November 22, 1991
JAY HESSEY, APPELLANT
DISTRICT OF COLUMBIA BOARD OF ELECTIONS AND ETHICS, ET AL., APPELLEES; GOTTLIEB SIMON, APPELLANT V. DISTRICT OF COLUMBIA BOARD OF ELECTIONS AND ETHICS, ET AL., APPELLEES
Appeals from the Superior Court of the District of Columbia; (Hon. Emmet G. Sullivan and Hon. Curtis E. von Kann, Trial Judges)
Before Rogers, Chief Judge, and Ferren, Terry, Steadman, Schwelb, Farrell, and Wagner, Associate Judges, and Belson,* Senior Judge
The opinion of the court was delivered by: Rogers
On Rehearing En Banc
Rogers, Chief Judge: Before the en banc court for the first time in a decade is the question of the scope of the right of initiative. *fn1 D.C. Code § 1-281 (a) (1987 Repl.). The issue arises in one context of two proposed initiatives that would impose fees or tax surcharges to be deposited in trust funds devoted to low and moderate income housing purposes. The question before the court is whether these initiatives fall within the prohibition of "laws appropriating funds" contained in D.C. Code § 1-281 (a) (1987 Repl.) or other limitation on the initiative right. The fundamental underlying question, however, is who is to be in charge of the District government's local financial management, the District's elected officials or the electorate by initiative. The answer necessarily requires consideration of the unique role of the Mayor and Council of the District of Columbia in the budget and financial management of the District government.
Part I of this opinion describes the proposed initiatives and four approaches for determining whether the proposed measures are proper subjects for initiatives. Part II describes the District government's budget process and financial management responsibilities. Part III reviews the creation of the initiative right and limitations on that right. Part IV examines the proposed initiatives in light of the interpretation that is most consistent with the District government's unique fiscal status.
We conclude that the right of initiative does not extend to initiatives, such as the ones here, which would allocate District government revenues. While the initiative right to authorize is broad, the limitation inheres in the unique budget process and the financial management scheme of the District government. Accordingly, we affirm the judgments of the trial court declining to order the District of Columbia Board of Elections and Ethics to accept these measures for inclusion on the ballot.
Each initiative contains linkage provisions between large commercial developments and funding low and moderate income housing programs. The "Affordable Housing Act" initiative, Appeal No. 90-680, would require developers of office buildings of 50,000 square feet or more to construct or rehabilitate housing for lower or moderate income families or to contribute funds for that purpose. The collected funds would be deposited in a trust fund created by the initiative, to be used exclusively for the construction of low income housing.
The "Housing Now! Act of 1990" initiative, Appeal No. 90-809, would amend D.C. Code § 47-813 (1990) to impose a surcharge on commercial properties of 50,000 or more square feet. The initiative would require an amount equal to the surcharge to be deposited in the Housing Production Trust Fund, an existing special fund established by the Council, D.C. Code §§ 45-3101 to -3104 (1990).
The Board of Elections, acting pursuant to D.C. Code § 1-1320 (b)(1) (1987), refused to accept the proposed initiatives for filing. The Board found that the Affordable Housing Initiative, by restricting the monies in the fund to a specific purpose, nullified the discretion of the Council and the Mayor, and that the initiative, therefore, was an attempt to "launch the appropriations process contrary to the holding in Convention Center II, supra note 1." Adopting the same reasoning, the Board found that the Housing Now! Act of 1990 initiative would limit the discretion of the Council to spend the monies for purposes unrelated to housing (even though by the terms of the Housing Production Trust Fund the Council could choose among nine distinct housing categories, see D.C. Code § 45-3102).
In separate actions filed pursuant to D.C. Code § 1-1320 (b) (1987), the proponents of the initiatives sought to have the Superior Court of the District of Columbia direct the Board to accept the measures and place them on the ballot as initiatives. Summary judgment was granted in both cases for the Board of Elections and intervenors James Durham, Kenneth Price, the Apartment and Office Building Association of Metropolitan Washington, and the Washington, D.C. Association of Realtors.
On appeal it is argued, on the one hand, by appellant that the measures are proper subjects for initiatives since they are not Budget Request Acts and do not affect the authority of the Council of the District of Columbia to allocate revenues among authorized programs and activities in the process of enacting a Budget Request Act for approval by Congress. Rather, the argument continues, the proposed initiatives simply authorize the collection of new revenues and only limit the Council's revenue allocation role to the extent that the initiatives would require the Council, if it wanted to use the new revenues, to use them for the particular purpose or program specified by the initiatives. In other words, no revenues from the new tax surcharge and fees could be spent for these programs (absent Congressional action) unless first allocated by the Council in a Budget Request Act.
