Earlier this week the California Supreme Court issued a stunning decision which imperils every California taxpayer. At issue is whether taxes proposed by special interests using the local initiative process have to comply with taxpayer protections set forth in Proposition 218, the Right to Vote on Taxes Act, a Howard Jarvis Taxpayers Association sponsored statewide measure approved by California voters in 1996.
The case, California Cannabis Coalition v. City of Upland, at first glance seems limited to a narrow technical question: When a local initiative seeks to impose a new tax, does the issue need to be put to the voters at the next general election or can the proponents, relying on other laws, force a special election? The lower court had ruled that taxes proposed by initiative are exempt from the taxpayer protections contained in the state constitution, such as the provision dictating the timing of the election.
When the lower court in San Diego issued its decision, the Howard Jarvis Taxpayers Association was alarmed because the constitution’s taxpayer protections include the right to vote on taxes. For that reason HJTA provided legal representation to the city of Upland. Of major concern was that, if local initiatives are exempt from taxpayer protections, then public agencies could easily deny taxpayers their right to vote on taxes 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 required. 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.
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