Politics
California Supreme Court to rule on high-stakes battle over ballot measure restricting tax increases
The battle between business and labor is headed for a high-stakes showdown at the California Supreme Court this week over a ballot measure that would tip the balance of power at the state Capitol.
The court on Wednesday will hear oral arguments on the legality of an initiative backed by business interests that strips the state Legislature and the governor of the ability to increase taxes and requires statewide voter approval.
In an effort to quash the measure, Gov. Gavin Newsom and legislative Democrats petitioned the Supreme Court last September to intervene. They argued that change revises the California Constitution and, therefore, can only be placed on the ballot if ratified during a Constitutional Convention or by winning a two-thirds vote in the Legislature.
The proposal has alarmed Democrats, unions and their liberal allies. The measure could limit state and local funding, hamstring the ability to generate new money for programs and make it more challenging for the governor and Legislature to offset a budget deficit in an economic crisis without slashing progressive policy priorities.
“They should be afraid because the people of California are fed up,” said Rob Lapsley, president of the California Business Roundtable, a proponent of the measure. “This gives the people of California the right to vote on future taxes, and voters are going to support it if it’s on the ballot.”
If approved by voters, the proposal would mark a historic win for the business community. Lapsley said establishing new checks and balances on taxation is essential to creating jobs and attracting companies to California.
Labor unions representing state workers, teachers, police and firefighters have joined forces with Democrats and dozens of other organizations to ask the high court to strike down the measure. They argue it would impair essential government functions and threaten services that rely on state dollars.
“I want to make it clear that the ‘Taxpayer Deception Act’ lets wealthy corporations, who can afford expensive campaigns, to block taxes on their industry while regular Californians, regular people, shoulder more of the cost of critical services,” said Tia Orr, executive director of Service Employees International Union California, which is leading the charge to defeat the measure on the ballot.
Officially dubbed the “Taxpayer Protection and Government Accountability Initiative,” the measure pushed by Lapsley’s group and the Howard Jarvis Taxpayers Assn. asks voters to require local governments to vote on all fee increases, which can now be approved administratively. The threshold to increase local special taxes would increase from a majority to a two-thirds vote of the people.
Fee increases at the state level, which are often approved by state agencies and boards, would need support from a majority of the state Legislature. The measure would expand the requirements necessary for a statewide tax increase, which currently can be done with a two-thirds vote of the Legislature. Under the ballot measure, support from a majority of California voters also would be required.
Taxes are often applied to the sale of goods, or income, for example, and pay for a variety of government expenses through the state general fund. A fee is typically collected and spent on a more specific service.
The measure expands the definition of taxes and restricts the potential use of fees to only cover the cost of the service, potentially prohibiting government from redirecting revenue to other purposes to close a budget deficit. The changes would take effect retroactively and reverse many local and state tax and fee increases approved since Jan. 1, 2022.
Carolyn Coleman, chief executive of the League of California Cities, said the new requirements for local ballot measures would effectively erase more than 100 measures that voters already approved with a majority vote. In Walnut Creek, for example, it would rescind a local public safety measure that voters approved with a 65% majority in 2022. The measure funded five new police officers, she said.
Opponents and supporters said that, if approved, the taxpayer ballot measure could rescind the “mansion tax,” also known as Measure ULA that took effect in Los Angeles last year. The measure applies a 4% charge on all property sales above $5 million and a 5.5% charge on sales above $10 million to fund housing and homelessness initiatives.
Lapsley argued that the mansion tax is “singularly the worst economic policy that you can possibly have in freezing the whole commercial, retail and residential real estate market in L.A.”
The luxury real estate market has slowed since the measure was adopted, but the charge has also raised about $215 million in funding in its first year.
Groups that have given money directly to Lapsley’s campaign, or funded other political action committees that contribute to the measure, include developers, landlords and real estate managers, among others with an interest in ending the mansion tax.
In addition to weighing whether the state ballot initiative constitutes a revision of the Constitution, the Supreme Court will consider the argument that it affects essential government functions.
Erin Mellon, a spokesperson for Newsom, said that in the event of a financial crisis the measure would require government to wait up to two years for the next ballot to raise taxes, “potentially putting lives and our economy at risk.”
“The governor is not a proponent of tax increases and has fought against propositions seeking to add new taxes, but the recession 15 years ago — and the current budget challenges facing our state — underscore the need for government to use every tool in the toolbox to respond to crises,” Mellon said in a statement. “The California Supreme Court should keep this radical effort led by wealthy business interests off the ballot because it violates the Constitution by attempting to completely restructure our system of government in a way that will prevent government from protecting Californians from future crises.”
