Court Opinion

ID: 4014253
Source: CourtListenerOpinion
Date Created: 2016-07-08 21:06:50.556719+00
Date Added: 2024-06-11T07:44:53.181733
License: Public Domain

IN THE MISSOURI COURT OF APPEALS
                   WESTERN DISTRICT
JIM BOEVING,                   )
        Respondent-Appellant, )
                               )
v.                             )                   WD79694
                               )                   (consolidated with
MISSOURI SECRETARY OF          )                   WD79697 and WD79725)
STATE JASON KANDER,            )
                   Respondent, )                   FILED: July 8, 2016
                               )
MISSOURI STATE AUDITOR         )
NICOLE GALLOWAY, RAISE         )
YOUR HAND FOR KIDS and         )
ERIN BROWER,                   )
       Appellants-Respondents. )

                 Appeal from the Circuit Court of Cole County
                    The Honorable Daniel R. Green, Judge
     Before Special Division: Alok Ahuja, P.J., and Thomas H. Newton
                           and Gary D. Witt, JJ.
      Missouri resident and taxpayer Jim Boeving filed suit in the Circuit Court of

Cole County to challenge the fairness and sufficiency of the official ballot title for an

initiative petition. The petition seeks to amend the Missouri constitution to

increase the taxes and fees to be paid on the sale of cigarettes, and to use the

revenues to fund programs addressing children’s health and education.

      The circuit court rejected Boeving’s challenge to the summary statement

prepared by the Secretary of State. But the court agreed with Boeving that the

fiscal note summary prepared by the State Auditor was insufficient and unfair.
State Auditor Nicole Galloway, and ballot initiative proponents Raise Your Hand
for Kids and Erin Brower, appeal the trial court’s ruling that the ballot title’s fiscal

note summary was insufficient. Boeving cross-appeals the circuit court’s conclusion

that the summary statement was adequate. We conclude that, while the fiscal note

summary is fair and sufficient, the summary statement is not. We accordingly

reverse, and certify to the Secretary of State modified language for the summary

statement.

                                Factual Background

      On November 20, 2015, Raise Your Hand for Kids submitted an initiative

petition sample sheet to the Secretary of State. Raise Your Hand is a Missouri not-

for-profit corporation and campaign committee formed under Missouri law to

support the petition.

      The initiative petition seeks to amend Article IV of the Missouri constitution

by adding new §§ 54, 54(a), 54(b), and 54(c). Several features of the initiative

petition are relevant to the issues on appeal.

      First, the proposed constitutional amendment imposes a new tax on the retail

sale of cigarettes. New § 54(c).1 provides:

             In addition to any tax levied upon the sale of cigarettes in this
      state, a tax shall be levied upon the sale of cigarettes in an amount
      equal to thirty mills per cigarette (or sixty cents per pack of twenty
      cigarettes) phased in, in four equal annual increments of seven and
      one-half mills (or fifteen cents per pack of twenty cigarettes) on
      January 1, 2017, January 1, 2018, January 1, 2019 and January 1,
      2020.
      Section 54(c).2.a provides that, “[i]n addition to the tax provided in section

54(c).1, effective January 1, 2017, an equity assessment fee is imposed upon the

first to occur of the following: the purchase, storage, use, consumption, handling,

distribution or wholesale sale of each package of twenty (20) cigarettes

manufactured by a non-participating manufacturer.” “Non-participating
manufacturers” are those who are not parties to the Master Settlement Agreement

                                            2
entered into by the State and certain tobacco manufacturers on November 23, 1998.

The petition specifies that “[t]he equity assessment fee shall be paid by the

wholesaler, and collected by the director of revenue at the same time cigarette tax

stamps are purchased from the director of revenue.” Section 54(c).2.b states that, as

an initial matter, “[t]he rate of the equity assessment fee shall be sixty-seven cents

($0.67) per package of twenty (20) cigarettes,” but that “[b]eginning with equity

assessment fees due in 2018, the equity assessment fee shall be adjusted each year

in accordance with the Inflation Adjustment in the Master Settlement Agreement.”

The parties agree that application of the Inflation Adjustment will require an

annual increase in the equity assessment fee of 3% or the annual increase in the

Consumer Price Index, whichever is greater.

      The proposed amendment provides that the funds generated by the new taxes

and fees will be deposited in a newly created Early Childhood Health and Education

Trust Fund, which “shall be kept separate from the general revenue fund as well as

any other funds or accounts in the state treasury.” The proposed amendment

specifies the following uses for monies in the Fund:

            “[a]t least seventy-five percent (75%) of funds shall be disbursed in
             grants for improving the quality and increasing access to Missouri
             early childhood education programs”;

            “[n]o less than ten percent (10%) and no more than fifteen percent
             (15%) of funds shall be disbursed in grants to Missouri hospitals or
             other health care facilities to improve access to quality early childhood
             health and development programs”; and

            “[n]o less than five percent (5%) and no more than ten percent (10%) of
             funds shall be disbursed in grants to provide evidence-based smoking
             cessation and prevention programs for Missouri pregnant mothers and
             youth.”
      The proposed amendment specifies that funds shall not “be used for human

cloning or research, clinical trials, or therapies or cures using human embryonic

stem cells, as defined in Article III, section 38(d).” The amendment also provides
that the distribution of funds under the amendment will be exempt from the

                                           3
restrictions of Article IX, § 8 of the Missouri constitution. Article IX, § 8 generally

prohibits the State and its political subdivisions from distributing State or local

funds or property “in aid of any religious creed, church or sectarian purpose,” or in

support of any educational institution “controlled by any religious creed, church or

sectarian denomination.”

      Finally, the initiative petition contains a “hold harmless” provision which

requires that,

      [o]n an annual basis, the director of revenue, in consultation with the
      director of health and senior services, shall determine whether the
      taxes imposed by section 54(c) have resulted in a decrease in
      consumption of tobacco products and thereby directly caused a
      reduction in the amount of moneys collected and deposited in the fair
      share fund, the health initiatives fund, or the state school moneys
      fund, revenues generated from local tobacco taxes, or revenues
      generated from local sales taxes.
If such revenue reductions are found, monies in the Fund shall be transferred to the

entities experiencing the revenue decreases, provided that the aggregate amount of

“hold harmless” payments in any year “shall not exceed four percent (4%) of the

total moneys collected pursuant to this section during that same year.”

      On January 5, 2016, the Secretary of State certified the official ballot title for

the petition. An official ballot title consists of a summary statement prepared by
the Secretary of State, as well as a fiscal note summary prepared by the State

Auditor. See §§ 116.010(4), 116.175, 116.3341; Brown v. Carnahan, 370 S.W.3d 637,

646 (Mo. banc 2012). As certified, the official ballot title reads:

      Shall the Missouri Constitution be amended to:

            increase taxes on cigarettes each year through 2020, at which point
             this additional tax will total 60 cents per pack of 20;

            create a fee paid by cigarette wholesalers of 67 cents per pack of 20 on
             certain cigarettes; and

      1      Statutory citations refer to the 2000 edition of the Revised Statutes of
Missouri, updated through the most recent cumulative and non-cumulative supplements.

