IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA FIFTH APPELLATE DISTRICT

Transcription

1 F IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA FIFTH APPELLATE DISTRICT STAND UP FOR CALIFORNIA and CHERYL SCHMIT, Plaintiffs, Cross-Defendants, and Respondents, v. STATE OF CALIFORNIA, et al., Defendants, Cross-Defendants, and Respondents. NORTH FORK RANCHERIA OF MONO INDIANS Intervenor-Defendant, Cross-Complainant, and Appellant. Madera County Superior Court Case No. MCV Honorable Michael J. Jurkovich APPELLANT S REPLY BRIEF * Fredric D. Woocher (SBN 96689) Dale K. Larson (SBN ) Strumwasser & Woocher LLP Wilshire Blvd., Ste Los Angeles, CA T: (310) F: (310) fwoocher@strumwooch.com John A. Maier (SBN ) Maier Pfeffer Kim Geary & Cohen LLP 1440 Broadway, Ste. 812 Oakland, CA T: (510) F: (510) jmaier@jmandmplaw.com Christopher E. Babbitt (SBN ) Danielle M. Spinelli (pro hac vice) Wilmer Cutler Pickering Hale & Dorr LLP 1875 Pennsylvania Avenue, NW Washington, D.C T: (202) F: (202) christopher.babbitt@wilmerhale.com Attorneys for Intervenor-Defendant, Cross-Complainant, and Appellant North Fork Rancheria of Mono Indians

2 TABLE OF CONTENTS Page INTRODUCTION AND SUMMARY OF ARGUMENT... 8 I. THE RATIFICATION OF A TRIBAL-STATE GAMING COMPACT PURSUANT TO ARTICLE IV, SECTION 19(F), OF THE STATE CONSTITUTION IS NOT A LEGISLATIVE ACT THAT IS SUBJECT TO REFERENDUM A. The Form That A Legislative Enactment Takes Does Not Control Whether It Is Subject To The Initiative and Referendum B. A Referendum May Only Be Used to Overturn Actions That Constitute Exercises of Legislative Power C. The Language of Article IV, Section 19, Makes Clear that the Legislature s Ratification of a Tribal-State Gaming Compact Is Not a Legislative Act Subject to Referendum D. Both the 1998 and 2007 Legislative Counsel Opinions Support the Conclusion that the Legislature s Ratification of North Fork s Compact Pursuant to Article IV, Section 19(f), Is Not Subject to Referendum E. The Ratification of a Tribal-State Compact Is Not Subject To Referendum Because It Does Not Constitute an Exercise of the Inherent State Lawmaking Power of the Legislature, But Merely Constitutes Its Approval of a Consensual Agreement Between Two Equal Sovereign Governments II. WHEN CONSTRUED IN ACCORDANCE WITH IGRA, STATE LAW LEAVES NO ROOM FOR A REFERENDUM ON THE LEGISLATURE S RATIFICATION OF A TRIBAL-STATE COMPACT

3 A. The Superior Court s Construction Of Cal. Gov. Code (f) Was Incorrect The Superior Court s Ruling Is Inconsistent With The Plain Text of Sections (f) And 9510 Of The Government Code The Superior Court s Ruling Ignores The Distinction Between A Statute s Enactment Date And Its Effective Date The State s Submission Of The Compact To The Secretary Of The Interior Was Consistent With Its Longstanding Practice IGRA s Good-Faith Negotiation Requirement Is Not At Issue In This Litigation B. The Policy Of Liberally Construing The People s Referendum Power Cannot Overcome The Plain Text Here CONCLUSION

4 TABLE OF AUTHORITIES FEDERAL CASES Page(s) California v. Cabazon Band of Mission Indians (1987) 480 U.S Gaming Corp. of America v. Dorsey & Whitney (8th Cir. 1996) 88 F.3d Hawke v. Smith (1920) 253 U.S , 31 Pueblo of Santa Ana v. Kelly (10th Cir. 1997) 104 F.3d , 43 Seminole Tribe of Florida v. Florida (1996) 517 U.S CALIFORNIA CASES American Federation of Labor v. Eu (1984) 36 Cal.3d passim Barratt American, Inc. v. City of Rancho Cucamonga (2005) 37 Cal.4th Choate v. Celite Corp. (2013) 215 Cal.App.4th City of Malibu v. California Coastal Commission (2004) 121 Cal.App.4th County of Sacramento v. Llanes (2008) 168 Cal.App.4th Cruz v. HomeBase (2000) 83 Cal.App.4th DuBois v. Land (1963) 212 Cal.App.2d

5 Empire Waste Management v. Town of Windsor (1998) 67 Cal.App.4th Geiger v. Board of Supervisors of Butte County (1957) 48 Cal.2d Hill v. National Collegiate Athletic Assn. (1994) 7 Cal.4th Hopping v. Council of City of Richmond (1915) 170 Cal , 18, 19, 35 Hotel Employees & Restaurant Employees International Union v. Davis (1999) 21 Cal.4th , 43 Hunt v. Mayor & Council of City of Riverside (1948) 31 Cal.2d In re Thierry S. (1977) 19 Cal.3d Mabry v. Superior Court (2010) 185 Cal.App.4th People s Advocate, Inc. v. Superior Court (1986) 181 Cal.App.3d Sacks v. City of Oakland (2010) 190 Cal.App.4th Special Assembly Interim Committee etc. v. Southard (1939) 13 Cal.2d Worthington v. City Council of the City of Rohnert Park (2005) 130 Cal.App.4th , 37, 38 Zaremberg v. Superior Court (2004) 115 Cal.App.4th OTHER CASES Confederated Tribes of the Chehalis Reservation v. Johnson (1998) 135 Wash.2d 734, 958 P.2d

6 Dalton v. Pataki (N.Y. 2005) 835 N.E.2d Florida House of Representatives v. Crist (Fla. 2008) 999 So.2d Kansas v. Finney (1992) 251 Kan. 559, 836 P.2d Kimble v. Swackhamer (1978) 94 Nev. 600, 584 P.2d New Mexico v. Johnson (1995) 120 N.M. 562, 904 P.2d Saratoga County Chamber of Commerce, Inc. v. Pataki (N.Y. 2003) 798 N.E.2d Taxpayers of Michigan Against Casinos v. State (Mich. 2004) 685 N.W.2d , 36, 40 FEDERAL STATUTES 25 U.S.C , 43, 49 CALIFORNIA CONSTITUTIONAL PROVISIONS Cal. Const., art. II, Cal. Const., art. IV, passim Cal. Const., art. IV, 10(a) CALIFORNIA STATUTES Gov. Code, , 46 Gov. Code, Gov. Code, passim 6

7 Gov. Code, OTHER AUTHORITIES Black s Law Dictionary (7th ed. 1999)

8 INTRODUCTION AND SUMMARY OF ARGUMENT In its opening brief, Appellant North Fork Rancheria of Mono Indians argued that the Legislature s ratification of a tribal-state gaming compact pursuant to article IV, section 19(f) of the California Constitution could not be undone by referendum because (1) ratification is not a legislative act subject to the people s reserved power of referendum and (2) the state process for compacting with Indian tribes leaves no room for referendum. Respondents arguments to the contrary should be rejected. First, it makes no difference that the Legislature ratified the North Fork compact by statute; controlling Supreme Court precedent makes clear that it is the substance, not the label, that controls. (American Federation of Labor v. Eu (1984) 36 Cal.3d 687, 710.) That same authority confirms that the referendum power extends only to statutes that are legislative in substance whether enacted at the state or local level. (Id. at p. 708.) When the Legislature is acting pursuant to its non-legislative powers, the referendum power simply does not apply. In substance, the Legislature s ratification of the North Fork compact was not a legislative act. In establishing the state law compacting process, article IV, section 19(f) uses the phrase ratification by the Legislature, which has a well-established historical meaning and refers to a non-legislative act. This meaning fully applies in the context of Indian gaming, where the State has no inherent law-making authority, but has only 8

