Court of Appeal Upholds Prison Bonds

Article XVI, Section 1 forbids the state from issuing any debt totaling more than $300,000 without a two-thirds vote of the Legislature and a majority vote of the people. Over time, however, this provision has become encrusted with exceptions, to the point where it no longer provides a realistic limitation on the power of the State to borrow. The latest case in this series is Taxpayers for Improving Public Safety v. Schwarzenegger (here), which upheld the State's ability to issue up to $7.4 billion of bonds to fund a massive prison construction program. Although in general Article XVI, Section 1 forbids the State from issuing debt that must be repaid by the general fund without the required votes of the Legislature and the electorate, the scheme upheld in this case as a practical matter required general fund financing. Here's how it worked. The "Public Works Board" would sell bonds to pay for prison construction. The bonds would not be repaid directly from the State's general fund. Instead, the bond payments would be made from rental payments made by the Department of Corrections and Rehabilitation (CDCR) for the use and/or availability of the prisons financed by the Board. And where would CDCR get the money to pay the rent? From prison inmates? From the lottery? No, from the general fund. So why didn't this financing scheme violate Article XVI, Section 1?

The answer is that, under the cases construing this constitutional provision, an "exception to the constitutional debt limits has been recognized where the governmental entity enters into a contingent obligation. 'A sum payable upon a contingency is not a debt, nor does it become a debt until the contingency happens.' (Doland v. Clark (1904) 143 Cal. 176, 181.) This contingency exception has been applied to uphold multiyear contracts, such as leases, where the governmental entity agrees to pay sums in succeeding periods in exchange for property, goods, or services to be provided during those periods. (Pension Obligation, supra, 152 Cal.App.4th at p. 1398.) Each periodic payment is viewed as a contemporaneous payment for the property, goods, or services received rather than an installment payment on a long-term debt." So when the State provided that CDCR would pay rent for the prisons based on their availability, issuance of the debt funded by these "rental payments" became exempt from the constitutional debt limit. especially where the bondholders could not lookdirectly to the general fund for repayment.

Is there a method to this madness? Here's the Court's attempt to manufacture a rationale: "As described earlier, the underlying purpose of [the constitutional debt] limits is to force governments to live within their means by prohibiting them from financing current expenses with future revenue. Thus, if the state were to borrow $1 billion dollars today to pay for current expenses, such as welfare benefits or employee salaries, and pay off the loan over the next several years, that would be burdening the taxpayers of tomorrow with the expenses of today. However, when a government constructs a facility that will be used for many years, it has created an asset that will benefit both current and future taxpayers. It is therefore appropriate that future taxpayers help pay for that benefit as it is used up. If, as plaintiffs suggest, the construction of a prison today should be paid for by the taxpayers of today, it is the taxpayers of tomorrow who would reap a windfall.

"In this instance, the Act provides a scheme by which large capital expenditures for prison facilities may be paid for as those facilities are used. This is consistent with the pay-as-you-go principle underlying the constitutional debt limits. Therefore, the trial court properly sustained the demurrers to plaintiffs’ complaint. "

Regrettably, the court's decision is well-founded in existing law. It also has a venerable and plausible raison d'etre. But it does do a great bit of violence to the constitutional language. Yet there seems little chance that the California Supreme Court will grant review. In this era of budget crises. the State needs the revenue, and prison construction programs are politically an easy sell.

Another 50-Year To Life Sentence Upheld

Another 50-year-to-life sentence has been upheld by the Court of Appeal. In People v. Uecker (here), the Court of Appeal upheld a sentence of fifty-years to life for a defendant convicted of stalking two women, because he had four strike priors. Most troubling is the court's dismissal of appellant's claim that the sentence was harsh compared to comparable sentences in other states. "Simply because California’s law might be among the harshest, it does not make it unconstitutional. Otherwise, California could never take the toughest stance against repeat offenders or any other type of criminal conduct." This reads this test for determining cruel or unusual punishment right out of the case law.

Mentally Disordered Offender Has The Right To Be Present At Hearing re Involuntary Medication

In People v. Fisher (here), the Court of Appeal has held that a Mentally Disordered Offender (MDO) has the right to be present at a hearing on whether he should be involuntarily medicated. In this case, however, the court found the error harmless, where the MDO's counsel was present and conducted a vigorous cross-examination of the medical doctor supporting involuntary medication, and appellant later had a chance to attempt to rebut the doctor's testimony.