                                            4
            deposit funds generated by these taxes and fees into a newly
             established Early Childhood Health and Education Trust Fund?

      When cigarette tax increases are fully implemented, estimated
      additional revenue to state government is $263 million to $374 million
      annually, with limited estimated implementation costs. The revenue
      will fund only programs and services allowed by the proposal. The
      fiscal impact to local governmental entities is unknown.
      Boeving filed suit in the Circuit Court of Cole County on January 15, 2016,

contending that both the summary statement and fiscal note summary were

insufficient and unfair. As required by § 116.190.2, Boeving’s action named

Secretary of State Jason Kander and State Auditor Nicole Galloway as defendants.

Raise Your Hand, and its Treasurer Erin Brower, were later granted leave to

intervene. (In this opinion we refer to Raise Your Hand and Brower collectively as

“Raise Your Hand.”)

      Following a bench trial, the circuit court entered its final judgment on May

19, 2016. The court found the ballot title’s summary statement to be adequate, but

agreed with Boeving that the fiscal note summary was insufficient and unfair.

With respect to the summary statement, the circuit court found that the statement

that the initiative would “create a fee . . . of 67 cents per pack” “could be

misleading,” because “there is nothing in this summary statement that would give

notice to the voters that the fee will increase annually or that would give an
indication that the voter should investigate the fee mechanism further.” The circuit

court also found that the summary statement “fails to provide notice to a voter as to

how the fund proceeds will be used,” and makes no reference to the initiative’s

“significant departure from Missouri’s current constitutional prohibition on

appropriations from public funds to religious educational organizations.” Despite

these deficiencies, the circuit court concluded that the summary statement was “not

insufficient and unfair.”

                                            5
      With respect to the fiscal note summary, the circuit court found that the

Auditor had unreasonably included the figure of $374 million as the upper bound of

potential State revenue increases. This figure was derived from the fiscal

submission prepared by the Department of Revenue. The Department of Revenue’s

estimate of the increase in State revenues assumed that future sales of cigarettes

remained unchanged, meaning that there would be no decrease in cigarette

consumption due to the imposition of the new taxes and fees. Based on expert

economic testimony presented by Boeving, the circuit court concluded that the

Department of Revenue’s assumption of a “zero price elasticity of demand” was

unreasonable, and that its fiscal submission “should therefore not have [been] used .

. . in the fiscal note summary.”

      The circuit court also concluded that the statement in the fiscal note

summary that “[t]he fiscal impact to local governmental entities is unknown” was

unfair and insufficient. The court noted that the Office of Administration had

calculated a $10.4 million loss in local government revenues, and concluded that the

Auditor’s determination “that the hold harmless [provision] would definitely apply

[to compensate for this revenue decline] was deceptively speculative.”

      The State Auditor and Raise Your Hand appeal the trial court’s
determination that the fiscal note summary is inadequate. Boeving cross-appeals

the trial court’s conclusion that the summary statement was fair and sufficient.

                              Appellate Jurisdiction

      “Before we can address the merits of an appeal, ‘this court has a duty to

determine sua sponte whether we have jurisdiction to review the appeal.’” Capital

Fin. Loans, LLC v. Read, 476 S.W.3d 925, 927 (Mo. App. W.D. 2015) (citation

omitted). “If this Court lacks jurisdiction to entertain an appeal, the appeal must be

dismissed.” Fannie Mae v. Truong, 361 S.W.3d 400, 403 (Mo. banc 2012) (citation
omitted).

                                          6
      “In Missouri, the right to appeal is purely statutory, and ‘where a statute

does not give a right to appeal, no right exists.’” Fannie Mae, 361 S.W.3d at 403

(quoting Farinella v. Croft, 922 S.W.2d 755, 756 (Mo. banc 1996)). “‘An appeal

without statutory sanction confers no authority upon an appellate court except to

enter an order dismissing the appeal.’” Id. at 405 (quoting Farinella, 922 S.W.2d at

757-58).

      In this case, the appellants rely on § 116.190.4 to establish their right to

appeal. Section 116.190.4 provides in relevant part that, in suits challenging the

terms of an official ballot title, “[a]ny party to the suit may appeal to the supreme

court within ten days after a circuit court decision.” (Emphasis added.) Section

116.190.4 makes no reference to an appeal to this Court.

      Although § 116.190.4 authorizes an appeal only “to the supreme court,” we

conclude that we have jurisdiction over these appeals. Missourians to Protect the

Initiative Process v. Blunt, 799 S.W.2d 824 (Mo. banc 1990), interpreted the similar

appeal-authorization language found in another election law, § 116.200.3, RSMo.

The Supreme Court observed that “[t]he appeal was initially filed in this Court but,

due to a lack of jurisdiction, the cause was transferred to the Missouri Court of

Appeals, Western District.” Id. at 826 (footnote omitted). The Court offered the
following explanation in the accompanying footnote:

      Section 116.200.3, RSMo 1986, purports to grant a party to an action
      such as this the right to appeal to the Supreme Court. However, our
      appellate jurisdiction is constitutionally defined and limited to specific
      situations, none of which exists here. See Mo.Const. art. V, § 3.
Id. at 826 n.1.

      The discussion in Missourians to Protect the Initiative Process holds that,

although the legislature may purport to grant a direct right of appeal to the

Supreme Court by statute, such direct appeals are only authorized if an appeal
otherwise falls within the scope of the Supreme Court’s exclusive appellate

                                           7
jurisdiction as specified in Article V, § 3 of the Missouri constitution. According to

Missourians to Protect the Initiative Process, the legislature cannot expand the

scope of the Supreme Court’s direct appellate jurisdiction beyond the categories of

cases specified in Article V, § 3.

       This appeal does not raise any issue which would trigger the Supreme

Court’s exclusive appellate jurisdiction. Therefore, § 116.190.4 cannot be read to

authorize a direct appeal to the Supreme Court. Because Article V, § 3 provides

that “[t]he court of appeals shall have general appellate jurisdiction in all cases

except those within the exclusive jurisdiction of the supreme court,” this appeal was

properly filed here.

                                 Standard of Review

       As in any court-tried matter, we will sustain the circuit court's
       judgment unless there is no substantial evidence to support it, it is
       against the weight of the evidence, or it erroneously declares or applies
       the law. Where . . . the parties simply argue the fairness and
       sufficiency of the [fiscal note summary or] summary statement based
       upon stipulated facts, joint exhibits, and undisputed facts, the only
       question on appeal is whether the trial court drew the proper legal
       conclusions, which we review de novo.
Billington v. Carnahan, 380 S.W.3d 586, 591 (Mo.App. W.D. 2012).

                                       Analysis
       In Brown v. Carnahan, 370 S.W.3d 637 (Mo. banc 2012), the Supreme Court

provided a detailed description of the legal standards which apply to both summary

statements and fiscal note summaries. “Secretary of state summary statements

and auditor fiscal notes and fiscal note summaries are required by section 116.190.3

to be sufficient and fair.” Id. at 653. “When reviewing whether the secretary of

state and the auditor have complied with the fairness and sufficiency requirements

under section 116.190, this Court considers that insufficient means inadequate;

especially lacking adequate power, capacity, or competence, and unfair means to be
marked by injustice, partiality, or deception.” Id.

