Adams v. Fort Madison Community School District

BECKER, Justice.

I respectfully dissent.

The precise issue before us; i.e., whether extraordinary majority requirements in bond issue cases are constitutional, has been decided by three states and a three-judge federal court in the past IS months. Idaho has held such a requirement constitutional. Bogert v. Kinzer, 93 Idaho 515 , 465 P.2d 639 (March 1970). A three-judge federal court held Missouri’s constitutional two-thirds-majority requirement constitutional. Brenner v. School District of Kansas City, D.C., 315 F.Supp. 627 (August 1970). West Virginia and California held such requirements unconstitutional and therefore void. Lance v. Board of Education of County of Roane, 170 S.E.2d 783 (W.Va., July 1969); Westbrook v. Mihaly, 2 Cal.3d 765 , 87 Cal.Rptr. 839 , 471 P.2d 487 (July 1970). The latter two states reach the proper conclusion.

I. Division I of the majority opinion recognizes the extraordinary majority requirement is in fact discriminatory against the “yes” voters. One cannot quarrel with this conclusion.

II. Division II of the opinion recognizes that simple majority rule is clearly a basic tenet of our political system. The opinion then proceeds to demonstrate that simple majority rule is not invariably applied in our American system. This latter demonstration is beside the point. The United States Supreme Court has said that weighted voting may be allowed if there is such a compelling state interest as to require such allowance. Westbrook v. Mihaly, supra, and Rimarcik v. Johansen, 310 F.Supp. 61 (D.C. 1970). For this reason the decision in the instant case does not hinge on whether all statutes requiring an extraordinary majority are unconstitutional. The answer depends on the state interest involved.

III. In the latter half of Division III the majority first addresses itself to' the basic question of whether the state need only show a rational basis for the discrimination inherent in weighted voting: or whether it must show a compelling state interest to justify such discrimination. The court states it does not make any difference which approach is used; the state has shown both a rational basis and a compelling state interest. I respectfully disagree.

IV. The necessity for showing compelling state interest is fundamental to the decision reached here. This is demonstrated by the majority opinion itself. The opinion builds a careful case for showing the discrimination practiced here has a rational basis. The compelling state interest portion of the division is disposed of in one paragraph which assumes, rather than demonstrates, a compelling state interest. We must therefore first inquire as to the validity of use of the rational basis test.

Ordinarily there is a strong presumption of constitutionality accorded the statutes of a state. We have said, “ * * * a statute will not be declared unconstitutional unless it clearly, palpably, and without doubt infringes the constitution.” Lee Enterprises, Inc. v. Iowa State Tax Comm’n., (Iowa 1968) 162 N.W.2d 730, 737 . However, this well-settled general rule is not applicable to statutes involving voting rights.

Reynolds v. Sims, 377 U.S. 533, 561, 562 , 84 S.Ct. 1362 , 12 L.Ed.2d 506 (1964) states: “ * * * Like Skinner v. Oklahoma, 316 U.S. 535 , 62 S.Ct. 1110 , 86 L.Ed. 1655 , such a case ‘touches a sensitive and important area of human rights,’ and ‘involves one of the basic civil rights of man,’ presenting questions of alleged ‘invidious discriminations * * * against groups or types of individuals in violation of the constitutional guaranty of just and equal laws.’ 316 U.S. at 536, 541 , 62 S.Ct. *143 [1110] at 1113 [ 86 L.Ed. at 1657, 1660 ], Undoubtedly, the right of suffrage is a fundamental matter in a free and democratic society. * * Therefore the court concluded, “the right of citizens to vote must be carefully and meticulously scrutinized.”

This was followed by Kramer v. Union Free Sch. Dist, 395 U.S. 621, 627-628 , 89 S.Ct. 1886, 1890, 1892-1893 , 23 L.Ed.2d 583, 590, 593 (1969), which states:

“* * * Accordingly, when we are reviewing statutes which deny some residents the right to vote, the general presumption of constitutionality afforded state statutes and the traditional approval given state classifications if the Court can conceive of a ‘rational basis’ for the distinctions made are not applicable. * * *.

"* * * But the issue is not whether the legislative judgments are rational. A more exacting standard obtains. The issue is whether the § 2012 requirements do in fact sufficiently further a compelling state interest to justify denying the franchise to appellant and members of his class. * * *.” (Emphasis supplied).

In Cipriano v. Houma, infra, the court said: “* * * ‘the Court must determine whether exclusions are necessary to promote a compelling state interest.’ * * * .