When A Majority Is Not Enough

Nicholas Goldberg of the Los Angeles Times has this column about the California Constitution's super-majority requirements.

California Supreme Court Asks For Briefing On Constitutionality Of Prop. 209

The California Supreme Court has asked the Attorney General to file a brief in the Coral Construction case, which involves the constitutionality of Prop. 209. Here's the order: "The court requests the Attorney General to file a brief directed to the following two questions: (1) Does article I, section 31 of the California Constitution, which prohibits government entities from discriminating against, or granting preferential treatment to, any individual or group on the basis of race, sex, color, ethnicity, or national origin in public contracting, violate federal equal protection principles by making it more difficult to enact legislation on behalf of minority groups? (See Washington v. Seattle School Dist. No. 1 (1982) 458 U.S. 457; Hunter v. Erickson (1969) 393 U.S. 385.) (2) If yes, is section 31 narrowly tailored to serve a compelling governmental interest? The Attorney General may serve and file a letter brief on or before April 17, 2009. Plaintiffs and defendants may simultaneously serve and file letter briefs in response within 15 days after the filing of the Attorney General's brief." Here is a link to the Supreme Court's docket in the case.

The Contra Costa Times On Ballot-Box Budgeting

Looking for a culprit to blame for California's budget crisis? The fault, says Daniel Borenstein of the Contra Costa Times, is partly with us--i.e., the voters. Here is the column.

Dan Walters On The Lieutenant Governor

Dan Walters has this column on the Lieutenant Governor and the Governor's budget cut. Here is my take on the cut, previously posted.

Court of Appeal Upholds Berkeley School Assignment Policy

The Court of Appeal has upheld Berkeley's school assignment policy against a challenge based on Prop. 209. Here is a link to the decision in American Civil Rights Foundation v. Berkeley Unified School District. Here's the takeaway quote: "The challenged policy does not use racial classifications; in fact, it does not consider an individual student’s race at all when assigning the student to a school. Instead, the assignment policy looks at the student’s residential neighborhood, and considers the average household income in the neighborhood, the average education level of adults residing in the neighborhood, and the racial composition of the neighborhood as a whole. Every student within a given neighborhood receives the same treatment, regardless of his or her individual race. We find that educators who include a general recognition of the demographics of neighborhoods in student assignments, without classifying a student by his or her race, do not “discriminate against, nor grant preferential treatment to, any individual or group on the basis of race.”

The plaintiffs argued that the Berkeley policy violated Prop. 209 because it considered the racial makeup of the student's neighborhood, and therefore discriminated against a group on the basis of race. But the court held that Prop. 209 is violated only when an individual or group is disadvantaged because of their race. Since the student's own race was never considered, there was no violation.

The plaintiffs also argued that using the racial of the students' neighborhoods was an impermissible proxy for the race of the student. But the court held that such a claim could not succeed in a facial challenge, where the plaintiffs had to prove that the Berkeley policy could never be constitutionally applied: "ACRF next argues that the School District uses the diversity rating as a veiled substitute for a student’s race that does not show the precise race of a student but shows the “likely” race of a student. ACRF claims that a student from a neighborhood planning area with a diversity category of one is more likely to be a student of color than a student coming from a category three planning area. The claim is unsupported by the record on appeal. The elementary school student assignment plan, incorporated into the complaint, shows that a diversity category rating is derived by averaging three demographic factors, of which race is one. There is no indication that, in every case, a student from a category one planning area is more likely to be a student of color than is a student from a category three planning area. It appears mathematically possible that a category one planning area may have more White students than students of color depending on the area’s household income and adult education.

While it is conceivable, as the School District concedes, that some neighborhoods are so racially segregated that using demographic data could potentially serve as a proxy for a student’s race, that hypothetical possibility cannot sustain ACRF’s facial challenge to the constitutional validity of the district’s student assignment policy. On a facial challenge, we do not consider the policy’s application to the particular circumstances of an individual. “[O]ur task is to determine whether the [challenged policy] can constitutionally be applied.” ‘To support a determination of facial unconstitutionality, voiding the statute [or policy] as a whole, petitioners cannot prevail by suggesting that in some future hypothetical situation constitutional problems may possibly arise as to the particular application of the statute . . . . Rather, petitioners must demonstrate that the act’s provisions inevitably pose a present total and fatal conflict with applicable constitutional prohibitions.’ ” ACRF has not shown that the policy provisions challenged here inevitably pose a total and fatal conflict with section 31. (citations omitted).

