AUGHENBAUGH, Petitioner, v. ROBERTS, Respondent.
(SC S36843)
Supreme Court of Oregon
Argued and submitted February 13, ballot title certified as modified March 27, 1990
reconsideration denied April 18, 1990
789 P2d 656 | 309 Or 510
John T. Bagg, Assistant Attorney General, Salem, argued the cause for respondent. With him on the Answering Memorandum were Dave Frohnmayer, Attorney General, and Virginia L. Linder, Solicitor General, Salem.
UNIS, J.
Fadeley, J., filed a specially concurring opinion in which Van Hoomissen, J., joined.
In this original proceeding, petitioner challenges a revised ballot title certified by the Attorney General to the Secretary of State. We review the ballot title for “substantial compliance” with the requirements of
The Attorney General certified the following ballot title to the Secretary of State:
“INCREASES BEER, LIQUOR TAXES TO FUND ALCOHOLISM AND DRUG PROGRAMS
“QUESTION: Shall beer and liquor taxes be increased and dedicated to fund state and county alcoholism and drug services programs?
“[SUMMARY]: Increases beer tax from $2.60 to $6.60 per barrel, alcoholic beverages tax from 65¢ to 90¢ per gallon. Annual increases for inflation. Retail liquor price must be at least 115% of wholesale cost. Alcohol taxes dedicated to chemical dependency programs. $25 million of taxes go biennially to build $250 million Alcoholism and Drug Services Trust Fund. Remainder plus trust fund interest goes to Alcoholism and Drug Services Fund. Fund distributes 60% to state, 40% to counties.”
This court‘s role in reviewing a ballot title and the
Petitioner claims that the ballot title is deficient in three respects. He contends that (1) the tax increases listed are neither accurate nor complete; (2) the statement that “[r]etail liquor price must be at least 115% of wholesale cost” is inaccurate, incomplete and misleading; and (3) the ballot title fails to mention the initiative measure‘s major effect, which petitioner asserts is “to take alcoholic beverage tax money outside of the state‘s general fund and dedicate those funds to particular listed purposes.”
Petitioner proposes the following ballot title:
“INCREASES ALCOHOL TAXES, FUNDS CHEMICAL DEPENDENCY PROGRAMS OUTSIDE GENERAL FUND
“QUESTION: Shall alcohol taxes be increased to fund state and county chemical dependency programs outside of the state‘s general fund?
“[SUMMARY]: Increases beer barrelage tax from $2.60 to $6.60, wine gallonage tax from 67¢ to 92¢, fortified wine gallonage tax from 77¢ to $1.02. Increases taxes yearly for inflation. Distilled sрirits retail price mark-up at least 115% over wholesale, plus state administration expenses. Removes alcohol taxes from the state‘s general fund. Creates $250 million Alcoholism and Drug Services Trust Fund. Interest on Fund plus most alcohol tax money goes to state and counties for chemical dependency programs. Some money goes unrestricted to cities and counties.”
The parties agree that the proposed initiative measure would increase the tax on “alcoholic beverages” and “malt beverages,” as those terms are defined in
Petitioner‘s first disagreement with the Attorney General‘s ballot title is with the language in its Summary that states that the measure “[i]ncreases * * * alcoholic beverages tax from 65¢ to 90¢ per gallon.” Petitioner also disagrees with respondent‘s suggеstion that that language be amended to read “[i]ncreases *** base wine tax from 65¢ to 90¢ per gallon.” Neither the language in the Summary nor that suggested by respondent is accurate, petitioner argues, because no “alcoholic beverage” is presently taxed at 65¢ per gallon, and under the proposed measure no “alcoholic bevеrage” would be taxed at 90¢ per gallon. We agree.
As noted previously, under
Although the proposed initiative measure would amend only that portion of the tax authorized by
The tax increases listed in the Attorney General‘s ballot title‘s Summary or in respondent‘s suggested amendment thereto arе neither accurate nor complete. We conclude, therefore, that the Attorney General‘s ballot title should be modified to state the actual taxes, as described above, that would be imposed on wine and fortified wine if the measure becomes law.
