Filed 10/28/19 Buena Park Successor Agency v. Bosler CA3

NOT TO BE PUBLISHED

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

THIRD APPELLATE DISTRICT

(Sacramento)

—-

BUENA PARK SUCCESSOR AGENCY et al.,

Plaintiffs and Appellants,

v.

KEELY BOSLER as Director, etc., et al.,

Defendants and Respondents.

C085064

(Super. Ct. No. 34201680002449CUWMGDS)

This appeal involves two loans purportedly made in 1995 and 2001 by the City of Buena Park (City) to its former redevelopment agency, the Buena Park Redevelopment Agency (Agency). The subsequent Great Dissolution of California’s redevelopment agencies in 2011 has been extensively chronicled. (E.g., California Redevelopment Assn. v. Matosantos (2011) 53 Cal.4th 231, 246-247 (Matosantos); California Redevelopment Assn. v. Matosantos (2013) 212 Cal.App.4th 1457, 1464-1473; Cuenca v. Cohen (2017) 8 Cal.App.5th 200, 207-212; City of Brentwood v. Campbell (2015) 237 Cal.App.4th 488, 491-503 (City of Brentwood).) Accordingly, we recount the Dissolution Law by which the redevelopment agencies were dissolved only briefly as pertinent to the issues in this appeal.

After California’s redevelopment agencies were dissolved, the Buena Park Successor Agency (Successor Agency) requested approval from the California Department of Finance (DOF) to allow repayment of the 1995 and 2001 loans to the City. DOF denied the request under Health and Safety Code section 34191.4 on grounds the evidence did not show the loans were actually made, money ever transferred to fund the loans, or that the loans had set repayment schedules.

The Successor Agency and City (collectively petitioners) challenged DOF’s determination by filing a petition for writ of mandate and complaint in superior court. The trial court denied the petition and complaint. In doing so, the trial court found that “the evidence or lack thereof presented by the Petitioners regarding the 1995 and 2001 Loans suggests that these were precisely the types of transactions with which the Legislature was concerned” when the “Dissolution Law was enacted because the financial dealings between the [redevelopment agencies] and their creating cities and counties ‘were often not the product of arms-length transactions.’ (See [Matosantos, supra,] 53 Cal.4th [at p.] 258, fn. 12.)”

On appeal, the petitioners contend (1) their evidence established the City made the 1995 and 2001 loans to its Agency, (2) there were actual transfers of money from the City to its Agency that funded the loans, (3) the Agency was obligated to repay the loans under certain repayment schedules, and (4) DOF’s disallowance of the loans violates the home-rule doctrine by cancelling valid contractual agreements between the City and its Agency.

We conclude the record supports the trial court’s determination that the purported loans from the City to the Agency had no repayment schedule. The parties’ conduct over the course of more than two decades shows repayment was, at most, optional. Because we conclude neither the 1995 nor 2001 loans were valid, we reject the petitioners’ home-rule contention. DOF did not cancel the purported loan agreements, but instead recognized they were not valid loans from the start. The order dismissing the City’s petition for writ of mandate is affirmed.

FACTUAL AND PROCEDURAL HISTORY

Origin of Redevelopment Agencies

This court has previously recounted the origin of California’s redevelopment agencies as follows: “In 1945, the California Legislature authorized local governments to create redevelopment agencies to revitalize blighted communities. These agencies had authority to acquire real property through purchase and eminent domain, dispose of property, build infrastructure, and improve public facilities in the agency’s project area. But funding for the agencies was scarce because they had no power to levy taxes. ([Matosantos, supra,] 53 Cal.4th [at pp.] 245–246.)

“In 1952, California voters adopted Proposition 18 to fund redevelopment agencies. This initiative created what eventually became article XVI, section 16 of the California Constitution. The effect of this provision is to give to the redevelopment agency the ad valorem tax receipts resulting from the increase of real property value in the redevelopment area. This ‘tax increment financing,’ along with the effect of Proposition 13 adopted by the voters in 1978, was described by the California Supreme Court in Matosantos[, supra, 53 Cal.4th at pp. 246-247]:

“ ‘Under [the tax increment financing] method, those public entities entitled to receive property tax revenue in a redevelopment project area (the cities, counties, special districts, and school districts containing territory in the area) are allocated a portion based on the assessed value of the property prior to the effective date of the redevelopment plan. Any tax revenue in excess of that amount—the tax increment created by the increased value of project area property—goes to the redevelopment agency for repayment of debt incurred to finance the project. (Cal. Const., art. XVI, § 16, subds. (a), (b); . . . § 33670, subds. (a), (b); [citation].)’ ” (City of San Jose v. Sharma (2016) 5 Cal.App.5th 123, 130-131 (City of San Jose), original brackets retained and italics added.)