Taking a contrary view, intervenors and the Board argue that any restriction on the Council's power to allocate revenues interferes with responsible financial management and runs afoul of the "laws appropriating funds" limitation. This Conclusion is required, intervenors argue, in order to assure that the legislature, and only the legislature -- whether Congress or the Council -- retains "control over the allocation of initiative-generated revenues among competing needs." Therefore, this view concludes that in addition to the prior holdings of the court on the nature of limitations on the right of initiative:
An initiative which attempts to impose, by the terms of the initiated law, a legal constraint (either by mandate or by prohibition) on the Council's authority to allocate revenues among competing programs or other uses in the normal budget process, or which attempts itself to exercise that authority, is prohibited. [ *fn2
Accordingly, the court is presented with a question of statutory interpretation, see Convention Center II, supra note 1, 441 A.2d at 911, in which the precise issue is whether a citizen initiative can have any revenue allocation role, either in the Budget Request Act process or by placing restrictions on the use by the Council of available revenues through deposits in special funds. This is a question of first impression. How one answers the question depends on how the initiative right in D.C. Code § 1-281 (a) (1987 Repl.) is construed. That section defines an initiative as:
the process by which the electors of the District of Columbia may propose laws (except laws appropriating funds) and present such proposed laws direct to the registered qualified electors for their approval or disapproval.
If an initiative is adopted by a majority of the registered, qualified electors voting, then the initiative, upon certification of the vote by the District of Columbia Board of Elections and Ethics, becomes an act of the Council subject to the congressional review period of D.C. Code § 1-233 (c). D.C. Code § 1-285.
An amendment to the Charter, such as the right of initiative, cannot be viewed in a vacuum, but must be construed in light of the statutory scheme established by the Charter in the District of Columbia Self-Government and Governmental Reorganization Act, Pub. L. No. 93-198, 87 Stat. 774 (1973), (codified as amended in scattered sections of the D.C. Code) (Self-Government Act). Id.; Peoples Drug Stores v. District of Columbia, 470 A.2d 751, 754 (D.C. 1983) (en banc). Since amendments to the Charter required Congressional approval when the initiative right was approved by Congress, 1 D.C. Code 184 (1991 Repl.), the court must consider Congressional intent in approving the amendment. Because the Charter amendment is in the form of an act passed by the Council, and because the Charter Amendment on the right of initiative included authority for the Council to adopt implementing legislation, the court must address the intent of the Council. Given this framework, several interpretations of the initiative right emerge.
One interpretation is that the initiative right extends to anything other than a Budget Request Act. Convention Center II, supra note 1, 441 A.2d at 925 (Gallagher, J., Dissenting). This interpretation takes a very broad view of the initiative right, and has the merit of simplicity and ease of application.
A second interpretation focuses on whether an initiative forces the Council to allocate funds as a result of the enactment of the initiative. Under this by-pass interpretation, if there is nothing for the Council to do other than allocate revenues to carry out the initiative, the measure runs afoul of the "laws appropriating funds" limitation. But if there remains, after the initiative becomes effective, the requirement of an allocation of revenues at the discretion of the Council, the measure would be a proper subject for initiative. This by-pass of the regular budget process approach, urged by appellants, is followed by the Alaska Supreme Court in McAlpine v. University of Alaska, 762 P.2d 81, 91 (Alaska 1988), and the Montana Supreme Court in State ex rel. Haynes v. District Court, 106 Mont. 470, , 78 P.2d 937, 941-42 (1938).
A third interpretation, adopted by a three-Judge plurality in Convention Center II, is that the "laws appropriating funds" limitation "prevents the electorate from using the initiative to (1) adopt a Budget Request Act or make some other affirmative effort to appropriate funds, or to (2) block the expenditure of funds requested or appropriated as of the effective date of the initiative act." 441 A.2d at 913. Although the plurality did not define "other affirmative effort," it noted that the Council "was particularly concerned . . . that the electorate not use the initiative to launch the appropriations process." Id. at 912. This interpretation of the initiative right is consistent with balancing the competing purposes of having a broad right of initiative without sacrificing sound financial management. Id. However, it has not always been easy to apply. Compare Convention Center II, supra note 1, 441 A.2d 889, and District of Columbia v. Jones, 481 A.2d 456 (D.C. 1984) (increased unemployment benefits initiative), with District of Columbia Bd. of Elections & Ethics v. District of Columbia, 520 A.2d 671 (D.C. 1986) (overnight shelter initiative).
A fourth interpretation equates "laws appropriating funds" with "laws apportioning funds." Thus, any measure which seeks to "segregate public moneys or a part of the public revenue to any narrow purpose" is not a proper subject for an initiative. In re Opinion of Justices, 297 Mass. 577, , 9 N.E.2d 186, 188 (1937) (interpreting state constitutional provision prohibiting an initiative that "makes a specific appropriation of money from the treasury"). The rationale of this interpretation, urged by intervenors, derives from the intent of the state constitution or charter to "centralize the financial affairs of the in its own treasury and place responsibility for their control in the ." Id. at , 9 N.E.2d at 188. Like the first interpretation, this interpretation benefits from simplicity. By contrast with the first interpretation, however, it is a more restrictive interpretation of the initiative right for it leaves control over financial management, including revenue allocation, within the sole discretion of the legislature (subject to executive veto).