                                           8
             The secretary of state's summary statement must be concise and
      cannot be intentionally argumentative or likely to create prejudice. To
      create such a summary statement that is not insufficient or unfair, the
      summary statement must be adequate and state the consequences of
      the initiative without bias, prejudice, deception, or favoritism. The
      language used should fairly and impartially summarize the purposes
      of the measure so that voters will not be deceived or misled. It should
      accurately reflect the legal and probable effects of the proposed
      initiative. Sometimes it is necessary for the secretary of state's
      summary statement to provide a context reference that will enable
      voters to understand the effect of the proposed change.

             Section 116.175.3 instructs the auditor to prepare a fiscal note
      and fiscal note summary for a proposed initiative that “state[s] the
      measure's estimated cost or savings, if any, to state or local
      governmental entities.” In the context of requiring a fair and sufficient
      fiscal note by the state auditor, the words insufficient and unfair mean
      to inadequately and with bias, prejudice, deception and/or favoritism
      state the fiscal consequences of the proposed proposition. Similarly, in
      examining the fairness and sufficiency of the fiscal note summary, the
      summary's words are considered sufficient and fair where they
      adequately and without bias, prejudice, or favoritism synopsize the
      fiscal note. A fiscal note summary is not judged on whether it is the
      “best” language, only on whether it is fair.

             Requiring fairness and sufficiency of an initiative's summary
      statement, fiscal note, and fiscal note summary reflects that there are
      procedural safeguards in the initiative process that are designed
      either, (1) to promote an informed understanding by the people of the
      probable effects of the proposed amendment, or (2) to prevent a self-
      serving faction from imposing its will upon the people without their
      full realization of the effects of the amendment. Initiative process
      safeguards assure that the desirability of the proposed amendment
      may be best judged by the people in the voting booth.
Id. at 654 (other citations and internal quotation marks omitted); see also, e.g.,

Dotson v. Kander, 464 S.W.3d 190, 195-96 (Mo. banc 2015); Shoemyer v. Mo. Sec’y of

State, 464 S.W.3d 171, 174 (Mo. banc 2015); State ex rel. Kander v. Green, 462
S.W.3d 844, 849-852 (Mo. App. W.D. 2015).

                                           I.

      We first address Boeving’s challenge to the summary statement, which he

has raised in a cross-appeal.
      The Secretary of State’s summary statement provides in full:

                                           9
      Shall the Missouri Constitution be amended to:

            increase taxes on cigarettes each year through 2020, at which point
             this additional tax will total 60 cents per pack of 20;

            create a fee paid by cigarette wholesalers of 67 cents per pack of 20 on
             certain cigarettes; and

            deposit funds generated by these taxes and fees into a newly
             established Early Childhood Health and Education Trust Fund?
      Although the trial court found the summary statement to be adequate,

Boeving argues that both the second and third bullet points are unfair and

insufficient. We consider these issues in turn.

                                           A.

      Boeving argues that the second bullet point is unfair and insufficient because

it does not mention that the equity assessment fee is mandated to increase

annually, in perpetuity, by the greater of 3% or the annual increase in the

Consumer Price Index. We agree.

      As the trial court noted, although the equity assessment fee will initially be

set at 67 cents per pack of cigarettes in 2017, it is required to be increased every

year "in accordance with the Inflation Adjustment" in the Master Settlement

Agreement. That Inflation Adjustment will result in an annual increase in the

equity assessment fee of at least 3%, or more if the annual change to the Consumer

Price Index is higher. The Inflation Adjustment is subject to compounding,

meaning that it operates every year on the adjusted equity assessment fee in the

immediately preceding year.

      The trial court itself observed that the second bullet point “could be

misleading,” because “there is nothing in this summary statement that would give

notice to the voters that the fee will increase annually or that would give an

indication that the voter should investigate the fee mechanism further.” We agree
that the second bullet point, as written, is likely to mislead voters, and fails to

                                           10
accurately summarize the equity assessment fee which the initiative petition

proposes to establish. The second bullet point asks voters whether the Missouri

constitution should be amended to “create a fee . . . of 67 cents per pack of 20.” The

initiative petition does not propose to establish a 67-cent fee, however. It proposes

to establish – in the Missouri constitution – an equity assessment fee which will

begin at 67 cents, but which will increase every year, forever, by the greater of 3%

or the increase in the Consumer Price Index. The statement that the initiative will

“create a fee . . . of 67 cents” would suggest to a reasonable voter that the fee is

established as an unchanging sum-certain. But that is not true. While the

initiative petition establishes 67 cents as the benchmark at which the fee will

originate, the fee is required to increase annually from there. As the circuit court

recognized, nothing in the summary statement would alert a voter to this

mandatory, perpetual, annual increase in the equity assessment fee, or would signal

that the voter should investigate the issue further before voting.

      The misleading nature of the second bullet point is heightened when it is

considered in context. The first bullet point states in clear language that the new

retail sales tax will “increase . . . each year through 2020, at which point this

additional tax will total 60 cents per pack.” Thus, the first bullet point clearly
advises voters that the retail sales tax will be subject to annual increases through

2020; it also tells voters the final, highest monetary amount of the tax, which will be

applicable in 2020 and thereafter. Given the wording of the first bullet point, voters

would reasonably expect that the second bullet point would similarly describe any

increases in the equity assessment fee. By failing to do so, the second bullet point

would mislead voters into believing that the fee is not subject to further increases,

but instead represents a definite, fixed 67-cent assessment. As Boeving argues, the

two bullet points read together will leave voters “with the clear impression that the
tax increases, but the fee remains constant.” This is clearly not the case.

                                           11
       The requirement that the equity assessment fee increase annually by 3% or

more “is a central feature of [the proposed constitutional amendment], and a fact of

which voters are entitled to be informed.” Seay v. Jones, 439 S.W.3d 881, 891 (Mo.

