Opinion ID: 1436613
Heading Depth: 3
Heading Rank: 9

Heading: Ordinances necessary to enable the mayor to exercise public emergency powers.[5]

Text: 10. Ordinances reimbursing city employees for non-routine travel expenses pursuant to section 8.410 of the charter. 11. Ordinances relative to purely administrative matters. A 12th exception  for all ordinances adopted as emergency measures  follows from a separate charter provision (S.F. Charter, § 2.304) declaring that such ordinances take effect immediately upon passage. They are therefore not subject to the referendum provisions of this charter ( ibid. ). It follows that whatever the intent of each document with regard to the initiative provision, the framers clearly intended to place multiple substantial limitations on the scope of the referendum provision. We must give effect to that intent. There is no problem when a referendum is presented that violates one of those limitations: it is invalid on its face. (E.g., Hunt v. Mayor & Council of Riverside (1948) 31 Cal.2d 619, 623-624 [191 P.2d 426].) The problem arises when, as here, the case involves an attempt to use the initiative to repeal a measure expressly excluded from the scope of the referendum. The solution, I submit, lies in applying the well-known principle that the courts will not permit a party to do indirectly what the Constitution prohibits doing directly. This principle has long been recognized and applied by both the United States Supreme Court and this court. I shall review a representative sample of the cases. Even before California entered the Union the foregoing rule was described in an opinion of the United States Supreme Court as a just and well-settled doctrine and a great principle. ( Passenger Cases (1849) 48 U.S. (7 How.) 283, 458 [12 L.Ed. 702, 775] (plur. opn. of Grier, J.).) There a Massachusetts statute required ship captains or owners to pay a tax on each foreign passenger disembarking in the state, for the support of foreign paupers. The United States Supreme Court held the statute violative, inter alia, of the provision of the federal Constitution which declares that No state shall, without the consent of Congress, lay any duty of tonnage (U.S. Const., art. I, § 10, cl. 3). No opinion commanded a majority, but in his plurality opinion Justice Grier reasoned that It is a just and well-settled doctrine established by this court, that a State cannot do that indirectly which she is forbidden by the Constitution to do directly. If she cannot levy a duty or tax from the master or owner of a vessel engaged in commerce graduated on the tonnage or admeasurement of the vessel, she cannot effect the same purpose by merely changing the ratio, and graduating it on the number of masts, or of mariners, the size and power of the steam-engine, or the number of passengers which she carries. We have to deal with things, and we cannot change them by changing their names. Can a State levy a duty on vessels engaged in commerce, and not owned by her own citizens, by changing its name from a `duty on tonnage' to a tax on the master, or an impost upon imports, by calling it a charge on the owner or supercargo, and justify this evasion of a great principle by producing a dictionary or a dictum to prove that a ship-captain is not a vessel, nor a supercargo an import? (48 U.S. at p. 458 [12 L.Ed. at pp. 775-776].) The principle was again invoked in Cummings v. The State of Missouri (1866) 71 U.S. (4 Wall.) 277 [18 L.Ed. 356]. At the close of the Civil War Missouri amended its constitution to require, inter alia, that clergymen take an oath swearing they had never engaged in armed hostility against the United States or given aid or comfort to persons so engaged. The United States Supreme Court held the Missouri constitutional provision to be an invalid bill of attainder (U.S. Const., art. I, § 10, cl. 1), i.e., a legislative act that inflicts punishment without a judicial trial. The high court reasoned that the challenged provisions of the Missouri Constitution would obviously have constituted a bill of attainder if, for example, they had simply declared all clergymen guilty of armed hostility against the United States unless they did a specified act by a given day. The difference between the last case supposed and the case actually presented is one of form only, and not of substance. The existing clauses presume the guilt of the priests and clergymen, and adjudge the deprivation of their right to preach or teach unless the presumption be first removed by their expurgatory oath  in other words, they assume the guilt and adjudge the punishment conditionally. The clauses supposed differ only in that they declare the guilt instead of assuming it. The deprivation is effected with equal certainty in the one case as it would be in the other, but not with equal directness. The purpose of the lawmaker in the case supposed would be openly avowed; in the case existing it is only disguised. The legal result must be the same, for what cannot be done directly cannot be done indirectly. The Constitution deals with substance, not shadows. Its inhibition was levelled at the thing, not the name. (71 U.S. at p. 325 [18 L.Ed.2d at p. 363].) In Fairbank v. United States (1901) 181 U.S. 283 [45 L.Ed. 862, 21 S.Ct. 648] a federal statute imposed an internal revenue stamp tax on export bills of lading, i.e., bills evidencing the sale of goods for export. The United States Supreme Court held the statute violated the prohibition of the federal Constitution declaring that Congress shall lay no tax on articles exported from any state. (U.S. Const., art. I, § 9, cl. 5.) The high court reasoned that a