Thus, indebtedness played a key role in the operation of the redevelopment agencies. California Constitution, article XVI, “Section 16 provides in relevant part that the ‘portion of the levied taxes,’ referring to the tax increment, ‘shall be allocated to and when collected shall be paid into a special fund of the redevelopment agency to pay the principal of and interest on loans, moneys advanced to, or indebtedness (whether funded, refunded, assumed or otherwise) incurred by the redevelopment agency to finance or refinance, in whole or in part, the redevelopment project.’ (§ 16, subd. (b).)” (City of San Jose, supra, 5 Cal.App.5th at pp. 134-135.)

The Agency’s Recommendation that a Debt to the City Be Created

In advance of the city council’s September 25, 1995 meeting the city manager issued a memo with the following recommendation: “In the past the City has loaned funds to the Redevelopment Agency . . . for operating funds and projects. This is a common method to fund agencies in the early years prior to receiving tax increment to assist projects. In order for the Agency to receive tax increment, debt must be created. A loan from the City is considered debt and will allow the Agency to receive tax increment in the future. The Agency debt must be established in a Statement of Indebtedness that is due October 1, 1995.” (Italics added.) The memo did not suggest a repayment schedule.

The Purported 1995 Loan

Consistent with the city manager’s recommendation, the city council adopted Resolution No. 10092 on September 25, 1995. In relevant part, Resolution No. 10092 stated:

“The sum of $500,000 is hereby appropriated as an operating loan to the Redevelopment Agency Project Funds for Project Area III pursuant to . . . Section 33610 as a loan to the Agency to be repaid from any legally available funds of the Agency, with interest from the date hereof to the date of repayment to be determined at the end of each fiscal year based on the yearly average of interest earned on the Agency Investment portfolio. The debt created hereby shall be subordinate to any other indebtedness of the Agency, presently existing or hereafter incurred for the purpose of fulfilling the redevelopment activities of the Agency.”

The city council’s resolution did not specify any repayment schedule.

On the same day, the Agency passed Resolution RA-775 that stated in pertinent part: “SECTION 1: The sum of $500,000 is hereby repaid to the City of Buena Park thus reducing the existing loan balance in Project Area II by said amount. All other remaining balances and agreements shall remain in effect including interest provisions.” Despite the statement the sum was “hereby repaid,” there was no transfer of any funds from the Agency to the City. Moreover, the Agency’s resolution referred to a different project area than that referred to in the city council’s resolution.

On September 29, 1995, the acting director of the Agency made the following report and recommendation to the city council:

“EXECUTIVE SUMMARY: [¶] The City has loaned the Redevelopment Agency funds for administration and project development since 1981. The loan balance as of June 30, 1996, is $6,837,333. The interest rate for the loans varies from 0% to 10% (see attached schedule). Staff is recommending that the annual interest rate for all loans be uniform and established each year on June 30, based on the previous one year average Treasury Bill rate. The Agency has been making loan payments to the City based on a set formula that is calculated at the end of the fiscal year. The repayment amount has ranged from $145,000 to $454,000. Staff is recommending that the loan repayment amount be set at $250,000 per year, so that staff can project the amount of cash the Agency has available. One of the Agency’s major goals has been to create projects that generate long term revenues to the City. In recognition of this staff is recommending that there is an annual reduction of the City loan to the Agency based on the Agency’s performance.

“DISCUSSION: [¶] . . . [¶] The Agency has repaid the City a portion of the loan amount based on a formula approved by the Agency Board. Based on the formula, the Loan payment varied from $145,000 in FY 1994-95 to $454,000 in FY 1995-96. This year the amount is expected to be $225,000. The amount is calculated after the fiscal year. This makes it difficult for staff to project the amount of cash the Agency has available. Staff is recommending that the amount repaid to the City be in the amount of $250,000 per year with the first payment retroactive to July 1, 1996, for the 1995-96 fiscal year.

