, Metropolitan could sell the
unsubscribed capacity interest to other water agencies.
       Resolution 9243 also authorized Metropolitan’s general
manager “to do any and all things necessary” to make
arrangements for the purchase of the Project’s unsubscribed
capacity interest and to “negotiate, execute, and deliver[] one or
more agreements and documents necessary or advisable to carry
into effect” the purchase. The resolution precluded Metropolitan
from entering into any agreement that would commit the agency
to pay for more than 64.6 percent of the Project’s estimated costs.
       Resolution 9244 authorized Metropolitan to participate in
the formation of a “Financing JPA” with other water agencies
that agreed to help finance the Project. The Financing JPA could

                                 3
issue its own bonds and help DWR issue bonds to finance the
Project. To protect purchasers of DWR’s bonds, the participating
water agencies could directly purchase DWR’s bonds or other
property or enter into one or more debt service agreements. If
DWR defaulted on its payment of debt service on its bonds, DWR
would agree to transfer to the Financing JPA, or to another
designated entity, DWR’s right, title, and interest in the Project.
       Resolution 9244 also authorized Metropolitan to invest in
certain DWR bonds. The resolution granted Metropolitan’s
general manager the authority “do any and all things necessary”
to effectuate the agency’s participation in the Financing JPA,
including negotiating, executing and delivering any necessary
agreements.
2.    The Lawsuit
      In early September 2018, plaintiffs filed a reverse
validation action against Metropolitan under Code of Civil
Procedure section 860 et seq. and Government Code section
53511 challenging the validity of the Resolutions. In the
operative first amended complaint, plaintiffs complain that the
Resolutions authorize Metropolitan to incur exorbitant debt
which may exceed the estimated costs of the Project and that
Metropolitan may have no lawful means of repaying in the
future. One reason the costs may exceed expectations, plaintiffs
claim, is because Metropolitan had yet to execute any master
agreements relating to the purchase of the Project’s unsubscribed
capacity.
      The gravamen of plaintiffs’ claims boils down to this: (1)
Metropolitan may raise its water rates and property taxes in the
future to ensure the agency has sufficient revenue to secure any
debt related to its purchase of an interest in the Project; and (2)
Metropolitan may raise its rates and increase property taxes
without first obtaining voter approval in violation of Propositions

                                 4
13 and 26. Plaintiffs do not allege, however, that Metropolitan
has imposed, let alone approved, any water rate or property tax
increases as a result of the Resolutions. Nor do the Resolutions,
which are attached to the first amended complaint, mention any
plan by Metropolitan to increase water rates or property taxes.
       The operative first amended complaint asserts four causes
of action. The first cause of action seeks to invalidate the
Resolutions on the ground that they violate Proposition 26.
Specifically, plaintiffs allege the Resolutions are unlawful
because they authorize Metropolitan’s general manager to raise
water rates in the future without first obtaining voter approval.
The second cause of action states a similar claim: the Resolutions
authorize the agency’s general manager to increase property
taxes in the future without voter approval in violation of
Proposition 13. The third cause of action alleges the Resolutions
authorize property tax increases and “issuance of charges that
may be prohibited” by Metropolitan’s contract with the State
Water Project. Finally, the fourth cause of action alleges—
without specifying how—the Resolutions authorize Metropolitan
to engage in conduct that exceeds the limits on its authority
under the District Act and the Joint Exercise of Powers Act.
       Metropolitan demurred to the entire first amended
complaint, and SDCWA demurred to the pleading’s first cause of
action.2 The court sustained both demurrers without leave to
amend.
       As to the first and second causes of action, the court found
the claims were not ripe. Specifically, the court found the

2The reverse validation action was brought against Metropolitan and
all persons interested in Metropolitan’s authorization of the
Resolutions. Although SDCWA is not named as a defendant in the
original or the first amended complaint, it filed demurrers to both
complaints in its capacity as an interested person.