stamp tax on a bill of lading, which evidences the export is just as clearly a burden on the exportation as a direct tax on the article mentioned in the bill of lading as the subject of the export. (181 U.S. at p. 293 [45 L.Ed. at p. 867].) The high court relied on a similar decision invalidating a California stamp tax on bills of lading for gold or silver shipped out of the state ( Almy v. State of California (1860) 65 U.S. (24 How.) 169 [16 L.Ed. 644]), saying, that decision affirms the great principle that what cannot be done directly because of constitutional restriction cannot be accomplished indirectly by legislation which accomplishes the same result. (181 U.S. at p. 294 [45 L.Ed. at p. 867].) Finally, in Frick v. Pennsylvania (1925) 268 U.S. 473 [69 L.Ed. 1058, 45 S.Ct. 603, 42 A.L.R. 316], a Pennsylvania statute levied an estate tax on the transfer by will of valuable tangible personal property owned by a Pennsylvania domiciliary but having its actual situs in New York. The United States Supreme Court held that Pennsylvania had no extraterritorial jurisdiction to tax such personal property and hence the tax was invalid under the due process clause of the 14th Amendment. Pennsylvania argued that even if it taxed only the property that the decedent owned in Pennsylvania it could take as a basis for calculating that tax the combined value of the decedent's property in Pennsylvania and New York. Rejecting the argument, the high court reasoned: this was but the equivalent of saying that it was admissible to measure the tax by a standard which took no account of the distinction between what the State had power to tax and what it had no power to tax, and which necessarily operated to make the amount of the tax just what it would have been had the State's power included what was excluded by the Constitution. This ground, in our opinion, is not tenable. It would open the way for easily doing indirectly what is forbidden to be done directly, and would render important constitutional limitations of no avail. (268 U.S. at pp. 494-495 [69 L.Ed. at pp. 1064-1065].) [6] This court followed Frick v. Pennsylvania, supra, 268 U.S. 473, in Perkins Mfg. Co v. Jordan (1927) 200 Cal. 667 [254 P. 551]. There a California statute required each foreign corporation doing business in this state to pay an annual license tax on the total value of the corporation's authorized capital stock, without regard to the amount of either property owned or business done in this state. We held the statute violated the interstate commerce clause and due process clause of the federal Constitution. In rejecting inter alia the state's argument that the license fee was not a tax on the corporation's capital stock but was simply measured by that standard ( id. at p. 679), we quoted with approval the foregoing refutation of a similar claim in Frick v. Pennsylvania, supra, 268 U.S. 473, 494-495 [69 L.Ed. 1058, 1064], including the explanation that `It would open the way for easily doing indirectly what is forbidden to be done directly, and would render important constitutional limitations of no avail.' (200 Cal. at p. 679.) In other decisions this court has invoked the same reasoning to reject attempts to evade direct prohibitions of the California Constitution. For example, in Farrell v. Board of Trustees (1890) 85 Cal. 408 [24 P. 868], a statute authorized the Board of Police Commissioners of the City of Sacramento to appoint policemen. We held the statute violated the prohibition of the Constitution against special laws Creating offices ... in ... cities (Cal. Const., former art. IV, § 25, subd. 28). Rejecting the argument that the offices were not created by the statute but by the board of police commissioners, we said: if the legislature cannot create an office by special act it certainly cannot accomplish the same thing through a special act which vests the power to appoint to such office in any board whatever. This would be a clear evasion of the constitution. (85 Cal. at pp. 416-417.) Two justices concurred on the ground that by providing that additional policeman might be appointed by the city authorities, the legislature attempted to do indirectly, by a special statute, what it was forbidden to do directly by the cited constitutional provision. ( Id. at p. 417 (conc. opn. of Works, J., and Fox, J.).) In Dougherty v. Austin (1892) 94 Cal. 601 [29 P. 1092], a statute authorized a county board of supervisors to hire a deputy county clerk whenever it deemed the county clerk to be insufficiently compensated. We held the statute violated the constitutional prohibition against increasing the compensation of county officers during their term of office. (Cal. Const., former art. XI, § 9.) We reasoned, To construe this provision of the constitution so that a county clerk's salary could not be increased during his term of office, but that an act of the legislature would be valid which provided that all of his deputies, men whom he was bound to employ and bound to pay in the absence of such an act, should be paid by the county, independent of and in addition to the clerk's salary, would be to allow that to be done indirectly which could not be done directly, and would be establishing a medium for the practice of the very abuses which the constitutional provision was inserted to destroy. (94 Cal. at p. 632.) In Wood v. Riley (1923) 192 Cal. 293 [219 P. 966], a section of the annual state budget bill provided that 1 percent of the amount appropriated for the support of teachers' colleges and special schools could be used instead to defray administrative expenses of the office of the state Superintendent of Public Instruction. The