California Supreme Court will review controversial tax decision

Last month, Pacific Legal Foundation filed a letter brief urging the California Supreme Court to review a decision denying taxpayers the right to vote on taxes imposed by initiative. Yesterday, the Court agreed to review the decision in California Cannabis Coalition v. City of Upland. The question before the Court is as follows:  Can the proponents of a new tax evade constitutional prerequisites by introducing the tax as an initiative rather than a resolution of the governing body?   See this earlier post for an explanation of the facts and relevant law involved in the case.

The Howard Jarvis Taxpayers Foundation filed the petition for review, arguing that the lower court’s decision creates a gigantic loophole that allows public agencies to increase existing taxes–or impose new taxes–without voter consent.  The petition states that the “loophole is so obvious that the media realized it as soon as the Court of Appeal announced the decision.”   

The San Diego Tribune reported as follows:  “In a decision that could have a sweeping impact across California, a new state appeals  court ruling may ease approval of local tax increases if they are placed on the ballot by citizen’s initiative instead of by a government agency. … ‘It has a far reaching impact across the state,’ San Diego City Attorney Jan Goldsmith said of the ruling.  ‘There was a belief there was a two-thirds requirement and this changes that.  There’s no question it’s a seminal case.'”

An article in California Planning & Development Report concluded that “[l]ocal governments can simply adopt an initiative rather than put it on the ballot.”  The process allows the “apparently magical power of the initiative process to end-run two generations of laws that make it more difficult to … adopt new taxes in California.”

A ruling for the City of Upland will protect an integral part of our State Constitution–the citizens right to vote on taxes.  PLF will file an amicus brief urging reversal of the lower court’s decision.