“* * * When, as in this case, the State’s sole justification for the statute is that the classification provides a ‘rational basis’ for limiting the franchise to those voters with a ‘special interest,’ The statute clearly does not meet the ‘exacting standard of precision we require of statutes which selectively distribute the franchise.’” (Loc. cit. 395 U.S. 701 , 89 S.Ct. 1897 at page 1899-1900, 23 L.Ed.2d 647 at page 650, 652).

Most recently the Supreme Court in City of Phoenix v. Kolodziejski, (June 23, 1970) 399 U.S. 204 , 90 S.Ct. 1990, 1994 , 26 L.Ed.2d 523, 527-528 , stated: “ * * * Presumptively, when all citizens are affected in important ways by a governmental decision subject to a referendum, the Constitution does not permit weighted voting or the exclusion of otherwise qualified citizens from the franchise. * * *. Placing such power in property owners alone can be justified only by some overriding interest of those owners which the State is entitled to recognize.” (Emphasis supplied.)

It is therefore submitted that weighted voting is presumptively unconstitutional and is justified only if a compelling state interest can be demonstrated as a basis for such discrimination. Westbrook v. Mihaly, 2 Cal.3d 765 , 87 Cal.Rptr. 839 , 471 P.2d 487 , (July 15, 1970); Rimarcik v. Johansen, 310 F.Supp. 61 (1970). If this is true, the rational basis demonstrated by the majority is clearly insufficient.

V. In approaching the question of compelling state interest it is also well to be cognizant of the compelling voter interest. The question of whether an extraordinary majority requirement is in fact discriminatory does not require extended discussion. The effect of a 60 percent majority requirement in bond issue elections is to debase or dilute the weight of an affirmative vote in relation to a negative vote. The statement made in Gray v. Sanders, 372 U.S. 368, 379 , 83 S.Ct. 801, 809 , 9 L.Ed.2d 821, 829 , (1963) is analogous: “* * * If a State in a statewide election weighted the male vote more heavily than the female vote or the white vote more heavily than the Negro vote, none could successfully contend that that discrimination was allowable. * * It is equally apparent that when the vote is weighted because it is negative rather than affirmative, discrimination occurs. Westbrook v. Mihaly, 2 Cal.3d 765 , 87 Cal.Rptr. 839 , 471 P.2d 487 .

In Cipriano v. Houma, 395 U.S. 701 , 89 S.Ct. 1897 , 23 L.Ed.2d 647, 651 , (1969), the U.S. Supreme Court said: “For, as we noted in Carrington v. Rash, 380 U.S. 89, 94 , 85 S.Ct. 775 , 13 L.Ed.2d 675, 679 *144 (1965), ‘“[fjencing out” from the franchise a sector of the population because of the way they may vote is constitutionally impermissible.’ ” Whether the voter is denied the right to vote entirely or has his vote diluted, the principle applies.

We should note the practical effect of this discriminatory effect on the Iowa school bond issue experience. In Gibson v. Winterset Comm. Sch. Dist., 258 Iowa 440 , 138 N.W.2d 112 (1965), the opinion shows the same bond issue was submitted six times; the record (but not the opinon) indicates the bond issue failed six times over a period of seven years. The vote counts were:

1959 $850,000 38 ⅜ 62%

1960 890,000 43% 57%

1963 845,000 50.5% 49.5%

Jan. 1964 845,000 56.7% 43.3%

July 1964 845,000 58.8% 41.2%

1965 845,000 58.4% 41.6% 1

The amicus curiae brief by the Attorney General supplies a list of school bond elections in Iowa for the 1960-1970 decennium. The list indicates the Winterset experience is not unusual. It shows 384 elections. 100 elections resulted in affirmative votes of over 60 percent; 127 elections received affirmative votes of less than 50 percent and would have been defeated in any event; 114 elections resulted in a vote of over 50 percent but less than 60 percent. This last category represents 29.7 percent of all elections held in which the will of clear majority of the electorate was thwarted. These results occurred after a majority of the school board (elected by majority vote) determined there was sufficient need for the improvements to justify submitting the matter to the electorate.

Stated otherwise a majority of the voting electorate wanted the bonds issued in 56 percent of the elections but the majority prevailed only 26 percent of the time. It is fair to say that a clear majority of voters also have a compelling interest; not in weighted voting but in equal treatment.

VI. There is an inherent contradiction in the argument against the so-called tyranny of the majority. The contradiction is cloaked by a quote from the New Republic (September 1969) magazine found in Bogert v. Kinzer, 93 Idaho 515 , 465 P.2d 639 , “so that government may rest on widespread consent rather than teetering on the knife-edge of a transient 51 percent.” The record of school bond elections in Iowa is otherwise. The knife edge is just as sharp at 61 percent as it is at 51 percent. Indeed, for those who have produced a substantial majority in election after election but have been thwarted by a 40 percent minority, the knife may be even sharper at the higher figure.

