Myers v. City Council of City of Pismo Beach

• Decision Date: 30 March 1966
• Citation: 241 Cal.App.2d 237,50 Cal.Rptr. 402
• Court: California Court of Appeals Court of Appeals
• Parties: Henry F. MYERS et al., Petitioners and Respondents, v. CITY COUNCIL OF the CITY OF PISMO BEACH et al., Defendants and Appellants. Civ. 29560.

Page 402

50 Cal.Rptr. 402

241 Cal.App.2d 237

Henry F. MYERS et al., Petitioners and Respondents, v. CITY COUNCIL OF the CITY OF PISMO BEACH et al., Defendants and Appellants.

Civ. 29560.

District Court of Appeal, Second District,

Division 2, California.

March 30, 1966.

David & Gould, by Ronald Gould, Arroyo Grande, for respondents.

Bernard S. Crossman, City Atty., City of Pismo Beach, for appellants.

FOX, ^* Justice.

This is an appeal by the City of Pismo Beach from a judgment of the Superior Court which directed that a peremptory writ of mandate issue commanding the City Council of the City of Pismo Beach to adopt an initiative ordinance submitted to them ¹ or in the alternative to call a special election to determine if the proposed initiative ordinance be adopted.

The city of Pismo Beach is not a chartered city but is governed by the general laws of the state.

On October 5, 1964, at a regular meeting of the City Council a resolution entitled 'Intent to Levy Tax' was adopted. On January 11, 1965, 'Ordinance No. 114, An Ordinance Imposing a Tax Upon the Privilege of Transient Occupancy and Providing for the Collection Thereof' (commonly known as a room occupancy tax), was introduced. Public hearings were held thereon. The first reading of the proposed ordinance was on February 8, 1965. The second reading and the vote thereon which resulted in its passage were on March 8, 1965.

On December 9, 1964, petitioners, motel owners, and electors within the City of Pismo Beach, filed with the city clerk of said city a petition entitled 'Initiative Petition for Enactment of a City Ordinance of Pismo Beach, California.' (See footnote 1 for text.) At the next regular scheduled meeting of the City Council on December 14, 1964, the City Council refused to consider said petition on the advice of the city attorney, although the city clerk stated that said petition could be certified as having the necessary signatures and being in the proper form.

On March 3, 1965, petitioners filed in the Superior Court a petition for writ of mandate to compel the City Council to adopt the proposed initiative ordinance that had been submitted to it, or, in the alternative, to call a special election to determine if the proposed ordinance should be adopted. An alternative writ was issue on March 4. The hearing on the writ was set for 2 p.m. on March 8. At approximately closing time on that date the court ruled in favor of petitioners, finding that 'this is a proper case for issuance of a Writ of Mandate' and ordering (1) that a peremptory writ of mandate issue, and (2) that 'the City Council is directed, under Section 4011 of the Elections Code, ² to introduce and adopt the ordinance at their regular meeting tonight or in the alternative call a special election.'

At the meeting of the City Council that evening it passed Ordinance No. 114 (referred to above) imposing a 4 per cent room occupancy tax. The Council also voted to call a special election on May 11, 1965, to determine whether the proposed initiative ordinance should be adopted. The result of the election was to a adopt the ordinance.

The judgment in the mandamus proceeding was signed on March 23, 1965, and filed on the same date. A peremptory writ of mandate was issued on that date but was not served on the city inasmuch as the City Council had elected to follow the alternative, and had therefore called a special election to vote upon the proposed initiative ordinance.

The basic question underlying this appeal is: Is the proposed ordinance (see footnote 1) a proper subject for the initiative process? We have concluded that this question must be answered in the negative.

In exploring this question we start with the principle that '(m)unicipal corporations have no inherent power of taxation. On the contrary, municipal corporations possess with respect to taxation only such power as has been granted to them by the Constitution or the statutes.' (McQuillin, Municipal Corporations, 3rd Ed. Rev., Vol. 16, § 44.05, quoted in substance in City of Los Angeles v. Belridge Oil Co., 42 Cal.2d 823, 834, 271 P.2d 5.)

Initially, therefore, it must be borne in mind that Pismo Beach is a general law city, that is, it is governed by the general laws of the state, and derives its power to tax from article XI, section 12, of the State Constitution. ³ By general laws the legislature has vested in the 'corporate authorities' the power to assess and collect taxes for local municipal purposes. One of these general laws relates to the specific question at bench, viz., section 51030, Government Code, ⁴ which confers upon '(t)he Legislative body of any city or county' the right to levy a room occupancy tax such as is here involved. (Emphasis added.)