9 the powers granted to it by federal law. Compact ratification is not a unilateral imposition of legislative will or an act setting state policy. As the Legislative Counsel explained, article IV, section 19(f) established the state policy and procedures governing Indian gaming; the ratification is simply an agreement between two sovereigns. To the extent the State exercises any regulatory authority pursuant to the compact, that is solely because of the Tribe s voluntary agreement. The ratification, therefore, is not a legislative act subject to a referendum. Second, there is no room for a referendum on a ratifying statute under the state law establishing California s tribal-state compacting process, which must be read in accordance with IGRA. Under the terms of Government Code section (f), and the State s longstanding practice, the Secretary of State will submit a compact to the Secretary of the Interior for approval upon receipt of a ratifying statute signed by the Governor. Because the submitted compact will be deemed approved within 45 days and thereafter takes effect as a matter of federal law, a referendum raises the absurd possibility that a compact will be un-ratified after it is in effect under federal law. Respondents argue that this absurdity can be avoided by requiring the Secretary of State to wait until any referendum process has played itself out before submitting the compact to her federal counterparts, invoking the judicial policy in favor of jealously guarding the referendum power. But 9

10 that policy does not apply where California law does not provide for the referendum power in the first place. Here, article IV, section 19(f) and the plain terms of Government Code section (f) leave no room for the referendum power to operate, demonstrating that neither the people (in enacting article IV, 19(f)) nor the Legislature (in enacting section ) contemplated that the ratification would be subject to the referendum power. For these reasons, and those set forth in Appellant s Opening Brief, the Superior Court s judgment should be reversed and the Superior Court should be directed to enter judgment granting the relief sought in Appellant s Cross-Complaint and declaring that the referendum against AB 277 is invalid, void, and unenforceable insofar as it purports to overturn the Legislature s ratification of North Fork s tribal-state gaming compact. ARGUMENT I. THE RATIFICATION OF A TRIBAL-STATE GAMING COMPACT PURSUANT TO ARTICLE IV, SECTION 19(f), OF THE STATE CONSTITUTION IS NOT A LEGISLATIVE ACT THAT IS SUBJECT TO REFERENDUM A. The Form That A Legislative Enactment Takes Does Not Control Whether It Is Subject To The Initiative and Referendum. It Is the Substance That Controls Both the State and Schmit assert that because the Legislature s ratification of North Fork s compact was included in a statute AB 277 that fact alone makes it subject to referendum. According to 10

11 Schmit, for example, two simple propositions control the outcome of this appeal: (1) Under article II, section 9, of the California Constitution, all statutes enacted by the Legislature are subject to referendum, except for urgency statutes, statutes calling elections, and statutes providing for tax levies or appropriations for usual current expenses of the State ; and (2) AB 277 was enacted by the Legislature in the form of a statute and does not fall within any of the three specified exemptions. Thus, Schmit contends, the only conclusion that can be drawn is that the enactment of AB 277 is subject to the People s power of referendum. (Schmit s Respondent s Brief ( Schmit s RB ), p. 9.) Respondents argument, however, is directly contradicted by the Supreme Court s admonition in American Federation of Labor v. Eu (1984) 36 Cal.3d 687 ( AFL-CIO ), that it is the substance, not the label, that controls. (Id. at p. 710.) Were the issue and analysis as simple as Respondents posit, the Court in AFL-CIO would not have needed almost 30 pages to explain why the proposed resolution at issue in that case which plainly did not take the form of a statute did not fall within the scope of the people s reserved initiative and referendum powers. Nor would the California Reporters be filled with numerous judicial decisions analyzing in great detail the distinction between legislative and non-legislative acts. Instead, all the courts would need to look at is whether the enactment at issue takes the form of a statute or an ordinance. If so, it would be a 11

12 proper subject of an initiative or referendum; if not, the reserved powers would not apply. Of course, that is not the proper inquiry and analysis. Nor should it be, for Respondents suggestion that the scope of the reserved power is determined solely by the form of a particular legislative enactment could well undermine the people s right of initiative and referendum. Do Respondents believe that the Legislature could preclude the people from exercising their right of referendum against an enactment that was truly legislative in character merely by adopting it in the form of a resolution rather than as a statute? Surely not. But if the Legislature cannot avoid a referendum against a legislative action through such an artifice, it likewise cannot make a non-legislative action subject to a referendum simply by choosing to enact it as a statute rather than as a resolution. The Supreme Court went to great lengths to make this point in AFL-CIO, yet Respondents either disregard or mischaracterize the Court s entire discussion of this issue in their briefs. The State barely mentions AFL-CIO at all, citing it only for the proposition that it is the duty of the courts to jealously guard the people s right of initiative and referendum (State s Respondent s Brief ( State s RB ), p. 5 [quoting AFL-CIO, 36 Cal.3d at p. 708]), while failing to note that in its very next breath the Court cautioned that [e]ven under the most liberal interpretation, however, the reserved powers of initiative and referendum do not encompass all possible 12

13 actions of a legislative body. (AFL-CIO, 36 Cal.3d at p. 708.) Schmit at least acknowledges that AFL-CIO is relevant to the issues in this appeal (Schmit s RB, p. 28), but she misstates the Court s reasoning and conclusion, erroneously asserting that the Court held that if a piece of legislation is introduced as a bill, passed by both houses, and presented to the Governor for his signature, it declares law, and is a statute within the scope of Article II, 9, and, therefore, subject to referendum. (Id. at p. 23 [citing AFL-CIO, 36 Cal.3d at p. 715].) 1 The Court in AFL-CIO, however, did not hold that a piece of legislation was subject to referendum merely because it was introduced as a bill and was enacted in the form of a statute. In fact, as noted above, the entire thrust of the Court s decision was just the opposite, explicitly ruling that it is the substance, not the label, that controls. (AFL-CIO, 36 Cal.3d at p. 710.) The Court in AFL-CIO began its analysis by noting that the term statute did not even appear in the 1911 amendment adding the initiative and referendum powers to the state Constitution, but had been selected by the California Constitution Revision Commission in 1966 as a shorthand 1 Nothing in AFL-CIO supports the assertion for which page 715 is cited in Schmit s brief. Earlier in the opinion, the Court did use the phrase referenced in Respondent s brief, but significantly, the Court did so only in the context of explaining that under the California Constitution, the reserved power of initiative and referendum was limited to such measures as constituted the exercise of legislative power to create binding law the kind of measure that would be introduced by bill, duly passed by both houses of the legislature, and presented to the governor for signature. (36 Cal.3d at p. 711 [italics added].) 13

14 description a simpler statement of the reserved power without any intended change in meaning from then-article IV, section 1 s original use of the terms laws and acts. (See 36 Cal.3d at pp ) 2 The Court then proceeded to consider whether the Balanced Budget Initiative, which called upon Congress to submit a balanced budget amendment to the federal constitution and applied to Congress for a constitutional convention for that purpose, could be deemed to be a law or statute within the meaning of article II of the California Constitution. Upon reviewing the case law from within California, such as Hopping v. Council of City of Richmond (1915) 170 Cal. 605, as well as the authorities from other states with constitutional provisions indistinguishable from California s, the Court concluded that the reserved power of initiative and referendum was limited to such measures as constituted the exercise of legislative power to create binding law and did not extend to the ratification of constitutional amendments. (36 Cal.3d at p. 711 [italics added].) Contrary to Respondents characterization, the Court s decision was not based upon the rationale that the ratification of a constitutional amendment took the form of a resolution and not a statute, but on the Court s determination that a state in ratifying an amendment was not asserting legislative power under 2 For this reason alone, Respondents exclusive reliance on the form of AB 277 s enactment as a statute is misguided. Even in its starkest formulation, the pertinent question should be whether a particular legislative action is a law, not whether it is a statute. 14

15 its own constitution, but exercising a power delegated to the state legislatures by article V of the federal Constitution. (Id. at pp [italics added].) That the particular form of an enactment is not the dispositive factor in determining whether it is subject to initiative or referendum was made clear again in People s Advocate, Inc. v. Superior Court (1986) 181 Cal.App.3d 316, in which the court invalidated portions of an initiative that added several sections to the Government Code purporting to regulate the internal proceedings of the Legislature. Although the initiative took the form of a statute, the court held that under the Constitution, such matters were properly the subject of rules or resolutions adopted by the Legislature not statutory laws and were therefore not subject to the people s initiative and referendum power. (Id. at p. 325.) The court held that it was of no legal consequence that the Legislature itself had in the past regulated its internal proceedings through the enactment of statutes, because [a] rule of proceeding adopted by the Legislature by statute is, notwithstanding its means of adoption or label, a rule or resolution within the provisions of article IV, sections 7 and 11. It is not the form by which the rule is adopted but its substance which measures its place in the constitutional scheme. The people wholly lack this power whatever the form of its application. (Id. at pp [italics added].) 15