                                 5
Resolutions establish only a framework through which
Metropolitan could in the future increase water rates or property
taxes. Plaintiffs did not allege, however, that Metropolitan
approved or enacted any water rate or property tax increase
without voter approval. Thus, plaintiffs failed to state a claim for
violation of Proposition 13 or 26.
       As to the third cause of action, the court found plaintiffs
failed to plead a breach of Metropolitan’s contract with the State
Water Project. Specifically, plaintiffs did not allege Metropolitan
assessed any taxes, imposed any charges, or issued any bonds in
a manner that would violate the contract. And finally, for the
fourth cause of action, the court found plaintiffs failed to plead
with sufficient specificity the applicable statutory sections and
manner of violations that form the basis of their claim.
       In April 2019, the court entered a judgment dismissing
plaintiffs’ lawsuit. Plaintiffs timely appealed.
3.    DWR Abandons the Project
      In early May 2019, DWR’s director rescinded the agency’s
approval of the Project. A few days later, DWR approved a
resolution rescinding all of its prior authorizations to issue bonds
to fund the Project.
      In June 2019, at a meeting of Metropolitan’s board of
directors, Metropolitan’s general manager stated that the
Resolutions were “void” and “mooted” by DWR’s decision to nix
the Project since the Resolutions only authorized him to negotiate
and execute agreements related to the Project. The general
manager informed the board that it would have to issue new
authorizations before Metropolitan could participate in, and
spend money related to, any new project proposed by DWR.
      In December 2020, Metropolitan staff prepared a letter
advising the agency’s board of directors to approve funding for
DWR’s new, single-tunnel project to convey water from the

                                 6
California Delta. That same month, Metropolitan’s board of
directors adopted the staff’s recommendation to approve funding
for part of DWR’s new California Delta project.3

                            DISCUSSION

1.    Standard of Review
       We independently review an order sustaining a demurrer
to determine whether the operative complaint alleges facts
sufficient to state a cause of action. (Ivanoff v. Bank of America,
N.A. (2017) 9 Cal.App.5th 719, 725.) We liberally construe the
complaint’s allegations, assuming the truth of all properly pled
facts and matters that are judicially noticeable. (Ibid; Quelimane
Co. v. Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 43, fn. 7.)
“In addition, other relevant matters which are properly the
subject of judicial notice may be treated as having been pled.”
(Friedland v. City of Long Beach (1998) 62 Cal.App.4th 835, 842.)
2.    The appeal is moot.4
      Metropolitan contends that plaintiffs’ appeal challenging
the order sustaining Metropolitan’s and SDCWA’s demurrers
without leave to amend is moot since DWR has formally
abandoned the Project, rendering the Resolutions null and void.
We agree.
      “California courts will decide only ‘ “justiciable
controversies.” ’ [Citation.] A moot case is one in which there may
have been an actual or ripe controversy at the outset, but due to

3We grant Metropolitan’s request for judicial notice of the staff’s letter
and the minutes from the meeting at which the board of directors
approved the staff’s recommendation.
4Before briefing was complete, we denied Metropolitan’s motion to
dismiss plaintiffs’ appeal as moot.

                                    7
intervening events, it no longer presents a context in which the
court can grant effectual relief.” (Placer Foreclosure, Inc. v.
Aflalo (2018) 23 Cal.App.5th 1109, 1112–1113.)
        Plaintiffs’ appeal is moot because we cannot grant any
effective relief. As our factual summary shows, Metropolitan
issued the Resolutions for the specific purpose to help fund the
construction of, and the agency’s purchase of an interest in, the
Project. Nothing in the Resolutions indicate they authorize
Metropolitan to spend or otherwise incur debt related to any
other project or activity. As Metropolitan’s general manager
acknowledged at the agency’s June 2019 board meeting, the
Resolutions only authorized him to negotiate and execute
agreements related to the Project and Metropolitan would need to
issue new resolutions to authorize spending related to any new
project proposed by DWR. Indeed, since that meeting, DWR has
proposed a new California Delta project and Metropolitan has
approved a recommendation by its staff to pursue financing,
through terms different from those specified in the Resolutions,
related to that project. Thus, even if we were to decide the appeal
in plaintiffs’ favor and they ultimately were to succeed in the trial
court, they could obtain no effective relief because the Resolutions
are essentially null and void.
       In any event, as we explain below, the court properly
sustained without leave to amend Metropolitan’s demurrer to the
entire first amended complaint and SDCWA’s demurrer to the
complaint’s first cause of action.
3.    The court properly sustained the demurrers as to the
      first and second causes of action.
     Plaintiffs contend the court erred in sustaining the
demurrers as to the first amended complaint’s first and second
causes of action. According to plaintiffs, any claim asserting the
Resolutions violate Proposition 13 or 26 must be brought as a