The case elevates the ongoing fight between progressive labor unions and the business community from the halls of the state Capitol to California’s highest court.
Companies in California often complain that they can’t get a fair shake in a state Legislature dominated by Democrats and under the powerful political influence of labor unions. Business interests are increasingly turning to the statewide ballot to block and stall progressive laws from taking effect, or to push their own policy agenda directly to voters.
The proposed ballot measure could deal a blow to labor unions and other interest groups, who would find it more challenging and more expensive to convince voters to increase taxes to back their policy agenda than making their case just to legislators. Requiring lawmakers to pass bills to increase every new fee could also become a political challenge.
Lapsley and others said it’s rare for the Supreme Court to take up this type of pre-election challenge to a ballot measure. He said he feels that it’s fair for the court to consider the arguments, but he criticized Democrats for bringing the case.
“The fact that the Legislature and the governor are using taxpayer money to try and deny the voters of California, over 1.43 million who signed our petitions, the opportunity to have their voice heard is a direct violation of everything they talk about in terms of direct democracy,” Lapsley said. “They’re complete hypocrites when it comes to this case.”
Each side has 30 minutes to present an oral argument to the Supreme Court on Wednesday in San Francisco. The court is expected to release a ruling sometime before the June 27 deadline for measures to qualify for the ballot.
Of all the government agencies that President-elect Donald J. Trump has threatened to shrink or eliminate, perhaps none has been a greater target than the Environmental Protection Agency.
During the first Trump administration, the nation’s top regulator of air and water pollution and industrial chemicals saw its budget slashed, leading to an exodus of employees and weakened enforcement of environmental rules.
This time, Mr. Trump could go further.
President Biden rebuilt the E.P.A. and used it to enact two powerful climate regulations aimed at cutting greenhouse gas emissions from tailpipes and power plants. But Mr. Trump has already promised to “kill” the agency’s climate regulations, and people close to the Trump transition have recommended ousting E.P.A. career staff, eliminating its scientific advisers, and closing an office that helps minority communities that disproportionately struggle with polluted air and water. There is even discussion of moving E.P.A. headquarters and its 7,000 workers out of Washington, possibly to Texas or Florida, as a way to shed employees.
The man who would carry out the dismantling is a former congressman from New York, Lee Zeldin, who is set to appear Thursday morning before the Senate Committee on Environment and Public Works.
The nomination of Mr. Zeldin baffled many, since he has little background in environmental regulation.
But Mr. Zeldin, 44, who ran unsuccessfully for governor of New York in 2022, is a Trump supporter who voted against certifying the results of the 2020 election. Friends say he has a long and loyal connection with the president-elect.
“They have a unique bond,” said Chris Berardini, a Republican lobbyist . “Republicans in New York tend to be always close. It’s a very lonely fraternity.”
The two men have something else in common, Mr. Berardini said. Last summer, Mr. Trump survived an assassination attempt at a campaign event. In 2022, Mr. Zeldin was attacked by a man with a pointed weapon at a campaign event. “Those are the subtle threads that weave into a personal relationship,” Mr. Berardini said.
While Mr. Zeldin is not experienced in environmental regulation, he and his allies point to his years representing his Long Island district, which included miles of coastline and had a bipartisan tradition of environmental conservation.
At the same time, Mr. Zeldin appears to have embraced Mr. Trump’s seemingly contradictory position: he says he wants clean air and water while he plans to erase regulations that ensure both, along with limits on the emissions of greenhouse gases from fossil fuels that are linked to stronger droughts, wildfires, floods.
Upon accepting the nomination to head the E.P.A., Mr. Zeldin wrote on X, “We will restore US energy dominance, revitalize our auto industry to bring back American jobs, and make the US the global leader of AI. We will do so by protecting clean air and water.”
Senator Shelley Moore Capito, Republican of West Virginia, who chairs the environment committee, said Wednesday on Fox Business News of Mr. Zeldin that “By being the representative from New York, he’s seen all different types of clean air, clean water issues, and the best way to solve those problems.”
But Ms. Capito, whose home state is a major producer of coal and natural gas, also appears confident that Mr. Zeldin will execute Mr. Trump’s plans.
In a Facebook post last month, Ms. Capito wrote, “Congressman Zeldin understands the need to roll back regulatory overreach, unleash American energy, and allow Americans to build again — all while protecting public health and the environment. His skill set is well suited to implement the agenda of President Trump. ”
Mr. Zeldin has not said much about whether he accepts the established science of climate change but he was a member of the bipartisan Climate Solutions Caucus in Congress. However, he voted against the Inflation Reduction Act, the nation’s first major climate law, which pumped at least $370 billion into clean energy programs.