The Attorney General‘s ballot title‘s Summary states that “[r]etail liquor price must be at least 115% оf wholesale cost.” Petitioner claims that this sentence is inaccurate, incomplete, and misleading.
Section 6 of the proposed initiative measure reads:
“On January 1, 1991, the Oregon Liquor Control Commission shall cause the sale price of alcoholic liquors sold at retail by the commission to be not less than 115 percent over the wholesale cost, including commission costs.” (Emphasis added.)
Both parties acknowledge in supplemental information furnished to this court that Section 6 of the measure would result in an increase in the retail sale price of liquor. Petitioner argues that under Section 6 of the measure, “the state would have to take the wholesale cost for the product, add in the approximately 20% state costs for handling the
If the measure is enacted into law, this court ultimately may be required to decide the meaning and significance of the language “including commission costs.” It would be inappropriate for this court to do so in the ballot title‘s Summary. See Sampson v. Roberts, 309 Or 335, 339, 788 P2d 421 (1990). Whatever the words “including commission costs” mean in the context of Section 6 of the measure, the measure‘s actual language should be used in the Summary, absent a compelling reason to the contrary. Id. at 340. We conclude, therefore, that the Summary should be modified to refer to the inclusion of commission costs, as well as to reflect increases in liquor retail sale prices.
Petitioner next contends that the ballot title‘s Summary fails to mention the major effect of the proposed initiative measure, which he asserts is “to take alcoholic beverage tax money outside of the state [G]eneral [F]und and dedicatе those funds to particular listed purposes.” We disagree.
The major effect of the proposed measure is an increase in beer and “alcoholic beverages” (wine and fortified wine) taxes, an increase in the retail sale price of liquor, and a dedication of most of those revenues to fund state and county chemical deрendency programs. It is true that under the measure revenues derived from beer, wine and fortified wine taxes and from the sale of liquor, which are now deposited in the state General Fund, would no longer be deposited there, but that is not the measure‘s major effect. Rather, the deposit of such revenues in a fund other than the state General Fund is a fiscal cоnsequence of bringing about the measure‘s major effect. Nevertheless, the reduction of state General Fund revenues is an important fiscal consequence of the measure, of
Substantial compliance with
Although each of petitioner‘s challenges to the Attorney General‘s ballot title appear to be principally directed at the Summary, his arguments have consequences for all components, viz, the Caption, the Question, and the Summary. We will, therefore, examine the Caption and the Question in the Attorney General‘s ballot title in the context of petitioner‘s arguments, which we discussed above.
The Caption in the Attorney Generаl‘s ballot title reads: “INCREASES BEER, LIQUOR TAXES TO FUND ALCOHOLISM AND DRUG PROGRAMS.” Petitioner‘s proposed Caption reads: “INCREASES ALCOHOL TAXES, FUNDS CHEMICAL DEPENDENCY PROGRAMS OUTSIDE GENERAL FUND.” Neither Caption substantially complies with the requirement that the Caption “reasonably identifies the subject of the measure.”
The proposed measure, if enacted into law, would not result in a tax increase on liquor, as suggested by each of the parties’ Caption. Rather, as the parties acknowledge, it would result in an increase in the retail sale price of liquor. Moreover, the Attorney General‘s Caption makes no mention of the measure‘s tax increase on wine.6 The reference in petitioner‘s Caption to the state General Fund suggests that the fiscal effect the measure will have on that particular fund is the subject of the measure. It is not. The reduction of state General Fund revenues that will result from the measure‘s passage
“INCREASES BEER, WINE TAXES, LIQUOR PRICES; FUNDS CHEMICAL DEPENDENCY PROGRAMS”7
Neither the Question in the Attorney General‘s ballot title nor the Question in petitioner‘s рroposed ballot title are in substantial compliance with the requirement that the Question “plainly phrase[] the chief purpose of the measure * * *”
Based on the foregoing discussion, we modify the Caption, the Question, and the Summary in the Attorney General‘s ballot title and certify the following ballot title to the Secretary of State:
INCREASES BEER, WINE TAXES, LIQUOR PRICES; FUNDS CHEMICAL DEPENDENCY PROGRAMS
QUESTION: Shall beer and wine taxes and liquor prices be increased and dedicated to fund state and county chemical dependency programs?