To determine which interpretation of the initiative right is most consistent with legislative intent in approving a right of initiative in the District of Columbia requires an examination of the District government's unique budget process and its financial management policies.
Under the Self-Government Act, Congress retains the power to appropriate all District government revenues. D.C. Code § 47-304 (1990). *fn3 The Self-Government Act provides that the Council of the District of Columbia is the local legislature, subject to the power of Congress under article I, section 8, clause 17 of the U.S. Constitution to enact legislation for the District of Columbia. D.C. Code §§ 1-204, -206. While granting self-government to District residents, and "consistent with the constitutional mandate, to relieve Congress of the burden of legislating upon essentially local District matters," D.C. Code § 1-201 (a), Congress limited the Council's power to enact legislation in three major respects. First, no legislation enacted by the Council, other than a temporary 90-day emergency act, may take effect until it has been presented to Congress for a prescribed period of time to consider whether or not to disapprove the legislation. *fn4 D.C. Code § 1-233 (c). Second, specific subject areas are excluded from the Council's legislative authority. D.C. Code § 1-233 (a) & (b). Third, and relevant here, the Council cannot authorize the spending of local revenues; only Congress can. *fn5 D.C. Code § 47-304. *fn6
The Self-Government Act, however, provides roles for the Mayor and the Council in the District's budget process. The Charter, title IV of the Act, prescribes the procedure by which the Mayor and the Council shall annually submit a budget request to the President for submission to Congress for approval. D.C. Code §§ 47-301, -304. The Mayor is required to prepare and submit to the Council an annual budget that "specifies the agencies and purposes for which funds are being requested; and . . . shall be prepared on the assumption that proposed expenditures . . . for such fiscal year shall not exceed estimated resources from existing sources and proposed sources." D.C. Code § 47-301 (a)(1). The Mayor's annual budget must include, in addition, a number of reports, such as multiyear plans for operating and capital expenditures, and program performance and issues reports. Id. § 47-301 (a)(3)-(6). *fn7 The Council, in turn, is required to adopt by act the annual budget within 50 days of receiving the Mayor's budget proposal. Id. § 47-304. *fn8 The Mayor may disapprove "any item or provision" of the Council's Budget Request Act, subject to override by two-thirds of the Council. Id. § 1-227 (e) (1987 Repl.). The final product, the District's budget request, is required to be a balanced budget, with proposed expenditures not exceeding existing and proposed revenues in the fiscal year. D.C. Code § 47-313 (c) & (d). *fn9 Hence, by direction of the Charter, the Mayor's annual budget proposal and the Council's Budget Request Act perform the function of forcing the locally elected officials to determine how they want Congress to authorize the spending of government revenues among competing programs and activities in a fiscal year.
As between the Mayor and the Council, therefore, the Budget Request Act is an important document. Upon its enactment, moreover, the Mayor is required to support the Budget Request Act when the District's budget is pending before the President, under review by the Office of Management and Budget, and also before Congress, after the President has submitted a budget request on behalf of the District government for approval by Congress. D.C. Code §§ 47-304, -313 (d). It is also an important document beyond the District government, notwithstanding Congressional line-by-line review of the District's budget request by the Congressional Appropriations Subcommittees on the District of Columbia. *fn10 The Budget Request Act sets the baseline for Congressional review, and in view of Congressional commitment to self government, see D.C. Code § 1-201 (a), the restructuring of the proposed allocation of revenues may often be substantially in accord with that proposed in the Budget Request Act. *fn11 Consequently, the Budget Request Act process is vitally important from the perspective of the elected officials of the District government, and the electorate, precisely because the process represents the District government's power of the purse.
