Case Title: Dirks v. Myers

Citation: 

Docket Number: S46917

State: oregon

Court: Oregon Supreme Court

Date: 2000-02-10T00:00:00Z

Document:
FILED: FEBRUARY 10, 2000
IN THE SUPREME COURT OF THE STATE OF OREGON
BRIAN DIRKS,
	v.
HARDY MYERS, Attorney General,
State of Oregon,
(SC S46917)
	En Banc
	On petition to review ballot title.
	Argued and submitted November 23, 1999.
	Gregory W. Byrne, Byrne & Associates, Portland, argued the cause and filed the
brief for petitioner.  With him on the brief was Molly E. Hickman, Portland.
	Kaye Ellen McDonald, Assistant Attorney General, Salem, argued the cause and
filed the brief for respondent.  With her on the brief was Hardy Myers, Attorney General.
	DURHAM, J.
	Ballot title certified as modified.  This decision shall become effective in
accordance with ORAP 11.30(10).
	DURHAM, J.
	Petitioner seeks review of a ballot title.  Petitioner is an elector who timely
submitted comments concerning the Attorney General's draft ballot title.  Therefore, he
is entitled to petition for review of the Attorney General's certified ballot title.  ORS
250.085(2).
	The Attorney General certified the following ballot title:
"AMENDS CONSTITUTION:  LIMITS STATE INCOME TAX GROWTH; REQUIRES TOBACCO SETTLEMENT REVENUE REFUND
		"RESULT OF 'YES' VOTE:  'Yes' vote limits income tax growth to
inflation, population increases; requires tobacco settlement revenue
refund.
		"RESULT OF 'NO' VOTE:  'No' vote does not limit income tax
growth; retains tobacco settlement revenue for public purposes.
		"SUMMARY:  Amends Constitution.  Limits state income tax
revenue growth.  State may retain income tax revenues only up to amount
collected in previous biennium, adjusted for inflation, population
increases.  Requires refund of 'surplus personal state income taxes' to
taxpayers, distribution of 'surplus corporate state income taxes' to
cities/counties.  Any funds received directly or indirectly from tobacco
settlement must be distributed to personal income taxpayers.  If voters
approve both this measure and a measure dedicating tobacco money to
health security fund, runoff election required to resolve conflict."
	Petitioner objects to each segment of the Attorney General's ballot title. 
We review those objections in order, bearing in mind that we must decide only whether
the Attorney General's ballot title complies substantially with statutory requirements. 
ORS 250.085(5). (1)  See also Mabon v. Kulongoski, 325 Or 121, 126, 934 P2d 403
(1997) ("The review statutes do not authorize this court to draft a 'better' or 'improved'
title; substantial compliance with the requirements stated in ORS 250.035 is
sufficient.").
	The initiative measure under consideration would add the following
provisions to the Oregon Constitution:
"SURPLUS STATE INCOME TAX REFUND ACT OF 2000 

