Respect the Promise v. Hanna (9/19/2015)

November 3, 2015

Arizona Court of Appeals Division One holds that (1) a city council’s approval of a settlement agreement to resolve pending litigation and (2) a city resolution that merely expresses support on a given issue are not legislative acts subject to referendum.

In general, the legislative acts of Arizona state and local governments are subject to the referendum power, which allows voters to approve or reject a legislative act.  Non-legislative acts are not subject to the referendum power.  This case tests the line between legislative acts and non-legislative acts.  The case arises out of the controversy surrounding the Tohono O’odham Nation’s efforts to open a casino near the City of Glendale.  The City opposed the Nation’s plans and became involved in litigation with the Nation and others.  Eventually, the City Council adopted a resolution repealing its earlier opposition to the Nation and authorizing the City’s staff to begin settlement negotiations with the Nation.  Soon after, the City Council adopted another resolution (Resolution 4840) generally declaring and reaffirming the City Council’s support of the Nation’s casino plans, and urging the state government and state congressional delegation to do the same.  Resolution 4840 also directed the mayor to execute a settlement agreement.  On the same day, the City and the Nation’s gaming enterprise entered into a settlement agreement to resolve the pending litigation.

A measure is referred to the voters for approval if a sufficient number of petitions are submitted calling for a referendum.  A local citizen submitted petitions to the City Clerk seeking to challenge both Resolution 4840 and the settlement agreement.  The City Clerk rejected the petitions on the basis that the resolution and settlement agreement were administrative acts, not legislative acts subject to the referendum.  The superior court refused to order the clerk to accept the petitions and this appeal followed.

The Court of Appeals agreed with the City Clerk, holding that the acts in question are not subject to the referendum power.  The Arizona Constitution provides for the referendum power as to “all . . . city . . . matters on which . . . cities . . . are or shall be empowered by general laws to legislate.”  Ariz. Const. art. 4, pt. 1, § 1(8).  The referral power does not, however, extend to executive and administrative actions.  An act is legislative in nature “if it prescribes a new policy or plan;” an administrative act “merely pursues a plan already adopted by the legislative body” or “carries out the policy or purpose already decided by the legislative body.”  In addition, a legislative act must do more than set forth a “general principle” because a legislative “measure must enact something.”  Applying these principles, the Court held that the portions of Resolution 4840 unrelated to the settlement agreement did not qualify as legislative because the resolution merely affirmed and acknowledged previous acts or expressed general support for a position, rather than enacting substantive legislative measures. 

As to the settlement agreement, although the agreement “enact[s] something” because it requires the expenditure and receipt of funds, the Court held as a policy matter that a city should be able to enter into binding settlement agreements “without the cloud of uncertainty that would exist” if the agreement were subject to referendum. 

Judge Brown authored the unanimous opinion.  Judges Portley and Gemmill concurred.

Disclosure:  Osborn Maledon PA appeared as counsel for Appellants.