Governor vetoed this provision in the exercise of a then-recent constitutional amendment giving him the power to reduce as well as eliminate individual items of appropriation in the budget. (Cal. Const., former art. IV, § 34.) The Superintendent of Public Instruction argued that the budget provision was not a separate item of appropriation but merely a transfer, as a matter of bookkeeping, of funds already appropriated. Sustaining the veto, we looked beyond the form of the provision to its substance: looked at in the light of what it was intended to accomplish, and what it would have accomplished if allowed to stand, one cannot escape the conviction that it worked an appropriation. (192 Cal. at p. 305.) We therefore concluded that to accept the superintendent's argument would be to hold that the legislature might, by indirection, defeat the purpose of the constitutional amendment giving the Governor power to control the expenditures of the state, when it could not accomplish that purpose directly or by an express provision in appropriation bills. ( Ibid. ) In County of Los Angeles v. Riley (1936) 6 Cal.2d 625 [59 P.2d 139, 106 A.L.R. 903], a statute provided that a portion of the motor vehicle license tax collected by the state would be appropriated to the counties for their use. We held the statute violated the constitutional provision prohibiting the Legislature from taxing cities or counties or their inhabitants for local purposes. (Cal. Const., former art. XI, § 12.) We reasoned: It necessarily follows that the state cannot levy and collect a tax, which it has power to levy and collect for state purposes, and then appropriate a portion of the fund so collected to the cities or counties for purely local purposes. This would be to permit the state to do indirectly what it is prohibited from doing directly.... (6 Cal.2d at pp. 626-627.) In the foregoing cases it was a statute that attempted to do indirectly what the Constitution prohibits directly. [7] In the case at bar the conflict is between two constitutional (and charter) provisions  the referendum and the initiative. Again, however, the rule is the same. Thus in In re McGee (1951) 36 Cal.2d 592 [226 P.2d 1], one constitutional provision (Cal. Const., former art. II, § 2 1/2) conferred broad powers on the Legislature over the subject of primary elections. [8] Another constitutional provision, however, conferred on the Legislature apparently exclusive jurisdiction to determine the qualifications of its members: Each house shall ... judge of the qualifications, elections, and returns of its members. (Cal. Const., former art. IV, § 7.) We held that the latter prevails over the former, reasoning that If the Legislature may, by authorizing court review of primary election contests, prevent a candidate from being on the ballot at the ensuing election for various defects as to the elections or qualifications, it would, in many situations, achieve indirectly what it could not do directly, that is, delegate to the courts its prerogatives under section 7 of article IV of the California Constitution. (36 Cal.2d at p. 598.) As noted above, in Legislature v. Deukmejian, supra, 34 Cal.3d 658, we held that the constitutional initiative power cannot be used to reapportion legislative districts after the Legislature has once done so in the same decade. We began (at p. 669) by quoting with approval from Wheeler v. Herbert (1907) 152 Cal. 224, 237 [92 P. 353], to the effect that `The general rule in regard to constitutional limitations of this character is that that which cannot be done directly cannot be done by indirection.' We rejected the contention that because the proposed second redistricting was to be achieved by initiative it was exempt from the constitutional command (art. XXI) of one redistricting per decade. We recognized the rule of liberal construction of the initiative power (34 Cal.3d at p. 675), but we held that rule must yield to the more fundamental principle of constitutional interpretation reiterated in Wheeler v. Herbert, supra, 152 Cal. 224, 237. We reasoned: By 1911, when the California constitutional provision providing for the exercise of the initiative power was first adopted (former art. IV, § 1), the once-a-decade rule had already been clearly established. Nothing on the face of the initiative provision reflects either consideration of the use of the initiative to redistrict, or, if such use is permissible, an intent to exclude initiatives from the operation of the once-a-decade rule.... Well-established principles, applicable both to statutes and constitutional provisions, including constitutional provisions added by initiative, as was former section 1 of article IV [citation], require that in the absence of irreconcilable conflict among their various parts, they must be harmonized and construed to give effect to all parts. [Citations.] There being no contrary intent apparent and no repugnancy between former article IV, section 6, the predecessor of article XXI as heretofore interpreted, and article II, section 8 [the initiative provision], we conclude that the initiative process may not be used to do that which the Legislature may not do, to redraw legislative and congressional districts during the decade following a federal decennial census at a time when the Legislature has enacted a valid and effective statute or statutes defining those districts. (34 Cal.3d at p. 676.) I apply the foregoing principle to the facts of this case. They are undisputed. For a number of years prior to 1982 the Board of Supervisors (Board) of the City and County of San Francisco (City) had by ordinance imposed a tax on both