“FISCAL IMPACT: [¶] The City loan to the Agency would be reduced due to the overall lower interest rate, a set repayment amount of $250,000 per year, and there would be a reduction to the loan balance based on Agency performance.” (Italics added.)

This report and recommendation did not define “Agency performance” or articulate any standards for the proposed discretionary indebtedness reduction. Even in the absence of any performance standards, the city council adopted Resolution No. 10233, on August 5, 1996, as follows: “NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF BUENA PARK does hereby resolve as follows:

“SECTION 1: The interest rate for the overall loan balance be uniform to be determined at the end of each fiscal year based on the average Treasury Bill rate. The debt created hereby shall be subordinate to any other indebtedness of the Agency, presently existing or hereafter incurred, for the purpose of fulfilling the redevelopment activities of the Agency.

“SECTION 2: The City of Buena Park ma[y] request that the Agency make payment in the amount of $250,000 per annum with the first payment retroactive to July 1, 1996 for the 1995-96 fiscal year.

“SECTION 3: In recognition of the Agency’s efforts to generate long term revenue for the City, the City will further reduce the loan balance based on the Agency’s performance, to be determined by the city council at the end of each fiscal year.” (Italics added.)

Only a single payment was ever made on the purported $500,000 loan from the City to the Agency. In June 2010, the Agency paid $117,850.27 to the City.

The Purported 2001 Loan

The Agency appears to have developed a surplus of funds in 2001. Thus, in advance of an October 9, 2001 meeting of the Agency’s board of directors, the acting director of the Agency recommended the following action:

“DISCUSSION: [¶] In the past, the City has loaned administrative and start-up funds to the Agency for Redevelopment in Project Area I. The tax increment not needed to repay bonded indebtedness is classified as surplus tax increment. This surplus tax increment can only be used to repay existing Agency debt, therefore staff is recommending repayment of the City loans in the amount of $3.3 million with the tax increment from Project Area I.

“FISCAL IMPACT: [¶] This surplus tax increment in the amount of $3.3 million will be used to repay existing debt to the City.

“ALTERNATIVE COURSES OF ACTION: [¶] Retain the surplus tax increment, incur other debt for use of the tax increment.” (Italics added.)

On October 9, 2001, the Agency adopted Resolution No. RA-993 to provide that “[t]he sum of $3.3 million is hereby repaid to the City of Buena Park thus reducing the existing loan balance in Project Area I by said amount. All other remaining balances and agreements shall remain in effect including interest provisions.” The record does not show whether any payment was made in accordance with this resolution. However, it is undisputed that no payment was made in 2001 on the 1995 loan.

Rather than having the Agency disgorge its $3.3 million surplus, the city council adopted Resolution No. 11017 on October 9, 2001 to create exactly that amount of indebtedness for the Agency. In language nearly identical to the 1995 loan resolution, the city council’s 2001 resolution stated:

“The sum of $3.3 million is hereby appropriated as an operating loan to the Redevelopment Agency Project Funds for Project Area III, pursuant to . . . Section 33810 as a loan to the Agency to be repaid from any legally available funds of the Agency, with interest from the date hereof, to the date of repayment to be determined at the end of the fiscal year based on the yearly average of interest earned on the Agency investment portfolio. The debt created hereby shall be subordinate to any other indebtedness of the Agency, presently existing or hereafter incurred for the purpose of fulfilling the redevelopment activities of the Agency.”

After the 2011 fiscal year ended, an independent auditor examined the Agency’s finances. The auditor issued a report with notes to financial statements that recounted: “Advances from the City of Buena Park [¶] The Agency has borrowed $9,448,850 from the City of Buena Park for use in its redevelopment activities. There are no stipulated due dates for the payment of principal and interest and interest accrues at rates ranging from 3.07% to 10.00%. During the 2010-11 fiscal year, the Agency repaid the full amount of the advance from the City of Buena Park.” (Italics added.)

The Great Dissolution

As this court has previously recounted, “in 2011, the California Legislature dissolved redevelopment agencies and provided for successor agencies to wind down the affairs of the redevelopment agencies.” (City of San Jose, supra, 5 Cal.App.5th 123 at p. 33; see also generally City of Brentwood, supra, 237 Cal.App.4th at pp. 491-503; County of Sonoma v. Cohen (2015) 235 Cal.App.4th 42, 44-50.)