16 Respondents attempt to minimize the significance of People s Advocate by focusing on the substantive basis for the court s conclusion that the initiative in that case was not within the people s reserved power, arguing that the decision has no bearing on the question before this court on appeal because the initiative in People s Advocate addressed the internal workings of the Senate and Assembly, whereas AB 277 addressed the world outside the Legislature. (Schmit s RB, p. 28.) But the import of People s Advocate to the present case lies not in the court s holding that the Legislature s internal rules for selecting its officers are not subject to initiative and referendum, but in the court s explicit declaration that those rules are not subject to initiative and referendum even though they might be and had in the past been adopted by the Legislature in the form of statutes. The decision in People s Advocate thus definitely refutes Respondents contention that the ratification of North Fork s compact is subject to referendum simply because it was included in a statute. 3 B. A Referendum May Only Be Used to Overturn Actions That Constitute Exercises of Legislative Power The principle that a referendum may only be used to overturn actions of the Legislature that constitute exercises of its legislative power is well- 3 People s Advocate likewise refutes the State s assertion that no published California appellate court decision has held that a nonexempt statute passed by the Legislature was not subject to a referendum. (State s RB, p. 8.) The statutes enacted by the Legislature to regulate its internal proceedings were held in People s Advocate not to be subject to initiative or referendum. 16

17 established. After all, it was only five years ago that the court of appeal in Sacks v. City of Oakland (2010) 190 Cal.App.4th 1070, observed that it is established beyond dispute that the power of referendum may be invoked only with respect to matters which are strictly legislative in character. (Id. at p [italics added] [citations omitted].) Remarkably, however, the State takes issue with this proposition, challenging Appellant s assertion that only those statutes that truly constitute exercises of legislative power are subject to referendum. (See State s RB, p. 7.) Schmit, while not going quite so far as the State, similarly argues that Appellant s position rests on a line of inapposite cases that analyze the referendum and initiative authority for local measures, not statutes enacted by the Legislature (Schmit s RB, p. 25 [emphasis in original]), suggesting that the analysis is somehow different in that context because local governments are of a mixed character, sometimes acting in a legislative capacity and other times in an executive or administrative capacity. (Ibid.) But AFL-CIO, the seminal California Supreme Court case that analyzed the scope of the people s initiative and referendum power, involved the exercise of that power at the state, not the local, level. And what the Court held in AFL-CIO was that the reserved powers of initiative and referendum do not encompass all possible actions of a legislative body. (36 Cal.3d at p. 708.) Rather, under constitutional provisions such as that in California, the reserved power of initiative and referendum was 17

18 limited to such measures as constituted the exercise of legislative power to create binding law. (Id. at p. 711 [italics added].) The Court in AFL-CIO drew no distinction between the scope of the initiative and referendum powers at the state versus local levels, for none exists. To the contrary, the Court cited with approval to its earlier decision in Hopping v. Council of City of Richmond, in which the Court after first noting that the state referendum does not apply to acts of legislative power which may be taken by joint resolution, but applies only to acts which must be passed in the form of a statute (170 Cal. at p. 609 [italics added]) 4 expressly held that the power of the people of the cities must therefore be deemed to be the same in character as that described in the opening clause with reference to the people of the state, that is to say, it applies only to the acts of the city council, or other legislative body of the 4 As noted in Appellant s Opening Brief, this language from Hopping is extremely instructive for the present appeal, for the Legislative Counsel has ruled and Respondents do not dispute that following the passage of Proposition 1A and the enactment of article IV, section 19(f), the ratification of a compact like North Fork s may be taken by joint resolution and does not need to be passed in the form of a statute. (Leg. Counsel Op. No (Nov. 2, 2007) ( 2007 Leg. Counsel Op. ), p. 7 [ [T]he Legislature is not required to ratify a tribal-state gaming compact by means of a statute, but instead may do so by means of resolution adopted by each house. ] [AA 1:99].) The Court s decision in Hopping therefore directly supports Appellant s contention that the referendum power does not apply to the Legislature s ratification of North Fork s compact. Neither the State nor Schmit offers any rebuttal whatsoever to this point in their briefs. 18

19 particular city, which are exercises of its legislative power. (Id. at pp ) To be sure, a local legislative body like a city council which, as Schmit notes, may often act in an executive or administrative capacity is more likely to exercise non-legislative powers than the state Legislature, and the predominance of reported cases involving local governments undoubtedly reflects both the greater number of local initiatives and referenda than statewide measures and the greater opportunity for legal disputes to arise at that level. But the governing principle for resolving such disputes when they arise is exactly the same: The people s reserved power applies only to the exercise of legislative power to create binding law. (AFL-CIO, 36 Cal.3d at p. 711 [italics added].) Judicial enforcement in this case of this fundamental restriction on the scope of the initiative and referendum would not, as the State contends, create[] a new tribal-state compact ratification exception to article II, section (9), subdivision (a), in addition to the existing exemptions for urgency statutes, statutes calling elections, and those providing for tax levies and appropriations. (State s RB, pp. 6.) Rather, it would simply constitute a recognition that the people s reserved power never applied to begin with to an action of the Legislature, like the ratification of a tribalstate gaming compact, that was not an exercise of legislative power to 19

20 create binding law. No exemption from the referendum power is needed if the Legislature was not acting to create a law in the first place. C. The Language of Article IV, Section 19, Makes Clear that the Legislature s Ratification of a Tribal-State Gaming Compact Is Not a Legislative Act Subject to Referendum There is no disagreement among the parties that article IV, section 19(f) sets forth the exclusive means for the State to enter into tribal-state gaming compacts. The pertinent part of that section declares: Notwithstanding subdivisions (a) and (e), and any other provision of state law, the Governor is authorized to negotiate and conclude compacts, subject to ratification by the Legislature, for the operation of slot machines and for the conduct of lottery games and banking and percentage card games by federally recognized Indian tribes on Indian lands in California in accordance with federal law. (italics added.) As discussed at greater length in Appellant s Opening Brief, the critical phrase employed in section 19(f) to describe the Legislature s role in the tribal-state compact process ratification by the Legislature has a well-established meaning based upon the historical role of state legislatures in ratifying proposed federal constitutional amendments. As the U.S. Supreme Court explained in Hawke v. Smith (1920) 253 U.S. 221, ratification by a state of a constitutional amendment is not an act of legislation within the proper sense of the word. It is but the expression of the assent of the state to a proposed amendment. (Id. at p. 229 [italics added].) The Supreme Court s interpretation fully comports with the 20

21 natural and ordinary meaning of the word ratification, which is not the enactment of legislation in the first instance, but the confirmation and acceptance of a previous act. (Cruz v. HomeBase (2000) 83 Cal.App.4th 160, 168, quoting Black s Law Dict. (7th ed. 1999) p [italics added].) Accordingly, as the Court recounted in AFL-CIO, courts throughout the country have without exception held that a legislature s action in ratifying a proposed amendment is not a legislative act subject to initiative or referendum. (See 36 Cal.3d at pp ) In enacting section 19(f), the voters are presumed to have been aware of this accepted judicial construction of that term, and to have adopted and incorporated it into the intended meaning of the phrase ratification by the Legislature. (Hill v. National Collegiate Athletic Assn. (1994) 7 Cal.4th 1, 23.) Respondents cannot and do not dispute any of the above. Instead, they proffer three arguments why they believe the phrase ratification by the Legislature in section 19(f) nevertheless should not be interpreted to preclude the use of a referendum to overturn the Legislature s action. None of Respondents arguments is availing, however, and upon closer analysis, they actually support Appellant s position, not Respondents position. Respondents first argument, put forward by the State, is that under traditional principles of statutory interpretation that are applicable to ballot measures such as Proposition 1A, the language of the measure should be construed in the context of the overall statutory scheme of which it is a part. 21

