Proposition 204, a voter initiative in the 2012 election cycle, would have made permanent a 1% sales tax increase that was set to expire in 2013. A.R.S. § 19-124 requires the Legislative Council to prepare an impartial analysis of the provisions of each ballot proposal.
An Arizona Political Committee called Quality Education & Jobs Supporting I-16-2012 challenged the Legislative Council’s analysis of Proposition 204. The Superior Court upheld the challenge and ordered the Council to rewrite its analysis. The Legislative Council filed a special action petition with the Supreme Court, which petition was accepted.
The Supreme Court denied relief, effectively affirming the Superior Court’s decision. The Supreme Court, like the Superior Court, held that the Legislative Council’s analysis was misleading or inaccurate in three respects.
First, the analysis misleadingly referred to the Proposition as imposing a “tax increase.” Although it is not inaccurate to characterize the result as a tax increase, the Court held that omitting the background information about the current temporary tax increase of the same magnitude made the analysis not completely neutral.
Second, the Legislative Council’s analysis overstated the Proposition’s limitation on adjustments to the sales tax base in a way that the Court held had a tendency to mislead.
Third, the Court faulted the Legislative Council for pointing out that the Proposition failed to define the term “resident” as used when describing how funds from the tax increase would be used in part to fund scholarships for “resident students.” Although the court noted that it was true that the Proposition did not define that term, drawing attention to it was provocative and belied neutrality.
Although the election has now passed (and the voters rejected Proposition 204), this opinion provides the reasoning for the order in the case the Court issued in August 2012.
Justice Pelander authored the opinion; Vice Chief Justice Bales and Justice Brutinel concurred.
Posted by: Eric Fraser