In addition, Congress, while retaining in the Self-Government Act the pre-home rule procedures for presidential review and submission for approval to Congress of the District's budget, D.C. Code § 47-313 (a), also contemplated that the financial management system for the District government would be improved with self-government. *fn12 The provisions in the Charter set forth with particularity the budget process and financial policies for the District of Columbia. Beyond requiring the Mayor and the Council to identify expenses and revenues and to propose a balanced budget for Congressional approval, the Charter includes standards for budget execution, requiring consistency between budget, accounting and personnel systems, and two separate audits by the Office of the District of Columbia Auditor and the Mayor. D.C. Code §§ 47-117 (b) -312 (4). *fn13 These provisions, consolidating local financial controls, were forecast in the Report of the Commission on the Organization of the Government of the District of Columbia submitted to Congress shortly before enactment of the Self-Government Act. See note 12, (supra) . Furthermore, with regard to District government revenues, the Charter Act places specific financial responsibilities in the Mayor for the management and accounting of all District government revenues. D.C. Code § 47-310. *fn14 The annual appropriations acts passed by Congress also direct the Mayor to submit to the Council, in advance of submission of the budget proposal for the forthcoming fiscal year, a report on all available revenues. *fn15
Of significance to the instant appeals, the Charter places the authority over the establishment of special revenue funds in the Council. The Charter defines the general fund of the District government as consisting of all District government revenues other than those "applied by law to any special fund existing on December 23, 1973." D.C. Code § 47-130. *fn16 It provides that the "Council . . . may establish such additional special funds as may be necessary for the efficient operation of the government of the District." Id. *fn17 The Charter provision thus places a special responsibility in the Council with respect to special funds. In vesting the Council with the decision whether special funds are necessary, Congress required that a determination be made that such funds would advance governmental efficiency. Such a decision could be difficult for the electorate to make. As was observed in State ex rel. Keefe v. St. Petersburg, 106 Fla. 742, 144 So. 313, 144 So. 671, 145 So. 175 (1933) (en banc):
A budget system means sound fiscal management of municipal affairs, by requiring all expenditures, through appropriations, to be predicated on a proper understanding and appreciation of all the pertinent facts . . . . [The statutory right of initiative] could not have intended to embrace those matters of financial management, which, while legislative in their character, are such as are impliedly, if not expressly, required by the charter to be dealt with by the city's responsible officers on the basis of peculiar and special knowledge possessed by them concerning the possible resources of the city, and the necessities required to be met through the exercise of the delegated power of taxation.
145 So. at 176 (citations omitted). *fn18
Accordingly, in vesting the Mayor and Council with control over the local budget process, and vesting the Council with responsibility for the establishment of special funds, Congress has assigned responsibility for the proper allocation of District government revenues to the District government's elected officials. With this background, we turn to the initiative right.
Following the effective date of the Self-Government Act, the Council began a process by which its power to legislate could extend beyond the thirteen elected members of the Council and the elected Mayor to the citizens of the District of Columbia. *fn19 The bill, introduced in the Council on July 3, 1977, proposed that the electors of the District of Columbia have the right of initiative, referendum and recall. *fn20 The Council was thereby proposing a further limitation on its legislative powers since a law passed by the electorate would, presumably, have sufficient popular support to cause an elected member of the Council to pause before attempting to repeal it. *fn21
The right of initiative was established pursuant to an act of the Council that called for an amendment to the Charter in the Self-Government Act. Initiative, Referendum and Recall Charter Amendments Act of 1977, D.C. Law 2-46, Sec. 2, § 1 (a), 24 D.C. Reg. 199 (1978) (codified at D.C. Code § 1-281 (a) (1987)). Following ratification by a majority of the registered qualified electors on November 7, 1977, Congress approved the amendment to the Charter. H.R. Res. Con. 464, 92 Stat. 3868 (1978). As originally proposed, the right of initiative was virtually unlimited. See Council Bill No. 2-2, (supra) note 20. However, before becoming effective, this changed. The first limitation relevant here was part of the Charter Amendments Act passed by the Council, and thereafter ratified by the electorate and approved by the Congress. The other two which are relevant here are part of the act passed by the Council to implement the Charter Amendments Act.
"Laws appropriating funds." While leaving a very broad right of initiative with regard to the authorization of programs and activities, the Council determined that initiatives could not include "laws appropriating funds." D.C. Code § 1-281 (a) (1987)). The debate in the Council on the Charter Amendments legislation focused, to the extent pertinent here, on confining the initiative power to the authorization of programs and activities as distinct from the Council's power with regard to the allocation of revenues in the budget process. *fn22 When Chairman Dixon introduced the "laws appropriating funds" provision he stated that it would "prohibit initiatives used against or as related to appropriated funds which go to tax levying and other forms of operating budget or appropriated fund actions." Convention Center II, supra note 1, 441 A.2d at 911 (emphasis added). Further explanation of the effect of the limitation indicated that it was designed to prohibit use of the initiative for "appropriations." Id. at 934.
The clearest expression in this legislative history by members of the Council regarding the effect of the "laws appropriating funds" limitation appears during a colloquy between the chairman of the Council (Dixon) and the chairman of the Council's Committee on Finance and Revenue (Barry). See note 22, (supra) . Distinguishing between the right by initiative to authorize the establishment of a new office with specific duties and the authorization of appropriations for the office to carry out its duties, Councilmember Barry stated that the citizens by initiative could create an Office of Latino Affairs but could not also fund it. Once a program or activity was authorized, it was for the Council initially to determine in the budget process whether and what amount of revenue would be dedicated to that program or activity. Chairman Dixon agreed, stating that "The electorate can initiate a tax if they want to, but they cannot appropriate that money. They can initiate any measure they want to initiate but they cannot initiate the spending of that money." Id. at 912. *fn23 He also remarked that the decision to authorize a project was distinct from the decisions by Congress to appropriate and by the Council "to set aside." Id. at 932 n.4 (emphasis added).