When Gov. Kathy Hochul of New York criticized Mr. Zeldin, he responded on social media, saying, “I just voted NO because the bill sucks.”
During Mr. Zeldin’s tenure in the House, he voted against clean water legislation at least a dozen times and clean air legislation at least half a dozen times, according to a scorecard by the League of Conservation Voters, an environmental group.
However, he has boasted about securing federal funds to improve the health of Long Island Sound, and he voted for a bill that would require the E.P.A. to set limits on PFAS, damaging chemicals that are persistent in the environment and the human body. The E.P.A. under the Biden administration has set strict limits on chemicals in drinking water. In 2020, he voted against legislation to slash E.P.A.’s budget.
Senator Edward J. Markey of Massachusetts, a senior Democrat on the environment committee, said he met with Mr. Zeldin Tuesday and had “a good, candid conversation.”
Still Mr. Markey questioned his qualifications to run the E.P.A., and expressed skepticism about his commitment to guard the air and water from polluting industries.
“I’m not convinced his top priority is protecting communities and our environment,” Mr. Markey said.
On climate change, Mr. Markey said Mr. Zeldin “said he believed that human activity contributes to climate change.” But he said, “My questions go to what the E.P.A. priorities would be under his leadership.”
Lisa Friedman contributed reporting.
House Judiciary Democrats penned a letter Wednesday asking outgoing U.S. Attorney General Merrick Garland to drop the charges against President-elect Donald Trump’s former co-defendants in the classified documents case.
They want Trump’s valet Walt Nauta and Carlos De Oliveira, the property manager of Trump’s Mar-a-Lago estate in Palm Beach, Florida, to walk from the charges so that Garland can release the second volume, which is related to the classified documents case, of Special Counsel Jack Smith’s report. Smith resigned from the Justice Department on Friday. Garland said he will not release the second volume because both men still face prosecution.
The Democrats believe that Trump will pardon both men, so Garland should drop the charges now or the report will not come out.
“While we understand your honorable and steadfast adherence to Mr. Nauta’s and Mr. De Oliveira’s due process rights as criminal defendants, the practical effect of this position is that Volume 2 will almost certainly remain concealed for at least four more years if you do not release it before President-elect Trump’s inauguration on January 20,” the letter obtained by Fox News says.
FORMER TRUMP CO-DEFENDANTS WANT JUDGE TO BLOCK SPECIAL COUNSEL JACK SMITH REPORT
Trump drives a golf cart accompanied by aide Walt Nauta prior to the start of day three of the LIV Golf Invitational – Bedminster at Trump National Golf Club on Aug.13, 2023, in Bedminster, New Jersey. (Mike Stobe/Getty Images)
“The public interest, however, now demands that the President-elect must not escape accountability to the American people,” they added. “Accordingly, to the extent the tangential charges against Mr. Nauta and Mr. De Oliveira stand in the way of the overriding imperative of transparency and truth, the interests of justice demand that their cases be dismissed now so that the entirety of Special Counsel Smith’s report can be released to the American people.”
The letter was signed by House Judiciary Committee Ranking Member Jamie Raskin of Maryland, as well as Democratic committee members Reps. Jerry Nadler and Dan Goldman of New York; Eric Swalwell, Ted Lieu, J. Luis Correa, Sydney Kamlager-Dove and Zoe Lofgren of California; Hank Johnson and Lucy McBath of Georgia; Steve Cohen of Tennessee, Pramila Jayapal of Washington; Mary Gay Scanlon of Pennsylvania; Joseph Neguse of Colorado; Deborah Ross of North Carolina; Becca Balint of Vermont; Jesus G. “Chuy” Garcia of Illinois; and Jasmine Crockett of Missouri.
Walt Nauta, a personal aide to Trump, arrives at the Alto Lee Adams Sr. US Courthouse in Fort Pierce, Florida, on Aug. 10, 2023. (CHANDAN KHANNA/AFP via Getty Images)
“We obviously do not condone the sycophantic, delinquent, and criminal behavior that Mr. Nauta and Mr. De Oliveira are charged with,” the letter says. “However, Donald Trump was plainly the mastermind of this deception operation to conceal and abuse classified material, a fact made clear by his being charged with 32 counts of willfully retaining these classified documents, while his co-defendants were charged with lesser offenses related to obstructing the investigation, largely at Mr. Trump’s direction. By virtue of DOJ policy prohibiting the indictment or prosecution of a sitting president, Mr. Trump has dodged any criminal accountability for his own wrongdoing. Mr. Trump’s 2024 victory saved him from a public trial and robbed the American people of the opportunity to learn the meaning and details of his unpatriotic, reckless, and intentional abuse of national security information.”