At the time the redevelopment agencies were dissolved, the Agency in this case had not repaid any part of the 2001 loan. And no payments were made on the 1995 loan after a single payment of $117,850.27 in June 2010.

In 2012, the Successor Agency assumed responsibility for winding down the Agency’s remaining obligations. In that capacity, the Successor Agency submitted a recognized obligation payment schedule (ROPS) to DOF for approval to pay $9.86 million for “payoff of advance” by the City. In January 2016, the Successor Agency passed a resolution to specifically request that DOF approve $1,356,570 in property tax increment funds to repay “City Loan to Former Redevelopment Agency” in the amount of $5,374,935.00.

DOF disallowed the claim, explaining that “the former [redevelopment agency] was not a party to these City Council Resolutions. In addition, the Agency was unable to provide any other contracts or loan agreements, executed by the Agency, obligating the Agency to repay the money it received. Finally, the Agency was unable to provide accounting records, such as cancelled checks or general ledger reports, to confirm the receipt of funds loaned by the City to the Agency.” On the same grounds, DOF denied the two loans at issue in this case constituted enforceable obligations.

The City’s Writ Petition and Complaint

In September 2016, petitioners filed a petition for writ of mandate and complaint for declaratory and injunctive relief. Petitioners sought to compel DOF to approve the purported 1995 and 2001 loans. DOF opposed the petition and complaint.

After a hearing, the trial court denied the petition and complaint. The trial court determined petitioners had not shown the 1995 and 2001 loans constituted enforceable obligations under section 34191.4, subdivision (b)(2)(A). Specifically, the trial court found petitioner had not established that (1) contractual loan agreements were formed between the City and the Agency in 1995 and 2001, (2) there were any actual transfers of money from the City to the Agency to fund the loans, or (3) that the Agency was obligated to repay the loans on any specific schedule. The trial court rejected the contention that DOF’s rejection of the purported loans violated the home-rule doctrine by invalidating valid contracts entered into by the City.

The trial court entered judgment in favor of DOF, and petitioners timely filed a notice of appeal.

DISCUSSION

I

Repayment of the 1995 and 2001 Loans

The petitioners contend the 1995 and 2001 loans from the City to the Agency meet the definition of enforceable obligations under section 34191, subdivision (b)(2)(A), including the statutorily required repayment schedule. We reject the contention.

A.

Section 34191.4

Section 34191.4, subdivision (b)(1), provides – with exceptions not pertinent here – that “loan agreements entered into between the redevelopment agency and the city, county, or city and county that created the redevelopment agency shall be deemed to be enforceable obligations provided that the oversight board makes a finding that the loan was for legitimate redevelopment purposes.” Subdivision (b)(2)(A) includes among enforceable obligations, “[l]oans for money entered into between the former redevelopment agency and the city, county, or city and county that created the former redevelopment agency under which the city, county, or city and county that created the former redevelopment agency transferred money to the former redevelopment agency for use by the former redevelopment agency for a lawful purpose, and where the former redevelopment agency was obligated to repay the money it received pursuant to a required repayment schedule.” (Italics added.)

In this case, the interpretation of the terms of the purported loans to the Agency is subject to the independent standard of review. (See People ex rel. Lockyer v. R.J. Reynolds Tobacco Co. (2003) 107 Cal.App.4th 516, 520.) “ ‘Unless the interpretation of a contract turns on the credibility of extrinsic evidence, the matter is a question of law. (California Assn. of Professional Scientists v. Schwarzenegger (2006) 137 Cal.App.4th 371, 382.) We review the trial court’s determination de novo. (Ibid.; LaMantia v. Voluntary Plan Administrators (9th Cir. 2005) 401 F.3d 1114, 1118.)’ (Roden v. AmerisourceBergen Corp. (2007) 155 Cal.App.4th 1548, 1561.) And ‘[u]nder statutory rules of contract interpretation, the mutual intention of the parties at the time the contract is formed governs interpretation. (Civ. Code, § 1636.) Such intent is to be inferred, if possible, solely from the written provisions of the contract. (Id., § 1639.) The “clear and explicit” meaning of these provisions, interpreted in their “ordinary and popular sense,” unless “used by the parties in a technical sense or a special meaning is given to them by usage” (id., § 1644), controls judicial interpretation. (Id., § 1638.) Thus, if the meaning a layperson would ascribe to contract language is not ambiguous, we apply that meaning.’ ” (Cuenca v. Cohen, supra, 8 Cal.App.5th at p. 222.)