"BE IT ENACTED BY THE PEOPLE OF THE STATE OF OREGON:
	"The Constitution of the State of Oregon is hereby amended by adding the
following section:
	"Section 1.  Not later than 180 days after the end of each biennium, the
state shall refund surplus personal state income taxes to state income tax
payers proportionately, based on the amount paid by each taxpayer
relative to the total amount of taxes paid by all personal state income tax
payers in the biennium.  Not later than 180 days after the end of each
biennium, the state shall distribute surplus corporate state income taxes to
cities and counties.
	"(a)	For purposes of this section, for the biennium beginning July 1,
2001, 'surplus personal state income taxes' means all personal
state income taxes collected by the state, which are in excess of
the sum of the amount of personal state income taxes collected by
the state in the previous biennium and not refunded to taxpayers,
plus an adjustment equal to the percentage rate of inflation, if any,
for the last two calendar years ending prior to the first day of the
biennium and an adjustment equal to the percentage increase, if
any, in the population of the state for the same period.  For
purposes of this section, 'inflation' shall be measured by the federal
implicit price deflator for state and local government purchases or
its successor index.
	"(b)	For each biennium beginning on or after July 1, 2003, the amount
of 'surplus personal state income taxes' to be refunded shall be
calculated by deducting from the total amount of personal state
income taxes collected in the biennium an amount equal to the
amount of personal state income taxes collected and retained by
the state in the previous biennium, which amount the state was not
required to refund under this section; and adding to that amount an
adjustment equal to the percentage rate of inflation, if any, for the
last two calendar years ending prior to the first day of the biennium,
plus the percentage increase, if any, in the population of the state
for the same period.
	"(c)	Four [sic] purposes of this section, any money received by the state
as a result of a settlement, reached directly or indirectly, with one or
more tobacco companies shall be considered a reimbursement to
the state of personal state income taxes spent on increased health
care costs due to tobacco related illnesses, and shall be refunded
to the personal state income tax payers who paid state income
taxes in the last biennium prior to the biennium in which the
tobacco settlement money was received.  If the state's interest in or
claim to tobacco settlement money is used in any way as security
to borrow money or to sell bonds, the money received by the state
from such borrowing or from the sale of such bonds also shall be
considered a reimbursement to the state of personal state income
taxes and shall be refunded to personal state income tax payers.
	"(d)	Surplus corporate state income taxes shall be calculated using the
same method set forth in subsections (a) and (b) of this section for
personal state income taxes, including the annual adjustments for
inflation and increases, if any, in the population of the state.
	"(e)	The state shall use consistent accounting, in accordance with
generally accepted accounting principles, for all purposes related to
this Amendment.
	"(f)	In the event of deflation or in the event of a decline in the
population of the state during a biennium, there shall be no
negative adjustment in the amount of money the state may retain in
the next biennium as a result of either statistic.  For example, if
there was a two percent reduction in the population of the state
during the previous biennium, and inflation for the period was five
percent, the amount of tax that could be retained by the state would
be five percent more than for the previous biennium.
	"(g)	If after the effective date of this 2000 Amendment, the state begins
to budget on an annual basis, rather than a biennial basis, the
calculations required by this section shall be made on an annual
basis, provided that the calculation of the amount of personal state
income tax revenue the state must refund, if any, shall be made
using inflation and population growth, if any, for the last calendar
year ending prior to the first day of each fiscal year.
	"(h)	If a measure dedicating tobacco settlement money to a health
security fund is approved by voters in the same election in which
this measure is approved, the conflicting provisions shall both be
placed before the voters as two alternatives and the one receiving
the most votes shall prevail.
	"(i)	If any phrase, clause, or part of this section is invalidated by a court
of competent jurisdiction, the remaining phrases, clauses, and
parts shall remain in full force and effect." 
	As an initial matter, the Attorney General points out that the measure at
issue here, known as proposed initiative 80, is nearly identical to another measure,
proposed initiative 62, which the same chief petitioner proposes for the same election. 
The parties agree that the principal difference between those measures is that
proposed initiative 80 requires a runoff election between it and a legislative referral,
known as House Bill 2007 (1999), which would create a health security fund, if the
voters approve both measures.  No elector challenged the Attorney General's certified
ballot title for proposed initiative 62.  Despite ORS 250.035(6), (2) the Attorney General
certified identical captions and result statements for each measure.  The Attorney
General asserts that the following statement in Carlson v. Myers, 327 Or 213, 227, 959
P2d 31 (1998), compels this court to certify the same caption and result statements that
the Attorney General certified for the nearly identical proposed initiative 62:
	"As this court held in Rooney [v. Kulongoski, 322 Or 15, 23, 909 P2d 1143
(1995)], when proposed initiative measures are themselves very similar or
nearly identical, there may be 'too great a risk' of voter confusion created
by the certification of different ballot titles.  322 Or at 46, 48, 51."  
(Emphasis in original.)   
	We disagree.  As explained below, the Attorney General's ballot title for
proposed initiative 80 does not comply substantially with ORS 250.035. (3)  The
modifications that we require, described below, eliminate the resemblance between the
