“The measure exceeds the scope of the power to amend the Constitution via citizen initiative” – California Supreme Court

“Today’s ruling is the greatest threat to democracy California has faced in recent memory…the California Supreme Court has put politics ahead of the Constitution” – Californians for Taxpayer Protection and Government Accountability

By Allen D. Payton

In response to a lawsuit by Gov. Gavin Newsom and the state legislature, the California Supreme Court justices unanimously ruled, today, Thursday, June 20, 2024, the measure known as the Taxpayer Protection and Government Accountability Act amounts to an illegal constitutional revision and removed it from the November election ballot. However, proponents vowed to continue to explore their legal options and efforts to minimize

According to Ballotpedia, “The initiative would have amended the California Constitution to define all state and local levies, charges, and fees as taxes. The initiative would have also required new or increased taxes to be passed by a two-thirds legislative vote in each chamber and approved by a simple majority of voters. It would also have increased the vote requirement for local taxes proposed by local government or citizens to a two-thirds vote of the local electorate. The increased vote requirements for new or higher taxes would have not applied to citizen-initiated state ballot measures. As of 2024, state tax increases require approval by a two-thirds vote in each chamber or a simple majority vote at a statewide election

In addition, a ‘yes’ vote on the measure would have supported “amending the state constitution to define all state and local levies, charges, and fees as taxes and to require new state taxes proposed by the state legislature to be enacted via a two-thirds legislative vote and voter approval and new local taxes to be enacted via a two-thirds vote of the electorate.”

However, according to the Associated Press, “The biggest impact…would have been that the measure threatened to retroactively reverse most tax increases approved since Jan. 1, 2022. Local governments warned they would have lost billions of dollars in revenue that had previously approved by voters. And it would have threatened recent statewide tax increases.”

Proponents

Proponents of the measure, Californians for Taxpayer Protection and Government Accountability, self-described as “a bipartisan coalition of homeowners, taxpayers and businesses committed to ensuring California remains affordable for families and accountable to its voters,” led the campaign in support of the initiative.  The campaign explained the initiative, saying, “The Taxpayer Protection and Government Accountability Act will give voters the right to vote on all future state taxes and holds politicians accountable for new fees and other increased costs paid by working families and all Californians. The measure increases accountability by requiring politicians to spend new or higher tax revenue on its intended purpose. It will provide much-needed relief to families, farmers, and business owners, helping them to combat the growing cost-of-living crisis facing all Californians.”

Supporters included the California Business Roundtable, California NAIOP Commercial Real Estate Development Association, and the Howard Jarvis Taxpayers Association. The campaign had received $17.8 million in contributions.

According to the NAIOP, the measure would have given “voters the right to vote on all future state taxes and holds politicians accountable for new fees and other increased costs paid by working families and all Californians.” It would have increased “accountability by requiring politicians to spend new or higher tax revenue on its intended purpose. It will provide much-needed relief to families, farmers, and business owners, helping them to combat the growing cost-of-living crisis facing all Californians. The Act doesn’t cut any current state or local government funding. It simply gives voters the right to vote on all future tax increases and stops working families from paying billions more in “hidden taxes” imposed by unelected bureaucrats.  They are currently gathering signatures and will need $70 million in fundraising efforts to pass the ballot measure in November of 2022.”

View materials on the proposed ballot measure.

Supporters Respond, Will Seek Legal Options, Continue Efforts

In response to the court’s ruling, the Taxpayer Protection and Government Accountability Act (TPA) campaign issued the following statement from Rob Lapsley, president of the California Business Roundtable, Jon Coupal, president of the Howard Jarvis Taxpayers Association (HJTA) and Matthew Hargrove, president and CEO of the California Business Properties Association:

“Today’s ruling is the greatest threat to democracy California has faced in recent memory. Governor Newsom has effectively erased the voice of 1.43 million voters who signed the petition to qualify the Taxpayer Protection Act for the November ballot. Most importantly, the governor has cynically terminated Californians’ rights to engage in direct democracy despite his many claims that he is a defender of individual rights and democracy. Evidently, the governor wants to protect democracy and individual rights in other states, but not for all Californians.

We are disappointed that the California Supreme Court has put politics ahead of the Constitution, disregarding long-standing precedent that they should not intervene in an election before voters decide qualified initiatives.

Direct democracy and our initiative process are now at risk with this decision, showing California is firmly a one-party state where the governor and Legislature can politically influence courts to block ballot measures that threaten their ability to increase spending and raise taxes. Using the courts to block voters’ voices is the latest effort from the Democrats’ supermajority to remove any accountability measures that interfere with their agenda – a failed agenda that continues to drive up the cost of living with little accountability and few results.

This ruling sends a damning message to businesses in California and across the country that it is politically perilous to invest and grow jobs for the future.

In light of this ruling and the state’s large budget deficit, a huge amount of tax increases are on the way that are sure to make California’s cost of living even higher.

We will continue to explore our legal options and fight for the people’s right to hold their government accountable through direct democracy.”

Opponents

The measure was opposed by Governor Newsom, CA Attorney General Rob Bonta, AFSCME California, SEIU California State Council, California Special Districts Association, California State Association of Counties, and League of California Cities. Graham Knaus, executive director of the California State Association of Counties (CSAC), said, “This deceptive initiative would undermine the rights of local voters and their elected officials to make decisions on critical local services that residents rely upon. It creates major new tax loopholes at the expense of residents and will weaken our local services and communities.”

Bonta had relabeled the measure’s title to, “Limits Ability of Voters and State and Local Governments to Raise Revenues for Government Services. Initiative Constitutional Amendment.” The summary he required to be included on signature petition sheets read as follows: “For new or increased state taxes currently enacted by two-thirds vote of Legislature, also requires statewide election and majority voter approval. Limits voters’ ability to pass voter-proposed local special taxes by raising vote requirement to two-thirds. Eliminates voters’ ability to advise how to spend revenues from proposed general tax on same ballot as the proposed tax. Expands definition of ‘taxes’ to include certain regulatory fees, broadening application of tax approval requirements. Requires Legislature or local governing body set certain other fees.”

In spite of that, supporters were still able to gather the required signatures to qualify the measure for the ballot. The signature gathering occurred in 2022.

Court’s Decision

According to information about the case #S281977 entitled LEGISLATURE OF THE STATE OF CALIFORNIA v. WEBER (HILTACHK) on the state Supreme Court’s website, it “presented the following issues: (1) Does the Taxpayer Protection and Government Accountability Act (TPA) constitute an impermissible attempted revision of the California Constitution by voter initiative? (2) Is this initiative measure subject to invalidation on the ground that, if adopted, it would impair essential government functions?”

The court wrote in its unanimous opinion, “we conclude that the TPA would clearly ‘accomplish such far reaching changes in the nature of our basic governmental plan as to amount to a revision’ of the (state) Constitution. The measure exceeds the scope of the power to amend the Constitution via citizen initiative.”

“It is within the people’s prerogative to make these changes, but they must be undertaken in a manner commensurate with their gravity: through the process for revision set forth in Article XVIII of the Constitution,” the decision continued.

The court concluded by “directing the (CA) Secretary of State to refrain from taking steps to place” the initiative “on the November 5, 2024 election ballot or to include the measure in the voter information guide.”

However, Section 3 of that Article clearly reads, “The electors may amend the Constitution by initiative.” Coupal of the HJTA was asked to explain what the court is referring to and what other approach or process should the proponents have followed. He did not respond prior to publication time.

See Court ruling, here.

For more information about the ballot measure and the coalition that supported it visit www.taxpayerprotection.com.

Please check back later for any updates to this report.