In addition to the City and the Agency’s resolutions regarding the purported loan, the parties also rely on subsequent conduct regarding the 1995 and 2001 loans. “A party’s conduct subsequent to the formation of a contract may be looked upon to determine the meaning of disputed contractual terms. (Oceanside 84, Ltd. v. Fidelity Federal Bank [(1997)] 56 Cal.App.4th [1441,] 1449 [‘The conduct of the parties after the execution of the contract, and before any controversy arose, may be considered in order to attempt to ascertain the parties’ intention’]; Southern Cal. Edison Co. v. Superior Court [(1995)] 37 Cal.App.4th [839,] 851.) According to Witkin, ‘The conduct of the parties may be, in effect, a practical construction thereof, for they are probably least likely to be mistaken as to the intent.’ (1 Witkin, Summary of Cal. Law (10th ed. 2005) Contracts, § 749, p. 838.)” (Cedars-Sinai Medical Center v. Shewry (2006) 137 Cal.App.4th 964, 983.)

B.

Repayment Schedule

The trial court correctly determined the purported loan by the City to the Agency did not meet the definition of a loan under section 34191.4, subdivision (b)(2)(A). As the trial court noted, “The resolutions’ language effectively stated that the RDA could repay the City, when and if it had the means to do so.” The record shows the 1995 and 2001 city council resolutions were not made with the goal of ensuring the Agency would repay its loans, but to create indebtedness that would allow the Agency to receive the tax increment. In this sense, the evidence showed the “parties never intended a writing to constitute a contract” between them but instead to influence a third party. (P.A. Smith Co. v. Muller (1927) 201 Cal. 219, 222.)

Here, the city manager urged the city council to create an indebtedness because “[i]n order for the Agency to receive tax increment, debt must be created.” In direct response, the city council passed a resolution purporting to loan $500,000 to the Agency but without specifying any kind of repayment schedule within the meaning of section 34191.4. The 1995 resolution does not specify when the Agency needed to begin repayments, how often repayments should be made, the amount of the repayments, or whether repayment should end when the debt was fully paid off or with a balloon payment on a specific date. Further showing the 1995 resolution did not create a loan that was intended to be paid off, the city council made its loan subordinate to every other obligation – even unknown future obligations – owed by the Agency.

The subsequent conduct of the parties is revealing. During the 21 years after the City made the purported 1995 loan, the Agency made only a single payment. The record does not indicate the City took any adverse action against the Agency for failing to make any additional payments. This lack of any effort to seek repayment of the 1995 loan shows the City and Agency did not consider it an actual loan to be repaid. On this point, the trial court found the loans in this case were precisely the kinds of loans that are not the product of arms’ length negotiations, and that the Legislature intended the Dissolution Law to exclude from enforceable obligations.

We reach the same conclusion with regard to the purported 2001 loan from the City to the Agency. Again, the resolution for this $3.3 million loan was made in direct response to the surplus of $3.3 million that the Agency had in 2001. As the Agency’s acting director stated to the city council, the alternative to repayment of the surplus was to “[r]etain the surplus tax increment,” and “incur other debt for use of the tax increment.” The city council’s loan exactly matched the amount of the surplus that the Agency would otherwise have had to repay.

From 2001, when the city council purportedly loaned $3.3 million to the Agency, until the time the Legislature dissolved California’s redevelopment agencies, not a single repayment was made. The failure of the Agency to make any repayment on the 2001 loan shows there was never a requirement to repay the loan – let alone on a schedule as required by section 34191.4 for an enforceable obligation.

For lack of any repayment on the 2001 loan and only a single payment on the 1995 loan, we reject the petitioners’ reliance on the maxim that the law implies a promise to repay borrowed money. (See Lee v. U.S. Fire Ins. Co. (1921) 55 Cal.App. 391, 393.) The parties’ conduct over the course of 16 years was inconsistent with an intent that the Agency actually repay the loans. To the contrary, the 2001 purported loan was created so that the Agency would not have to disgorge the surplus it had.

