Finding one's way out of a paper bag . . . tax

April 05, 2013 | By TONY FRANCOIS

Usually in California, when the state or a local government passes a law that requires citizens to pay a charge for something, a debate ensues about whether the charge is a tax or a fee.  Under the California Constitution, as amended by Proposition 26 in 2010, new local taxes must be passed by the voters before they can go into effect.  On the other hand, a list of fairly narrow exceptions allows the imposition of certain local regulatory, licensing, development, and similar fees without voter approval.

So when Los Angeles County banned plastic shopping bags and imposed a 10 cent charge on shoppers for paper bags without voter approval, everyone assumed the legal question to be whether the state constitution defined the bag charge as a tax, or whether one of the constitutional exceptions applies.

Wow, was everybody wrong about that.  Turns out the California Constitution has nothing to do with it.

According to the California Court of Appeal, in Schmeer v. County of Los Angeles, forcing shoppers to pay money to grocers, and then making the grocers spend the money on specific public programs, is not limited by the state constitution at all.  Schmeer says that as long as the money never actually passes through a public bank account, the government can make us pay charges, and can tell the recipient how to spend them, with no constitutional limits.

Schmeer is a blueprint for widespread mischief.  Under the rule in the case, cities could force apartment renters to pay a charge to their landlord along with the rent, and then force the landlord to spend it on recycling, or drought resistent landscaping, or whatever else is in vogue.  Or force restaurant customers to pay a charge to the restaurant, and force the restaurant to spend it on reducing trans fats in their menu.  Or force drivers to pay their gas station a charge that the gas station has to spend to subsidize alternative fuel sales.  Just wait till Mayor Bloomberg hears about the Schmeer rule; he may move from New York so he can run for mayor somewhere in California.

The plaintiffs in Schmeer have petitioned the California Supreme Court to review the case, and PLF supports review of this disastrous decision.