The city’s long-running effort to fund expansion of the downtown Convention Center through an increased tax on hotel guests won a key victory when an appeals court ruled in favor of a 2020 ballot measure.
The state Court of Appeal for the 4th District ruled Friday that as a citizen initiative, Measure C did not require a two-thirds majority and therefore was passed by voters in 2020.
The initiative was approved by 65.2% of voters, just short of the two-thirds needed for government-imposed taxes. But recent court cases have concluded that tax measures brought by citizens, as opposed to government, require only a simple majority.
The measure has also been challenged on grounds that it is not a true citizens’ initiative. The convention center, Mayor Kevin Faulconer and other public officials publicly supported it.
While concluding that measure passed in 2020, the Court of Appeal said it did this “based on the assumption that Measure C is a citizens’ initiative,” and the “record is not sufficiently developed” to determine if that assumption is valid.
The case was sent back to San Diego Superior Court to determine whether the measure is in fact a citizens’ initiative.
Also at issue were a delay in certifying the outcome of the vote and the fact that ballot materials indicated that a two-thirds majority was necessary.
“Once the Appeals Court decided the vote threshold issue, it discounted the due process issue,” said Dr. Isidro D. Ortiz, president of the board of Alliance San Diego, a community group challenging the measure. “In a dangerous ruling, the court determined that the ends justify the means.”
The measure would raise the transient occupancy tax that is paid by guests who stay overnight at hotels. Estimates are it would generate generate $4.0 billion for the convention center, $2.1 billion for homelessness programs, and $700 million for street repairs over a 42-year-period.
City officials have sought for years to expand the convention center so that it can continue to host Comic-Con and other large meetings.