A group of people holding signs outside
South Bay Labor Council Executive Officer Jean Cohen speaks on May 22, 2024 against an anti-tax measure planned for the November ballot. The California Supreme Court struck the ballot proposal down on June 20. Photo by Brandon Pho.

The California Supreme Court has blocked an anti-tax ballot measure that faced fierce opposition from local officials, unions and activists in Santa Clara County.

The panel’s unanimous decision on Thursday orders Secretary of State Shirley Weber not to place the measure on the November ballot, which if approved would have brought all statewide tax increases before voters and raised the voter approval threshold for local tax initiatives seeking to raise revenue for government services. It would have also reclassified fees for public services and programs as taxes, requiring voter approval for things such as library fines.

“Such changes would substantially overhaul how local governments go about ensuring that everyday services are properly provided. In sum, the (proposal) would affect all local revenue measures — big or small, essential or nonessential — to an extent that leaves no aspect of government untouched,” the court’s opinion reads.

The measure had qualified for the ballot, prompting a lawsuit by Gov. Gavin Newsom and the state Legislature seeking to stop it from going to voters. It would have applied retroactively to January 2022 — effectively canceling any special taxes approved in Santa Clara County in recent years.

That prompted a passionate rally among Santa Clara County activists, union leaders and Democratic elected officials in May, who called the measure a ploy by corporations to avoid paying their share for things such as development impact fees associated with construction projects, which can help communities fund infrastructure improvements. Others called it a logistical nightmare jeopardizing funding for essential services and canceling as many as eight recently passed ballot measures in Silicon Valley — totaling $64.3 million in annual losses in jurisdictions such as Los Gatos and Palo Alto.

“Im very happy that the court saw the measure for what it is and we won’t have to put a lot of resources into protecting sources of revenue for cities and local governments this fall,” San Jose Councilmember David Cohen, an outspoken opponent of the tax measure, told San José Spotlight.

The $17 million campaign for the measure has been spearheaded by the California Business Roundtable, composed of senior executives of major companies up and down the state, such as Apple, General Motors and Procter & Gamble. It’s also being supported by the real estate industry, namely the California Business Properties Association. Proponents argue the initiative closes loopholes that empowered state lawmakers and unelected government administrators to raise fees for services.

“Today’s ruling is the greatest threat to democracy California has faced in recent memory. Governor Newsom has effectively erased the voice of 1.43 million voters who signed the petition to qualify the Taxpayer Protection Act for the November ballot,” Rob Lapsley, president of the California Business Roundtable, said in a statement. “Most importantly, the governor has cynically terminated Californians’ rights to engage in direct democracy despite his many claims that he is a defender of individual rights and democracy. Evidently, the governor wants to protect democracy and individual rights in other states, but not for all Californians.”

Contact Brandon Pho at [email protected] or @brandonphooo on X, formerly known as Twitter.

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