two ballot titles.  Thus, the ballot title that we certify here satisfies ORS 250.035(6). 
	We are mindful that certifying a different ballot title for proposed initiative
80, despite the similarities between that measure and proposed initiative 62, risks the
confusion that results from the use of dissimilar ballot titles for similar measures.  See
Carlson, 327 Or at 227 (discussing that risk).  But that risk inheres in the present ballot
title review scheme, in which not all ballot titles receive judicial review for substantial
compliance with statutory requirements.  The Attorney General's suggested response to
that risk -- certification of identical ballot titles -- would require the court to disregard the
inadequacies of the ballot title now under consideration.  Because that course would
compound, not avoid, the problem of confusion, we decline to take it. 
	We turn to petitioner's challenge to the Attorney General's ballot title
caption.  The ballot title caption must reasonably identify, within 10 words, the subject
matter of the measure.  ORS 250.035(2)(a) (1997).  To determine whether a caption
accurately states the subject matter of a proposed initiative measure, "we examine the
text of the measure itself 
* * *."  Doell v. Myers, 328 Or 635, 640, 984 P2d 266 (1999).  
	Petitioner argues that the Attorney General's caption is inadequate
because the phrase "limits state income tax growth" identifies an effect of the measure,
not its subject.  The Attorney General responds that that phrase is accurate in this
context, because the refund requirement in the measure is tantamount to a limitation on
the growth of the state income tax.
	The problem with the phrase in question and the Attorney General's
argument is that they misstate the measure.  If adopted, the measure would not limit
the growth of the state income tax or prevent increases in income tax rates.  The
measure does not purport to affect the state's authority to levy and collect income taxes
in any amount.  Instead, the measure establishes a method for calculating what the
measure calls "surplus" state income taxes.  If the specially defined "surplus" condition
comes into existence, the measure requires state government to refund that sum
proportionately to state income tax payers and, thus, prevents state government from
using those funds for any public purpose.
	Representations in a caption about how a measure would modify existing
law must not be misleading.  See Rice v. Myers, 326 Or 419, 423, 952 P2d 533 (1998)
(so stating); Sizemore v. Kulongoski, 322 Or 229, 236, 905 P2d 1146, mod on recons
322 Or 387, 908 P2d 825 (1995) (ballot title must not misstate existing law, even by
implication).  The phrase "limits state income tax growth" in the caption is misleading,
because it promises a limitation on the existing state income tax laws that the measure
would not produce.  Neither is the refund mechanism described in the measure
tantamount to an income tax limitation, as the Attorney General claims.  That
mechanism would operate after levy and collection of whatever income taxes the state
desires to collect.  The measure does not limit the growth of the income tax itself.  We
conclude that petitioner is correct that the caption is misleading and requires
modification.
	Petitioner also contends that the Attorney General's caption fails to
mention the principal subject of the measure, i.e., the requirement that state
government refund "surplus" state income taxes, as defined in the measure, to
taxpayers.  The Attorney General responds that he correctly declined to use the term
"surplus" in the caption because it is confusing and argumentative in this context.  We
agree with the Attorney General that the caption should not describe the amount
refunded under the measure as "surplus" income taxes.  The term "surplus" in this
context implies that the refunded taxes are "more than sufficient for use or need * * *." 
Webster's Third New Int'l Dictionary, 2301 (unabridged ed 1993).  In our view, using the
term "surplus" in the ballot title caption might be misleading.  The sole reason that might
justify using the term "surplus" in the caption to describe the personal and corporate
income tax funds to which the measure refers is the special definition and calculation
method that the measure employs, not any generally accepted definition or usage of
the term "surplus." 
	The fact that the measure uses the term "surplus" to describe the amount
to be refunded does not require a different answer.  We have noted in the past that
	"the potential exists for the proponents of an initiative measure either
intentionally or unintentionally to use words in the measure that obfuscate
the subject, chief purpose, summary, or major effect of the measure."
Bernard v. Keisling, 317 Or 591, 596, 858 P2d 1309 (1993).  To avoid the potential to
mislead voters, we have resisted attempts to incorporate into the ballot title caption
terms or phrases in a measure that, due to specialized definitions or usage out of
familiar context, tend more to promote or defeat passage of the measure than to
describe its substance accurately.  For example, in Mabon v. Keisling, 317 Or 406, 412-13, 856 P2d 1023 (1993), the measure's chief petitioner asked this court to incorporate
the phrase "minority status" into the ballot title caption, because the measure used that
phrase.  This court declined to do so, because that phrase had "no recognized meaning
outside of this measure, the phrase is not self-defining, and [thus] would do little to
inform the voters of the measure's subject."  Id. at 412.  The same reasoning militates
against incorporating the specially defined term "surplus" into the ballot title caption for
this measure.  Therefore, we reject petitioner's contrary contention.
	Finally, petitioner argues that, although the phrase "requires tobacco
settlement revenue refund" in the Attorney General's caption does refer to a subject of
the measure, that phrase, by itself, is misleading, because it fails to indicate that the
taxpayers, not tobacco companies, will receive the refund.  We agree that that phrase is
misleading, but petitioner's suggested amendment does not address the problem
satisfactorily.  The tobacco settlement revenue to which the measure refers is not a
refund to the taxpayers, as petitioner claims.  A "refund" is "a sum that is paid back :