This is an obviously important case, since it provides a blueprint for school districts that want to increase diversity without falling afoul of Prop. 209. Nevertheless, I doubt that the California Supreme Court will grant review, since the decision below is a plausible (and, I think, desirable) interpretation of Prop. 209.

Will There Be Well-Funded Opposition To The May Ballot Measures?

Not yet. The San Francisco Chronicle reports (here).

New Articles On The Constitutional Convention

The Sacramento Bee has two articles on the proposed constitutional convention. David Holwerk says a constitutional convention is "cool" and going to happen (here) while Bill Whalen looks at it from a Republican perspective (here).

Secret Ballot Required In Prop. 218 Fee Elections

Article XIII D, Section 6(c) requires that local governments obtain electoral approval of certain property-related fees. But it does not spell out the procedures for such elections, other than to provide that local governments "may adopt procedures similar to those for increases in assessments in the conduct of elections under this subdivision." In Greene v. Marin County Flood Control and Water Conservation District (here), the court held that the secret ballot requirement contained in Article II, Section 7 ("Voting shall be secret") applies to fee elections under Article XIII D, Section 6(c). It then invalidated an election upholding a fee where the voters had not been assured that their ballots would be secret.

The opinion is pretty straightforward and seems to reach the right result, given the unqualified command of Article II, Section7, and the lack of any good reason not to have a secret election. The only troublesome part of the opinion is the court's holding that a secret ballot furthers the tax-limitation goals of Proposition 218. The court said that "[s]ecrecy in voting enhances free taxpayer consent to approve or reject a proposed fee in the face of local controversy about its merits and it makes it more difficult for government to extract revenue from unwilling taxpayers. Therefore, in liberally construing Proposition 218 to further its purposes, we construe the terms 'election' and 'voting' to mean secret voting." Given the anti-tax proclivities of the California electorate, this seems like a stretch, but it's utterly unnecessary to the opinion.

Court of Appeal Divides Over Cruel Or Unusual Punishment Case

Do judges matter? Or, to put it more precisely, do the backgrounds, predilections and perhaps the gender of judges matter? Of course they do. Just look, for example, at the decision in People v. Em (here). In that case the defendant, who was less than 16 at the time of the offense, was a somewhat passive participant in a robbery, and the other robber shot and killed the victim. Found guilty of murder under the felony murder doctrine, the defendant was sentenced to fifty years to life, with two twenty-five year to life sentences running consecutively. The majority opinion focuses on the particulars of the crime, which were pretty bad. The dissent focuses on the defendant's background, and provides numerous facts that don't appear in the majority opinion. And the tone of the two opinions is quite different as well.

I don't know enough about the cases construing the California Constitution's "cruel or unusual punishment" clause to know which of the two opinions is right. But it is troubling that the majority opinion doesn't acknowledge the facts discussed in the dissent. Conversely, it's troubling that the dissent doesn't come to grips with People v. Gonzales, the principal case relied on by the majority, in which an identical sentence was upheld under somewhat similar circumstances. Perhaps the California Supreme Court will intervene to bring some clarity and more objective standards to this area of the law.

Court of Appeal Holds That Legislature Has No Power To Set Aside Final Decisions

In a fascinating opinion that discusses a number of interesting state constitutional issues, the Court of Appeal has held that the Legislature has no power to set aside final agency quasi-judicial decisions. In California School Board Ass'n v. State of California (here), the Legislature had commanded the Commission on State Mandates, which implements Article XIII B, Section 6, to reconsider or set aside several final agency decisions. The court held that this legislative directive violated the separation of powers clause of the California Constitution, Article III, Section 3.

The court's logic is curious and, I think, flawed. The court first held--correctly--that the Legislature has no power to set aside final judicial decisions, citing Mandel v. Myers, 29 Cal. 3d 531 (1981). The court then held that the Legislature had created the Commission as a "quasi-judicial body" to resolve claims for reimbursement of state-mandated local costs. This seems both right and wrong--the Commission acts in a "quasi-judicial" function when it applies legal principles to a set of retrospective facts, but it's hard to see how a body that is not a court can exercise "judicial" power, "quasi" or not. The court then seemed to hold that the Legislature was trampling on the Commission's judicial (or "quasi-judicial") power when it directed the Commission to set aside prior decisions. In my view, this confuses the kind of task that the Commission performs--which is quasi-judicial rather than quasi-legislative--with the kind of power that it exercises.