                                 8
reverse validation action because once the validation period
expires, any future decision by Metropolitan to raise water rates
or to increase property taxes to pay its debt obligation under the
Resolutions will be insulated from judicial attack. This argument
lacks merit.
       Even if we were to assume the validation statutes apply to
the Resolutions,5 plaintiffs’ claims that the Resolutions authorize
Metropolitan to incur unlawful debt based on future violations of

5 Among other things, the validation statutes allow “interested
persons” to bring an action challenging the validity of certain
government actions, including a local public agency’s “bonds, warrants,
contracts, obligations or evidences of indebtedness” (Gov. Code, §
53511), which includes the authorization of bonds. (Code Civ. Proc., §
864.) If the action is not challenged within 60 days, it becomes
“immune from attack whether it is legally valid or not.” (Davis v.
Fresno Unified School District (2020) 57 Cal.App.5th 911, 928.)
       On their face, the Resolutions only authorize Metropolitan’s
general manager to begin negotiating agreements through which
Metropolitan could incur debt in the future related to the financing of
the Project and which would allow the Capacity Interest JPA to issue
bonds to secure its payments to DWR. The Resolutions do not
authorize Metropolitan to issue any bonds, and nothing in the
Resolutions constitutes an agreement between Metropolitan and any
other entity. Nor do the Resolutions indicate that any agreement had
been negotiated at the time they were issued. Indeed, in their first
amended complaint, plaintiffs complain that the Resolutions are
flawed because Metropolitan has yet to negotiate or enter into any
master agreements related to the purchase of the Project’s
unsubscribed capacity interest. In short, the Resolutions only: (1) state
Metropolitan’s intent to purchase an interest in, and help finance
construction of, the Project; and (2) authorize Metropolitan’s general
manager to begin negotiating with other entities to effectuate those
goals. Thus, it appears the validation statutes don’t apply to the
Resolutions. We need not decide whether the statutes apply, however,
because plaintiffs’ first and second causes of action are not ripe.

                                    9
Propositions 13 and 26 are not ripe for judicial determination.
Before a claim may be adjudicated it must present a justiciable
controversy. (Pacific Legal Foundation v. California Coastal Com.
(1982) 33 Cal.3d 158, 169 (Pacific).) To be justiciable, a claim
must be, among other things, “ripe.” (Ibid.)
       For a claim to be ripe, the “ ‘controversy must be definite
and concrete, touching the legal relations of parties having
adverse legal interests. [Citation.] It must be a real and
substantial controversy admitting of specific relief through a
decree of a conclusive character, as distinguished from an opinion
advising what the law would be upon a hypothetical state of
facts.’ ” (Pacific, supra, 33 Cal.3d at p. 171.) “ ‘A controversy is
“ripe” when it has reached, but has not passed, the point that the
facts have sufficiently congealed to permit an intelligent and
useful decision to be made.’ [Citation.]” (Ibid.) In other words,
“ ‘the judgment must decree, not suggest, what the parties may or
may not do.’ [Citation.]” (Ibid.) The ripeness doctrine applies to
validation actions. (City of Santa Monica v. Stewart (2005) 126
Cal.App.4th 43, 66 (Stewart).)
       Courts apply a two-pronged test to determine if a claim is
ripe: “(1) whether the dispute is sufficiently concrete so that
declaratory relief is appropriate; and (2) whether the parties will
suffer hardship if judicial consideration is withheld.” (Stewart,
supra, 126 Cal.App.4th at p. 64.) Relevant here, courts will
decline to adjudicate a claim under the first prong “ ‘if “the
abstract posture of [the case] makes it difficult to evaluate … the
issues” [citation], if the court is asked to speculate on the
resolution of hypothetical situations [citation], or if the case
presents a “contrived inquiry [citation].” ’ ” (Ibid.)
       The first and second causes of action assert that the
Resolutions are invalid because they will in the future require
Metropolitan to raise water rates and property taxes without