22 In the case of Proposition 1A, the State contends, the statutory scheme includes the pre-existing Government Code section , which permits tribal-state gaming compacts to be ratified under either a nonstatutory (Gov. Code, , subd. (b)) or a statutory (id., , subd. (c)) process. The State then asserts that Proposition 1A s language in subdivision (f) regarding the Legislature s ratification authority is not inconsistent with the Legislature s pre-existing statutory ratification options under Government Code section (State s RB, p. 12.) The initial flaw in the State s argument is that this last statement is manifestly incorrect. As the Legislative Counsel pointed out in its 2007 Opinion, there is at least one very significant difference between the ratification process set forth in article IV, section 19(f), and that set forth in the pre-existing Government Code section The Government Code provided that compacts shall be ratified by a statute approved by each house of the Legislature, a majority of the members thereof concurring, and signed by the Governor. (Gov. Code, , subd. (c) [italics added].) 5 Section 19(f), however, specifically removed the 5 Pointing to this language in Government Code section (c), Schmit suggests that the Legislature apparently did not get the memo about the well-settled meaning of ratification as not constituting legislation. It is Schmit, however, who disregards the principle that it is the substance, not the label, that controls. Schmit once again wrongly assumes that an action must be legislative merely because it takes the statutory form. The law is plainly to the contrary. 22

23 requirement that compacts must be ratified by a statute and simply made them subject to ratification by the Legislature. As the Legislative Counsel concluded, the procedure set forth in subdivision (f) for the ratification of tribal-state gaming compacts takes precedence to the extent that it conflicts with any statutory provisions on this subject, such as Section of the Government Code. Consequently, while the Legislature may elect to codify its actions by means of statute, it is not required to do so, and in our opinion may supercede any putative statutory restriction on the exercise of this power without regard to that codified rule. (2007 Leg. Counsel Op., pp. 5-6 [[AA 1:97-98].) 6 Thus, far from supporting Respondents contention that section 19(f) should not be interpreted to preclude the use of a referendum to overturn the Legislature s ratification of a compact, consideration of the overall statutory scheme in particular, consideration of the changes made to that 6 There are any number of reasons why the Legislature may choose to ratify a tribal-state gaming compact by means of a statute, even though it is not constitutionally required to do so. As indicated in the Legislative Counsel s opinion, the Legislature may simply wish to codify the ratification in the code books, so that a permanent and readily accessible record of its action is available for review. In addition, as was the case with AB 277 s ratification of North Fork s compact and SB 287 s earlier ratification of the eleven Pala compacts (see note 10, infra), the Legislature may wish to combine the ratification of the compact in the same measure with certain statutory changes necessary to implement the compact, in which case the statutory form must be used in order to effect the latter changes. (See AB 277 (2013) [proposing to add Gov. Code, , sub. (b), exempting certain compact-related actions from the definition of project under CEQA].) 23

24 scheme by section 19(f) only underscores that the voters understood and intended that the Legislature s ratification of a tribal-state gaming compact would not be subject to referendum. By affirmatively deleting the requirement that the Legislature must ratify a compact by a statute, section 19(f) left no doubt that ratification was not considered to be a legislative act, and therefore that it was not subject to referendum. 7 Government Code section undercuts Respondents argument in another manner, as well. As the State notes, subdivision (b) of that section provides that any tribal-state gaming compact that is certified by the Governor to be materially identical to any of the compacts previously ratified and listed in subdivision (a) of that section shall be deemed to be ratified if it is not rejected by a two-thirds vote of each house of the Legislature within 30 days of the Governor s submission of the compact to the Legislature. The ratification of these compacts which, despite having terms that might be materially identical to another tribe s compact, would nonetheless authorize class III gaming by a different Indian tribe, in a new location, at a unique gaming facility could thus occur without any action being taken by the Legislature at all, by statute or 7 The absence of the by statute language in section 19(f) is all the more notable because other provisions of that same constitutional provision explicitly refer to the Legislature acting by statute. (See, e.g., art. IV, 19, subd. (c) [ the Legislature by statute may authorize cities and counties to provide for bingo games ].) 24

25 otherwise. And since there was no legislative action taken, there would of course be no way for anyone to submit a referendum against the ratification of one of these compacts. That Government Code section authorizes this type of non-statutory, non-referendable procedure further supports the conclusion that the ratification of a tribal-state gaming compact whether by statute, by resolution, or by the passage of time alone cannot be considered the exercise of legislative power that is subject to initiative and referendum. Respondents second argument against interpreting the language of section 19(f) to preclude the use of a referendum, advanced by Schmit, takes issue with the very notion that the Legislature s ratification of a federal constitutional amendment is in any way analogous to its ratification of a tribal-state gaming compact, and thus that the interpretation of the term ratification in the former context should be imported into the latter. In particular, Schmit asserts that the Tribe is incorrect as a matter of law when it states the state Legislature does not derive its power to ratify a tribal-state compact from its inherent legislative power under the California Constitution, but from IGRA s narrow grant to the state of authority that would otherwise belong to Congress. (Schmit s RB, p. 34 [correcting Schmit s misquotation of AOB at pp ].) According to Schmit, [t]he authority to approve a compact is drawn from state law, not IGRA. (Ibid.) 25

26 Schmit is wrong. As Schmit s own quotation from Pueblo of Santa Ana v. Kelly (10th Cir. 1997) 104 F.3d 1546, indicates, state law determines the procedures by which a state may validly enter into a compact (id. at p [italics added]), but the authority of a state to enter into a gaming compact in the first instance is exclusively the result of Congress grant of such authority to the state in IGRA. Under the U.S. Constitution, a state has no jurisdiction over Indian lands unless Congress has ceded jurisdiction to the state. (California v. Cabazon Band of Mission Indians (1987) 480 U.S. 202, 207, 222.) Thus, when the Legislature ratifies a gaming compact under IGRA, it is not exercising the state s inherent lawmaking or regulatory authority over Indian gaming (because the state has no such authority), but is exercising a power that belongs in the first instance only to Congress, and that Congress has conferred upon the state in IGRA. (See generally Gaming Corp. of America v. Dorsey & Whitney (8th Cir. 1996) 88 F.3d 536, 546 [ Congress thus left states with no regulatory role over gaming except as expressly authorized by IGRA. Tribal-state compacts. are a creation of federal law, and IGRA prescribes the permissible scope of a Tribal-State compact. ].) Indeed, the authorities cited elsewhere in Schmit s brief refute her contention (at RB, p. 34) that the authority to enter into a tribal-state compact is drawn from state law, not IGRA. (See Schmit s RB, p. 38, discussing Seminole Tribe of Florida v. Florida (1996) 517 U.S. 44, 58 [IGRA extends to the 26

27 States a power withheld from them by the Constitution ] and Dalton v. Pataki (N.Y. 2005) 835 N.E.2d 1180, 1189 [ Through IGRA the states are granted a certain degree of authority over class III gaming that they otherwise would not have due to the sovereignty of Indian nations. ] [italics added].) 8 Thus, the role of a state Legislature in ratifying a class III tribal-state gaming compact is virtually identical to its role in ratifying a federal constitutional amendment. In neither context is the Legislature exercising its legislative power to create binding law that prescribes rules of conduct for its own citizens. In neither context is the Legislature initiating any action, as it typically would with legislation, but is instead merely giving its assent to a proposal that has been crafted by others (Congress in one instance, and the Governor and the Tribe in the other). In neither context 8 Schmit provides a misleading description of the Supreme Court s decision in Hotel Employees & Rest. Employees International Union v. Davis (1999) 21 Cal.4th 585, suggesting that the Legislature derives its power to ratify gaming compacts from state law because the Court in Hotel Employees held that an amendment to the California Constitution was needed in order to permit class III Indian gaming in California. A constitutional amendment was needed, however, only because IGRA provides that such gaming activities are lawful only if they are located in a State that permits such gaming for any purpose by any person, organization, or entity. (25 U.S.C., 2710, subd. (d)(1)(b).) Prior to the passage of Proposition 1A, Las Vegas-style casino gaming was prohibited throughout California; section 19(f) lifted that prohibition for federally recognized Indian tribes on Indian lands that entered into compacts with the state, thus satisfying this condition of IGRA. It is still IGRA, however not the state Constitution that gives the state and the Legislature the power to enter into gaming compacts in the first place. 27

