ALAMEDA -- Property owners who paid a parcel tax to support local schools may receive refunds after the state 1st District Court of Appeal upheld a decision Wednesday that invalidated parts of Measure H, which Alameda voters passed in 2008.

The decision, which struck down the measure's rate structure and found only the flat $120 rate that residential owners paid was valid, could mean cuts at the Alameda Unified School District as officials look for ways to pay the refunds.

While the ruling clears the way for hearings to determine the amount of refunds, school district officials are expected to now bring the case before the California Supreme Court.

"We will know their next move within 40 days," said David Brillant, the attorney who represents the commercial property owners who sued the district. "Taxpayers should be pleased with this result but again I caution that we are still far away from the potential large refunds due to taxpayers."

The case could have far reaching consequences for school districts throughout the state as similar lawsuits over parcel tax structures have been filed in Yolo, Contra Costa and Los Angeles counties.

In December, the school board of the Piedmont Unified School District held an emergency meeting to modify its proposed property tax -- changing it from a parcel tax to a flat tax -- to comply with the ruling handed down earlier that month in the Alameda case. Piedmont voters passed the tax, called Measure A, on Tuesday. Alameda Superintendent Kirsten Vital said district officials are reviewing Wednesday's decision. Trustees are expected to be briefed next week, she said.

George Borikas and other commercial property owners who sued the Alameda district maintain Measure H was unfair because it taxed them differently than residential owners.

Owners of commercial properties of less than 2,000 feet were taxed at $120 annually under the measure -- the same as residential property owners. But those owning parcels more than 2,000 square feet were taxed at 15 cents a square foot, capped at $9,500 annually.

The decision follows teachers and district representatives reaching a tentative contract Feb. 28, capping 10 months of negotiations that twice stalled when teachers declared an impasse.

Details are not being disclosed until the rank-and-file of the Alameda Education Association, which represents 524 teachers, can review the agreement and vote. The outcome is expected as early as next week.

During the talks, the district offered teachers a 2.5 percent ongoing raise, plus an opportunity to reopen salary talks next January. Teachers were seeking a 4.5 percent raise over two years.

District officials said the financial uncertainty faced by the district over the lawsuit, as well as over state funding, limited what they could offer teachers.

Among those who joined Borikas in the lawsuit against the school district over Measure H was Ed Hirshberg, who owns the building that houses the Alameda Journal, a Media News publication.

Reach Peter Hegarty at 510-748-1654 or follow him on Twitter.com/Peter_Hegarty.

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