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December 7, 2006

State Supreme Court says I-776 unconstitutional

Posted by David Postman at 9:05 AM

In an 8-1 decision the Supreme Court this morning upheld a King Pierce County Superior Court judge who ruled that Tim Eyman's Initiative 776 "impairs the contract between the bondholders and Sound Transit."

Justice Barbara Madsen, writing for the majority, said:

The crux of the intervenors' argument appears to be that the people, through initiative, have the right to repeal taxes, pledged as security for capital intensive projects such as highways and bridges, when they no longer want to pay such taxes. However, the contract clause of our state constitution guarantees that "No . . . law impairing the obligations of contracts shall ever be passed."

Madsen said if the court accepted Eyman's argument that voters have the right to repeal taxes even if the money were obligated to pay off bonds:

we would imperil the ability of state and local governments to finance essential public works projects such as elementary schools, fire stations, highways, and bridges, by casting considerable doubt on the reliability of pledged funding sources. We decline to do so.

Justice Richard Sanders was the lone dissenter. And he relies on a compelling legal source in a footnote:

In principle, I admire the Lochnerian rigor with which the majority defends the sanctity of contractual obligation. Lochner v. New York, 198 U.S.45, 25 S. Ct. 539, 49 L. Ed. 937 (1905). Unfortunately, its proposed remedy finds no support in the law. In contracts, as in love, "you can't always get what you want," but the law of remedies ensures "you get what you need."8


8 The Rolling Stones, You Can't Always Get What You Want, on Let It Bleed
(ABKCO 1969).

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