28 can the Legislature subtract, add to, or change any of the terms of the proposal that is submitted to it for approval. And in neither context is the Legislature exercising the broad, inherent state legislative authority that is reserved to the people through the initiative and referendum power, but is instead exercising a narrow, restricted power that has been granted to the state by federal law, and to which the people s reserved power does not extend. (AFL-CIO, 36 Cal.3d at pp ) 9 9 Schmit is likewise incorrect in asserting that [t]he constitutional amendment cases on which the Tribe relies stand only for the proposition that the U.S. Constitution expressly provides for the manner in which states ratify amendments to the U.S. Constitution, and that ratification by state legislatures cannot be subject to referendum [b]ecause the states cannot prescribe their own methods of ratification. (Schmit s RB, p. 33.) The cases decided under article V of the U.S. Constitution hold that the ratification of constitutional amendments cannot be subject to referendum because the framers of the Constitution specifically asswigned that function to the legislatures as deliberative, representative bodies, and not by popular election. (See AFL-CIO, 36 Cal.3d at pp ) As the Court in AFL-CIO inventoried, however, there is another line of cases decided under various state constitutions holding that the action of a legislature in ratifying a constitutional amendment is not subject to referendum because it is not the making of a law or an act as understood in legislative parlance and [i]t was in no sense legislation. (Id. at pp [quoting the Supreme Courts of Michigan and Maine].) Other state cases held the reserved powers to be inapplicable to the ratification of constitutional amendments on the ground that a state in ratifying an amendment was not asserting legislative power under its own constitution, but exercising a power delegated to the state legislatures by article V of the federal Constitution. (Id. at pp ) None of the cases, however, hold that the states cannot prescribe their own methods of ratification (Schmit s RB, p. 33), as long as the decision is made by the legislative body and the legislators are free to vote their own considered judgment on the issue. In Kimble v. Swackhamer (1978) 94 Nev. 600, 584 P.2d 161, for example, the court upheld the people s use of a non-binding referendum advising 28

29 Respondents final argument merits only a brief response. The State suggests that because five referendum elections were previously held seeking to overturn the Legislature s ratification of tribal-state gaming compacts, this demonstrates that section 19(f) did not intend to limit the ability of voters to challenge compact ratification statutes through referendums. (State s RB, pp ) Of course, even a longstanding custom or practice whose validity has not been challenged is entitled to no deference (e.g., Special Assembly Interim Committee etc. v. Southard (1939) 13 Cal.2d 497, ), so the existence of five prior referendums on the ballot has no bearing on whether they or the instant referendum against the ratification of North Fork s compact were lawful or not. Nor do these elections say anything about the voters intent in enacting section 19(f), either. The State first points to Proposition 29, a referendum measure that appeared on the same March 2000 ballot as Proposition 1A, but which had actually been filed two years earlier against the Legislature s enactment of a statute that, among other provisions, ratified eleven tribal-state compacts negotiated by Governor Wilson (the Pala compacts ). 10 The State Nevada s legislators whether to ratify the Equal Rights Amendment. (See AFL-CIO, 36 Cal.3d at pp ) 10 It bears emphasizing that the statute challenged by the referendum in Proposition 29 like AB 277 in the present case did more than merely ratify the Pala compacts. That statute, SB 287, would also have designated 29

30 suggests that simply by voting on Proposition 29, the people were somehow indicating that they wanted to exercise their referendum right regarding compact ratification statutes, and that it would therefore be inconsistent to interpret Proposition 1A as limiting that right. Even leaving aside that Proposition 1A and Proposition 29 were actually presented to the voters as competing measures, the State s argument makes little sense. It is not as if the people who voted on Proposition 29 were somehow approving the use of the referendum to challenge the ratification of compacts; they were merely casting their ballots on the measure that was put before them. Indeed, at that same election, the voters were directly asked whether they wanted to enact a constitutional amendment that specifically removed the requirement that the Legislature must ratify tribal-state gaming compacts by a statute. The voters overwhelmingly approved that constitutional amendment and defeated the effort to overturn the Pala compacts by referendum. Thus, if anything, the message sent by the electorate at the March 2000 election was that the people were not in favor of using the referendum to deny Indian tribes the benefits of compacts that had been negotiated in good faith with the Governor and ratified by the Legislature. the Governor as the state officer responsible for negotiating and executing future compacts, would have authorized him to waive the state s sovereign immunity, would have specified a procedure for the Legislature s ratification of future compacts, and like AB 277 would have exempted certain specified actions related to the execution of the Pala compacts from CEQA. (See SB 287 (1998) [proposing to add Gov. Code, ].) 30

31 This was the same message that the voters sent in 2008, when they were asked to cast ballots on referendums against the Legislature s ratification of amendments to four tribal-state gaming compacts (Propositions 94, 95, 96, and 97), and when the people once again voted overwhelmingly to approve the compacts. 11 In any event, the existence of these referendums on the ballot in 2008 obviously says nothing about the intent of the voters in enacting Proposition 1A almost a decade earlier, in March That intent, according to the rules of statutory interpretation, should instead be discerned first from the language of the measure itself, giving those words their ordinary and customary meaning. In the case of section 19(f), the term ratification has a well-established meaning, and it is not an act of legislation within the proper sense of the word. (Hawke v. Smith, 253 U.S. at p. 229.) Accordingly, the Legislature s ratification of a tribal-state gaming compact pursuant to section 19(f) is not a legislative act subject to the people s reserved powers. 11 Notably, legal challenges had been filed and were pending against each of these referendums, but those lawsuits became moot and were dismissed when the referenda were unsuccessful. (See, e.g., Milanovich v. Bowen, 3d DCA Civ. No. C (2008) [appeal dismissed by stipulation of the parties].) 31

32 D. Both the 1998 and 2007 Legislative Counsel Opinions Support the Conclusion that the Legislature s Ratification of North Fork s Compact Pursuant to Article IV, Section 19(f), Is Not Subject to Referendum Although this is the first time that a California appellate court has been called upon to determine whether the Legislature s ratification of a tribal-state gaming compact is a legislative act subject to referendum, the issue has twice been considered by the Office of Legislative Counsel once, in 1998, before the adoption of Proposition 1A, and again in 2007, following the enactment of section 19(f). As noted in Appellant s Opening Brief (and not disputed by Respondents), Legislative Counsel opinions are entitled to great persuasive weight (Barratt Am., Inc. v. City of Rancho Cucamonga (2005) 37 Cal.4th 685, 697). In the present case, both Legislative Counsel opinions support the conclusion that the Legislature s ratification of North Fork s compact is not subject to referendum. In 1998, the Legislative Counsel was asked a number of questions related to the Legislature s enactment of SB 287, the bill that became the subject of Proposition 29 s referendum. (See note 10, supra.) The first question was whether the Legislature s ratification of a tribal-state compact by means of a bill approved by each house of the Legislature and signed by the Governor would be subject to referendum. (Leg. Counsel Op. No (Sep. 28, 1998) ( 1998 Leg. Counsel Op. ), pp. 1-3 [AA 1:81-83].) Significantly, the Legislative Counsel did not determine as Respondents 32

33 would have this Court hold that the ratification of a compact was subject to referendum simply because it took the form of a statute. Instead, the opinion undertook an analysis of the Legislature s action in the context of the overall constitutional and statutory scheme in order to determine whether the Legislature s action was legislative in character (id. at p. 2 [AA 1:82]), ultimately concluding that because it represents a change in the state s public policy on gambling, we think that the ratification by the Legislature of a tribal-state gaming compact constitutes a change in law that cannot be accomplished except by statute. Accordingly, if the bill by which this ratification was accomplished is not an urgency statute, then it is subject to the people s power of referendum. (Id. at p. 3 [AA 1:83] [italics added].) At the time of Legislative Counsel s 1998 opinion, neither the Constitution nor any statute authorized class III gaming or the execution of tribal-state compacts, so there was no expression of the state s public policy on Indian gaming other than what might be contained in an individual compact with a particular tribe. That changed, however, with the adoption of Proposition 1A and the addition of section 19(f) to the Constitution, which both (1) established the state policy permitting certain forms of class III gaming on Indian lands, and (2) prescribed a procedure for the Governor and any federally recognized Indian tribe to negotiate and execute a compact authorizing such gaming, subject to ratification by the 33