VII. The arguments in favor of finding a compelling state interest to justify an extraordinary majority requirement in bond issue cases are largely economic. The unfortunate early history of bonded indebtedness of local government units has been reviewed in detail: Cf. Note, Judicial Activism and Municipal Bonds: Killing Two-Thirds With One Stone?, (March 1970) 56 Virginia Law Rev. 295, 300, 301. The over-extension of municipal bonded indebtedness in the last half of the 19th Century is traced and the reaction noted:

“ * * * The Panic of 1873 and the end of ‘cheap money’ hopes stirred a reaction against unrestricted borrowing. As defaults multiplied, taxpayers, bondholders and grange units united to oppose easy borrowing. Constitutional conventions were called in many states, resulting in the imposition of debt ceilings and referendum requirements.” Iowa did not amend its constitution as did many other states. Instead it waited until 1931, at the beginning of the depression, to impose the 60 percent requirement by legislative action, Iowa *145 Code, 1966, section 75.1. At the present time 23 of the 50 states require an extraordinary majority; 27 do not. Appendix to note, 56 Virginia Law Rev., page 331.

The California Supreme Court in West-brook v. Mihaly, supra, makes the following statements in relation to the compelling interest problem:

“We do not think respondents have demonstrated that bond-finance decisions are fundamentally different from many other political decisions made by a majority vote or by representatives elected by a majority vote. Even assuming, however, that respondents had done so we think their argument fails at another level. This justification for the extraordinary majority requirement rests on the premise that a decision to undertake a project such as the construction of schools and playgrounds is qualitatively different from a decision not to do so. This, in turn, is based on the assumption that spending money is a more serious matter than not spending it and, consequently, must be justified whereas frugality is self-justifying. A predisposition to thrift may serve a man well. It does not, however, justify governmental inertia, especially when government is faced with critical social problems demanding urgent and sometimes costly remedies. There is no presumption in favor of inaction, as the United States Supreme Court observed in Avery v. Midland County, supra, 390 U.S. 474, 484 , 88 S.Ct. 1114, 1120 [ 20 L.Ed.2d 45 ]: ‘[W]e might point out that a decision not to exercise a function within [local government’s] power — a decision, for example, not to build an airport or a library, or not to participate in the federal food stamp program — is just as much a decision affecting all citizens * * * as an affirmative decision.’

“In sum, we do not believe that the nature of general obligation bond financing warrants diluting the votes of those who want action, in order to institutionalize a preference for the interests of those who want stasis. (Hunter v. Erickson, supra, 393 U.S. 385, 392-393 , 89 S.Ct. 557 [ 21 L. Ed.2d 616 ].)” (Loc. cit. 87 Cal.Rptr. at page 859 , 471 P.2d at page 507 .)

In Westbrook v. Mihaly, supra, the court concluded: “We find nothing to support respondents’ grim warnings of financial disaster in the absence of a two-thirds vote requirement. We must, therefore, conclude that that provision is not necessary to insure the solvency of our local governments.” The 27 states that do not require an extraordinary majority have not been shown to have suffered financial catastrophe nor is there any evidence that their bonds are less acceptable on the market. The basic reasons for rejecting the economic argument are set forth in Public Affairs Report, Bulletin of the Institute of Governmental Studies, University of California, Berkeley, Vol. 10, No. 4, August 1969:

“Regardless of whether the requirement could be considered appropriate for the conditions prevailing in the late 1800’s, it is obvious that virtually every factor that may then have been relevant has since changed drastically. For example, great improvements have been made in the quality and integrity both of the legislative processes and of financial administration. Local legislative bodies of the present are far more responsible than their counterparts were a century ago. A corps of highly trained professional administrators, finance officers, and financial/bond consultants is available to serve even the smallest jurisdictions.

“Numerous modern procedures of fiscal administration have been developed since 1879. A host of auditing and financial accounting requirements have been written into law. The bond market itself is subject to safeguards precluding most of the practices that the 1879 constitutional provision was probably intended to correct. For example, greatly improved reporting procedures are now in effect, assuring that full and accurate information on the financial and legal ramifications of individual *146 bond issues is supplied to prospective buyers. ' Highly qualified bond consulting firms, specialized' legal counsel, and careful bond issue evaluation by respected national rating agencies, have all built strong public confidencé ’ in most local bond offerings. The sense of security appears to(be gener- / al, and is not limited to; states-requiring an extraordinary majority'vote. This fact, in „ itself, strongly suggests that the many, institutional and procedural improvements outlined here — and not the two-thirds re- ' quirement — are responsible for the soundness of modern', local ¡capital outlay finance.” ' • ■

VIII. The arguments in favor of weighted voting seem .to1 assume that all adverse votes are motivated by economic .considerations alone and should therefore receive additional weight. The motivation for a negative vote lies in the heart and mind of the voter. Many negative votes are cast for other than purely economic reasons; to name a few, the voter does not like the school board membership or the superintendent; the parochial school oriented voters decide to vote “no” in large numbers; the school will be built on the other side of town or in a different town; the voter does not like swimming pools in high schools; there is need for a grade school on the voters’ side of the district which has been left out of the program; the whole program will advantage one economic or ethnic group more than another. There are a host of other motivations for voting “no”. Their validity need be apparent only to the person voting.

