How Austin City Council Tried To Mislead Voters About $1 Billion Ballot Measure

Austin Convention Center, Exhibit Halls 2–3

In a 3:00 a.m. vote on August 9, the Austin City Council adopted ballot language for a measure that ultimately could decide the fate of upwards of a billion dollars of city spending over the next decade.

Now, a state appeals court has invalidated that vote, ordering the city to alter the language before printing ballots for the election in November.

At issue are plans by City Council to spend $1.2 billion expanding the Austin Convention Center, using revenues from a city tax on hotel occupancy.

Shortly after the city adopted a resolution in May to move forward with these plans, opposition arose in the form of a group called Unconventional Austin. The group began a petition to cap spending on the convention center and redirect it to cultural, historic, and heritage tourism.

Under the city charter, any petition for a proposed ordinance with 20,000 valid signatures results in the matter being put before voters at the next election. If voters approve, then the proposal becomes law.

Unconventional Austin submitted its petition with over 30,000 signatures on July 12, and received a certificate of sufficiency from the city clerk on July 26.

So far so good for opponents of the new convention center.

Unfortunately for Unconventional Austin, the state Election Code empowers City Council itself to craft the wording of the ballot proposition. In other words, the very politicians who want to expand the convention center get to decide on how to describe the proposal opposing this.

To ensure fairness in this process, however, Texas courts have adopted a standard called the Dacus test, so-called for the case in which the standard was first established. The two parts of the Dacus test are: (1) Is the ballot proposal worded in such as way as to misrepresent a proposed ordinance’s character, purpose, or chief features? (2) Does it mislead voters by omitting certain chief features of the proposal?

On August 22, a three-judge panel of the Third Court of Appeals ruled that the Austin City Council had failed to meet this standard. “We hold that the ballot language is inadequate under the common-law standard for ballot integrity, and as a result, the City abused its discretion by adopting that language,” Chief Justice Jeff Rose wrote in a memorandum opinion.

The ballot language failed the Dacus test on two grounds, the Court found. First, the language was misleading in suggesting that the proposed ordinance would result in extra election costs, the Court found.

Under the ordinance, the City Council would need to seek voter approval in order to make improvements or expansions to the Convention Center beyond $20 million. The City’s stance was that, if the proposed ordinance became law, this voter approval would need to happen “at an election for which the City must pay.”

But plaintiff Nelson Linder, one of the petitioners and the head of the local NAACP chapter, argued that the city would incur additional election costs only under a narrow set of circumstances that could easily be avoided. “There is no mandatory cost to the City of Austin (and its taxpayers) for a convention center expansion election if Proposition B passes,” Linder’s attorney wrote in an Aug. 16 petition to the Court.

“The City elections for Council are held the first Tuesday in November of every even-numbered year. According to the Travis County Clerk, who administers for a charge all elections for the City, there is no additional cost to add a ballot measure to the City Council candidate ballot. (This Council regularly adds ballot measures in November of even-numbered years to avoid additional costs).”

The petition added, “While the City could call the election in May and incur election costs, the Council regularly can and does avoid any cost by having ballot measures on even-numbered year November ballots. In short, it is misleading to state that taxpayers must pay for a convention center expansion election…”

City attorneys countered, “Texas law allows municipalities to hold elections on four different election dates… There is no way to know in advance whether the $20,000,000 convention center election would be triggered and then conducted on the only uniform date Petitioner chooses to mention or instead on one of the other three uniform dates.”

The Court of Appeals sided with Linder and Unconventional Austin. Justice Rose stated, “the ballot language ordered by the City Council affirmatively misrepresents future election costs associated with the ordinance.” Rose reasoned that the proposed ordinance would require voter approval for Convention Center costs “at the next required uniform election date” — or in other words, “in the next otherwise-occurring election.”

He then ordered the city to strike from its ballot language the phrase “at an election for which the City must pay.”

The second part of the Dacus test is whether a ballot measure misleads voters by omitting certain chief features of a proposed ordinance. The Court found that the City’s ballot language failed this test too.

Justice Rose stated, “The ballot language ordered by the City Council… omits a chief feature of the proposed ordinance — the fact that the ordinance would require the City to prioritize the spending of hotel-occupancy tax revenue on cultural arts, historic preservation, and ‘Austin’s Cultural Tourism Industry,’ to the exclusion of other uses allowable under the Tax Code.”

The petitioner, NAACP President Nelson Linder, had contended that this was a central component of the proposed ordinance, affecting the allocation of approximately $100 million in hotel-occupancy taxes raised every year.

The Court agreed: “Although the ballot language expressly explains the limit placed on convention-center spending, it does not mention the requirements specified for spending on other categories. As noted, the proposed ordinance would require not less than 15% of hotel-occupancy tax revenue to be spent on cultural arts and not less than 15% to be spent on historic preservation.”

Lawyers for the City of Austin had argued that under the City Charter ordinances “appropriating money” are not an allowable subject of the citizen initiative process: “The Petitioner’s argument about redirection of revenue is based on an assumption about appropriations through the city budget process… the council would not want to describe the ordinance in a way that renders it an improper subject for initiative.”

The Court rejected this argument, saying the validity of the proposed ordinance under the City Charter was not at issue in the proceeding. The Court then directed the City to add information to the ballot to inform voters on how that the proposed ordinance would require the City to prioritize the spending of hotel-occupancy tax revenue.

The Court’s order was issued under an Election Code statute empowering a court “to issue a write of mandamus to compel the performance of any duty imposed by law in connection with the holding of an election.”

Not all members of City Council had supported using misleading ballot language. Some had foreseen legal trouble. Members Katie Tovo, Leslie Pool, and Anne Kitchen voted to use the petitioner’s original proposed langauge.

But Mayor Steve Adler pushed the Council to modify the language to omit the redirection of funds. Adler said, “I wouldn’t want… to create the impression that it’s created new spending areas, because it hasn’t. What should go to the voters tonight is: Should we be capping the amount of HOT [hotel-occupancy tax] money that should be spent on the Convention Center?”

Council Member Kitchen expressed reluctance, saying, “I think that one of the tenets of the law, in terms of what criteria are for setting the ballot language, is that we cannot omit certain chief features that reflect the measure’s character and purpose. I feel really very strongly about this, that… to refer to it in a way other than cultural tourism would be omitting a key feature, and I cannot support that.”

Tovo agreed: “I think that the emphasis on cultural tourism was a key element in the [ordinance] and… it belongs in the ballot language.”

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Honest Austin

Original reporting on local Austin news, Texas politics, and the economy. honestaustin.com