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California State Capitol (Photo: Kevin Sanders for California Globe).

Are Legislative Findings in Lottery Act Bills Sufficient?

Another example is California’s AUMA allowing the adult use of cannabis initiative statute

By Chris Micheli, October 8, 2022 11:05 am

In reviewing recently-passed legislation that proposes amendments to the California State Lottery Act, as enacted by the voters by Prop. 37 in 1984, the same legislative finding and declaration is made in each bill. It is a simplistic statement that raises the question whether this language meets the requirements of Prop. 37.

Prop. 37 enacted the California State Lottery Act, which amended the California Constitution, as well as added numerous sections to the California Government Code. Section 5 of Prop. 37 provides the following:

No provision of this act may be changed except to further its purpose by a bill passed by a vote of two-thirds of the membership of both houses of the legislature and signed by the Governor.

Prop. 37 was a constitutional and statutory initiative enacted by the People and allows the California State Lottery Act’s Government Code provisions to be amended by the Legislature. The act provides that any provision of the Act may be amended by a 2/3 vote of the Legislature, so long as that amendment “further its purpose.”

Recall that Article II, Section 10 of the California Constitution provides in Subdivision (c)

The Legislature may amend or repeal a referendum statute. The Legislature may amend or repeal an initiative statute by another statute that becomes effective only when approved by the electors unless the initiative statute permits amendment or repeal without the electors’ approval.

This constitutional provision only allows an initiative that was adopted by the state’s voters to be amended by the Legislature (such as Prop. 37) if the initiative permits amendment without the electorate’s approval. Prop. 37 does allow amendment by the Legislature as described above.

As a result, the Legislature may amend Prop. 37. So, when the Legislature desires to amend Prop. 37, it includes in a “plus section” (which can be seen at the end of a bill that proposes to amend the California State Lottery Act) a legislative finding and declaration. The following is an example of what is contained in these Prop. 37 amendment bills:

The Legislature finds and declares that Section __ of this act furthers the purposes of the California State Lottery Act of 1984, enacted by Proposition 37 at the November 6, 1984, statewide general election.

The question to address is whether the language in the above example is sufficient or if there should be some explanation why the Legislature believes that Prop. 37’s stated purposes are being furthered by the proposed amendment and that the proposed amendment is consistent with Prop. 63. What are those stated purposes? In Government Code Section 8880.1, the following language can be found in the act:

Purpose and Intent

The People of the State of California declare that the purpose of this Act is support for preservation of the rights, liberties and welfare of the people by providing additional monies to benefit education without the imposition of additional or increased taxes.

The People of the State of California further declare that it is their intent that the net revenues of the California State Lottery shall not be used as substitute funds but rather shall supplement the total amount of money allocated for public education in California.

Unfortunately, bills amending Prop. 37 that contain a simple statement as set forth above do not in any way explain why the Legislature actually believes the proposed amendment “furthers the purpose” the California State Lottery Act. Instead, the bill merely states the legislative finding and declaration without any further justification or explanation provided.

So, as with other bills that require legislative findings and declarations, should the bills that propose amendments to Prop. 37 include reference to any of Prop. 37’s specified declarations or purposes?

This approach, providing a short explanation, is the approach often taken with urgency clauses and special statutes. If courts examine the urgency clause or special statute findings, there is at least a short sentence or paragraph that explains why the Legislature has determined a particular bill needs an urgency clause or why the bill qualifies as a special statute.

As another example, California’s AUMA (allowing the adult use of cannabis) initiative statute similarly allows legislative amendment if those amendments further the purposes of the AUMA. A recent bill amending the AUMA contains what could be an example for Prop. 37 amendment bills:

The Legislature finds and declares that this act furthers the purposes and intent of the Control, Regulate and Tax Adult Use of Marijuana Act (AUMA) by accomplishing all of the following:

(a) Preventing the illegal diversion of cannabis to other states by providing legal and regulated channels for multistate commercial cannabis activities.

(b) Reducing barriers to entry into the legal, regulated market by providing additional legal outlets for cannabis and cannabis products produced in California.

(c) Ensuring that cannabis and cannabis products produced in other states and sold in this state meet the same testing and packaging requirements required under AUMA.

So, perhaps the bills that propose to amend Prop. 37 should also provide some rationale for their proposed amendment(s) so that, if the legislation were challenged in litigation, courts would have a basis for understanding why the Legislature determined the bill made an amendment to Prop. 37 that furthered its purposes. As a result, the Legislature should consider adding some explanatory language to their simple statements in Prop. 37-amendment bills going forward.

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