34 Legislature. In 2007, then, the Legislative Counsel was asked to reconsider its earlier opinion that the Legislature s ratification of a tribalstate compact constituted a change in law that cannot be accomplished except by statute. Specifically, the Legislative Counsel was asked whether a resolution is sufficient for ratification by the Legislature of a tribal-state gaming compact. This time, as previously mentioned (see note 4, supra), the Legislative Counsel determined that while the Legislature may elect to codify its actions by means of statute, it is not required to do so. (2007 Leg. Counsel Op., p. 6 [italics added] [AA 1:98].) In addition to relying upon the language of section 19(f), the 2007 Opinion cited with approval the Michigan Supreme Court s opinion in Taxpayers of Michigan Against Casinos v. State (Mich. 2004) 685 N.W.2d 221 ( TOMAC I ), which had reached a similar conclusion on the ground that the Legislature s ratification of tribal-state gaming compacts did not constitute legislation because the compacts were contracts between two sovereigns and did not involve the Legislature s unilateral regulation or unilateral[] exert[ion] of its will over the tribes involved. (2007 Leg. Counsel Op., p. 6 [AA 1:98].) Because the California Legislature s ratification of a tribalstate gaming compact pursuant to section 19(f) likewise did not constitute a legislative act, the Legislative Counsel s 2007 Opinion concluded that the Legislature is not required to ratify a tribal-state gaming compact by 34

35 means of a statute, but instead may do so by means of a resolution adopted by each house. (Id. at p. 7 [AA 1:99].) Thus, although the Legislative Counsel was not directly asked in 2007 whether the Legislature s ratification of a tribal-state gaming compact pursuant to section 19(f) is subject to referendum, its Opinion left no doubt about the answer: Ratification of a compact does not constitute legislation, and therefore the Legislature is not required to pass a statute to ratify a compact, but may act by a joint resolution. As the Court held in Hopping, the referendum does not apply to acts of legislative power which may be taken by joint resolution, but applies only to acts which must be passed in the form of a statute (170 Cal. at p. 609.) The ratification of a tribal-state gaming compact pursuant to section 19(f) is therefore not subject to referendum. E. The Ratification of a Tribal-State Compact Is Not Subject To Referendum Because It Does Not Constitute an Exercise of the Inherent State Lawmaking Power of the Legislature, But Merely Constitutes Its Approval of a Consensual Agreement Between Two Equal Sovereign Governments Appellant s Opening Brief demonstrated that even if the Court were to disregard the language of section 19(f) and the prior judicial decisions holding that ratification is not an act of legislation that is subject to initiative and referendum, the Legislature s ratification specifically of a tribal-state gaming compact cannot be considered to be an act of 35

36 lawmaking because the Legislature is not exercising its inherent authority under state law to prescribe rules governing the conduct of the state s citizens, but is merely giving its assent to the terms of a consensual agreement between two equal sovereign governments. As the Court explained in AFL-CIO, true legislation involves the unilateral exercise of the state s regulatory authority over its own citizens: The word law. imports a general rule of conduct with appropriate means for its enforcement declared by some authority possessing sovereign power over the subject; it implies command and not entreaty. (36 Cal.3d at p. 711 [citation omitted].) The Michigan Supreme Court relied upon precisely this rationale in ruling that the ratification of a tribal-state gaming compact does not constitute legislation that would have to be enacted by a statute: [T]he hallmark of legislation is unilateral imposition of legislative will. Such a unilateral imposition of legislative will is completely absent in the Legislature s approval of tribal-state gaming compacts under IGRA. (TOMAC I, 685 N.W.2d at p. 229; accord, Confederated Tribes of the Chehalis Reservation v. Johnson (1998) 135 Wash.2d 734, 750, 958 P.2d 260 [ Tribal-state gaming compacts are agreements, not legislation, and are interpreted as contracts. ].) Closer to home, the court of appeal in Worthington v. City Council of the City of Rohnert Park (2005) 130 Cal.App.4th 1132 likewise held that a city council s approval of an MOU 36

37 specifying a local Indian tribe s mitigation obligations for the impacts of its planned casino was not a legislative act subject to referendum because the MOU required the consent of the tribe: The give-and-take involved when a government entity negotiates an agreement with a sovereign Indian tribe is not legislation, but is a process requiring the consent of both contracting parties. (Id. at p ) Respondents try in vain to distinguish these cases, but they can do so only by distorting or simply ignoring the reasoning and stated grounds for the courts decisions. The State contends, for example, that Worthington s holding that the city council s approval of the MOU was not a legislative act is inapplicable to AB 277, because [u]nlike a state, which possesses some regulatory authority over class III gaming through negotiated compacts, a city council exercises no similar authority through an MOU. (State s RB, p. 19 [citations omitted].) The MOU, the State continues, did not decide whether or how the casino project should proceed and did not contain any rules or regulatory provisions, and thus the City Council s approval of the MOU was not legislation. (Id., pp ) North Fork s compact, by contrast, would have provided for meaningful State regulatory involvement regarding the scope, location, and operation of North Fork s proposed gaming facility. (Id., p. 20.) Schmit makes a similar argument, asserting that [w]hile the MOU at issue in Worthington was a contract not a law because the City had 37

38 Respondents miss (or at least pretend to miss) the principal point of the Worthington decision. The court did not rule that the MOU was not subject to referendum because the city council lacked the authority to regulate the development and operation of the proposed casino. 13 Rather, the court held that the council s approval of the MOU was not an exercise of its legislative power because it was a negotiated contractual agreement between the two parties, not the assertion of unilateral regulatory authority. (130 Cal.App.4th at pp ; accord, id. at p [ The City has merely bargained for some benefit for the community, it has not legislated no regulatory authority over Indian gaming, the same is not true for the compact here because the Legislature does have regulatory authority over Indian gaming and the compact prescribes regulatory duties to state agencies. (Schmit s RB, p. 45.) Schmit also points to provisions in North Fork s compact that it contends involve the state s unilateral regulation over non-indian entities who wish to conduct compact-related business on the Tribe s land, citing the requirement that all Gaming Resource Suppliers must pass a suitability determination conducted by the State Gaming Agency. (Id. at p. 44, fn. 8.) These are not examples of the state s unilateral regulation over private third parties, however. These are restrictions on the Tribe s conduct, voluntarily agreed to by the Tribe as part of its contract with the state; the Tribe has agreed in the compact that it will only do business with Gaming Resource Suppliers who are able to pass a suitability determination. This restriction is no different in kind than the Tribe s agreement in the compact that it will not allow gaming by minors, or that it will only hire personnel who are appropriately licensed. 13 Worthington discussed the city council s lack of authority to regulate Indian gaming only to make clear that the council had no ability to unilaterally enforce or require compliance with the terms of the MOU i.e., to exercise legislative power (130 Cal.App.4th at p. 1143) and therefore could only obtain mitigation through a negotiated consensual agreement with the tribe. 38

39 in this highly regulated field. Consequently, its action is not subject to the referendum process. ].) That rationale applies with equal force to the Legislature s ratification of North Fork s compact. To the extent that the compact provides the State with any regulatory involvement regarding the scope, location, and operation of North Fork s gaming facility, it is solely because the Tribe voluntarily agreed to these conditions as part of the negotiating process, not because the State has the unilateral legislative authority to dictate what the Tribe could or could not do. 14 The court s holding in Worthington therefore applies just as much to the Legislature s ratification of a tribal-state gaming compact as it does to the city council s adoption of the MOU in that case. Moreover, Respondents offer no substantive response to the wellreasoned and directly-on-point decision of the Michigan Supreme Court in TOMAC I. The State does not even mention the decision in its Respondent s Brief quite remarkable given that it is the only reported decision that addresses the precise question presented in this appeal: whether the Legislature s approval of a tribal-state gaming compact constitutes legislation. Schmit acknowledges TOMAC I, but attempts to 14 The State s own description of its supposed regulatory authority over Indian gaming acknowledges as much, observing that the State possesses some regulatory authority over class III gaming through negotiated compacts. (State s RB, p. 19 [italics added].) 39