Although the debate of the Council did not address the precise issue in the instant appeals, it sheds some light on the Council's understanding that the proposed Charter amendment to allow initiatives did not extend to the budget process. Id. at 932 n.3. The colloquy makes clear that the proponent of the "laws appropriating funds" limitation contemplated that new sources of revenue could be identified by initiative, but that only the Council could decide how those revenues would be allocated. Interestingly, during the debate, Councilmember Clarke raised the question whether an initiative that would have a fiscal impact could be required to include a source of funding, by "special tax levy to raise funds for the project or program proposed," and if so, whether a court could order the Council to use the revenues raised for that purpose and provide more if those revenues raised by the initiative proved insufficient to carry out the initiative. Id. at 935 n.10. Chairman Dixon appeared to agree that it was possible for an initiative to include a funding source and that, in any event, the District government could be sued if it failed to carry out the initiative even if it had not identified funding. Id. The focus of the debate at this point, however, was on the possibility that an initiative would result in an unbalanced budget or a deficit, and the Council appears to have concluded that this problem would be avoided with the "laws appropriating funds" limitation because the Council would determine how revenues would be allocated. Id. at 935.
Following up on the distinction between authorization and allocation of revenues, Councilmember Barry's remarks also indicate that he viewed the initiative right compatible with funds being identified in an initiative so long as the final decision about allocating funds was the Council's. Id. at 932 n.3. His position arose from concern that an unlimited right of initiative had the potential to intrude upon proper financial management if an initiative could force the Council to allocate revenues. Id. at 931 n.1.
Congressman Fauntroy echoed this refrain in explaining to the U.S. House of Representatives that House Concurrent Resolution 436, to approve the Charter Amendments Act, "relates to initiative which is the process that allows electors to propose laws which will be voted on by them. This process of course excludes laws relating to the appropriation of funds." Id. at 912 (emphasis added). The "relating to" phrase suggests, again, -- as does Chairman Dixon's reference to "other forms of operating budget or appropriated fund actions" -- that more was contemplated by the "laws appropriating funds" limitation than simply prohibiting the electors from proposing Budget Request Acts. *fn24 To be consistent with the Council debate, the phrases would extend to the budget process.
Title IV (the Charter). As required by the Charter Amendments Act, see D.C. Code § 1-287, following Congressional approval of the Charter Amendment authorizing initiatives, the Council enacted the Initiative Procedures Act. D.C. Code § 1-1320 (1987 Repl.). In so doing, the Council interpreted the Congressionally-approved initiative right to encompass several limitations on that right. The limitations arose from the language of the initiative in the Charter Amendments Act and from the Charter itself. Thus, the Council directed the Board of Elections to refuse to accept a proposed initiative if the Board found that the proposed initiative "is not a proper subject for initiative . . . under the terms of title IV of the District of Columbia Self-Government and Governmental Reorganization Act . . . ." D.C. Code § 1-1320 (b)(1) (1987 Repl.). The Board also could not accept a proposed initiative that would "negate or limit an act of the Council of the District of Columbia pursuant to § 47-304." Id. § 1-1320 (b)(1)(D).
Title IV of the Self-Government Act (the Charter) establishes a tripartite form of government for the District of Columbia, with an elected Council and Mayor, and a judicial system established by Congress in 1971. In addition, title IV addresses the District's budget process as well as financial management policies and responsibilities and borrowing authority, bonds and notes, and the independent agencies. See scattered sections of 1 D.C. Code, & 47 D.C. Code. It establishes, in other words, the "means of governance of the District." D.C. Code § 1-203 (1987 Repl.).
While the court has yet to address the meaning of this limitation on the initiative right, *fn25 the language of § 1-1320 (b)(1) suggests that the Council may have intended more than simply placing a restriction on direct amendments of the Charter. The language chosen by the Council is "under the terms of title IV." While the phrase is not precise, its meaning can only arise from the substantive provisions of title IV. Adopted to implement the Charter Amendments Act, the phrase could reasonably be interpreted to mean that an initiative is also prohibited if it would interfere with the responsibilities assigned to the Council by the Charter, such as the Council's revenue allocation role and control of special funds. Accordingly, by referring to title IV, the Council, accepting that the initiative right was no more extensive than its own powers, excluded from the initiative right matters that would purport to change the structure of government and the procedures and responsibilities assigned by the Charter. See D.C. Code § 1-184. In other words, under § 1-1320 (b)(1), an initiative, like an act of the Council, could not directly amend the Charter, and an initiative also could not interfere with the ability of the Council to carry out its responsibilities under the Charter.
Negate or limit. The Council, in addition, as part of the Initiative Procedures Act, interpreted the initiative right established by the Charter Amendments Act to prohibit an initiative that would "negate or limit" a Budget Request Act passed by the Council. Since an initiative could not be a law appropriating funds, it would reasonably follow that the electorate could not accomplish after the fact what it could not accomplish before the fact, namely, interference with the Council's discretionary allocation of revenues among competing programs and activities. Here again it would seem that the Council preserved its ultimate control, subject only to veto by the Mayor, over the allocation of revenues to be presented for Congressional approval. Just as the Mayor must support the Budget Request Act passed by the Council, so too, under § 1-1320 (b)(1)(D) the Council intended that the District's electorate would be bound by the determination by the District government's elected officials of how revenues will be allocated, subject only to revision by the President and Congress. Thus, an initiative could not amend the allocation in a Budget Request Act, to require, for example, that additional revenues be devoted to housing or that all revenues from a particular source, new or old, be devoted to a specific purpose.