                                10
voter approval in violation of Propositions 13 and 26. The first
and second causes of action don’t assert any other legal bases for
invalidating the Resolutions. Because any violation of Proposition
13 or 26 stemming from Metropolitan’s adoption of the
Resolutions is purely speculative at this point, the first and
second causes of action are not ripe.
       In 1978, California voters passed Proposition 13, which
added article XIII A to the California Constitution. (Citizens for
Fair REU Rates v. City of Redding (2018) 6 Cal.5th 1, 10
(Redding).) Relevant here, Proposition 13 limits the amount of
any “ad valorem tax on real property” at one percent unless,
among other exceptions, two-thirds of the voting electorate
approve the imposition of ad valorem taxes or special
assessments to pay the interest and redemption charges on the
“[b]onded indebtedness for the acquisition or improvement of real
property” incurred on or after July 1, 1978. (Cal. Const., art. XIII
A, § 1, subd. (b)(2).) Proposition 13, therefore, limits “local
government authority to increase property taxes.” (Redding, at p.
10.)
       In 1996, voters passed Proposition 218, which added
articles XIII C and XIII D to the Constitution. (Redding, supra, 6
Cal.5th at p. 10.) Like parts of Proposition 13, Proposition 218
limits local governments’ authority “to assess taxes and other
charges on real property.” (Ibid.) It also restricts the methods by
which “local governments can exact revenue using fees and taxes
not based on real property value or ownership.” (Ibid.)
       In 2010, voters passed Proposition 26, which was designed
to curb a common practice among local governments to exact new
property taxes by disguising them as “fees.” (Redding, supra, 6
Cal.5th at p. 11.) To that end, Proposition 26 amended article
XIII C of the Constitution by broadly defining the term “tax” to
include “any levy, charge, or exaction of any kind imposed by a

                                11
local government.” (Cal. Const., art. XIII C, § 1, subd. (e); see also
Redding, at p. 11.) Proposition 13 excepted from its definition of a
“tax” several different forms of charges, fines, and assessments,
including “[a] charge imposed for a specific government service or
product provided directly to the payor that is not provided to
those not charged, and which does not exceed the reasonable
costs to the local government of providing the service or product.”
(Cal. Const., art. XIII C, § 1, subd. (e)(2).)
       Important here, a taxpayer cannot bring a claim for
violation of Proposition 13 or 26 until the public agency at issue
actually imposes the challenged tax increase, either directly or
through the imposition of a new fee or a fee increase that
qualifies as a tax. (Reid v. City of San Diego (2018) 24
Cal.App.5th 343, 368.) In other words, a claim for violation of the
Constitution’s prohibition against local governments assessing
taxes without voter approval is not ripe until a new tax or a tax
increase has been enacted or imposed. (Webb v. City of
Riverside (2018) 23 Cal.App.5th 244, 258–261 [plaintiff failed to
state a claim for violation of Constitution’s limitations on
imposition of taxes because she did not allege the city imposed
any tax or rate increase].)
       The Resolutions are silent as to whether they will require
Metropolitan to raise water rates or property taxes to help fund
the investment the agency had planned to make in the Project.
Although Resolution 9243 states that Metropolitan would secure
its obligation to make installment payments to fund its
investment through a lien on Metropolitan’s water revenues, it
does not specify how the agency would secure funding for those
payments. Nor does it state that the agency has increased, or will
increase, water rates or property taxes to secure the lien on its
water revenues. Most importantly, while plaintiffs allege that
Metropolitan will raise its water rates or property taxes in the

