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California Supreme Court Blocks Taxpayer Protection Ballot Measure

California Supreme Court Blocks Taxpayer Protection Ballot Measure

The California State Capitol building Sacramento, Calif., on April 18, 2022. (John Fredricks/The Epoch Times)

Travis Gillmore
Travis Gillmore

6/20/2024

Updated: 6/25/2024

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In an opinion released on June 20, the California Supreme Court ruled unanimously in favor of California Gov. Gavin Newsom’s and the state Legislature’s request to remove a ballot measure that would make it more difficult for the government to raise taxes.
At issue is an initiative known as the Taxpayer Protection and Government Accountability Act, which would define taxes to include any fees or charges imposed by the state and would require approval by the electorate and a two-thirds vote by lawmakers.
The governor and state Legislature filed a lawsuit in September 2023 seeking to keep it out of the election and took the matter directly to the state’s highest court.
“We are grateful the California Supreme Court unanimously removed this unconstitutional measure from the ballot,” Mr. Newsom’s office said in a statement emailed to The Epoch Times on June 20. “The governor believes the initiative process is a sacred part of our democracy, but as the court’s decision affirmed today, that process does not allow for an illegal constitutional revision.”
The ruling orders the secretary of state to refrain from placing the initiative on the November ballot or including any mention of the measure in the voter information guide.
Just days ahead of the June 27 deadline to remove eligible initiatives, the court set its judgment to become final on June 25.
The opinion, written by Justice Goodwin H. Liu, said the initiative constitutes a violation of Article XVIII of the state’s constitution by revising instead of amending the document and thus would require a constitutional convention or two-thirds vote from the Legislature before heading to voters.
“The measure exceeds the scope of the power to amend the Constitution via citizen initiative,” the opinion reads. “It is within the people’s prerogative to make these changes, but they must be undertaken in a manner commensurate with their gravity.”
Provisions within the initiative would fundamentally affect every level of government in the state, the justices concluded.
“The [Taxpayer Protection Act] would shift so much authority, in such a significant manner, that it would substantially alter our framework of government,” the opinion reads.
One point of contention that justices found with the initiative is the requirement that any new tax—with an expanded definition of such including any fees or costs to Californians—would require voter approval.
“We have never before considered a voter approval requirement imposed on the Legislature like the one at issue here,” the opinion reads, while also citing case law. “We think it clear that a voter approval requirement for any new state tax measure would constitute a significant interference with the administration of [the Legislature’s] fiscal powers and policies.”
Justices ruled that such changes fundamentally alter state and local governments’ ability to raise revenues.
“We observe only that requiring any new or higher tax levy to undergo voter approval would significantly alter the existing constitutional balance between direct democracy and representative democracy, with reverberations throughout the framework of our government,” the opinion reads.
“We conclude that the [initiative] would substantially transform the process for enacting new statewide tax legislation that has existed since the state’s founding and that this transformation weighs significantly in favor of finding that the [initiative] would effect a constitutional revision.”
The court found that the Legislature would be prevented from raising revenues quickly when necessary.
“This is particularly important when changes in revenue or appropriations are needed to respond to state or local emergencies,” the opinion reads. “By requiring the electorate to approve any new tax or any change in the use of any special tax revenue previously approved by the voters, the [Taxpayer Protection Act] would preclude the state from raising new revenue or redirecting any existing special tax revenue in light of unforeseen events, until after a statewide election.”
As the state’s Elections Code requires a minimum of 131 days between the adoption of proposed ballot measures and a special election, the delay could hurt the state, according to the ruling.
While the court generally reviews constitutional challenges to voter initiatives after elections, the justices said in this case that a preelection decision was proper because the measure did not follow the constitutional requirements and could take time and attention away from other ballot measures.
They also found that if the election took place and the court later overturned the electorate’s decision, distrust in the process could proliferate and “may contribute to an increasing cynicism on the part of the electorate with respect to the efficacy of the initiative process.”
Rollback provisions included in the initiative—which would void any state or local taxes adopted after Jan. 1, 2022, if not subsequently approved by voters—also concerned the justices because they would require governments to administer special elections and could jeopardize billions of dollars in taxes already approved.
“These provisions would effectively transform any postelection review of the [initiative] into another form of preelection review in advance of the special elections expected to take place the following year,” the opinion reads. “The rollback provisions also generate uncertainty before the election as to whether already enacted revenue measures will be later voided.”
The ruling follows oral arguments presented on May 8. At the time, Margaret Prinzing—the attorney representing the governor and Legislature—told the court the measure should be tossed because it represents a revision to the state constitution as opposed to an amendment.
“The initiative measure before this court is unlike any that has come before it,” Ms. Prinzing said. “This measure would fundamentally restructure the power of government to raise revenue as set forth in the California Constitution.”
She argued that the Legislature has held the power to impose taxes since the state was founded but would lose that right if the measure was approved by voters.
“This measure would revoke that power for the first time in California and instead put it in the hands of the voters,” Ms. Prinzing said. “It’s a revision that would occur in ways that would endanger the government’s ability to provide essential government services.”
Proponents argued that the Legislature’s power is balanced by the will of the people.
“Voter approval has been a component of California’s history since its inception and ... the extension of that to other matters is perfectly within the realm of reason,” Thomas Hiltachk, the attorney representing the measure and its supporters, told the court.
“What we have, essentially, is a two-way street where the legislative power is shared amongst these two groups: the people on the one hand and the Legislature on the other, but the people have the last word.”
He said such rights are given to the electorate by the state’s constitution.
“Our constitution, since its inception, has stated that all political power is inherent in the people,” Mr. Hiltachk said. “It has stated that the people have the power to reform and alter their government whenever they decide it needs reform.”
Some lawmakers said they would prefer that voters have a say in the matter.
“I’m disgusted. The court has failed in its duty to the people of California and our democratic system,” state Senate Minority Leader Brian W. Jones said in a June 20 statement after the ruling was announced.
With the June 27 deadline looming, little time is left for legal action from proponents to have the measure placed on the ballot this year, although a similar initiative with revised language that seeks to address the court’s concerns could be considered for an election in 2026 or 2028.
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Travis Gillmore is an avid reader and journalism connoisseur based in California covering finance, politics, the State Capitol, and breaking news for The Epoch Times.

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