REPAYMENT."  Webster's Third New Int'l Dictionary at 1910.  The measure purports to
treat the settlement proceeds of state litigation against tobacco companies as a
"reimbursement" to personal income tax payers, but that special designation in the
measure does not reflect the common meaning of a "refund" of taxes.  Stated
accurately, the measure requires the state to distribute tobacco settlement proceeds to
personal income taxpayers.  The Attorney General acknowledged that point by using
the word "distributed" in his summary of the measure's effect on tobacco settlement
revenue.
	Because the word "refund" is inaccurate and misleading in this context,
the Attorney General's phrase does not comply substantially with statutory
requirements.  To remedy that problem, we will substitute the term "distributes" for
"refunds" in the caption.  Additionally, because the word "refunds" appears in the "yes"
vote result statement and the summary, and conveys the same misleading meaning in
those contexts, we will make similar conforming changes to those parts of the ballot
title.  See Garst v. Myers, 329 Or 529, 535, ____ P2d ____ (1999) (following that
practice).
	As a consequence of the foregoing discussion, we modify the caption as
follows:
AMENDS CONSTITUTION:  CONDITIONALLY REFUNDS CERTAIN 
TAXES, RESTRICTS EXPENDITURES; DISTRIBUTES TOBACCO 
SETTLEMENT REVENUE
	In challenging the Attorney General's "yes" and "no" result statements,
petitioner repeats his criticisms of the Attorney General's caption.  As discussed above,
we agree in part with those criticisms and adopt corresponding changes to bring the
"yes" and "no" result statements into substantial compliance with ORS 250.035(2)(b)
and (c) (1997).  We reject petitioner's further contention that the Attorney General's
description in the result statements of the tobacco settlement revenue issue fails to
satisfy the preference for parallelism in ORS 250.035(3). (4)  The Attorney General's result
statements, as pertinent, are parallel "to the extent practical."  The statute requires no
more.  Carson v. Myers, 326 Or 248, 257, 951 P2d 700 (1998).
	As a consequence of the foregoing, we adopt the following "yes" and "no"
vote result statements:
		RESULT OF "YES" VOTE:  "Yes" vote ties tax refund to previous
collections, inflation, population increases; distributes tobacco settlement
revenue.
		RESULT OF "NO" VOTE:  "No" vote retains income taxation and
refund laws; retains tobacco settlement revenue for public purposes.
	Petitioner's challenges to the Attorney General's summary are similar to
those discussed above in connection with the caption. (5)  Because the summary does not
comply substantially with ORS 250.035(2)(d) (1997) for the reasons already discussed,
we will adopt changes to the summary that conform to the changes discussed above in
connection with the caption.  To accommodate those changes within the statutory 85-word limit, we will alter the wording of the last sentence of the Attorney General's
summary in a way that does not change its substance.
	Petitioner further challenges the Attorney General's summary because it
fails to describe the tax refund as a "proportionate" refund and states that the measure
would require tobacco settlement revenue to be distributed, rather than "refunded," to
taxpayers.  For the reasons already discussed, we do not agree that the latter criticisms
establish that the Attorney General's summary fails to comply substantially with
statutory requirements.
	We modify the Attorney General's summary as follows:
		SUMMARY:  Amends Constitution.  Creates conditional income tax
refund, restricts expenditures.  State may retain income tax revenues only
up to amount collected in previous biennium, adjusted for inflation,
population increases.  Requires refund of "surplus personal state income
taxes" to taxpayers, distribution of "surplus corporate state income taxes"
to cities/counties.  Any funds received directly or indirectly from tobacco
settlement must be distributed to personal income taxpayers.  If voters
approve both this measure and measure dedicating tobacco money to
health security fund, runoff election required to resolve conflict.
	We certify the following ballot title for proposed initiative 80:
AMENDS CONSTITUTION:  CONDITIONALLY REFUNDS CERTAIN 
TAXES, RESTRICTS EXPENDITURES; DISTRIBUTES TOBACCO 
SETTLEMENT REVENUE
		RESULT OF "YES" VOTE:  "Yes" vote ties tax refund to previous
collections, inflation, population increases; distributes tobacco settlement
revenue.
		RESULT OF "NO" VOTE:  "No" vote retains income taxation and
refund laws; retains tobacco settlement revenue for public purposes.
		SUMMARY:  Amends Constitution.  Creates conditional income tax
refund, restricts expenditures.  State may retain income tax revenues only
up to amount collected in previous biennium, adjusted for inflation,
population increases.  Requires refund of "surplus personal state income
taxes" to taxpayers, distribution of "surplus corporate state income taxes"
to cities/counties.  Any funds received directly or indirectly from tobacco
settlement must be distributed to personal income taxpayers.  If voters
approve both this measure and measure dedicating tobacco money to
health security fund, runoff election required to resolve conflict.
	Ballot title certified as modified.  This decision shall become effective in
accordance with ORAP 11.30(10).
1. 	ORS 250.085(5) states:
		"The court shall review the title for substantial compliance with the
requirements of ORS 250.035, and shall certify a title meeting this
standard to the Secretary of State."

2. 	ORS 250.035(6) provides:
		"To avoid confusion, a ballot title shall not resemble any title previously
filed for a measure to be submitted at that election."

3. 	Our decision here demonstrates that, as a practical matter, the identical caption
and result statements for proposed initiative 62 also do not comply with statutory requirements. 
However, this court has no authority in this proceeding to modify the ballot title for that
proposed initiative.

4. 	ORS 250.035(3) provides:
		"The statements required by subsection (2)(b) and (c) of this section shall
be written so that, to the extent practical, the language of the two statements is
parallel."	 

5. 	Petitioner does not challenge the Attorney General's use of the term "surplus" in
the summary.