                                 12
future to fund its obligations under the Resolutions and could do
so without first obtaining voter approval, plaintiffs don’t allege,
nor do they claim on appeal, that Metropolitan has imposed any
new property taxes, increased existing property taxes, or
increased its water rates as a consequence of approving the
Resolutions. (See Gonzalez v. City of Norwalk (2017) 17
Cal.App.5th 1295, 1312–1314 [because city’s local ordinance did
not impose, extend, or increase a tax, court properly sustained
demurrer with respect to claim for violation of the state
Constitution’s limitations on imposition of taxes by a public
agency].) Any claim that Metropolitan will increase water rates
or property taxes in the future without first obtaining voter
approval is, therefore, entirely speculative. Consequently, the
first and second causes of action asserted in the first amended
complaint are not ripe for judicial determination. (Stewart, supra,
126 Cal.App.4th at p. 64.)
       In passing, plaintiffs claim the Resolutions are also
unlawful because they authorize Metropolitan to incur an
amount of debt the agency has no lawful means to repay.
Plaintiffs fail, however, to point to any authority outside of
Propositions 13 and 26 to support this argument. Because we
already rejected plaintiffs’ contentions concerning the application
of Propositions 13 and 26 to their first two causes of action, and
because plaintiffs cite no additional authority to show those
claims are ripe, we need not address this argument any further.
(See Dietz v. Meisenheimer & Herron (2009) 177 Cal.App.4th 771,
799 (Dietz) [appellant’s failure to support claim with
reasoned argument and citations to authority permits the
reviewing court to treat that claim as waived].)

                                13
4.    Plaintiffs failed to show the court erred in sustaining
      Metropolitan’s demurrer as to the third cause of
      action.
       In their briefs, plaintiffs don’t include any arguments
discussing why the court erred in sustaining Metropolitan’s
demurrer as to the third cause of action for violation of
Metropolitan’s contract with the State Water Project. Although
plaintiffs briefly discuss the underlying contract in an attempt to
show why Metropolitan will increase property taxes in the future
without voter approval, they fail to provide any argument
addressing why the first amended complaint states a claim that
the Resolutions violate that contract.
       It is a fundamental principle of appellate review that a
challenged judgment or order is presumed correct and all
presumptions must be indulged in favor of its correctness. (Dietz,
supra, 177 Cal.App.4th at p. 799.) Accordingly, the appellant
bears the burden to affirmatively demonstrate why the
challenged judgment or order is wrong and should be reversed.
(Ibid.) As part of that burden, the appellant must provide
reasoned argument and citations to relevant legal authority that
support that argument. (Ibid.) It is not enough to simply assert a
judgment is wrong. “ ‘ “Issues do not have a life of their own: If
they are not raised or supported by argument or citation to
authority, [they are] … waived.” [Citation.] It is not our place to
construct theories or arguments to undermine the judgment and
defeat the presumption of correctness. When an appellant fails to
raise a point, or asserts it but fails to support it with
reasoned argument and citations to authority, we treat the point
as waived. [Citation.]’ [Citation.]” (Ibid.)
       Because plaintiffs don’t provide any reasoned argument
discussing why the court erred in sustaining Metropolitan’s
demurrer as to the third cause of action asserted in the first