Once the vote is weighted in favor of the negative side it is so weighted for all votes cast. It need hardly be argued that negative votes based on some of the above motivations should not, as a matter of compelling state interest, count for 1.5 times as much as the affirmative vote.

IX. Further, the state has adequate sources for controlling the amounts of bonded indebtedness without resorting to a discriminatory vote formula. Controls have already been exercised: (1) limitation of bonded indebtedness to a percentage of the value of the property within the taxing district, Iowa Constitution, Article XI, section 3; (2) requirement that a referendum be held, (3) bonds to mature in a specified time, (4) limitation on interest rates, Iowa Code, section 296.1, and (5) requirements for public hearings before public improvements contracts in excess of $5000 are undertaken, Iowa Code, 1966, 'chapter 23. It seems needless to add that the legislature could prohibit bonded indebtedness altogether or could limit such indebtedness to a fixed amount.

The referendum requirement is itself a legislative control. But when this control is used it must comply with the United States Constitution. As stated in Lance v. Board of Education of County of Roane, 170 S.E.2d 783, 791 (1969 W.Va.) :

“ * * * when the voter was constitutionally granted the right to vote on these important issues, he thereby became guaranteed the equal protection of the law under the Fourteenth Amendment and the constitutional right to have his vote accorded the same weight, effect and force as that of any other person’s vote, * * This is the controlling rule in the absence of a showing of compelling state interest. None is shown here.

X. The state relies heavily on Waugh v. Shirer, 216 Iowa 468 , 249 N.W. 246 (1933). The 60 percent majority requirement in section 75.1 was held to be constitutional as it applied to a county bond issue for road building purposes. Federal constitutional issues were not raised or decided. The one-person, one-vote principle contained in Gray v. Sanders, supra, had not been formulated in 1933. In light of such development, Waugh’ v. Shirer, supra, should be overruled.

XI. A reversal of this case and a holding that the extraordinary voting majority requirements in our statute are unconstitutional would require consideration of the prospective-retrospective problems inher *147 ent in such decision. In their reply brief plaintiffs with commendable frankness acknowledge there would probably be difficulties arising from the grant of a writ of mandamus in this case at this time. The reasons given are the success of the school board in taking care of part of their building program, changes in building costs and interest rates on the bonds. While it is not directly necessary to this dissent, it seems appropriate to suggest this is one of the rare cases which might be made wholly prospective in its effect; that is, the ruling would affect no election held before the date of the opinion and would not affect the election in question. This procedure was used by the Supreme Court of California in Westbrook v. Mihaly, 2 Cal.3d 765 , 87 Cal.Rptr. 839 , 471 P.2d 487 (1970), in a super majority bond issue case and by the Minnesota Supreme Court in Spanel v. Mounds View Sch. Dist. No. 621, 264 Minn. 279 , 118 N.W.2d 795, 803 (1962), in connection with governmental immunity. These problems have been handled by this court and other courts in similar cases. Cf. Kruidenier v. McCulloch, 258 Iowa 1121 , 142 N.W.2d 355 ; In Re Legislative Districting of General Assembly, 175 N. W.2d 20 (Iowa 1970). They present no insurmountable difficulties.

For the foregoing reasons I would hold the 60 percent majority requirements found in sections 75.1 and 296.6, Iowa Code, 1966, are unconstitutional in that they violate Article I, section 6 of the Iowa Constitution and Amendment 14 of the United States Constitution. Meyer v. Campbell, 260 Iowa 1346 , 152 N.W.2d 617, 621 (1967), quotes the controlling principle from Gray v. Sanders, 372 U.S. 368 , 83 S. Ct. 801 , 9 L.Ed.2d 821 (1963):

“ * * * ‘The concept of “we the people” under the Constitution visualizes no preferred class of voters but equality among those who meet the basic qualifications.’ ”

RAWLINGS and REES, JJ., join in this dissent.

. In March 1966 a $500,000 issue was submitted and lost; 66 percent “nay”, 34 percent “yea”. In October 1966 a $982,-000 issue was approved by 63.6 percent of the voters. Appendix to Attorney General’s Amicus Curiae Brief.