40 dismiss it with the erroneous assertion that the decision was based on a unique aspect of the Michigan compacts at issue that they do not create any state agencies or impose any regulatory obligation on the state. (Schmit s RB, p. 40.) Not only can the same be said for the North Fork compact at issue in the present case, 15 but more importantly, that was not the basis for the court s decision in TOMAC I. Rather, the court unequivocally held that the Legislature s approval of the Michigan compacts did not constitute legislation because [i]n approving those compacts by resolution, the Legislature did not modify Michigan law in any respect; instead, the Legislature simply expressed its approval of valid contracts between two independent, sovereign entities. (685 N.W.2d at p. 223.) The same is true of the California Legislature s ratification of North Fork s compact Schmit states that North Fork s compact creates a State Gaming Agency and a State Designated Agency with the power to exercise the rights and fulfill the responsibilities established by this compact. (Schmit s RB, p. 41.) The compact does no such thing. The State Gaming Agency and State Designated Agency already exist; they would not be created by the North Fork compact. Likewise, the North Fork compact imposes no new regulatory obligations or duties upon any state agencies; all of the state regulatory functions referred to in North Fork s compact are already being performed for the more than 70 tribes with existing gaming compacts in the state. 16 Schmit contends that the decision in TOMAC I is contrary to the authority in other jurisdictions, which she asserts have concluded that approving a compact is a legislative act. (Schmit s RB, p. 39.) As the court explained in TOMAC I, however (see 685 N.W.2d at pp ), the cases cited by Schmit all involved efforts by state governors to 40

41 In sum, Respondents cannot overcome the central failing of their argument that the Legislature s ratification of a tribal-state gaming compact does not involve the unilateral imposition of legislative will or the exercise of the state s inherent lawmaking authority. North Fork s compact is not a law that governs the conduct of California s citizens. It is a negotiated agreement, created pursuant to federal law, between two sovereign governments, requiring the mutual consent of both the State and the Tribe. In giving its approval to that agreement, the Legislature did not engage in an act of legislation, regardless of the form that the enactment unilaterally execute tribal-state gaming compacts, without the approval of the legislature, that substantially changed or contravened existing state law. For example, in Kansas v. Finney (1992) 251 Kan. 559, 836 P.2d 1169, the compact at issue created a new state gaming agency, which the court found was a legislative function requiring legislative approval. Similarly, in New Mexico v. Johnson (1995) 120 N.M. 562, 904 P.2d 11 and Florida House of Representatives v. Crist (Fla. 2008) 999 So.2d 601, the compacts purported to authorize forms of gaming that were not otherwise permitted in the state, and the courts held that the compacts must therefore be presented to the Legislature for approval. And in Saratoga County Chamber of Commerce, Inc. v. Pataki (N.Y. 2003) 798 N.E.2d 1047, the court held that a compact unilaterally executed by the Governor usurped the Legislature s power by requiring the State Racing and Wagering Board to adopt new regulations without any prior legislative authorization. None of these decisions made any general pronouncement, as Schmit misleadingly suggests, that approving a compact is a legislative act. Equally importantly, North Fork s Compact contains no offending provisions, like those at issue in these separation of powers cases, that changes state law or contravenes the state s established policies, nor does it create or assign any new function to an existing state agency. Because the North Fork compact does not alter or violate existing policies, as occurred in each of these cases, its ratification by the Legislature does not constitute a legislative act and is not subject to being overturned by referendum. 41

42 might have taken. Accordingly, under well-established judicial authority dating back to the incorporation of the people s reserved powers into the California Constitution, the Legislature s ratification of North Fork s compact was not subject to referendum. II. WHEN CONSTRUED IN ACCORDANCE WITH IGRA, STATE LAW LEAVES NO ROOM FOR A REFERENDUM ON THE LEGISLATURE S RATIFICATION OF A TRIBAL- STATE COMPACT By their express terms, the state constitutional and statutory provisions establishing the tribal-state compacting process in California must operate in accordance with IGRA. 17 In light of that bedrock requirement, basic principles of statutory construction leave no room under state law for a referendum on a statute ratifying a compact. 18 The contrary view adopted by the Superior Court and advanced by Respondents on appeal rests on a tortured reading of section (f) and cannot be reconciled either with other provisions of the Government Code or with the State s longstanding practice. Moreover, permitting referenda to unratify compacts under state law after the State has submitted them to the Secretary of the Interior and they have gone into effect under federal law 17 See Cal. Const. art IV, 19(f); Gov. Code (f). 18 Although the questions before this Court are purely questions of state law, the state laws at issue should be interpreted in light of the federal legal framework within which they were enacted. (Choate v. Celite Corp. (2013) 215 Cal.App.4th 1460, 1466; Mabry v. Superior Court (2010) 185 Cal.App.4th 208, 231.) 42

43 would lead to absurd results that are manifestly not in accordance with IGRA for the reasons set forth in North Fork s Opening Brief (AOB, pp ). Respondents do not dispute that it would be absurd to allow a state referendum to un-ratify a compact that is in effect under federal law. Rather, they argue that the Legislature s ratification of the compact never took effect and that the Secretary of State should not have submitted the compact to the Secretary of the Interior for approval until after the referendum had been held. (See State s RB, p. 30 [ [T]he referendum was not an un-ratification of the North Fork Compact. ]; Schmit s RB, p. 51 [ If California waits to submit the compact until the ratifying statute takes effect as it should there is no danger that the compact will be approved under federal law before the state has entered into it. ].) 19 Respondents view would require the Court to ignore the plain text of section (f), other provisions of the Government Code, and the State s longstanding practice. The better view, North Fork submits, is that 19 An essential premise of Respondents argument is that state law determines whether a compact has been validly entered into under IGRA, 25 U.S.C. 2710(d)(1)(C). (See State s RB, pp ; Schmit s RB, pp ) North Fork recognizes that this Court is bound by the California Supreme Court s decision in Hotel Employees and Restaurant Employees International Union v. Davis (1999) 21 Cal.4th 585, 612, in which the Court followed the Tenth Circuit s decision in Pueblo of Santa Ana, 104 F.3d 1546 on this point, but it preserves for further review its contention that those decisions were wrongly decided and have been superseded by the promulgation of the regulations set forth at 25 C.F.R. Part

44 the scheme must be interpreted as leaving no room for a referendum to occur, and thus as not having contemplated that ratification was ever subject to referendum in the first place. A. The Superior Court s Construction Of Cal. Gov. Code (f) Was Incorrect The question of statutory construction before this Court turns on the proper meaning of the word receipt in section (f) of the Government Code, which provides: Upon receipt of a statute ratifying a tribal-state compact the Secretary of State shall forward a copy of the executed compact and the ratifying statute to the Secretary of the Interior for his or her review and approval, in accordance with federal law. The Superior Court held that [t]he Secretary of State is not in receipt of a statute ratifying a compact for purposes of Cal. Gov. Code (f) until that statute takes effect. (AA 2:464 [italics added].) More specifically, it held that the Secretary of State s obligations under Cal. Gov. Code (f) do not apply until the day after a referendum adopted the statute. (Ibid.) To sustain the Superior Court s construction, Respondents thus ask this Court to construe receipt of a statute ratifying a tribal-state compact to mean receipt of a statute ratifying a tribal state compact that has gone into effect under state law. (See Schmit s RB, p. 52; State s RB, pp ) That is, Respondents contend that the Secretary of State is required to 44