DOJ RELEASES FORMER SPECIAL COUNSEL JACK SMITH’S REPORT ON INVESTIGATION INTO TRUMP ELECTION INTERFERENCE CASE
Judge Aileen Cannon will hear arguments over Volume 2 in Fort Pierce, Florida, on Thursday. Garland released Volume 1, focused on the election interference case, earlier this week.
Attorneys for Nauta and De Oliveira earlier this month asked Cannon to keep the special counsel report out of the public eye.
Carlos De Oliveira, property manager of Trump’s Mar-a-Lago estate, arrives at the Alto Lee Adams Sr. U.S. Courthouse in Fort Pierce, Florida, on Aug. 10, 2023. (EVA MARIE UZCATEGUI/AFP via Getty Images)
Trump, Nauta and De Oliveira all pleaded not guilty to federal charges alleging they conspired to obstruct the FBI investigation into classified documents found at Mar-a-Lago.
Smith was tapped by Garland in 2022 to investigate both the alleged effort by Trump and his allies to overturn the results of the 2020 election, as well as Trump’s keeping of allegedly classified documents at his Florida residence.
It is customary for a special counsel to release a final report when his or her work is done, detailing the findings of their investigation and explaining any prosecution or declination decisions they reached as a result of the probe. It’s up to Garland whether to release it publicly. In Smith’s case, the prosecution decision is immaterial, given Trump’s status as president-elect and longstanding Justice Department policy against bringing criminal charges against a sitting president.
Garland is expected to give his farewell address to the Justice Department on Thursday afternoon.
On the first day of the California Legislature’s new session, Assemblymember Kate Sanchez, an Orange County Republican, introduced a bill that would ban transgender high school students from competing on girls’ sports teams.
“Young women who have spent years training, sacrificing and earning their place to compete at the highest level are now being forced to compete against individuals with undeniable biological advantages,” Sanchez, of Rancho Santa Margarita, said in a video posted to social media.
“It’s not just unfair,” she added. “It’s disheartening and dangerous.”
Sanchez’s proposed law, called the Protect Girls’ Sports Act, is almost certain to fail in a Legislature controlled by a Democratic supermajority with a record of embracing inclusion for LGBTQ+ Californians.
But her introduction of it — notably, as her first bill of the session — underscores the persistent Republican emphasis on transgender issues, which continue to shape policy debates in California, where Democratic leaders have cast the state as a bulwark against President-elect Donald Trump, whose opposition to trans rights was central to his campaign.
Sacramento Democrats have blasted Sanchez’s bill as a political stunt, saying it is an unnecessary attack against transgender youth, who make up a tiny portion of California’s school-age population.
Supporters and opponents of banning transgender athletes from girls’ sports attend a meeting of the Riverside Unified School District board on Dec. 19.
(Allen J. Schaben/Los Angeles Times)
Assemblymember Chris Ward, chair of the California Legislative LGBTQ Caucus, said in a statement that the caucus, whose members are all Democrats, “will not stand by as anyone attempts to use kids as political pawns.”
“Attacking kids is a failed 2024 issue,” said Ward (D-San Diego). “We are surprised the Assembly member introduced her first bill targeting a very small, vulnerable population of kids rather than using the opportunity to address key issues of affordability, housing and more that are impacting Californians.”
The Williams Institute at UCLA School of Law, which researches public policy around sexual orientation and gender identity, estimates that about 1.4% of American teenagers ages 13-17 — about 300,000 individuals nationwide — identify as transgender. Fewer play sports.
While polls show that most Americans support protecting LGBTQ+ people from discrimination, they are deeply divided on issues involving queer children, especially kids who identify as transgender or nonbinary.
In a nationwide poll conducted last year for The Times by NORC at the University of Chicago, about two-third of adult respondents said transgender girls and women should never or only rarely be allowed to participate on female sports teams.
“Regardless of where Sacramento Democrats are on this issue, they’ll need to face facts,” Sanchez said in a statement to The Times, noting public opinion on the issue.
On the other side of the political aisle, state Sen. Scott Wiener (D-San Francisco) last week introduced the Transgender Privacy Act, which would automatically seal all court records related to a person’s gender transition in an effort to protect them from being outed or harassed.