Viewed together, these limitations on the right of initiative reflect a decision, implicit if not explicit, by the Congress and the Council that the power of the purse which Congress had delegated to the District government in the Self-Government Act would remain with the elected officials of the District government and not be subject to control by the electorate through an initiative. *fn26 The Charter created a budget process and established financial policies designed to assure that the District government's fiscal affairs would be run effectively and efficiently on a sound financial basis, without deficit financing. See Part II, (supra) . The Council intended to retain its control of the local budget process under the Charter. By ratifying the Charter Amendments Act with the "laws appropriating funds" limitation, and in the absence of other amendments removing limitations on the right that arise from other provisions of the Charter, the electorate reaffirmed its commitment to the fiscal scheme that it had ratified following Congressional enactment of the Self-Government Act in 1973.
The words and the legislative history of the "laws appropriating funds" limitation, combined with the Council's implementation of the initiative right in the Initiative Procedures Act, evince the Council's acknowledgment of its initial and continuing financial responsibilities. Congress had made no change in them when it approved the Charter Amendments Act to allow initiatives. That history likewise reveals the Council's concern that matters relating to the local budget process would remain within the control of the Mayor and Council, and that initiatives not create deficits or interfere with the locally elected officials' decisions about how District government revenues should be spent. The broad right of initiative was balanced against the financial responsibilities of elected officials under the Charter. See Convention Center II, supra note 1, at 912 ("an unqualified initiative right would enable the electorate to interfere with the fiscal affairs of the District [referring to distinction between appropriation and authorization]"); State ex rel. Keefe v. City of St. Petersburg, supra, 145 So. at 175 ("To hold that the initiative and referendum provisions of the charter are applicable to the appropriation ordinances, would materially obstruct, if not entirely defeat, the purpose of having a budget system.").
Accordingly we examine the four interpretations of the initiative right to determine which is most consistent with the District's unique fiscal scheme, Congressional expectations for improved financial management with self government, and the legislative intent of the Congress and Council in adopting and implementing the "laws appropriating funds" limitation on the initiative right. See Convention Center II, supra note 1, 441 A.2d at 911 (court's role in statutory interpretation). To construe the "laws appropriating funds" language literally would render the limitation meaningless since the Council is without power to enact "laws appropriating funds." *fn27 See id. at 911 (language is "ambiguous on its face"). Neither the Council nor the electors of the District of Columbia can overrule acts of Congress. See supra, note 27. Since the court must assume that the Council did not enact a meaningless provision, the phrase "laws appropriating funds" must be viewed as a qualification on the initiative right that extends beyond limitations placed on the Council's legislative powers under the Self-Government Act. *fn28
As discussed in Part I, (supra) , the first interpretation views the initiative right to extend to any legislative action other than a Budget Request Act. This is unsatisfactory for two reasons. First, a Budget Request Act is not ordinary legislation under the Self-Government Act since it does not become effective pursuant to a Congressional review period set forth in D.C. Code § 1-233 (c). The Council's power to enact legislation is limited to the enactment of "acts." D.C. Code § 1-229 (a). Such "acts," which become effective after Congressional review (unless disapproved by Congress), D.C. Code §§ 1-227 (e) & -233 (c), do not include a Budget Request Act, which follows a very different procedure than ordinary legislation passed by the Council. D.C. Code §§ 1-227 (f), 47-304, 47-313 (a). The Charter Amendment provides that initiatives are subject to Congressional review in the same manner as ordinary Council legislation. 1 D.C. Code 270 (Sec. 5), codified at D.C. Code § 1-285. It necessarily follows that if the power of initiative is otherwise coextensive with the legislative power of the Council, in which acts become effective after a period of Congressional review pursuant to D.C.Code § 1-233 (c), then the initiative cannot include a Budget Request Act. See Part II, (supra) . Therefore, the "laws appropriating funds" limitation on the initiative right would be superfluous unless it applied to more than a Budget Request Act. Hence, the language of the limitation must refer, in some other manner, to the Council's role in the District government's budget process. Further, this interpretation does not take into account the financial responsibilities placed in the Council by the Charter, and thus would require the court to ignore Congressional expectations for improved financial management with self government. In addition, this interpretation suffers from the fact that almost any initiative could be framed in a way that it would not be in the form of a Budget Request Act.