There is, I think, a more defensible route to the same result, but it's only inherent in the court's opinion. The court did point out that only the judiciary can set aside the Commission's decisions, through judicial review. So one could argue that the Legislature's directive to the Commission to set aside and/or reconsider prior decisions violated the judicial power of the courts to review final agency decisions, rather than the "judicial" power of this plainly non-judicial agency.

On balance, though, I find this unconvincing. Like most administrative agencies, the Commission is a creature of statute--the Legislature created it and the Legislature can dissolve it. These statutes define the Commission's powers and, among other things, define when and how the Commission's orders are subject to review. Suppose the Legislature had said, up front, that no Commission decision shall be final for a period of six months after rendition, during which time the Legislature could pass a statute nullifying the decision. Would that violate the separation of powers? I suspect not. Now the only difference between that hypothetical and this case is that in CSBA the Commission's decisions had become "final." But, at least as far as administrative agencies are concerned, "finality" is a creature of statute and the common law; there is nothing "constitutional" about it. So I think the better argument is that the Legislature can do what it wants to with the decisions of administrative agencies. Now in some instances there might be a due process limit on the power of the Legislature to set aside "final" agency decisions. But here that's not a limit, because only public agencies were involved and a subordinate political body has no federal due process rights against the state that created it.

There are other interesting rulings in this case, too, in particular whether the state-mandated cost reimbursement requirement, which applies to mandates imposed by the "Legislature" applies to mandates imposed by a state initiative. The court said "no," but it had to do a certain amount of fancy footwork to get around the California Supreme Court's decision in Independent Energy Producers Assn. v. McPherson, 43 Cal. 4th 1188 (2006), which had held that a constitutional provision giving the "Legislature" plenary power to add to the jurisdiction of the Public Utilities Commission did not preclude an initiative from doing the same thing.

I think this case is a good candidate for review by the California Supreme Court. It raises lots of interesting issues, and there is at the very least a fair amount of tension between it and the Supreme Court 1997 decision in Carmel Valley Fire Protection Dist. v. State of California. Stay tuned.

LAO Issues Grim Report On State Finances

Here is the latest from the Legislative Analyst, who projects continued budget shortfalls even with last month's budget deal. The key message: "Our updated revenue forecast projects that revenues will fall short of the assumptions in the budget package by $8 billion. Moreover, a number of the adopted solutions—revenue increases and spending reductions—are of a short–term duration. Thus, without corrective actions, the state’s huge operating shortfalls will reappear in future years—growing from $12.6 billion in 2010–11 to $26 billion in 2013–14." Here is a summary article from the Sacramento Bee.

Governor Backs Constitutional Convention

The Sacramento Bee's article is here. Maybe this idea is starting to get some real traction.

Light Blogging For A Few Days

Will be relatively quiet for a few days--but there are a couple of cases waiting to be discussed--the interesting debate on the Cruel or Unusual Punishment Clause in People v. Em (here) and the separation of powers issues in California School Boards Ass'n v. State of California (here). Stay tuned.

What If Voters Reject The Budget Propositions?

Rough&Tumble has this link: "Uncertainty over a May 19 special election in which California voters will be asked to approve six measures to balance the state budget has raised a crucial question: What if the measures are turned down? John Howard and Anthony York in Capitol Weekly -- 3/12/09."

Dan Walters On A Prop. 8 Rerun

Dan Walters of the Sacramento Bee has this column about a potential re-run of the Prop. 8 campaign.

The Politics Of Prop. 1A

Dan Weintraub of the Sacramento Bee reports here on opposition to Prop. 1A, the spending limit placed on the ballot by the Legislature, from both Health Access and the Howard Jarvis Taxpayers Association. He doesn't mention that both organizations were also plaintiffs in the recent successful suit to change the wording of the Prop. 1A ballot label.)

Ballot Labels Changed For Two Propositions

The Sacramento Bee reports here that the ballot labels for Propositions 1A and 1E on the May ballot have been changed, the first by court order and the second by stipulation.

First Reports On The Prop. 8 Arguments

Here is the New York Times; here is Bob Egelko in the San Francisco Chronicle; and here is the article from the Los Angeles Times.

More On The Constitutional Convention

Patt Morrison of the Los Angeles Times weighs in here.

Link to Live Coverage Of Prop. 8 Argument

Here is a link of live coverage of the Prop. 8 arguments, happening now.