“The incoming Trump Administration and Republican Congressional leadership have made clear that targeting and erasing trans people is among their highest policy priorities, and California must have our trans community members’ backs,” Wiener said in a statement about his Senate Bill 59.
Supporters of LGBTQ+ students at a Dec. 19 Riverside Unified School District board meeting where demonstrators called on the district to “save girls’ sports.”
(Allen J. Schaben/Los Angeles Times)
Sanchez’s Assembly Bill 89, would require the California Interscholastic Federation, which regulates high school sports for public and private schools, to enact rules prohibiting any “pupil whose sex was assigned male at birth from participating on a girls’ interscholastic sports team.” It does not stop transgender boys from playing on boys’ teams or specify how the CIF would verify students’ gender.
California education code explicitly says students must be allowed to participate in sex-segregated school programs and activities, including team sports, and must be permitted to use restrooms and locker rooms consistent with their gender identity. Then-Gov. Jerry Brown signed those rights into law in 2013.
Sanchez’s bill comes after several recent high-profile fights across California over trans girls and women playing high school and college sports.
In November, a Christian high school in Merced withdrew its girls’ volleyball team from a state playoff match against a San Francisco team with a transgender player.
This fall, the San José State women’s volleyball team was embroiled in controversy after current and former players and an associate coach tried to have a trans player removed from the roster by filing a federal lawsuit. A judge later ruled the player could compete.
In November, two female high school students sued the Riverside Unified School District, alleging a transgender girl unfairly ousted one of them from a spot on the varsity cross-country team. The federal lawsuit also claims that when the girls protested the situation — by wearing T-shirts that read, “Save Girls Sports,” and, “It’s common sense. XX [does not equal] XY” — school officials compared it to wearing a swastika in front of a Jewish student.
The suit claims that the district’s policies unfairly restrict the girls’ freedom of expression and deny them fair and equal access to athletic opportunities.
Republican Assemblymembers Bill Essayli, front left, and Leticia Castillo, front right, called on the Riverside Unified School District superintendent to resign over his handling of the issue of transgender athletes competing in girls’ high school sports at a board meeting last month.
(Allen J. Schaben/Los Angeles Times)
Two Republican Assembly members from the Inland Empire, Bill Essayli and Leticia Castillo, called on the district’s superintendent to resign over her handling of the issue.
In 2023, Essayli, whose district borders Sanchez’s, co-sponsored a bill that would have required school employees to notify parents if their child identified as transgender at school. Critics argued the bill would out and potentially endanger trans kids, while violating student privacy protections under California law. The bill died in committee, but similar policies sprouted up on school boards in conservative parts of the state, showing how a Republican idea that gets squelched in the state Capitol can still drive debate on an issue.
In July, Gov. Gavin Newsom signed into law Assembly Bill 1955, which prohibits schools from mandating that teachers notify families about student gender identity changes.
Daisy Gardner, an outreach director for Our Schools USA, a nonprofit that supported AB 1955, called Sanchez’s bill and Republicans’ focus on transgender athletes “a very powerful organizing tool from the far right.”
The parent of an LGBTQ+ student who said she was speaking for herself, not on behalf of Our Schools USA, Gardner called Sanchez’s bill “a media stunt designed to whip up fear and hatred of trans people so that the far right can flip California red in 2026, and the casualties are trans lives.”
Gardner has been in contact with parents of two transgender high school athletes in the Riverside Unified School District amid the recent controversy and read a statement on behalf of one of the girl’s family during a raucous school board meeting last month.
“They are in pure hell,” she said of the parents. “They don’t know how to protect their kids.”
Matt Rexroad, a longtime California political consultant, said that while urban Democrats might be scratching their heads over Sanchez introducing this long shot bill on such a hot-button issue, it makes sense for her suburban district, which is “one of the more conservative areas of California.”
“It’s a good political issue for certain parts of California,” Rexroad said. “Clearly, Scott Wiener is not going to introduce this bill or vote for it, but not all of his bills pass either.”
Sanchez, he said, “is representing the views of her constituents.”
At least one of her constituents, though, was so angry about the Protect Girls’ Sports Act that she called Sanchez’s office and grilled a staffer about the specifics, like how a child’s gender would be verified.
Michele McNutt, a former Democrat who just changed her party registration to no-party-preference, said she was not satisfied with the staffer’s answers and called the bill “performative.”
“If it fails, they can frame it as, ‘California hates parents,’” said McNutt, whose two teenage daughters are student athletes in the Capistrano Unified School District. “I think the theater is the point, and it really isn’t about protecting girls’ sports.”
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