The second interpretation, the by-pass approach, which would result in the allocation of revenues for specific purposes by initiative but require further legislative action in order to appropriate (i.e., spend) those revenues, is not easily applied where the allocation and appropriation functions are divided between two legislatures, as in the District of Columbia. Congress has retained a tight rein on District government spending, itself making the ultimate decision in annual appropriations acts. See Part II, (supra) . Congress also has assigned to the elected officials of the District government, in order to improve financial management, specific financial responsibilities, including budget preparation involving the allocation of revenues, following preparation of detailed studies by the Mayor, and control over special revenue funds. Because of the nature of the Council's role in the appropriations process for the District government, sharing the allocation role with the electorate would jeopardize the Council's ability to carry out its other Charter responsibilities. Where a legislature has control over both the authorization and the appropriation functions, as in a state, the by-pass interpretation still assures that the same legislative authority is invoked to authorize an activity that is invoked to make the final decision on spending. In the absence of such budget autonomy, however, this is not true. Moreover, the division of controls is complex in the District of Columbia; as noted during the Council's debate, the procedure for Congressional review of legislation passed by the Council did not assure that the same Congressional committees would review the initiative as would consider its fiscal impact. See Convention Center II, supra note 1, 441 A.2d at 931 n.1.
The deficiency of the by-pass interpretation applied to the District of Columbia is most dramatically illustrated by a hypothetical initiative which would allocate 95 percent of District government revenues to special funds for initiative-designated purposes. The Council's ability to allocate revenues effectively and efficiently is clearly thwarted. The Council would be powerless to use the available revenues other than as the initiative directs, regardless of other demands and requirements. But even a lesser revenue allocation by initiative demonstrates the point: any allocation intrudes on both the discretion of the Council in deciding how to allocate revenues among competing programs and activities, and on the Charter's financial policies, as reflected, most significantly in the instant appeals, by the limit on the establishment of special funds to only those that the Council determines "may be necessary for the efficient operation of the government of the District." D.C. Code § 47-130. The limitation of the number of actors in the local budget process arises, therefore, from the nature of the Council's role in that process; it cannot both share its allocation role and carry out its financial responsibilities, including that for special funds. Cf. Opinion of the Justices, supra, 9 N.E. at 188 (prohibition of "special appropriations" was "designed to prevent any interference with the general plan [in the state constitution 'to centralize financial affairs . . . and responsibility'] by means of initiative"). Thus, the by-pass interpretation adopted in some states fails to address fully the unique nature of the Council's fiscal role.
The third interpretation, adopted by the three-Judge plurality in Convention Center II, supra note 1, by contrast, addresses the District government's fiscal uniqueness. *fn29 It acknowledges the legislative intent to prohibit initiatives that would "launch the appropriations process." 411 A.2d at 912. In the context of the instant appeals such launching would occur when revenues were required to be put in special funds dedicated to specific purposes. The Council's ability to free those revenues for other purposes in a Budget Request Act would require it to repeal the initiative dedicating the revenues. Because the court in Convention Center II, supra note 1, did not have occasion to define the nature of "launching the appropriations process," its import was not clear. The needed clarity is provided by the fourth interpretation. *fn30
The fourth interpretation equates "laws appropriating funds" with laws allocating funds, and thereby fully addresses Congressional intent in the Charter and the Council's intent in limiting the initiative right. It does so in several ways. First, it responds to the Congressional purpose of consolidating local financial responsibility in the District government's elected officials. See Part II, (supra) . The restriction on the creation of special funds practically forces the Conclusion that ire order for the Council to be in a position to assure sound financial management, it must retain control of decisions on how revenues, new as well as old, should be allocated. *fn31 Once Congress assigned local financial responsibilities while limiting local fiscal autonomy, it was incumbent upon the Council to assure that deficits would not occur and that District government's revenues would be most effectively and efficiently allocated among competing programs and activities. The Congress and the Council, in approving a right of initiative, accomplished this by allowing a broad right of authorization by initiative but eliminating any allocation right by initiative.
In addition, the language and legislative history of the "laws appropriating funds" limitation do not suggest that some limitations on the Council's allocation role would be valid. The words chosen by the Council in the Charter Amendments Act legislation, to include the "laws appropriating funds" limitation, and the words chosen by the Council in the Initiative Procedures Act, reflect a concern about financial control that is in accord with Congressional expectations for improved financial management with self government. The reference during the Council's debate on the "laws appropriating funds" limitation that an initiative could include a source of funding is not inconsistent with a determination by the Council to retain full control of the allocation of revenues raised by the initiative. See Part III.A., (supra) . As the Chairman of the Council (and author of the "laws appropriating funds" limitation) and the chairman of the Council's Finance Committee stated, an initiative could establish a new tax but not dictate the uses of the taxes thereby collected. Furthermore, since the Council's financial responsibilities under the Charter extend to the determination of when special funds are necessary, see Part II, (supra) , the title IV limitation on the initiative right would prevent the electorate, through the initiative, from interfering with the Council's power to allocate by placing revenues in special funds.