App. W.D. 2014). The desirability of mandatory, annual, inflation-based increases

has been the subject of substantial public debate, in connection with (for example)

the minimum wage, public-employee compensation, governmental benefits such as

Social Security, and income tax rates and brackets. These policy debates have

concerned not only whether to adopt or continue an inflation-based escalator, but

also what measure best reflects inflation or cost-of-living increases. It is significant

that in this case the equity assessment fee will, over time, inevitably increase more

than the increase in the Consumer Price Index, since the initiative petition requires

a minimum annual increase of 3%, even when the increase in the Consumer Price

Index is lower. As an example, in the ten years from 2006 to 2015, the Consumer

Price Index for All Urban Consumers (the measure specified in the Master

Settlement Agreement) increased by 3% or more in only two years.2 Therefore, in

the other eight years, the equity assessment fee would have increased at a rate

greater than the Consumer Price Index. The fact that the initiative petition adopts

a “Consumer Price Index-plus” annual increase factor is not simply an incidental
detail of the proposal. Cf. Protect Consumers' Access To Quality Home Care Coal.,

LLC v. Kander, WD 79100, 2015 WL 7252587, at *3 (Mo.App. W.D. Nov. 17, 2015)

(finding summary statement inadequate where it referred to “in-home service

providers,” but “g[a]ve[ ] no indication as to what types of services are contemplated

or under what programs”).3

       2      See Bureau of Labor Statistics, CPI Detailed Report: Data for May 2016,
Table 24 (available at http://www.bls.gov/cpi/cpi_dr.htm#2016 (last visited on July 5, 2016)).
       3       Although it has not yet been published in the SOUTHWESTERN REPORTER, the
Protect Consumers’ Access decision is final, and has the precedential value of any published
opinion of this Court. A post-disposition application for transfer filed in this Court was
denied on December 22, 2015, and an application for transfer filed in the Supreme Court

                                             12
      The Secretary of State and Raise Your Hand argue that the second bullet

point satisfies the standards found in Brown v. Carnahan, 370 S.W.3d 637, despite

its failure to make any reference to the Inflation Adjustment. The Brown appeal

involved three consolidated cases, which challenged the official ballot titles for three

different initiatives. In each case, the plaintiffs challenged the fairness and

sufficiency of both the summary statements and fiscal note summaries. The

Secretary of State and Raise Your Hand rely on the Supreme Court’s discussion of

the summary statements for two of the initiatives. In the first, the summary

statement for a minimum-wage initiative asked voters whether Missouri law should

be amended to “increase the state minimum wage to $8.25 per hour, or to the

federal minimum wage if that is higher, and adjust the state wage annually based

upon changes in the Consumer Price Index.” Id. at 660 (quoting summary

statement). Among other things, the plaintiff argued

      that the summary statement is unfair and insufficient because it fails
      to explain adequately and accurately how the proposed minimum wage
      initiative would result in state minimum wage adjustments based on
      changes to the federal minimum wage. He contends that the summary
      statement fails to explain to voters that the proposed initiative would
      create a new “super-escalator” scheme whereby Missouri's state
      minimum wage would be increased to meet the federal minimum wage
      if the federal minimum wage is higher and then still be subject to
      increases based on the application of the CPI. He argues that voters
      are not informed fully by the summary statement that it is likely
      under the proposed measure that the state's minimum wage will
      increase annually.
Id. at 661.

      The Supreme Court rejected this challenge, and found the summary

statement for the minimum-wage initiative to be fair and sufficient. The Court

agreed with the Secretary of State “that setting out a separate explanation of the

‘super-escalator’ provision was not necessary to render the summary statement fair

was denied on December 28, 2015. No. SC95447. We issued our mandate in the case on
December 29, 2015.

                                          13
and sufficient”; the Court emphasized that “the summary statement ‘need not set

out the details of the proposal’ to be fair and sufficient.” Id. (citation omitted).

      The Secretary of State and Raise Your Hand argue that Brown holds that an

inflation-based adjustment factor in an initiative petition is merely a “detail” of the

proposal, which need not be described in the summary statement. We believe that

they read this aspect of the Brown decision far too broadly. In Brown, the

minimum-wage summary statement already stated that the state minimum wage

would be increased to $8.25 per hour “or to the federal minimum wage if that is

higher,” “and” that the state minimum wage would be “adjust[ed] . . . annually

based upon changes in the Consumer Price Index.” Thus, the existing summary

statement already explained that (1) benchmarking the state minimum wage to the

federal minimum wage, and (2) adjusting the state minimum wage annually based

on changes in the Consumer Price Index, would operate together (not as mutually

exclusive alternatives). Given the existing description of the proposed state

minimum wage formula, the Court merely held that the Secretary of State was not

required to include a “separate,” additional explanation of the fact that the two

features would work together. Brown held that the Secretary of State’s existing

description of the Consumer Price Index escalator was adequate; it did not hold that
it was unnecessary to include any description of that escalation factor.

      Raise Your Hand also relies on Brown’s discussing of a separate initiative,

which sought to place limits on the interest and fees which could be charged by

certain consumer lenders. The summary statement for that initiative asked: “Shall

Missouri law be amended to limit the annual rate of interests, fees, and finance

charges for payday, title, installment, and consumer credit loans and prohibit such

lenders from using other transactions to avoid the rate limit?” 370 S.W.3d at 663

(quoting summary statement). The circuit court held that the summary statement
was unfair and insufficient, because “the initiative’s impact – i.e. its “probable

                                            14
effect” – on businesses, consumers, and governmental entities, is not tied to the

mere existence of a “limit,” but rather, it depends on what that “limit” is.’” Id.

(quoting circuit court’s judgment). The circuit court accordingly certified an

amended summary statement, which specified that the initiative would impose an

annual limit “of 36 [percent]” on the interest, fees, and finance charges which

lenders charged. Id.

      The Supreme Court reversed. It explained:

             Here, the secretary of state prepared a summary statement that
      was accurate as to the purpose of the initiative – to limit the
      permissible interest rate for certain types of loans – and there was no
      requirement to articulate specifically the proposed 36–percent rate
      limit. That the court might believe that the additional information
      about the rate limit would render a better summary is not the test.
      See Bergman v. Mills, 988 S.W.2d 84, 92 (Mo. App. [W.D.] 1999)
      (rejecting claims by an initiative's opponents who alleged that the
      secretary of state's summary statement for the initiative was vague,
      ambiguous, and insufficient; finding that “even if the language
      proposed by [the opponents] is more specific, and even if that level of
      specificity might be preferable, whether the summary statement
      prepared by the Secretary of State is the best language for describing
      the referendum is not the test”).
370 S.W.3d at 664. “Because the secretary of state's summary statement language

was fair and sufficient in summarizing the purpose of the initiative and was not

written in a way that would mislead voters, the trial court erred in rejecting her
summary statement.” Id.

      Raise Your Hand argues that this aspect of Brown indicates that it is

unnecessary for a summary statement to advise voters of the specific numerical or

monetary provisions of an initiative, so long as the summary advises voters of the

proposal’s general purposes. Once again, we conclude that Raise Your Hand reads

Brown too broadly. Although the summary statement for the payday lending

initiative at issue in Brown may have been vague or general, the Supreme Court
held that the language “was accurate as to the purpose of the initiative,” and “was

                                           15
not written in a way that would mislead voters.” 370 S.W.3d at 664. As the

quotation from Bergman makes clear, the Supreme Court held only that greater

specificity was not required for this “vague but accurate” summary statement.

       In the present case, Boeving’s challenge to the second bullet point does not

argue merely that the description is insufficiently specific. Instead, as we have

explained above, Boeving’s argument is that the second bullet point is inaccurate

and misleading, because it would lead a voter to believe that the equity assessment

fee will be set at $.67 for all time. This is not a case of a “vague but accurate”

summary; instead, the summary statement in this case is specific, but inaccurate.4

       Raise Your Hand also contends that application of the Inflation Adjustment

to the equity assessment fee is merely a continuation of existing law, and that it

was accordingly unnecessary to refer to the Inflation Adjustment in the summary

statement. See Dotson v. Kander, 464 S.W.3d 190, 196-98 (Mo. banc 2015) (holding

that summary statement was not required to reference specific features of initiative

where those features did not change existing law). Raise Your Hand points to

§ 196.1003, which currently requires nonparticipating manufacturers to annually

“place into a qualified escrow fund . . . the following amounts [stated in terms of a

monetary amount per cigarette sold] (as such amounts are adjusted for inflation).”
§ 196.1003(b)(1). The required per-cigarette escrow amounts are “adjusted for

inflation” using the same Inflation Adjustment employed in the initiative petition.