45 wait until the referendum process has played itself out rather than to act promptly upon receipt of the statute. That is simply not what the plain text of the Government Code directs. Not surprisingly, neither respondent offers any textual justification for their proposed construction of the statute; they simply contend that their view is compelled by the principle that courts should jealously guard the people s right to referendum (State s RB, p. 30; see also Schmit s RB, p. 56.). But that principle has its limits, and its application here begs the very question at issue, which is whether a right to referendum exists in the first place. 1. The Superior Court s Ruling Is Inconsistent With The Plain Text of Sections (f) And 9510 Of The Government Code Subjecting statutes ratifying tribal-state compacts to a referendum cannot be reconciled with the text of section (f) of the Government Code, which requires the Secretary of State to submit a compact for approval [u]pon receipt of the ratifying statute. This term cannot be read out of the statute; the plain meaning of receipt and its use in section 9510 of the Government Code both lead to the common-sense conclusion that the Secretary of State receives a statute when the Governor sends it to her, not at some later time. Schmit argues that Government Code section (f) s provision for receipt of a statute ratifying a tribal-state compact means receipt of a statute ratifying a tribal-state compact that has gone into 45

46 effect. (Schmit s RB, p. 52. [italics added].) But there is no basis to read these extraneous words into the provision. The Secretary of State receives a statute only once: when it is transmitted by the Governor. When the time period for a referendum expires, the Secretary of State does not receive the statute from anyone; she simply continues to have the statute she previously received. Schmit argues (RB p. 53) that North Fork ignores the difference between a statute and a bill, noting that Government Code section 9510 refers to receipt of [a] bill. But Schmit confuses the definitions of bill and statute under California law. The Constitution provides that a bill becomes a statute if it is signed by the Governor. (Cal. Const. art. IV, 10(a) [italics added].) It then becomes an enacted statute after the Governor transmits and the Secretary of State receives it. (In re Thierry S. (1977) 19 Cal.3d 727, ) No additional steps are necessary; a bill becomes a statute well before it becomes effective under state law. As a result, when the Governor transmitted a signed version of AB 277 to the Secretary of State on July 3, 2013 (AA 1:13), she received a ratifying statute that was enacted upon her receipt. Under the plain terms of section (f), she was thereupon required to forward a copy to the Secretary of the Interior, which she properly did here. 46

47 2. The Superior Court s Ruling Ignores The Distinction Between A Statute s Enactment Date And Its Effective Date For similar reasons, the Superior Court s construction ignores the basic distinction between a statute s date of enactment and its effective date. Under California law, the terms enactment and effective date have distinct meanings when applied to statutes. (County of Sacramento v. Llanes (2008) 168 Cal.App.4th 1165, 1174.) Section (f) does not permit the Secretary of State to wait until the ratifying statute becomes effective to submit it to the Secretary of the Interior for approval; it requires the Secretary of State to submit it when she is in receipt of the ratifying statute. If the Legislature meant to condition the Secretary of State s submission on a ratifying statute s effectiveness, it could and would have done so expressly. In County of Sacramento, the court rejected a construction of the relevant statute that would have delayed the start of the statutory time limit at issue from the statute s enactment to its effective date, reasoning that it strains credulity to suggest the Legislature meant effective date, when it said enactment. (168 Cal.App.4th at 1175.) The same reasoning applies here: Where the Legislature has expressly obligated the Secretary of State to submit the ratified compact to the Secretary of the Interior [u]pon receipt of the statute from the Governor i.e., upon the statute s 47

48 enactment there is no room to suggest the Legislature expected her obligations to be delayed until the statute takes effect. 3. The State s Submission Of The Compact To The Secretary Of The Interior Was Consistent With Its Longstanding Practice As explained in Appellant s Opening Brief (AOB, pp ), the State s longstanding practice is to chapter ratification statutes and to forward compacts to the Secretary of the Interior upon receipt of the Governor s transmission of the ratifying statute to the Secretary of State before waiting for any referenda to be held or the statute to take effect under state law. Respondents do not dispute that practice, which is directly at odds with the rule they ask this Court to adopt here. Indeed, neither respondent challenges the historical record at all. The State s only response is that the Secretary of State s task of forwarding compacts did not, and constitutionally could not, change AB 277 s effective date. (See State s RB, p. 24.) And Schmit s only response is that the historical fact of the State s longstanding practice cannot override a right to referendum. (See Schmit RB, pp ) But those points are not responsive to Appellant s argument. North Fork does not contend that the State s historical practice, by itself, could change the statute s effective date or overcome a right to referendum; rather, it contends that the longstanding practice is relevant to how the relevant state laws should be interpreted. Where, as here, that 48

49 historical practice conforms to the plain meaning of the relevant provisions, Respondents burden to establish their alternative interpretation is especially heavy. And for the reasons above, they have failed to meet that burden. 4. IGRA s Good-Faith Negotiation Requirement Is Not At Issue In This Litigation There is no occasion for this Court to address whether a referendum is consistent with IGRA s good-faith negotiation requirement. The State argues (State s RB 33-34) that California s referendum process does not conflict with IGRA s good-faith provision, 25 U.S.C. 2710(d)(3)(A). That is not at issue in this appeal; indeed, it is never mentioned in Appellant s Opening Brief. Rather (as the State acknowledges), it is the subject of separate litigation devoted to that issue now pending in federal court. B. The Policy Of Liberally Construing The People s Referendum Power Cannot Overcome The Plain Text Here Respondents invoke the principle that courts should jealously guard the people s reserved referendum and initiative power, but that principle does not change the outcome here, where the question is whether state law permits a referendum in the first place. And in determining whether state law permits a referendum, the policy of liberally construing the referendum power cannot overcome plain text to the contrary. 49

50 Courts will seek to protect the referendum power when exercised within the scope of the constitutional reservation. (See, e.g., Zaremberg v. Superior Court (2004) 115 Cal.App.4th 111, 120 [where referendum was in substantial compliance with statute requiring short title to be on each page of petition, validity of referendum upheld under policy of preserving right of referendum].) But where the Constitution provides otherwise, the presumption in favor of the referendum power does not apply. (See Geiger v. Board of Sup rs of Butte County (1957) 48 Cal.2d 832, 836 [ The listing of exceptions in the Constitution amounts to a declaration of policy against subjecting legislation concerning the excepted matters to a vote of the people. ].) Here, the framework created by article IV, section 19(f) of the Constitution and section (f) of the Government Code precludes the referendum from operating. As state law does not reserve the power of referendum, there is no right to be jealously guarded. Further, in applying the policy in favor of the referendum power, courts will not disregard the plain text of relevant state law in determining whether the referendum power applies. (See, e.g., DuBois v. Land (1963) 212 Cal.App.2d 563, 565 [ [T]he provisions of the statute are clear and not ambiguous and make no provision for such referendum. ]; see also Empire Waste Mgmt. v. Town of Windsor (1998) 67 Cal.App.4th 714 [ Such reluctance has been described either as a judicial policy of liberally construing the power of initiative and referendum or as a presumption in 50

51 favor of the power absent a clear showing of legislative intent to the contrary. ] [italics added].) In particular, where subjecting an act of the Legislature to referendum would impair or wholly destroy the efficacy of some other governmental power then in such case the courts may and should assume that the people intended no such result to flow from the application of those powers and that they do not so apply. (Hunt v. Mayor & Council of City of Riverside (1948) 31 Cal.2d 619, 629.) As discussed above, Government Code section (f) unambiguously requires the Secretary of State to submit a ratifying statute upon receipt, and subjecting the ratifying statute to referendum would have the effect of overriding this statutory obligation. This is an outcome contrary to the plain terms of the statute, and therefore contrary to the expectations of the people and the Legislature in providing for the ratification of tribal-state gaming compacts. A reading contrary to these plain terms cannot be sustained on the basis of the referendum-protecting policy. (See City of Malibu v. California Coastal Comm n (2004) 121 Cal.App.4th 989, 998 [ Permitting no time for a referendum is evidence no referendum was to be allowed. ].) CONCLUSION For the reasons stated above, the Superior Court s judgment should be reversed and the Superior Court should be directed to enter judgment granting the relief sought in Appellant s Cross-Complaint and declaring 51

52 that the referendum against AB 277 is invalid, void, and unenforceable insofar as it purports to overturn the Legislature s ratification of North Fork s tribal-state gaming compact. 52

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