One day after Prop. 207 was approved overwhelmingly by state voters, the Arizona Supreme Court struck down a lower court’s pre-election ruling that the initiative violates revenue source rule for ballot propositions.
The disputed proposition prohibits governments from using eminent domain to acquire property for non-public projects and requires property owners be compensated for land-use actions that negatively affect property values.
The court also explained its refusal to remove Prop. 207 from the 2006 ballot as requested by the League of Arizona Cities and Towns.
In the written opinion, Vice Chief Justice Rebecca White Berch stated that courts only have the right to prevent initiatives from reaching ballots if measures are fraudulent, defective in form, or lacking the proper amount of valid signatures demanded by the Constitution.
Without those requirements, testing the constitutionality of a ballot measure prior to an election, she wrote, would violate separation of powers clauses and prevent citizens from exercising their rights.
“A fundamental component of the legislative process in Arizona is the right of the people to offer legislation through the initiative,” wrote Justice Berch. “This legislative power of the people is as great as that of the Legislature.”
The court also ruled that Maricopa Superior Court did not have the authority to declare that Prop. 207 violated the revenue source provision and that it is possible that there is no violation.
Ken Strobeck, executive director of the League of Arizona Cities and Towns, said his organization has assembled attorneys and land-use experts to determine the effects of the ruling, but it is not clear if a lawsuit against the initiative will be initiated.
In the meantime, he expects disruptions for member cities and towns pursuing land-use actions.
“I think it will probably have the effect of seriously slowing down or virtually stopping new zoning,” he said.
The League serves represent the interests of local governments at the state Legislature. It has said it opposes Prop. 207 because it says language requiring compensation for regulatory takings will make common land-use restrictions impossible to implement and will create excessive and costly litigation.
Arizona’s revenue source provision requires ballot initiatives that result in expenditures of state revenues identify a source of funds to cover the immediate and future costs of the initiative.
On Nov. 7, Prop 207 received 732,000 votes of approval, representing 65 percent of 1.124 million total votes counted so far.
The wide margin contrasts with a poll conducted by an Arizona State University professor in mid-October that found 53 percent of random likely voters surveyed were supportive of the measure, compared to 29 percent in opposition and 20 percent undecided.
The use of ballot initiatives as a vehicle to pass the land-use regulations was called into question by Rep. John Nelson, R-12, who told the Arizona Capitol Times before the election that he would have preferred more direct political negotiation in the Legislature.
Lori Klein, chairwoman of the Homeowners Protection Effort, said efforts were made with legislators, utility companies, and the League of Arizona Cities and Towns to create the new protections.
And when the best completed effort was vetoed by Governor Napolitano, the legislative process was again the preferred method, Ms. Klein said, but the drive was thwarted by lobbyists representing the cities and towns even after concessions were made.
“Every time we gave in to one demand they came up with ten more,” she said. “We had to go with the signature gathering route, which is time consuming and expensive.”
She doubts the proposition will be targeted with another lawsuit based on the revenue source identification. Land-use actions like zoning are usually handled locally and would have no bearing on the state’s general fund, she said.
The National Restaurant Association immediately called for reform of the ballot initiative process following the passing of several initiatives that raised minimum wage levels and altered labor laws they claim could invite identity theft and negatively affect the economy.
“Cramming a complicated economic issue like raising the minimum onto an already cluttered ballot is no way to enact sound economic policy,” said Tom Foulkes, National Restaurant Association vice president for state relations “Issues that have broad economic impact on jobs and benefits, not to mention potential threats to privacy, should be scrutinized and debated through the legislative process.
“These provisions would have been hard-pressed to pass a deliberative legislative process,” he said.
The restaurant group also rebuked the business community for not opening the checkbook to help fight such initiatives.
In Colorado and Ohio, support for two minimum wage initiatives dropped as much as 20 percent after newspaper editorial boards opined against the drives following successful lobbying from business interests, according to the NRA.