Court Rules 2020 San Diego Hotel Tax Passed, But There’s a Catch

The city scored a legal victory in its years-long argument that a 2020 hotel-tax measure passed with less than a two-thirds vote.  

The state Court of Appeal on Friday declared that Measure C – which aimed to fund a Convention Center expansion, homeless services and road repairs – passed with 65 percent of the vote in March 2020.  

But it may be a while before the city can collect the increased hotel-room taxes. The ruling came with a catch. The court decided it didn’t have enough information to make a definitive ruling on whether one Convention Center Corp. official got too involved in the measure, thus not making it a true citizens initiative.  

The state appellate court’s decision is now the latest of a series of state appeals court rulings to conclude that citizen-led tax measures can pass with a simple majority rather than the often-elusive two-thirds threshold required of government-backed tax hikes.  

A 2022 San Diego Superior Court ruling found Measure C failed before the city or initiative supporters went to court due to process issues. The 2022 ruling bypassed the debate over whether the citizens’ initiative passed with a simple majority. And that’s what the Court of Appeal has now overturned. 

Associate Justice Richard D. Huffman, who wrote the appellate opinion that two other justices signed off on, waved aside process issues including the city’s delayed certification of Measure C election result in and focused on the threshold issue. 

“We have concluded that Measure C, as a citizens’ initiative, was subject to a simple majority vote,” Huffman wrote. “We will not now undo the will of the voters based on a delay that resulted in protecting the citizens’ initiative power.” 

However, there was the catch. The Court of Appeal’s ruling ordered the city and other players back to Superior Court to hash out whether Convention Center Corp. board member Jaymie Bradford’s dual involvement in the campaign and the city agency should change its conclusion that Measure C is a citizens initiative.  

Attorney Michael Colantuono, who represents the Yes for a Better San Diego committee that rallied for the 2020 tax hike, cheered the Friday ruling but also acknowledged the impact of the caveat. 

“The city and the Yes committee won every issue that the court of appeal decided. We’re very grateful for that,” Colantuono said. “There’s one issue that remains to be decided in the trial court. We regret the time it will take to resolve it, but we look forward to getting to the work that voters set before us – fixing streets, addressing homelessness and expanding the Convention Center.” 

Alliance San Diego Executive Director Andrea Guerrero, whose organization contended the city sought to disregard voters’ will with steps to set the stage to argue the tax hike passed, said her advocacy group was considering its next steps Friday.  

Plaintiffs Alliance San Diego, California Taxpayers Action Network and Howard Jarvis Taxpayers Foundation could ask the state Supreme Court to reconsider. If they submit a request, the Supreme Court will have at least 60 days to respond.  

In the meantime, Guerrero said she was disappointed by the ruling. 

“If all you care about is vote threshold for passage then maybe you see this as a victory but if you care about a democracy and you care about the integrity of the process and you care about the harm to due process, this is a tragic decision,” Guerrero said. 

Guerrero’s organization and allies argued that because the city attorney told voters the city needed to get approval from two-thirds of voters, then that’s what the threshold is.  

City Attorney Mara Elliott took the opposite position, calling Friday a “good day for democracy.” 

“Once again, an appellate court has determined that citizens have the right to pass measures that address their most pressing needs,” Elliott wrote in a statement. “San Diego voters approved Measure C to make major investments in homeless services, road repairs, and other critical needs. Today’s decision brings our city one step closer to delivering on that goal.” 

Attorney Cory Briggs, who is representing California Taxpayers Action Network, and a spokeswoman for the Howard Jarvis Taxpayers Foundation could not immediately be reached for comment Friday.  

That catch, explained: The California Taxpayers Action Network had argued Bradford’s involvement in a Convention Center Corp. board resolution in support of Measure C and campaigning for Measure created a conflict.  

The courts have interpreted the law to mean that if governments want to pass special taxes, they must get approval from two-thirds of voters. But that law doesn’t apply to citizens initiatives, which become law with a majority vote. But if Bradford was too involved as a government official, than maybe it was the government trying to pass the tax and not a true citizens initiative.  

The Court of Appeal decided not to even make a decision on that but to ask the lower court to hash it out.   

The Friday appellate court ruling noted that a government official’s involvement in an initiative doesn’t necessarily mean a citizens’ initiative is a government-backed measure but that too much government involvement can be problematic. The ruling said the information it had on Bradford’s involvement was incomplete.  

“This affirmative defense is simply too underdeveloped at this point for us to reach the merits,” Huffman wrote. “Thus, we direct the trial court to consider this issue on remand.” 

Sacramento-based election attorney Brian Hildreth said additional legal wrangling over Bradford’s role in Measure C is unlikely to result in a Superior Court ruling that clashes with the Court of Appeal’s direction.  

“It doesn’t appear that the Court of Appeal is persuaded by the opponents’ argument questioning whether Measure C is a citizens initiative,” said Hildreth, who reviewed the Friday court ruling. 

Hildreth noted that the case cited to explain the situation – Rider v. County of San Diego – involved the Board of Supervisors creating a new government agency to try to avoid the state’s two-thirds vote requirement. 

“The facts here do not rise to the issue in Rider,” Hildreth said. 

Mayor Todd Gloria is also optimistic about Measure C’s future. 

“This ruling is an encouraging sign that the City will finally be able to implement the will of an overwhelming majority of San Diego voters, who have made clear they want to collect funds from tourists to address homelessness, street repair and the expansion of the San Diego Convention Center, one of our greatest local economic drivers,” he wrote in a Friday statement.