residential and commercial users of certain public utilities within the City. The tax consisted of a levy of at least 5 percent on electricity, gas, water, steam, and telephone bills. The revenues generated by the tax were paid into the City's general fund. In 1982 the Board enacted an ordinance exempting residential users from this tax for calendar year 1983; the ordinance also provided in effect that in each succeeding calendar year beginning with 1984 the tax would be imposed on residential users unless the Board renewed the exemption for such users by September 15 of the previous year. In 1985 the Board did not renew the exemption for residential users, and the tax was therefore collected throughout 1986. In 1986 the Board began by renewing the exemption, an action that would have suspended the tax for 1987. However, by an ordinance that took effect on April 27, 1987, the Board reversed itself and rescinded its prior exemption, thereby reimposing the tax for 1987. On July 22, 1987, an initiative petition was filed with the City's registrar of voters seeking to repeal the tax. The initiative (Prop. R) declared that No tax shall be levied on residential utilities users in the City after June 30, 1988. Proposition R was adopted by the voters at the November 1987 election. The Board did not renew the residential users' exemption in 1987, thereby reimposing the tax for the year 1988. The tax was nevertheless collected only until June 30, 1988; on that date the City's tax collector ceased collecting the tax as prescribed by Proposition R. We need not speculate why Proposition R was presented to the voters when it was; the sole author of the initiative, state Senator Quentin L. Kopp, gave us the reason in his ballot argument, and it is wholly consistent with the foregoing sequence of events. [9] Declaring that it was time to end the residential utilities tax once and for all, he stated his substantive objections to the tax and then explained: That's why I fought the utility tax from the beginning of my service on the San Francisco Board of Supervisors in 1972. That's why I authored the 1982 ordinance to repeal the tax. The last one-year repeal recently expired and the Board of Supervisors and the Mayor acted to reinstate the tax in April, 1987. And that's why I was forced to author Proposition R, the Stop The Utility Tax Initiative. (Ballot Pamp., S.F. City & County, argument in favor of Prop. R (elec. of Nov. 3, 1987), p. 90, italics added.) In other words, although the author had long opposed the residential utilities tax, the passage of the ordinance rescinding the prior exemption and reimposing the tax on April 27, 1987, was the specific event that triggered the effort to repeal the tax once and for all. With this background it is plain to see what actually happened here. The opponents of the residential utilities tax wished to repeal the ordinance levying it, but they could not achieve their purpose by means of a petition for referendum because both the Constitution and the San Francisco Charter expressly exclude tax levies from the referendum power. Accordingly, less than 90 days after the ordinance levying the tax took effect [10] the tax opponents presented instead a petition for initiative that indirectly achieved the same purpose: at the small cost of allowing the tax to be collected for the first six months of 1988, the opponents managed not merely to have the tax suspended for the following year  as had happened before  but to have it repealed once and for all, i.e., forever. The trial court took the same view of the tax opponents' technique. In explaining its decision to strike down Proposition R, the court pointed out that first of all, if you just look at the sequence of events it becomes clear what happened: it is, of course, the fact that what happened here was that in April of 1987 the Board of Supervisors adopted a measure which lifted the residential exemption from the utility tax. They adopted that measure. And in the absence of the prohibition against such a referendum, that would have been tested by popular vote by a referendum. That was the measure that the Board of Supervisors adopted. It is being challenged by a group of citizens. If you bring a referendum and you put it on the ballot, and if it is passed, as Proposition R did, you set aside the measure that was adopted in April 1987. Well, obviously, they could not do that. The Constitution clearly prohibits such a referendum. And, so, realistically, what happened was the proponents of this point of view instead put an initiative on the ballot to have exactly the same effect, and to restore the residential exemption that the Board of Supervisors had just removed. (Italics added.) The initiative in question was thus the functional equivalent of a referendum. Yet as we have seen, The Constitution deals with substance, not shadows. Its inhibition was leveled at the thing, not the name. ( Cummings v. The State of Missouri, supra, 71 U.S. 277, 325 [18 L.Ed. 356, 363].) The tax opponents well knew that both the Constitution and the San Francisco Charter barred the use of the referendum to repeal the tax imposed by the ordinance of April 27, 1987; they therefore achieved the same result by use of the initiative. To allow that maneuver to succeed simply because the initiative provisions do not expressly exclude tax levies from their wording would be to open the way for easily doing indirectly what is forbidden to be done directly, and would render important constitutional limitations of no avail. ( Frick v. Pennsylvania, supra, 268 U.S. 473, 495 [69 L.Ed. 1058, 1065]; Perkins Mfg. Co. v. Jordan, supra, 200 Cal. 667, 679.)