See § 196.1000(a).5

       4      We recognize that, under Brown, it would potentially have been sufficient for
the second bullet point to merely advise voters that the initiative would “create a fee paid
by cigarette wholesalers on certain cigarettes,” without stating any monetary value
whatsoever. That is not the case before us, however. Here, the summary statement
purported to precisely state the monetary amount of the equity assessment fee; but it did so
in a materially inaccurate fashion.
       5      It is unclear how the $.67 per pack assessment rate imposed by the initative
petition compares to the amounts currently required to be escrowed under § 196.1003(b)(1).
Section 196.1003(b)(1) provides that the amount required to be escrowed, per cigarette sold,
is $.0188482 “for each of 2007 and each year thereafter.” The per-unit escrow amount

                                            16
       Although § 196.1003 currently requires nonparticipating manufacturers to

escrow sums based on cigarettes sold, using a per-cigarette amount which is

increased by use of the Inflation Adjustment, the use of the Inflation Adjustment in

the initiative petition is not simply a continuation of the legal obligations currently

contained in chapter 196. The monies required to be escrowed under

§ 196.1003(b)(1) are to be used “to pay a judgment or settlement on any released

claim brought against such tobacco product manufacturer by the State or any

releasing party located or residing in the State.” § 196.1003(b)(2)(A). Unless used

to fund judgments or settlements, or refunded as an overpayment,6 escrowed funds

“shall be released from escrow and revert back to such tobacco product

manufacturer twenty-five years after the date on which they were placed into

escrow.” § 196.1003(2)(C).

       Thus, the escrow fund payments required by § 196.1003 constitute a

fundamentally different legal obligation than the equity assessment fee established

by the initiative petition. The monies held in escrow are used to secure qualifying

judgments and settlements, and are otherwise returned to the manufacturer. The

equity assessment fee, by contrast, is paid into the Early Childhood Health and

Education Trust Fund, and is immediately available for use by the Fund for the
purposes specified in the initiative. Unlike the escrow payments made by a

nonparticipating manufacturer under § 196.1003, a wholesaler would have no right

specified in the statute would approximate $.38 per pack of 20 cigarettes. This amount has,
however, been subject to escalation since 2007 using the Inflation Adjustment. The parties
were unable to advise us at oral argument concerning the current per-cigarette or per-pack
amount of the escrow payments required by § 196.1003(b)(1).
       6      Section 196.1003(b)(2)(B) provides that escrowed funds can be released to the
nonparticipating manufacturer if it establishes that an escrow payment it made “was
greater than the State’s allocable share of the total payments that such manufacturer
would have been required to make in that year under the Master Settlement Agreement . . .
had it been a participating manufacturer.”

                                            17
to recoup the equity assessment fees that it would pay if the initiative is adopted.7

Because the equity assessment fee is a fundamentally different legal obligation

than the escrow payments required by § 196.1003, the fact that the same Inflation

Adjustment is used in the statute and in the proposed constitutional amendment is

immaterial. In other words, the fact that the Inflation Adjustment is used in

§ 196.1003 would not alert voters that the same escalator will be applied to the

equity assessment fee created by the initiative petition.

       Moreover, even if the use of the Inflation Adjustment in the proposed

constitutional amendment merely continued existing law, it is well established that

“[s]ometimes it is necessary for the secretary of state's summary statement to

provide a context reference that will enable voters to understand the effect of the

proposed change.” Brown, 370 S.W.3d at 654; see also, e.g., Mo. Mun. League v.

Carnahan, 364 S.W.3d 548, 553 (Mo.App. W.D. 2011) (“at least in some instances

context demands a reference to what is currently present to understand the effect of

the proposed change”). Such a “context reference” would be necessary here, even if

the Inflation Adjustment continued existing law. As we have explained above,

reporting that the equity assessment fee will be “67 cents,” with no reference to the

fact that the fee will necessarily increase every year, is misleading and inaccurate.
Whether it is new or not, the Inflation Adjustment must be referenced in the second

bullet point in some fashion to give voters a fair and sufficient summary.

        7       It also appears that the entity paying the relevant assessments may be
different. Section 196.1003 requires escrow payments by “tobacco product manufacturers,”
§ 196.1003 (which may include the first purchaser of cigarettes for resale, if “the
manufacturer does not intend [the cigarettes] to be sold in the United States,”
§ 196.1000(i)(2)), while the initiative petition specifies that the equity assessment fee “shall
be paid by the wholesaler.” Proposed § 54(c).2.a. To the extent § 196.1003 and the
initiative petition impose legal obligations on different entities, this would be all the more
reason to hold that use of the Inflation Adjustment in § 196.1003 gives no notice of the
proposed use of the Inflation Adjustment in the proposed constitutional amendment.

                                              18
      We accordingly find that the second bullet point in the summary statement

fails to adequately inform voters of the initiative’s probable effects, and is therefore

unfair and insufficient. We reverse the trial court’s contrary determination.

                                           B.

      Boeving also challenges the summary statement’s third bullet point, arguing

that it is insufficient and unfair because it fails to inform voters how the proceeds of

the initiative would be used. Boeving also asserts that the third bullet point is

inadequate because it fails to advise voters that the initiative would permit funds to

be disbursed to religious schools, despite the prohibition in Article IX, § 8 of the

Missouri constitution, and would prohibit funds from being used for “research,

clinical trials, or therapies or cures using human embryonic stem cells,” despite the

provisions of Article III, § 38(d) of the Missouri constitution.

      The trial court acknowledged the third bullet point’s potential deficiencies,

but nonetheless found that the summary was not unfair or insufficient on this basis.

We agree.

      As we have explained above, in Brown v. Carnahan the Supreme Court

approved a summary statement that indicated that the initiative would “limit the

permissible interest rate for certain types of [payday] loans,” but failed to articulate
the specific 36-percent limit proposed. 370 S.W.3d at 664. The Court emphasized

that “the summary statement need not set out the details of the proposal to be fair

and sufficient. . . . [T]he test is not whether increased specificity would be have

been preferable but instead is whether the language used was fair and impartial in

summarizing the initiative's purposes.” Id. at 661. “That the court might believe

that the additional information about the rate limit would render a better summary

is not the test.” Id. at 664. Instead, “the important test is whether the language

fairly and impartially summarizes the purposes of the initiative.” Id. at 656
(citation and internal quotation marks omitted).

