31 January 2022 — 0741 mst

Court allows CI-121 supporters to gather signatures while
it considers a lawsuit filed by the initiative’s opponents

By James Conner

LEGAL DOCUMENTS

Combined as one PDF: Request for writ of supervisory control, the complaint, plaintiffs’ brief to Judge McMahon, McMahon’s TRO. Monforton’s brief for Abbott’s court.

Briefs are due Friday in the anti-CI-121 lawsuit now before district judge Christopher Abbott, a Bullock appointee confirmed in a close vote last year. Abbott filed for election on 13 January.

Background

CI-121, approved for signature gathering in early January by Montana secretary of state and attorney general, would cap residential property taxes at their 2019 values and limit annual tax increases. It is reminiscent of, but not identical to, California’s Proposition 13.

Abbott, on 25 January, lifted the temporary restraining order suspending signature gathering that district judge Michael F. McMahon imprudently issued on 13 January. See stories by the Helena IR and the Daily Montanan.

Led by the Montana Federation of Public Employees and the Montana Farmer’s Union, the plaintiffs, who want to keep CI-121 off the ballot, argue that Montana’s secretary of state and attorney general violated law created in 2021 by HB-651, which requires economic reviews of ballot issues.

This lawsuit, a stalling tactic, seeks to narrow the window for gathering the more than 60,000 signatures required to qualify the initiative for the ballot. If the initiative qualifies for the ballot, the plaintiffs can be expected to mount a scorched earth campaign to disqualify signatures. The MFPE fears CI-121’s property cap would mean less money for education and local government. The Farmer's Union fears farmers and businesses would pay higher property taxes to make up the shortfall in revenues that CI-121 might pass.

The defendants, MT SecST Christi Jacobson, MT AG Ken Knudsen, and CI-121 authors Troy Downing and Matt Monforton, argue that HB-651 applies to statutory initiatives, not to constitutional initiatives. Downing is a Republican not acting in his official capacity as Montana’s auditor. Monforton, a Bozeman based attorney, is a former Republican and Republican state representative.

Is CI-121 backed by the Montana Republican Party?

CI-121 is not, insofar as I can determine, a project of Montana’s Republican Party. It is, rather, a genuine property tax revolt triggered by sharply rising residential valuations and taxes and the 2019 Montana Legislature’s failure to provide property tax relief. When gradual change becomes impossible, radical change becomes inevitable.

HB-651 and the law and the constitution

The invocation of HB-651 raises two issues: (1) does it apply to constitutional initiatives as well as statutory initiatives, and (2) does it constitute a de facto, and constitutionally impermissible, amendment to Montana’s constitution?

To the first question, I believe to answer is NO. To the second question, I believe the answer is YES.

Does HB-651 apply to constitutional initiatives?

In Title 13, Elections, Chapter 27, Ballot Issues, of the Montana Codes Annotated, 13-27-204 governs statutory initiatives, and 13-27-207 governs constitutional initiatives.

The title of HB-651 mentions only 13-27-204:

AN ACT GENERALLY REVISING BALLOT INITIATIVES; DEFINING APPROPRIATION FOR THE PURPOSES OF A BALLOT INITIATIVE; REQUIRING EMPLOYERS OF PAID SIGNATURE GATHERERS TO REGISTER WITH THE SECRETARY OF STATE AND PAY A FEE; ALLOWING FOR A WAIVER; REQUIRING INTERIM COMMITTEES OR THE LEGISLATIVE COUNCIL TO REVIEW PROPOSED BALLOT INITIATIVE LANGUAGE AND VOTE WHETHER TO SUPPORT THE PLACEMENT OF A MEASURE ON THE BALLOT; REQUIRING LANGUAGE REGARDING THE REVIEW BY AN INTERIM COMMITTEE OR THE LEGISLATIVE COUNCIL BE PLACED ON THE PETITION PRIOR TO SIGNATURE GATHERING; REQUIRING THE ATTORNEY GENERAL TO REVIEW BALLOT INITIATIVES FOR REGULATORY TAKINGS AND DETERMINATIONS TO BE PLACED ON THE PETITION PRIOR TO SIGNATURE GATHERING; PROVIDING RULEMAKING AUTHORITY; AMENDING SECTIONS 5-5-215, 5-11-105, 13-27-202, 13-27-204, AND 13-27-312, MCA; AND PROVIDING AN IMMEDIATE EFFECTIVE DATE AND AN APPLICABILITY DATE.

In his 21 January brief to the district court, Monforton argues that:

The placement of business-impact statements on petition forms for ballot initiatives is governed by Mont. Code Ann. § 13-37-312(9)(b), which states as follows:

If the Attorney General determines the proposed ballot issue will likely cause significant material harm to one or more business interests in Montana, the Attorney General shall notify the Secretary of State, which must include the finding set forth in 13-27-204(2) on the final form of the petition.

(emphasis added). This language makes clear that the Legislature intended business-impact statements to be applied only to statutory initiatives, not constitutional initiatives, because Mont. Code Ann. § 13-27-204 applies to the former, not the latter.

Plantiff’s attorney state Rep. Robert Farris-Olsen (D, HD-79, Helena), who voted against HB-651, said the bill was not as well drafted as it might have been. Perhaps not, but the black letter text of the bill clearly does not apply to constitutional initiatives.

Was HB-651 an impermissible attempt to amend Montana’s constitution?

In his 24 January guest essay on HB-651, retired justice of the Montana Supreme Court James C. Nelson wrote:

As already noted, the Constitutional guarantee for citizens initiative is very simple. It only prohibits CIs appropriating money and local or special laws. It doesn’t provide the legislature with any power to burden the process with interim or administrative committee votes, various reviews by the attorney general, determinations by the attorney general that the issue might cause significant harm to one or more businesses, cause a regulatory taking or anything else for that matter. The only public official authorized to be involved in the process is the secretary of state, and that, only for purposes for filing the petition.

In my layman's view, HB-651 was a an outrageous, high-handed, attempt to change Montana's constitution with a statute instead of a constitutional amendment. Judge Abbott should declare the law created by HB-651 unconstitutional.

Next stop, Montana’s Supreme Court

Whether Judge Abbott rules for the plaintiffs (unlikely, in my opinion) or the defendants (likely, in my opinion), his decision almost certainly will be appealed to the Montana Supreme Court.

Briefs

Flathead Memo will make available for public download the complaints, briefs, orders, and decisions in this case.