It will be noted that the authority to levy this tax is specifically delegated to The legislative body of the city. That, of course, is the City Council. Upon that body is conferred the power and duty to deal with this subject matter. And the City Council of course has discretion, as in any legislative matter, to determine what action, if any, should be taken.

We are thus brought to this aspect of our problem: May The legislative body of the city delegate the power and duty specifically conferred upon it in this matter? We think not.

On this point McQuillin says: 'The rule that public powers conferred upon the council of a municipality cannot be delegated by it, has been applied to the power conferred upon municipalities to levy taxes, so that when power to levy taxes has been delegated by the legislature to a certain body or officers, they cannot delegate such power to another body or other officers.' (Id. § 44.16.) Later in the same section is this statement: 'Clearly, taxing power committed to the 'Corporate authorities' cannot be exercised by others.' (Emphasis added.)

In Mitchell v. Walker, 140 Cal.App.2d 239, 295 P.2d 90 (hear. den.) the court had before it an initiative ordinance which attempted to delegate to the County Board of Supervisors the power vested in the City Council of a general law city to fix the salaries of city officials and employees. The court pointed out that 'section 36506 of the Government Code not only empowers the City Council to fix the salaries of the city's officers and employees but makes it its duty so to do.' And, '(i)n performing this duty it is required to exercise its discretion.' (Page 243, 295 P.2d page 92.) The court further stated (page 244, 295 P.2d page 92) 'The council could not itself delegate the power given it to any other body (citations), nor could it abandon that power and refuse to perform the duty placed upon it by the statute or so act as to impede the future exercise of that power. (Citations.)'

The court went on to say: 'The effect of the proposed ordinance is to delegate to the governing body of another political subdivision of the state, to-wit: the Board of Supervisors of the County of Los Angeles, the power vested in the council to fix the salaries in question; under it the council would abandon that power and the duty placed upon it by the statute and take that power and duty away from any future council. This the council could not do by an ordinance initiated and enacted by it, and therefore * * * the ordinance is not one which may be adopted by means of the initiative.'

As pointed out above the authority to deal with the type of tax here involved is specifically delegated to The legislative body, namely the City Council, and in dealing with that problem it is called upon to use its discretion. Since the authority was given to the City Council and to no one else, and since the duty to deal with that problem was specifically placed upon the City Council and since it involved the exercise of its discretion, it follows, as in the Mitchell case, that the Council could not delegate this authority to another body, even to the electors of the city, nor could it abandon the power and duty imposed upon it and permit the electorate to usurp such responsibility by means of the initiative process.

Geiger v. Board of Supervisors, 48 Cal.2d 832, 313 P.2d 545, although dealing with an attempt to subject a county sales and use tax ordinance to referendum, supports the foregoing conclusion. The county sales and use tax ordinance was passed pursuant to the enactment of the Bradley-Burns Act. In the course of the opinion Chief Justice Gibson pointed out (page 835, 313 P.2d page 546) that article IV, section 1, of the California Constitution, reserves the referendum powers to the people except "tax levies or appropriations for the usual current expenses of the State" and the same exception applies to the referendum powers reserved to county electors. Therefore the Constitution, standing alone, does not secure to county electors the right of referendum over tax levies or appropriations for the usual current expenses of county government. It was argued, however, that by reason of certain language used in the Elections Code (§§ 1651--1653) that county tax ordinances were subject to referendum. The court, however, held that the language used in the Elections Code did not compel the conclusion that the legislature sought to extend the referendum power to embrace sales and use tax ordinances contrary to article IV, section 1, of the Constitution. In arriving at that conclusion the Chief Justice made the following significant point (page 838, 313 P.2d page 548):

'An even stronger indication of intention that referendum should not be permitted appears in the language used by the Legislature in authorizing boards of supervisors to adopt sales and use tax ordinances. The act provides: 'Any county may By action of its board of supervisors adopt a sales and use tax in accordance with the provisions of this part.' (Italics added (by the court.)) Rev. & Tax.Code, § 7201. Ordinarily, a county exercises its powers through its board of supervisors (Gov. Code, § 23005), and it would have been unnecessary to...