Salinas Repeal of Utility Users Tax, Measure O (November 2002)
The question on the ballot was, "Shall the ordinance proposing to amend the Salinas City Code to reduce the utility users tax to three percent upon the effective date of the initiative, and then one percent on January 1, 2004, and then repeal the tax on January 1, 2005 be adopted?"
The tax that Measure O sought to reduce and ultimately repeal was enacted as an ordinance by the Salinas City Council on July 28, 1969. The tax is assessed on cable television, electricity, natural gas, telephone, and water utilities. The initial rate of the tax was 5%, with a $500 cap per taxpayer.
- The cap was increased to $1,500 in 1990 and to $2,000 in 1994.
- The rate was increased to 6% in 1994.
Two weeks before the election, Angelina Morfin Vargas and Mark Dierolf filed a lawsuit asking the court to order a new election because Salinas City officials had spend hundreds of thousands of dollars in taxpayers' funds advertising to voters a one-sided opinion hence interfered with the electoral process and the free speech rights of proponents. The lawsuit also asked the court to define what would be illegal expenditures and to order public officials responsible for illegal expenditures to reimburse the city treasury.
The information at issue included that in a newsletter that was sent to every household, like information posted on the city's website and a leaflet distributed by the city a month before the election.
City officials said they had a right to say whatever they wanted short of expressly advocating how to vote and could use public funds. The trial court agreed. City officials asked for and were granted a money award under a state law intended to protect citizens from lawsuits involving speech issues. Vargas and Dierolf appealed. The CA Supreme Court ruled in 2009 that the lower courts were wrong interpreting the law but city officials did nothing wrong.
Steven Andre, attorney for Vargas and Dierolf, represented his clients without pay and asked the court for an attorney fee award against the city because he did the job of the City Attorney by representing taxpayers, with success: lower court interpretation of law was overturned in favor of taxpayers. The city asked for another money award under a state law intended to protect citizens from lawsuits involving speech issues.
On January 11, 2010, Superior Court Judge Susan Dauphine ruled against Andre's fees and ruled in favor of the city ordering his clients to pay $229,423 to the city treasury. This ruling is now on appeal.
- Monterey County Elections Department, Official Statement of Vote, November 5, 2002
- League of Women Voters, "Smart Voter," Election Report
- CA Supreme Court, "Opinion: Vargas v. City of Salinas," April 20, 2009
- Wikipedia, "Strategic Lawsuit Against Public Participation," SLAPP
- CA 6th District Appellate Court, "Docket: Vargas v. City of Salinas"