LOS ANGELES — A California Supreme Court ruling changes one of the ground rules for local ballot initiatives.

In California Cannabis Association v. Upland the successful litigants challenged the city’s interpretation that a citizen’s initiative needed to be on the ballot at the same time council members are up for election.

The Supreme Court's 5-2 ruling found that citizen’s initiatives can come at any time.

The ruling was about a medical marijuana initiative, but speculation arose that it could make it easier to pass local tax measures.

Sen. Scott Wiener, D-San Francisco, is among those who believe the ruling could have a widespread impact.

“It’s hard to overstate how important this ruling is," Wiener said. " Communities will now have a much easier time funding schools, transportation and other critical needs.”

Senator Wiener talking with fellow Senator Anthony Portantino
California State Sen. Scott Wiener, D-San Francisco, (right) believes a state Supreme Court ruling will make it easier to pass local government tax measures.

Jon Coupal, President of the Howard Jarvis Taxpayers Association, said in a statement that it may be necessary to use the initiative process to close what he termed a “court created loophole" in propositions 13 and 218, which restrict local tax votes in California.

“If local initiatives are exempt from critical taxpayer protections, then public agencies could easily deny taxpayers their rights by colluding with outside interests to propose taxes in the form of an initiative, then submitting a tax under a lower vote threshold than that currently mandated by the constitution,” Coupal said. “The worst case scenario would be if a local government were to rely on this case as legal authority to impose a tax without any election at all. However, if that were attempted, we would commence a new lawsuit immediately.”

The tax talk may be an overreaction, one expert said.

“No that’s premature,” said Michael Coleman, fiscal policy advisor for the League of California Cities. “The case was not about voter thresholds; it was about if the timing requirements of Proposition 218/Proposition 13 apply to citizen tax initiatives the same as they do to tax measures placed on the ballot by local governments.”

Local tax initiatives for a specific purpose require a two-thirds supermajority from voters.

The term threshold is not used anywhere in the 45-page ruling, Coleman said.

Attorneys that work with the League of California Cities say unless it is later addressed in case law, the law will not change voter thresholds.

“So, we think it is premature to say the ruling has altered voter threshold,” Coleman said.

He said there is “conjecture that if 218 and 13 don’t apply to the timing of elections that maybe they don’t apply to other provisions,” Coleman said.

Even if the case did open the door to a majority-vote threshold, Coleman said it is unlikely to open the floodgates on agencies trying to use citizen initiatives to increase taxes.

There are other easier ways for agencies to increase taxes than the costly method of gathering signatures to get something on a ballot and pitching it to voters.

Initiatives that link taxes to specific purposes end up tying up revenue sources for specific needs and limiting budget flexibility for cities in a downturn or if its needs change, he said.

“Cities are better off passing a general purpose tax with a majority vote,” he said. “Cities have gotten into trouble by locking up revenue sources, for instance, with binding salaries. It is harder to be nimble if budgets are fragmented in that way.

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