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Ariz. SC clarifies Prop 204 decisions

By Nathan Bass | Jan 30, 2013

PHOENIX (Legal Newsline) - The Arizona Supreme Court has released a pair of opinions explaining decisions it made on two actions regarding the state's language describing Proposition 204, a tax initiative which was rejected by the people of Arizona in the November election.

Justice John Pelander authored the opinion in each case, both released Jan. 17, with Justices Scott Bales and Robert M. Brutinel concurring. The Court accepted and ruled on the two actions prior to the election but without opinions.

In each case, the Court affirmed the judgment of Maricopa County Superior Court Judge John Christian Rea.

In the first action, Quality Education & Jobs Supporting I-16-2012, referred to as "the Committee," challenged the Legislative Council's analysis of initiative Proposition 204, claiming that the analysis was misleading and unfair.

The superior court upheld the Committee's challenge in part and ordered the Council to revise or delete parts of the analysis.

The Council then filed a "petition for special action" with the Court. On Aug. 17, 2012, the Court issued an order denying relief and thereby upholding the superior court's order.

Proposition 204 would have replaced Proposition 100 which had amended the state constitution to levy an additional, but temporary one percent sales tax for education, by making the "temporary" sales tax raise permanent.

"The Legislative Council then undertook its statutorily required task of preparing an impartial analysis of the initiative," the opinion states.

The Committee filed a special action in superior court to challenge parts of the Council's analysis. The alleged the analysis was not impartial because: (1) it repeatedly stated that the initiative would impose a "tax increase" when there would be no increase from the temporary measure, Proposition 100; (2) it inaccurately stated that the "sales tax base cannot be adjusted in a way that causes the amount of sales tax collected to be less than the amount collected in the prior year; and (3) it "gratuitously" pointed out that the initiative fails to define who qualifies as a "resident" for purposes of distributing university scholarship monies raised under the tax.

After hearing oral argument on the issues, the court ordered the three portions of the analysis to be "revised or deleted."

The Court backed Rea on appeal.

"When Legislative Council analyses are challenged under § 19-124(B), we must evaluate them for statutory compliance, though we do so reluctantly and with reservation. As we have previously said, "[n]o member of this court has any particular fondness for these challenges."

"Nor can we "settle each of these disputes; our function is only to ensure that a challenged analysis is reasonably impartial and fulfills the statutory requirements." Determinations of impartiality are not always easy or clear-cut.

"Based on our existing case law, however, we cannot say that the superior court erred in finding the Legislative Council's analysis noncompliant with § 19-124(B)'s impartiality requirement in the three respects discussed above. We therefore accept jurisdiction of the special action but deny relief."

In the second action, the Committee challenged the Arizona Secretary of State's descriptive title of the proposition and the "yes/no" language in the Secretary's voter information guide and on the ballot for the November 2012 election.

The superior court rejected the challenge, finding that the language was "not arbitrary or unquestionably inaccurate" and thereby it substantially complied with the relevant statute.

On Aug. 28, 2012, the Court issued an order affirming the superior court.

The general election guide, also known as "publicity pamphlet", and ballot contained this language:

Proposition 204


A "yes" vote shall have the effect of permanently increasing the state sales tax by one cent per dollar, effective June 1, 2013, for the purpose of funding educational programs, public transportation infrastructure projects, and human services. It forbids reductions to current K-12 and university funding levels and forbids reductions to the current state sales tax base.

A "no" vote shall have the effect of not increasing the state sales tax by one cent per one dollar, beginning June 1, 2013.

"The Committee argues that the Secretary's description violates § 19-125(D) by 'falsely characterizing the Act as a tax increase' and 'exaggerating the limitation on the Legislature contained in the Act,'" wrote Justice Pelander.

"The Committee's preferred language would have stated that the Act "'replac[es] the temporary one cent per dollar sales tax set to expire on June 1, 2013, with a permanent one-cent sales tax,' and 'forbids reductions to the current sales tax base applicable to the one-cent sales tax.'

"In Tobin, we required modification of the Legislative Council's analysis not because it characterized the Act as imposing a new tax increase, but only because it did not satisfy § 19-124(B)'s impartiality requirement, as explicated in this Court's case law. Absent any explanatory context, the Council's analysis was not completely 'free from any misleading tendency.'

"Accordingly, the analysis could not be viewed as 'a completely neutral summary, without advocacy or argument' ... Nor did it lack any hint of 'partisan coloring.'

"Although § 19-125(D) does not permit the Secretary to use false or clearly misleading language, the 'tax increase' language he used in the publicity pamphlet and ballot cannot be characterized as such.

"As with the Secretary's 'tax increase' language to which the Committee objects, the meaning of his 'sales tax base' language is fairly debatable and potentially subject to differing interpretations. But that does not mean the language fails to comply with § 19-125(D).

"We have no more appetite for enmeshing ourselves in quarrels regarding the Secretary's compliance with § 19-125(D) than in disputes over the Council's compliance with § 19-124(B).

"As the superior court correctly observed regarding the areas of contention here, however, the parties each raised 'legitimate points,' and neither side's position 'is irrational or frivolous.'

"The court did not abuse its discretion or otherwise err in finding that the Secretary's language substantially complies with § 19-125(D). Accordingly, we accept special action jurisdiction but deny relief."

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