Jon Coupal- Columnist
is an attorney and president of the Howard Jarvis Taxpayers
Association -- California's largest taxpayer organization with
offices in Los Angeles and Sacramento. [go to website] [go
to Coupal index]
Legal Action: A Necessary Weapon
the never ending onslaught of greedy government
[Jon Coupal and Trevor Grimm] 12/1/03
Although supported by two-thirds of the voters in 1978, Proposition
13 was not born into a friendly world. Indeed, immediately after
its passage, a massive legal effort tried to kill the new law
in its cradle. That effort failed as the California Supreme Court
upheld Proposition 13 against a host of constitutional attacks.
Since that time, the courtrooms have been major battlefields
in defending taxpayer protections.
Using law books as ammunition in the fight for taxpayer rights,
we have come to appreciate the little Dutch Boy. By using his
finger to plug a leaking dike he was able keep the ocean out
and to save his community from destruction.
Unfortunately, it often seems that the dike holding back a crushing
burden of higher taxes has more leaks than taxpayer attorneys
have fingers and toes. And every time one leak is plugged energetic
tax raisers begin work on creating a new way to overcome the
taxpayer protections provided by Proposition 13 and Proposition
218, the Right to Vote on Taxes Act, passed in 1996.
At any given time the Howard Jarvis Taxpayers Association is
involved in more than a score of legal actions. The reason for
so many suits is often the result of bad advice given to government
officials by their own legal counsel. Some lawyers paid by the
public purse have become so energetic and creative in their efforts
to punch holes in Proposition 13 you'd think that there was a
bounty for violating taxpayer rights.
there is a prize to the city administration that finds the
way around Proposition 13 are probably
unfounded, but if there were, the city of Roseville would definitely
be in the running. Prior to April 2000, the City of Roseville
enacted a so-called "in-lieu franchise fee" on utility
users. This "fee" (which of course was never approved
by the voters) was imposed on the theory that if the city were
served by privately owned utility companies, the providers would
be charged such a fee and that fee would be passed on to the
years of litigation, Howard Jarvis Taxpayers Association lawyers
had the illegal "in lieu franchise fee" struck.
In the language of the law, there was no "nexus" or
connection between the amount of the fee and any particular use-caused
expense, therefore the "fee" had all the characteristics
of a tax requiring voter approval.
This was the taxpayers' second victory against the City of Roseville.
HJTA had won a previously lawsuit, again representing the local
taxpayer group Friends of Roseville, over an illegal effort to
impose a special tax without a two-thirds vote. In short, some
government entities seem to go out of their way to ignore the
important protections taxpayers have secured for themselves at
the ballot box.
A more recent
example, similar to Roseville's "in-lieu
franchise fee" case involved the City of Lancaster. There,
the City Council just deliberated over an ordinance to tag apartment
owners with an annual $95 per unit security "fee," dedicated
to hiring more police. The theory was the city's crime rate had
increased in the wake of an influx of renters, and, therefore,
rental property owners should pay for more cops and try to get
the money back in the form of higher rents. Fortunately, legal
action was not required. The proposal was laid aside after a
public outcry aided and abetted by Howard Jarvis Taxpayers Association.
(Sometimes, just the threat of litigation can bring compliance
with taxpayer protection laws).
Both the Roseville and Lancaster situations involve local governments.
But Proposition 13 extends to state taxes as well because it
requires a two-thirds vote of the Legislature to raise taxes.
Indeed, it was the violation of this provision that is the basis
of HJTA's lawsuit against the dreaded car tax. One reason our
new Governor repealed the car tax -- in addition to the fact
that the tax hike was simply bad policy -- was the fact that
the tripling of the tax was illegal. His rollback of the tax
might make our lawsuit unnecessary, but we also want to make
sure this kind of illegal tax hike isn't attempted by future
taxpayer protection found in our state constitution requires
a vote for going into debt over $300,000. When Gray
Davis and the Legislature tried to float $2 billion (that's billion
with a "b") in bonds to meet the pension obligations
of state employees, HJTA filed suit. It didn't take the judge
too long to figure out that HJTA was right on the law, so the
bonds were invalidated. That case is on appeal.
Taxpayer advocacy groups, especially HJTA, are often best known
for their initiatives. But the war against higher taxes takes
a triad of weapons. During the cold war, America's nuclear capability
consisted of such a triad: sea based nuclear subs, land based
ICBMs and a huge air-based bomber fleet. For HJTA, our triad
consists of initiatives, political action and litigation. Without
all three, we would be far less effective in preserving and defending
the rights of California taxpayers.