Laws governing those tax elections, however, are in a state of legal flux.
The state constitution separates local tax proposals into those meant for general purposes and those for specially designated purposes. It allows simple majority voter approval of the former and requires two-thirds voter approval for the latter.
Last year, the state Supreme Court shook up those provisions, implying in a Southern California marijuana case that if special purpose tax measures are placed on the ballot by initiative petition, rather than by the local governments themselves, the two-thirds vote threshold might not apply.
The ruling was not definitive, but ever since it was issued, those in the cloistered world of local government finance have speculated about its potential effects. Everyone’s been waiting for a test case and it might be a special property-related tax approved by San Francisco voters on June 5.
Measure C, placed on the ballot by an initiative petition sponsored by members of the city’s Board of Supervisors and approved by 51 percent of its voters, imposes a 3.5 percent tax on local commercial rents, such as office buildings, and a 1 percent tax on warehouse rents.
Entitled “Universal Childcare for San Francisco Families,” the measure dedicates tax proceeds to child care and early childhood education.
Commercial property owners and the Howard Jarvis Taxpayers Association sued, contending that Measure C is clearly a special tax,
since its proceeds are designated for one purpose, and thereby needed a two-thirds vote.
It’s evident that tax sponsors see it as a way of converting the Supreme Court’s earlier implication into rock-solid case law, thus making it easier to enact new local taxes. And just as clearly, Jarvis and other plaintiffs in the suit see it as a potential erosion of the constitution’s two-thirds vote requirement for special taxes.
Thus, the die appears to be cast for a legal showdown. But wait, as the TV peddlers say, there’s more.