                                14
amended complaint, they have waived any challenge to the
court’s ruling on that claim. (Behr v. Redmond (2011) 193
Cal.App.4th 517, 538 (Behr) [failure to brief issue constitutes a
waiver or abandonment of the issue on appeal].)
5.    Plaintiffs have not shown the court erred in sustaining
      Metropolitan’s demurrer as to the fourth cause of
      action.
       Plaintiffs also have failed to show the court erred in
sustaining Metropolitan’s demurrer as to the fourth cause of
action. That claim asserts in general terms that the Resolutions
exceed Metropolitan’s authority under the agency’s District Act
and the Joint Exercise of Powers Act. To the extent the fourth
cause of action asserts a violation of the Joint Exercise of Powers
Act, plaintiffs fail to cite any authority that would support a
claim brought under that statute let alone discuss that statute at
any length. Consequently, plaintiffs have waived any claim that
the court erred in sustaining Metropolitan’s demurrer to the
fourth cause of action insofar as it asserts the Resolutions violate
the Joint Exercise of Powers Act. (Behr, supra, 193 Cal.App.4th
at p. 538.)
       In addition, plaintiffs haven’t shown the court erred in
sustaining Metropolitan’s demurrer as to the fourth cause of
action to the extent it asserts a violation of Metropolitan’s
District Act. In their briefs, plaintiffs contend the Resolutions
violate section 200 of the District Act (Section 200) because that
provision requires Metropolitan to obtain approval from its voters
before incurring bonded indebtedness related to certain types of
spending that will exceed the agency’s ordinary annual income
and revenue. Plaintiffs misconstrue Section 200.
       That provision provides: “Whenever the board, by
ordinance adopted by a vote of a majority of the total vote of the
board, determines that the interests of the district and the public

                                15
interest or necessity demand the acquisition, construction or
completion of any public improvement or works of the district, or
the payment of funds for any part of the capital costs of any
public improvement or works of this state from which service is to
be provided to the district, or the incurring of any preliminary
expenses, or any combination of such purposes, necessary or
convenient to carry out the objects or purposes of the district, the
cost of which will be too great to be paid out of the ordinary
annual income and revenue of the district, the board may order
the submission of the proposition of incurring bonded
indebtedness, for the purposes set forth in such ordinance, to the
qualified voters of the district, at an election held for that
purpose.” (Wat. Code Appen., § 109-200, italics added.)
       As the italicized language shows, Section 200 is permissive
in nature. (Compton College Federation of Teachers v. Compton
Community College Dist. (1982) 132 Cal.App.3d 704, 711–712 [for
purposes of statutory construction, the word “may” is generally
construed as permissive].) That is, it permits, but does not
require, Metropolitan to submit to its voters a proposition to
incur qualifying bonded indebtedness. Plaintiffs cite no other
authority to support the proposition that Section 200 requires
Metropolitan to obtain voter approval before incurring qualifying
bonded indebtedness. (Compton College, at p. 712 [a construction
of “may” to be mandatory is proper “ ‘ “only where sense of entire
enactment requires it or it is necessary to carry out legislative
intention” ’ ”].) Accordingly, plaintiffs have not shown the court
erred when it found they failed to state a claim for violation of
Section 200.

                                16
6.    The court properly sustained the demurrers without
      leave to amend.
       When a demurrer is sustained without leave to amend, we
decide whether there is a reasonable possibility that the plaintiffs
can amend their complaint to cure the defect. (Blank v. Kirwan
(1985) 39 Cal.3d 311, 318.) If the defect can be cured, “the trial
court has abused its discretion and we reverse; if not, there has
been no abuse of discretion and we affirm.” (Ibid.) “The burden of
proving such reasonable possibility is squarely on the plaintiff.”
(Ibid.) Such a showing can be made for the first time on appeal.
(Smith v. State Farm Mutual Automobile Ins. Co. (2001) 93
Cal.App.4th 700, 711.)
       Plaintiffs did not argue below, nor do they argue on appeal,
that they could amend the first amended complaint to plead
additional facts to state claims for violations of Propositions 13
and 26, Metropolitan’s contract with the State Water Project,
Metropolitan’s District Act, or the Joint Exercise of Powers Act.
Plaintiffs, therefore, have not met their burden to show the court
abused its discretion in sustaining Metropolitan’s and SDCWA’s
demurrers without leave to amend.

                                17
                            DISPOSITION

      The judgment is affirmed. Metropolitan Water District of
Southern California and San Diego County Water Authority shall
recover their costs on appeal.

    NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

                                                LAVIN, Acting P. J.
WE CONCUR:

      EGERTON, J.

      ADAMS, J.*

*Judge of the Los Angeles Superior Court, assigned by the Chief
Justice pursuant to article VI, section 6 of the California Constitution.

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