                                           19
      Here, the summary statement accurately advises voters that the revenues

generated by the new taxes and fees will be deposited into the Early Childhood

Health and Education Trust Fund. Although the summary statement does not

explicitly state the purposes for which revenues will be expended, the name of the

Fund accurately – albeit generally – describes the purposes to which funds will be

put: increasing access to early childhood education and health and development

programs, and funding smoking cessation and prevention programs targeting

pregnant mothers and youth.

      Moreover, the fiscal note summary which immediately follows the summary

statement advises voters that “[t]he revenue [generated by the proposal] will fund

only programs and services allowed by the proposal.” Boeving himself

acknowledges that a statement like the one appearing in the fiscal note summary

would be sufficient to alert voters to further investigate the uses to which revenues

will be put: in his opening Brief, he argued that, “[a]t a minimum, the Summary

Statement should have alerted voters that the revenues would be used for the

purposes identified in the measure (to alert voters to go and read the underlying

measure).” While the additional statement appears in the fiscal note summary

rather than in the summary statement, the two summaries follow one another in
the ballot title, and we are aware of no authority which prevents us from relying on

the language of the fiscal note summary to provide voters with additional relevant

information.

      The language used in the summary statement and fiscal note summary

advises voters generally of the purposes for which revenues will be spent, and

notifies them that additional details exist in the proposal (which would prompt

those interested to make further inquiry). “The ballot title is sufficient if it makes

the subject evident with sufficient clearness to give notice of the purpose to those

                                          20
interested or affected by the proposal.” Protect Consumers' Access, 2015 WL
7252587, at *2. The summary statement here does so adequately.

      Boeving also argues that the summary statement is deficient for failing to

advise voters that it prohibits funding of human embryonic stem-cell research

which would otherwise be authorized by Article III, § 38(d) of the Missouri

constitution, and fails to advise voters that the initiative creates an exception to

Article IX, § 8, which generally prohibits governmental funding of religious

educational institutions.

             Within the confines of the word limit, the ballot title is not
      required to set out the details of the proposal or resolve every
      peripheral question related thereto. While there may be aspects of the
      ballot initiative or consequences resulting therefrom that Appellants
      would have liked to have seen included in the summary statement,
      their exclusion does not render the summary statement either
      insufficient or unfair. The test is not whether increased specificity and
      accuracy would be preferable or provide the best summary; rather, the
      important test is whether the language fairly and impartially
      summarizes the purpose of the initiative.
Archey v. Carnahan, 373 S.W.3d 528, 533–34 (Mo. App. W.D. 2012) (citations and

internal quotation marks omitted); see also, e.g., Brown, 370 S.W.3d at 656.

      The central features of the initiative petition are the imposition of a new

retail sales tax on cigarettes; the creation of a new equity assessment fee to be paid

by cigarette wholesalers; and the creation of the Early Childhood Health and

Education Trust Fund, and the use of monies from the Fund for early childhood

health and education programs. As long as voters are accurately and fairly advised

of these key components of the initiative petition, the summary statement is fair

and sufficient. We recognize that exempting Fund distributions from Article IX, § 8,

and prohibiting the use of funds for research which otherwise complies with Article

III, § 38(d), may be of interest to individual voters. But these details are not central

to the initiative petition’s purpose, and it is not necessary to reference them in the
space of a summary statement limited to 100 words. We note that the initiative

                                           21
petition contains other features which might also be of interest to particular voters.

These include: the reformation of the Coordinating Board for Early Childhood into

the Early Childhood Commission, which will administer the Fund; a prohibition on

payments to any organization which provides abortion services; a prohibition on

providing services or benefits funded by the initiative to persons who are not legal

residents of the United States; and the “hold harmless” provision which seeks to

compensate local governments and other funds for revenue reductions they

experience as a result of reduced cigarette consumption. It would be impossible in

the space of a 100-word summary to address all of these aspects of the initiative,

even generally. The summary was not unfair and insufficient for its failure to

reference the initiative’s relationship to Article III, § 38(d), and Article IX, § 8.

       We therefore affirm the trial court’s conclusion that the summary statement’s

third bullet point was fair and sufficient.

                                              C.

       Section 116.190.4 provides that, “[i]nsofar as the action challenges the

summary statement portion of the official ballot title, the court shall consider the

petition, hear arguments, and in its decision certify the summary statement portion

of the official ballot title to the secretary of state.” Consistent with this directive
and with its conclusion that the existing summary statement was not insufficient or

unfair, the circuit court certified the existing language to the Secretary of State.

Because we have found the language of the second bullet point to be insufficient and

unfair, we reverse this aspect of the circuit court’s judgment.

       This Court has held in multiple cases that § 116.190.4 authorizes the circuit

court to certify alternative language to the Secretary of State where the circuit court

finds the existing summary statement language to be deficient. We have also held

that, where this Court concludes that the summary statement is insufficient or
unfair, we “step into the circuit court’s shoes” by virtue of Supreme Court Rule

                                              22
84.14. Rule 84.14 authorizes appellate courts to “give such judgment as the court

ought to give,” and provides that, “[u]nless justice otherwise requires, the court

shall dispose finally of the case.”

       We discussed these dispositional issues in Seay v. Jones, 439 S.W.3d 881,

observing:

              We have repeatedly construed the provisions of § 116.190, and
       in particular the provisions of § 116.190.4, to authorize the courts to
       modify the language of a summary statement found to be insufficient
       or unfair, and to certify the modified language to the Secretary of
       State. As we explained in Cures without Cloning [v. Pund], 259
S.W.3d 76 [(Mo. App. W.D. 2008)]:

              Missouri courts have recognized that “Section 116.190
              allows the trial court to correct any insufficient or unfair
              language of the ballot title and to certify the corrected
              official ballot title to the secretary of state.” These
              decisions are consistent with Section 116.190.3, which
              allows a petitioner in circuit court to request a “different
              summary statement” if the Secretary's ballot title is
              determined insufficient or unfair. Notably, there is no
              provision for a remand of the summary statement under
              these circumstances. Section 116.190.4 gives the court
              discretion to remand a fiscal note or fiscal note summary
              to the State Auditor to correct deficiencies, but the statute
              does not authorize remand of any portion of the ballot
              title to the Secretary for modification. The statute
              implicitly allows the court to certify a corrected summary
              statement, and then “the secretary of state shall certify
              the language which the court certifies to [her].” Section
              116.190.4.

       Id. at 83 (emphasis and other citations omitted); see also, e.g., Mo.
       Mun. League v. Carnahan, 303 S.W.3d 573, 588-89 (Mo. App. W.D.
       2010) (entering “a judgment modifying the ballot summary as set forth
       herein” and remanding modified language to Secretary of State); Cole
       v. Carnahan, 272 S.W.3d 392, 394-95 (Mo. App. W.D. 2008).
Seay, 439 S.W.3d at 894; see also Protect Consumers’ Access, 2015 WL 7252587, at

*4.

       As we have explained above, in Brown v. Carnahan the Supreme Court
approved the summary statement for a payday lending initiative which omitted

                                           23
numerical values and may have been general, but which accurately advised voters

of the effect which passage of the initiative would have. 370 S.W.3d at 664. With

that decision in mind, we believe that adding the phrase “which fee shall increase

annually” to the second bullet point will adequately advise voters that the equity

assessment fee will be subject to mandatory annual increases, while modifying the

Secretary of State’s language in the most limited fashion possible. As modified, the

second bullet point will read: “create a fee paid by cigarette wholesalers of 67 cents

per pack of 20 on certain cigarettes, which fee shall increase annually.”8

                                             II.