Briefs In The Prop. 1E Case

Here are the briefs in the case challenging the ballot materials for Prop. 1E, which amends Prop. 63: the Petition is here; the memo supporting the petition is here; the Legislature's opposition memo is here; the Legislature's request for judicial notice is here; and the Attorney General's answer to the petition is here. The hearing is scheduled for today.

Lawsuit Challenges Prop. 1E Ballot Materials

A lawsuit has been filed challenging the ballot materials prepared by the Legislature for Prop. 1E, which would amend Prop. 63. The Sacramento Bee reports here. A hearing is scheduled for Thursday. (A lawsuit has also been filed regardling the ballot materials for Prop. 1A, the spending cap.)

Field Poll Shows Support For Ballot Measures

Here's the report from "Rough&Tumble": "Likely voters in the May 19 special election initially support six ballot measures designed to complete the budget recently approved by lawmakers and Gov. Arnold Schwarzenegger, according to a Field Poll released Tuesday. Kevin Yamamura in the Sacramento Bee John Marelius in the San Diego Union-Trib Matthew Yi in the San Francisco Chronicle -- 3/3/09"

Reports On The Constitutional Convention "Summit"

One February 24. a group of business leaders, union leaders and governmental officials held a "summit" to discuss revising the California Constitution by a constitutional convention, which would be the first since 1879. (The Constitution was revised extensively during the 1960's and 1970's, but that was the result of a commission that made proposals to the Legislature, not a convention.) Here are reports from the Los Angeles Times (here) and here is a video report from the Sacramento Bee (here), here is a report from the San Francisco Chronicle (which floats the idea of a unicameral, or single-house, legislature), and here is another article from the Chronicle talking about Latino support for the idea. Finally, here is a link to the Bay Area Council's web-page on their push for a convention.

Supreme Court Punts Football Search Case

Today the California Supreme Court decided Sheehan v. San Francisco 49ers (here), the football stadium pat-down case. The plaintiffs contended that their state constitutional rights of privacy were violated when they were subjected to full-body pat-down searches before they could enter Monster Park to see the 49ers play. The Superior Court sustained a demurrer on the basis of consent and the Court of Appeal affirmed. The Supreme Court unanimously reversed, holding that whether the searches violated the right of privacy could not be determined on demurrer.

While the Court's decision was unanimous, and a reversal to boot, the decision may be something of a Pyrrhic victory for privacy advocates. That's because the four-Justice majority opinion (Justice Chin, joined by Justices Kennard, Baxter and Corrigan), adopted a policy of deference to non-governmental decision-makers in the area of privacy: "The state constitutional right of privacy does not grant courts a roving commission to second-guess security decisions at private entertainment events or to micromanage interactions between private parties. . . . Private entities that present entertainment events, like the 49ers’, necessarily retain primary responsibility for determining what security measures are appropriate to ensure the safety of their patrons, subject, when those security measures substantially infringe on a privacy interest, to judicial review for reasonableness." The three-Justice concurrence (Justice Werdegar, joined by the Chief Justice and Justice Moreno), chided the majority for reaching out to decide issuez that the case on demurrer did not present, while not deciding whether the pat-down searches constituted a serious invasion of a privacy interest.

One particularly noteworthy aspect of the opinion concerns its treatment of the right of "pursuaing and obtaining safety," which is found in Article I, Section 1's listing of "inalienable rights." The majority opinion mentions it obliquely, in the following passage: "The factual record of this case — which consists solely of the complaint — does not establish what the competing social interests are. Presumably, the NFL, and ultimately the 49ers’, adopted the policy to enhance spectator safety, but the record does not establish this or explain why the NFL believed the policy was appropriate. As evidenced by the circumstance that the pursuit of safety, like the pursuit of privacy, is a state constitutional right, the competing social interest of enhancing safety is substantial. " (Emphasis added). The concurrence attacked the majority's reliance on this right, which it described as "particularly unnecessary," in the following footnote: "Insofar as I am aware, we have never given an interpretive gloss to this portion of the state Constitution. I find it unusual that we would invoke this clause in this context, without any discussion of its provenance or of legislative or voter intent. I find it more unusual that we would invoke the right, in effect, on behalf of third parties (other attendees) not even involved in this suit, as the Sheehans are not raising their own right to pursue safety here. I find it most unusual that we would invoke the right as a justification for conduct by an entity that is not the holder of the right, and do so sua sponte, when even the entity itself has not done so; the 49ers nowhere mention the constitutional right to pursue safety in their brief."

The majority's reliance on the right to "pursue and obtain safety" seems obviously to lay down a marker for future use. Where will the right turn up next?