SUMMARY: Increases beer tax from $2.60 to $6.60 per barrel, wine tax from 67¢ to 92¢ per gallon, fortified wine from 77¢ to $1.02 per gallon. Annual inflation tax increases. Increases retail liquor prices, must be at least 115% over wholesale costs, including commission costs. Taxes, sale revenues dedicated to chemical dependency programs. $25 million biennially to build $250 million Alcoholism and Drug Service
Ballot title certified as modified.
Pursuant to ORAP 11.30(10) and notwithstanding ORAP 9.25(1), this certified ballot title will become effective when the appellate judgment issues. The State Court Administrator shall issue the appellate judgment 10 days from the date of this decision, unless a petition for reconsideration is both filed with and physically received by the Office of the State Court Administrator within seven days of the date of this decision. A timely petition for reconsideration will stay issuance of the appellate judgment until the court acts on all timely petitions for reconsideration. If the court denies the petition, the Administrator shall issue the appellate judgment the next judicial day after denial of the petition(s) for reconsideration.
FADELEY, J., specially concurring.
I concur that the ballot title should be mоdified. However, I do not agree that the court‘s proposed modification goes far enough to accurately or adequately advise the voters of the chief purpose, true subject or major effect of this measure. The inaccurate information which the modified ballot title will provide results from the title‘s failure to expressly notice that all existing liquor revenues, derived from the existing level of liquor prices and beverage excises as well as the proposed increase, will be lost to the general fund under the provisions of the measure.
Because these lost revenues exceed the amount to be raised by the proposed revenue increases from higher prices and gallonage rates, I do not concur with leaving the voters in the dark. I am not content to describe only the tail on the dog when the voters are being asked to approve both dog and tail in a single vote.
Presently, 56 percent of net revenues from liquor and alcoholic beverages go into the state general fund, 34 percent go to cities and 10 pеrcent go to counties.
The measure removes all 56 percent of the liquor-related net revenues from the state general fund and may also shift more of the impact of the deduction for liquor-control administrative costs onto the general fund than it now bears. The former loss would equal $56.5 million if the measure were in full effect for the current budget period. See 1989-91 Adopted Budget 9 (Schedule C - General Fund Revenues).
The combined effect of this measure and its companion involving cigarette and tobacco taxes is discussed in the specially concurring opinion in Nelson v. Roberts, 309 Or 499, 789 P2d 650 (1990). That opinion also more fully discusses the problem with the majority analysis in these companion measures.
Van Hoomissen, J., joins this specially concurring opinion.
Notes
“The ballot title of any measure to be initiated or referred shall consist of:
“(a) A caption of not more than 10 words which reasonаbly identifies the subject of the measure;
“(b) A question of not more than 20 words which plainly phrases the chief purpose of the measure so that an affirmative response to the question corresponds to an affirmative vote on the measure; and
“(c) A concise and impartial statement of not more than 85 words summarizing the measure and its major effect.”
“‘Alcoholic beverages’ means and includes any fortified wine or similar fermented vinous liquor and fruit juice, or other fermented beverage fit for beverage purposes, containing more than one-half of one percent of alcohol by volume and not more than 21 percent of alcohol by volume.”
“* * * *
“(2) A tax hereby is imposed upon the privilege of engaging in business as a manufacturer or as an importing distributor of alcoholic beverages at the rate of 65 cents per gallon on all such beverages.
“(3) In addition to the tax imposed by subsection (2) of this section, alcoholic beverages containing more than 14 percent of alcohol by volume and not more than 21 percent of alcohol by volume shall be taxed at 10 cents per gallon.
“(4) In addition to the taxes imposed by subsections (2) and (3) of this section, alcoholic beverages containing not more than 21 percеnt of alcohol by volume shall be taxed an additional two cents per gallon. Notwithstanding any other provision of law, all moneys collected by the commission pursuant to this subsection shall be paid into the Wine Advisory Board Account established under
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