Before the court could conclude that the Congress and the Council intended that the Council would share its power of the purse by granting the electorate the right of initiative, the Charter Amendment would have to be explicit. We have not even found anything in the legislative history to suggest that the Congress or the Council contemplated that the discretion of the District government's elected officials to allocate revenues could be limited by an initiative. So dramatic a revision of the fiscal scheme in the Charter cannot be lightly inferred. Financial mismanagement resulted in the loss of self-government for the District of Columbia in the last century, see Act of July 20, 1874, 18 Stat. 116, and Congressional concern in this century about strengthening financial management in the District government prompted the Charter's fiscal scheme. See id. Thus, the word "appropriations," when used in connection with the functions of the Mayor and the Council in the District's budget process, refers to the discretionary process by which revenues are identified and allocated among competing programs and activities. *fn32 Otherwise the improved financial management envisioned by the financial policies in the Charter would be jeopardized. See note 12, (supra) .
Accordingly, we conclude that the allocation interpretation is most consistent with the District government's unique fiscal status. This interpretation equates "laws appropriating funds" with "acts allocating funds" in recognition of the nature of the Council's role in the budget process and its financial responsibilities under the Charter. It thereby balances the right of initiative with the Charter's provisions for sound financial management by the District government's elected officials. While the initiative right is to be liberally construed, if there are clear and compelling limitations, see Convention Center II, supra note 1, 441 A.2d at 913 (citations omitted), the right may be limited. Here there are clear limitations. The initiative right must conform to the structure of government established by Congress in the Charter. This means that a measure which would intrude upon the discretion of the Council to allocate District government revenues in the budget process is not a proper subject for initiative. This is true whether or not the initiatives would raise new revenues.
The right of initiative nevertheless remains "broad" under the allocation interpretation. See McQuillan, (supra) note 25, § 16.51, at 254; 42 Am.Jur.2d Initiative and Referendum § 5, at 653 (1969). The initiative right to propose authorizing legislation that the Council could enact is essentially unfettered. In addition, as the Board of Elections noted in the appeal involving the "Housing Now! Act of 1990" initiative, measures may be proper subjects for initiative where the proposal contains a "non-binding policy statement" that revenues should be allocated for specified purposes. While the Mayor and Councilmembers, like any elected officials, may take a potential risk in allocating initiative-raised revenues for a purpose other than that suggested by the initiative, the risk is necessarily overshadowed by the financial responsibilities placed by Congress in the District government's elected officials, and the Mayor and Council have acted accordingly. *fn33 Moreover, there are other avenues available to the electorate to advise the District government's elected officials about community priorities. See, e.g., D.C. Code § 47-304 (requiring public hearings on the proposed Budget Request Act).
To recapitulate: Unless the "laws appropriating funds" limitation on the right of initiative extends beyond Budget Request Acts, the limitation is superfluous. Failure to extend the limitations on the initiative right to the full measure of the Council's role in the District's budget process is incompatible with the Council's financial responsibilities under the Charter. Therefore, the right of initiative cannot extend to the Council's discretion to allocate revenues or to the Council's decision about when it would be necessary for "the efficient operation of the government of the District" to establish a special fund. D.C. Code § 47-130. *fn34
The allocation interpretation disposes of Appeal No. 90-680 ("Affordable Housing Act Initiative"), which would create a new trust fund for the deposit of the new revenues. Under the initiative the Council could only use the revenues in the trust fund to increase the supply of housing for low and moderate income families. The effect of the initiative would be to delay or condition the Council's allocation authority, forcing the Council to use those funds in accordance with the initiative rather than in the discretion of the Council to meet District government needs. *fn35 The electorate, rather than the District government's elected officials, would direct the allocation of District revenues.
The initiative also would run afoul of the provisions of title IV of the Self-Government Act placing fiscal management responsibilities in the Mayor and Council and requiring that the Council establish special funds only when "necessary for the efficient government of the District." D.C. Code § 47-130. The initiative would directly interfere with, by usurping, the Council's responsibility under title IV to make that determination.
The allocation interpretation also disposes of Appeal No. 90-809 (Housing Now! Act of 1990) even though that initiative would call for deposit of new revenues in an existing revolving fund, the Housing Production Trust Fund, established by the D.C. Council in 1989. D.C. Code §§ 45-3101 to -3104 (1990). *fn36 Under the provisions of the Housing Production Trust Fund, among the types of funds that may be deposited in the Fund are "fee option contributions made by commercial developers under a commercially linked development policy to be established by statute by the Council." D.C.Code § 45-3102 (c)(1). It, therefore, could be argued that the Housing Now! Act of 1990 initiative would not run afoul of the limitations on the initiative right since the initiative proposes to deposit new revenues in a fund established by the Council. However, this argument fails to come to grips with the fact that the initiative would interfere with the Council's allocation power since the Council would have no discretion about the allocation of the new revenues raised by the initiative. Although the Council has authorized such funds to be deposited in the Housing Production Trust fund, it has not, thereby, relinquished its authority, muchless its Charter responsibility, to determine when, if, and how much revenue shall be allocated to the fund.
Accordingly, the judgments are affirmed.