       We now turn to the circuit court’s conclusion that the State Auditor’s fiscal

note summary was unfair and insufficient.

       The fiscal note summary states:

               When cigarette tax increases are fully implemented, estimated
       additional revenue to state government is $263 million to $374 million
       annually, with limited estimated implementation costs. The revenue
       will fund only programs and services allowed by the proposal. The
       fiscal impact to local governmental entities is unknown.
                                             A.

       The trial court found the fiscal note summary deficient for two reasons.

First, the court concluded that the Auditor acted unreasonably by including in the
fiscal note summary the Department of Revenue’s estimate of a $374 million

increase in State revenues. The trial court held that the Auditor should have

excluded the Department of Revenue’s estimate because that estimate failed to

account for the price elasticity of demand for cigarettes (in other words, because it

       8      At oral argument, counsel for Boeving and for the Secretary of State
indicated that the initiative proponents have filed signed petitions with the Secretary of
State pursuant to § 116.100, and that the Secretary of State’s office is currently reviewing
the signed petitions for sufficiency. We express no opinion concerning the effect of our
decision today on the validity of the petitions which the initiative proponents have
submitted to the Secretary of State.

                                             24
failed to predict a decrease in cigarette consumption due to the increased taxes and

fees). The trial court held that “[t]he failure to use even the most rudimentary

concepts of Price and Demand render the inclusion of the unreasonably high DOR

number deceptive and unfair.” The trial court determined that “the Auditor should

have identified [the use of zero price elasticity of demand] as an unreasonable

assumption” and should therefore have excluded the Department of Revenue’s

revenue estimate from the fiscal note summary.

      We initially note that the Department of Revenue’s $374 million estimate is

merely the upper bound of a range of potential effects on State revenue reported in

the fiscal note summary. The lower bound is derived from the Office of

Administration’s estimate, which took account of price elasticity of demand in a

manner with which Boeving has no dispute. Even if the Department of Revenue’s

estimate of the State revenue impact of the initiative were based on flawed

assumptions, that estimate merely supplies the high end of the range of potential

revenue impacts; it is not the sole estimate provided to voters.

      More importantly, the circuit court’s conclusion that the Auditor should have

separately assessed, and rejected, the economic assumptions underlying the

Department of Revenue’s revenue estimate fundamentally misconceives the
function of the State Auditor in preparing fiscal notes and fiscal note summaries.

The Supreme Court described the Auditor’s role in substantial detail in Brown v.

Carnahan, 370 S.W.3d 637. It explained that, in preparing a fiscal note and fiscal

note summary,

      [t]he auditor does not analyze or evaluate the correctness of the
      returned fiscal impact submissions. Rather, he or she examines the
      submissions to determine whether they appear complete, are relevant,
      have an identifiable source, and are reasonable. The auditor studies
      each submission regarding completeness, determining whether the
      entity's response conveys a complete representation of what the entity
      intended to send and if it reasonably is related to the proposal. He also
      reviews the submission to ensure there are no missing pages or breaks

                                          25
      in the continuity of information. With respect to reasonableness, the
      auditor examines the submission to establish whether it addresses or
      diverges from the particular issue. The auditor's determination of
      reasonableness is based on the auditor's experience in state
      government and overall knowledge and understanding of business and
      economic issues. If the auditor concludes a submission is
      unreasonable, he or she determines what weight the submission will
      be given when preparing the fiscal note summary. If the auditor has
      any questions regarding the submission of an entity or needs to clarify
      an incomplete submission, he or she may conduct a follow-up inquiry.
Id. at 649.

      Brown also explained that the Auditor may rely on the fiscal submissions

provided to him or her, without independently analyzing the reliability of those

submissions:

      The auditor is not required to compel and second-guess reasonable
      submissions from entities but is able to rely on the responses
      submitted. Nor should the auditor wade into the policy debates
      surrounding initiative petitions, which an independent investigation
      would entail. In each of these cases, proponents and opponents argued
      zealously for their position with respect to the initiative at issue. It is
      not the auditor's role to choose a winner among these opposing
      viewpoints by independently researching the issue himself, double-
      checking economic theories and assumptions, and adopting one side's
      view over another's in the resulting fiscal note.
Id. at 650 (emphasis added).

      Brown applied these principles in connection with the fiscal note summary

for the payday loan initiative that was at issue in one of the cases consolidated on
appeal. In that case, the challengers argued that the Auditor had erroneously failed

to consider the potential impact that limiting interest and fees could have on the

economic viability of certain lenders (known as “510 lenders”). The Supreme Court

disagreed:

      The auditor did nothing out of his ordinary practice when
      incorporating verbatim the fiscal impact submissions that were
      returned to him, and the initiative opponents are unpersuasive in
      suggesting that the auditor should have undertaken additional
      examinations of the fiscal impacts that the initiative would have
      specifically on “510 lenders.” While it might have been more
      informative to have had additional information related to the likely

                                          26
      fiscal impact of the initiative on “510 lenders,” nothing required the
      auditor to look beyond the information he was provided in assessing
      the fiscal impact on those lenders. As noted earlier in this opinion:
      “The auditor is not required to compel and second-guess reasonable
      submissions from entities but is able to rely on the responses
      submitted . . . . [And][i]t is not the auditor's role to choose a winner . . .
      by independently researching the issue himself, double-checking
      economic theories and assumptions, and adopting one side's view over
      another's in the resulting fiscal note.”
370 S.W.3d at 666-67.

      We succinctly explained the scope of the Auditor’s role in examining fiscal

submissions he or she receives in Protect Consumers’ Access:

      The role of the Auditor is not to judge the merits of a fiscal impact
      submission, but only to examine to determine whether the submission
      is complete, is relevant, has an identifiable source, and is reasonable.
2015 WL 7252587, at *6 (emphasis added). In Protect Consumers’ Access, we

rejected the argument of initiative proponents that the Auditor had an obligation to

develop an estimate of the impacts of the initiative on State tax revenues.

      While the Auditor received general statements regarding potential
      impacts on the economy by the proponents of the Initiative, the
      Auditor received no submission that provided a projection of an
      increase or decrease of tax revenue to the State. Having received no
      submission regarding an impact on state finances for the Fiscal Note,
      it would be improper for the Auditor to include comment upon any
      impact to state finances in the summary. . . . As explained above, it is
      not the Auditor's responsibility to undertake an independent
      investigation and comment upon a possible impact to state finances if
      no submissions are made to the Auditor describing those impacts.
Id. at *7 (emphasis added); see also Mo. Mun. League v. Carnahan, 364 S.W.3d 548,

557 (Mo. App. W.D. 2011) (citing Mo. Mun. League v. Carnahan, 303 S.W.3d 573,

582 (Mo. App. W.D. 2010)).