We are not persuaded by the petitioners’ reliance on Daniels v. Select Portfolio Servicing, Inc. (2016) 246 Cal.App.4th 1150 (Daniels) or Hardman v. United States (9th Cir. 1987) 827 F.2d 1409 (Hardman).

Daniels involved an action by a borrower against a lender based on allegations the lender had not honored its promise to modify the loan. (246 Cal.App.4th at pp. 1157, 1174-1175) The Daniels court rejected the argument on grounds the terms of the promised loan modification were too indefinite to enforce. (Id. at p. 1174.) As the Daniels court noted, “Typically, a contract involving a loan must include the identity of the lender and borrower, the amount of the loan, and the terms for repayment in order to be sufficiently definite.” (Id. at p. 1174.) The borrowers, however, were unable to articulate the “essential terms of the loan modification they were promised.” (Id. at p. 1175.) Likewise, here the petitioners are unable to describe what would be essential terms of repayment for the 1995 and 2001 loans – including payment start dates, payment amounts, and final payment details such as at full payoff or a balloon payment.

We reject the petitioner’s suggestion the Agency was under an obligation to pay $250,000 toward the loans. The record shows the Agency did not make a single payment in the amount of $250,000. Nor did the City appear to take any action to collect that amount as an annual payment. Moreover, we note the petitioners cite a resolution in which the city council declared it could “request that the Agency make payment in the amount of $250,000 per annum . . . .” (Italics added.) A request is not the same as a contractual duty to make a loan payment. Moreover, the resolution suggested the annual payment would be reduced by some amount “based on the Agency’s performance, to be determined by the city council at the end of each fiscal year.” The “performance” standard, however, was not defined. In short, the city council’s recognition that it had the ability to request a payment of $250,000 did not provide evidence of the type of repayment schedule necessary to establish the existence of sufficiently definite loan terms.

The question presented in Hardman, supra, 827 F.2d 1409, was whether the giving of money to a company by an investor constituted a loan or an equity investment. (Id. at p. 1411.) For purposes of federal income taxation, the characterization of the funding either as a loan or an equity investment determined the amount of tax the appellants would have to pay. (Ibid.) The case did not involve the question of what type of loan passes muster as an enforceable obligation under California law. Nonetheless, Hardman is instructive insofar as it indicates that funding without a fixed maturity date or dependent on a specific event – such as the sale of a particular property – is likely not to be a loan. (Id. at p. 1413.) Here, the 1995 and 2001 funding resolutions by the city council were silent on maturity dates for the purported loans. There also were no conditions specified that would trigger a requirement that the Agency repay the loans.

In sum, the city council’s 1995 and 2001 resolutions were intended to create indebtedness to allow the Agency to receive and retain the tax increment that was then available to redevelopment agencies. The resolutions did not impose repayment schedules as required by section 34191.4 for enforceable obligations under the Dissolution Law. Accordingly, the trial court properly dismissed the petition and complaint.

II

Home-rule Doctrine

The petitioners argue DOF’s denial of the purported 1995 and 2001 loans violates the home-rule doctrine because it nullifies the loans. We disagree.

The home-rule doctrine arises out of California Constitution article XI, section 5. “The general home rule provision of the Constitution gives chartered cities the power to ‘make and enforce all ordinances and regulations in respect to municipal affairs, subject only to [the] restrictions and limitations provided in their several charters . . . .’ (Cal. Const., art. XI, § 5, subd. (a).)” (Baggett v. Gates (1982) 32 Cal.3d 128, 135-136.)

Here, the purported 1995 and 2001 loans were an accounting move to create indebtedness to allow the Agency to receive the tax increment to fund its activities. (P.A. Smith v. Muller, supra, 201 Cal. at p. 222.) DOF did not impinge on the City’s home-rule prerogative by denying the enforceability of the loans because the purported loans were not valid contractual obligations. (Ibid.)

DISPOSITION

The order dismissing the City of Buena Park’s petition for a writ of mandate is affirmed. Keely Bosler as Director of the Department of Finance shall recover costs on appeal. (Cal. Rules of Court, rule 8.278(a)(1) & (2).)

/s/

HOCH, J.

We concur:

/s/

BLEASE, Acting P. J.

/s/

HULL, J.