California Cannabis Coalition v. City of Upland, 222 Cal. Rptr. 3d 210

Background

Plaintiffs (California Cannabis Coalition and initiative proponents) circulated a 2014 Upland city initiative to allow up to three medical marijuana dispensaries and impose a $75,000 annual "Licensing and Inspection fee."
Petitioners gathered ≥15% of registered voters and requested the initiative be placed on a special election under Elections Code § 9214; the city ordered an agency report instead.
The city agency report concluded the $75,000 charge exceeded administrative costs and qualified as a general tax, so it directed placement at the next general election under Cal. Const., art. XIII C, § 2(b).
Plaintiffs sought writ relief; the superior court denied relief. The Court of Appeal reversed, holding article XIII C § 2(b) governs only local governments (not voter initiatives) and directed the city to put the measure on a special election ballot.
The California Supreme Court granted review, held that article XIII C § 2(b) does not restrict voters’ initiative power to enact taxes, affirmed the Court of Appeal, and admonished the city that it must follow § 9214’s mandatory deadlines.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether art. XIII C § 2(b) (general-tax general-election requirement) applies to taxes enacted by voter initiative	§ 2(b) does not constrain the electorate; it applies only to actions by local government, so initiatives may be submitted at a special election under § 9214	§ 2(b) applies to any local tax regardless of origin; voter-enacted taxes are taxes "of the local government" and must be at a general election	Held: § 2(b) applies to local governments, not to taxes enacted by voters via initiative absent an explicit statement of intent to limit the initiative power; initiatives governed by § 9214 may be presented at special elections
Whether the term "local government" in art. XIII C includes the electorate acting by initiative	Plaintiffs: ordinary meaning and ballot materials show "local government" targets government actors, not the electorate; initiative power must be liberally construed	City: "local government" logically includes the body politic that imposes taxes; initiative enactments are laws of the local government and thus fall within § 2(b)	Held: "local government" refers to governmental entities (councils, agencies); reading it to include the electorate would be inconsistent with text, context, ejusdem generis, and ballot materials
Whether "impose" in § 2(b) means to enact or to collect/continue collection	Plaintiffs: "impose" means establish/enact, not merely collect; precedents interpret "impose" as enact	City: "impose" should be read to include collection/continuing imposition so § 2(b) prevents collection until general-election approval	Held: "impose" in context means to establish/enact (consistent with Guardino and ballot materials); Howard Jarvis decisions do not require reading it as mere collection
Whether the city complied with mandatory Elections Code § 9214 procedures	Plaintiffs: City violated § 9214 by refusing to adopt or call the special election and unilaterally declaring the measure a tax	City: relied on agency report and article XIII C to postpone to next general election	Held: City erred — § 9214’s deadlines and options are mandatory; city should have ordered a special election (or adopted the measure) and any tax classification could be litigated pre- or postelection

Key Cases Cited

Associated Home Builders etc., Inc. v. City of Livermore, 18 Cal.3d 582 (court must jealously guard and liberally construe initiative power)
Kennedy Wholesale, Inc. v. State Bd. of Equalization, 53 Cal.3d 245 (requirements on legislatures do not apply to initiative power absent clear intent)
Rossi v. Brown, 9 Cal.4th 688 (initiative power includes taxation; limits on initiative must be explicit)
DeVita v. County of Napa, 9 Cal.4th 763 (procedural rules for legislative bodies do not imply limits on initiative absent evidence)
Guardino, 11 Cal.4th 220 ("impose" interpreted as enact; voter-approval statutes construed re: government action)
Tuolumne Jobs & Small Business Alliance v. Superior Court, 59 Cal.4th 1029 (Elections Code § 9214 duties are mandatory and require expeditious action)
Greene v. Marin County Flood Control & Water Conservation Dist., 49 Cal.4th 277 (contextual background on Proposition 218 and article XIII C/D)
Bighorn-Desert View Water Agency v. Verjil, 39 Cal.4th 205 (use ordinary meaning and statutory structure in constitutional interpretation)
Howard Jarvis Taxpayers Assn. v. City of La Habra, 25 Cal.4th 809 (discussed continuation of collection as ongoing injury; does not compel reading "impose" as only collection)
Jacks v. City of Santa Barbara, 3 Cal.5th 248 (discusses relationships among Prop. 13, 26, 218 and voter-approval rules)