      The circuit court’s conclusion that “the Auditor should have identified [the

Department of Revenue’s use of zero price elasticity of demand] as an unreasonable

assumption” cannot be reconciled with the discussion of the Auditor’s role in Brown

and Protect Consumers’ Access. The trial court’s holding that the Auditor should
have second-guessed, and rejected, the Department of Revenue’s revenue estimate

                                           27
“impose[s] on the Auditor a duty it does not have.” Id. at *6. “Because the

Department’s submission addressed and did not diverge from the particular issue of

the Initiative, it was reasonable.” Sinquefield v. Jones, 435 S.W.3d 674, 682 (Mo.

App. W.D. 2014) (citing Brown, 370 S.W.3d at 649).

      Further, the Auditor had plausible grounds for concluding that the

Department of Revenue’s revenue estimate was not so speculative that it should be

discounted or omitted entirely from the fiscal note summary. See Sinquefield, 435
S.W.3d at 685 (finding that Auditor was justified in finding a particular revenue

estimate to be speculative, and therefore omitting it from the fiscal note summary).

The employee from the Auditor’s office who prepared the fiscal note and fiscal note

summary testified that he determined that the Department of Revenue’s failure to

use a price-elasticity factor was “a reasonable assumption in this particular

initiative petition,” even though use of an elasticity factor might be appropriate if

the new taxes and fees were higher. The representative also testified that he

considered the fact that, “even with the $.60 to $1.27 increase in Missouri[’s]

cigarette tax, Misssouri[’s] cigarette tax will remain lower than many of its

contiguous states, in particular the states that border major metropolitan areas;

Illinois and Kansas.” The Auditor also noted that the Office of Administration
(which had used a price elasticity factor to forecast a decrease in cigarette

consumption following adoption of the initiative) stated in its fiscal submission that

“there is no way to truly know what impact these tax increases will have on demand

due to smoking cessation efforts, other state and federal regulations, and the

increase in sales of e-cigarettes and other substitute products.”   (Emphasis added.)

We see no reason to second guess the Auditor’s conclusion that it was appropriate to

reflect the Department of Revenue’s estimate in the fiscal note summary; her

decision to do so falls well within the scope of her authority.

                                           28
      Boeving argues that Brown is distinguishable because, in this case, the

Auditor chose to conduct a more searching examination of the fiscal submissions

than the review described in Brown. We disagree. Instead, we read the testimony

as indicating merely that the official who prepared the fiscal note and fiscal note

summary conducted the level of review required to determine the proper weight to

give to the submissions (as Brown requires), and properly determined that the

various submissions were not so speculative as to require that they be discounted.

The Auditor’s staff did not voluntarily assume an obligation to conduct a more

searching review of the assumptions underlying the fiscal submissions.

      We therefore conclude the trial court erred in its determination that the fiscal

note summary was insufficient and unfair for including the Department of

Revenue’s estimate as the upper bound of a range of potential increases to State

revenue as a result of the initiative petition.

                                           B.

      The circuit court also held that the fiscal note summary’s statement that local

fiscal impact was “unknown” was problematic, because of submissions identifying

the range of impact as between $0 and a loss of $10.4 million. Again, we disagree.

      Boeving’s argument misreads the Office of Administration’s fiscal
submission, which he contends estimates a $10.4 million reduction in local sales

taxes. Although the Office of Administration’s submission predicts that local sales

taxes will be reduced by $10.4 million as a result of the initiative, that estimate

does not take into account the effect of the initiative’s “hold harmless” provision. As

the Office of Administration’s submission recognized, the “hold harmless” provision

allows up to 4 percent of the money collected under the initiative to be distributed to

political subdivisions experiencing revenue declines, so long as the Departments of

Revenue and Health and Senior Services determine that the initiative “directly
caused” those declines.

                                           29
      Although the Office of Administration’s fiscal submission does not take a

definite position as to whether the “hold harmless” provision would be triggered, its

submission assumes that the $10.4 million revenue decline was caused by the

increased taxes and fees imposed by the initiative. Thus, although other agencies

would make the causation determination necessary to actually trigger the “hold

harmless” provision, the Office of Administration plainly assumed that the facts

would justify a determination that the revenue declines it predicted were, in fact,

“directly caused” by the initiative. In these circumstances, it was reasonable for the

Auditor to assume that the hold harmless provision would be triggered, and would

compensate localities fully for any declines in sales taxes which the Office of

Administration forecast. See Protect Consumers’ Access, 2015 WL 7252587, at *5

(concluding that Auditor reasonably interpreted fiscal submission to represent

potential financial impacts on “the University of Missouri system as a whole,” and

as representing a “one-time cost”).

      The Auditor nevertheless chose to indicate that the impact on local

governmental entities would be “unknown” because of the potential for reduced

local healthcare costs due to reductions in smoking, the potential that local entities

would benefit from increased funding of childhood education, and the potential that
localities might be able to compete for grants funded by the initiative. Although

Boeving argues that “‘unknown’ cannot be a sufficient description of fiscal impact

when the Auditor had reasonable submissions quantifying the fiscal impact,” the

Auditor reasonably concluded that the Office of Administration’s submission did

not, in fact, “quantify” an expected decrease in local sales tax revenues, because of

the availability of “hold harmless” payments. In the circumstances of this case,

“[t]he use of the word “unknown” . . . adequately fulfills the fiscal note summary's

purpose of informing the public about the proposed initiative's potential fiscal
consequences without using language that is likely to cause bias, prejudice,

                                          30
deception, or favoritism for or against the proposal.” Sinquefield, 435 S.W.3d at

685. Here, as in Sinquefield, “[t]he majority of submissions indicated that there

would be either no impact or no direct, foreseeable, or adverse impact, or in some

way indicated they at least did not anticipate such impact.” Id. The “[u]se of the

word ‘unknown’ in the fiscal note summary to characterize potential impact to

revenues for state and local governments is sufficient and fair.” Id. Further, “courts

must remain mindful that the word limitations of the fiscal note summary

necessarily result in exclusion of specific fiscal impact details that might improve

the summary but that are not required for it to be upheld as sufficient and fair.”

Brown v. Carnahan, 370 S.W.3d at 667; see also Sinquefield, 435 S.W.3d at 683.

                                       Conclusion

       The judgment of the circuit court is reversed. We conclude that the fiscal

note summary prepared by the State Auditor is fair and sufficient, and the trial

court erred by vacating it, and remanding it to the State Auditor. We also find that

the summary statement prepared by the Secretary of State is unfair and

insufficient, and we hereby certify the following summary statement language to

the Secretary of State, for inclusion in the official ballot title for the initiative

petition:

       Shall the Missouri Constitution be amended to:

             increase taxes on cigarettes each year through 2020, at which point
              this additional tax will total 60 cents per pack of 20;

             create a fee paid by cigarette wholesalers of 67 cents per pack of 20 on
              certain cigarettes, which fee shall increase annually; and

             deposit funds generated by these taxes and fees into a newly
              established Early Childhood Health and Education Trust Fund?

                                                  __________________________________
                                                  Alok Ahuja, Judge
All concur.

                                             31