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Cleveland taxpayers demand that Council Clerk accept petition for ballot referendum on Quicken Loans Arena subsidy

Council Clerk unlawfully refused to accept referendum petition as required by the Ohio Revised Code and City of Cleveland Charter. If law director refuses to take corrective action, taxpayers will exercise right to file lawsuit to compel Clerk to fulfill her legal duties.

CLEVELAND, OHIO - Today, counsel for City of Cleveland taxpayers Diane S. Bufford, Jennifer A. Blakeney, Verdia Y. Conner, Khalilah A. Worley, and Linda C. Robinson wrote a "taxpayer-demand letter" to Cleveland law director Barbara Langhenry demanding that the City Council Clerk Patricia J. Britt accept the petition they submitted on behalf of 20,603 Cleveland residents to subject the recently enacted Ordinance No. 305-17 to referendum approval by Cleveland voters. The controversial ordinance would commit an estimated $88 million of City tax revenue to a discretionary renovation of Quicken Loans Arena's exterior and concourse area and has been the subject of vigorous public debate. 

The Cleveland taxpayers who served the demand on the law director are part of a coalition of citizens led by members of Greater Cleveland Congregations, SEIU Local 1199, the Cuyahoga County Progressive Caucus, AFSCME Ohio Council 8, and Amalgamated Transit Union Local 268. On May 22, 2017, these citizens submitted a referendum petition to the Clerk of Council consistent with the requirements of the City of Cleveland Charter containing 20,603 signatures of Cleveland residents (more than three times the number required by law), and directing the Clerk "that Ordinance No. 305-17, passed by Council of this City on the 24th day of April, 2017, be submitted to the electors of Cleveland for their approval or rejection."

Despite the fact that taxpayers' petition meets all the requirements of Ohio law and the Cleveland Charter, the Clerk of Council refused to accept the petition, claiming that a referendum on the ordinance "would unconstitutionally impair an already executed and binding contract." The demand letter explains that the Clerk's purported justification is unsupported by law: 

[B]y its plain language, the [U.S. Constitution's] Contract Clause only bars the passing of laws "impairing the obligation of contracts." It has no application to an electorate's rejection of a newly proposed or newly enacted law subject to referendum. Not only has no Ohio court ever held to the contrary, but our research suggests that no Ohio party has ever advanced this specious argument. Indeed, it is unimaginable that the Contract Clause was intended to give government officials carte blanche to propose new laws against the will of the electorate and then rush into contracts in an effort to void the electorate's statutory right to repeal those laws. Of course, any party that has entered a contract pertaining to the controversial Ordinance at issue has done so on notice not only that the Ordinance was subject to referendum, but that it was likely to be put to the test through the referendum process. Thus, no contractual obligations could be considered "substantially impaired" here even if the Contract Clause did apply (again, it does not). See M&F Supermarket v. Owens, 997 F. Supp. 908, 914-15 (S.D. Ohio, 1997) (noting that substantial impairment of contractual obligations could not be found where "[p]laintiffs were on notice that at any time the local community could vote [in the manner that impacted plaintiffs' business]" and where "[p]laintiffs [c]ould have put a clause in their lease that allowed them to cancel the lease if the community voted [in the manner at issue].").

The demand letter further explains that if the Clerk of Council continues to fail to accept taxpayers' petition as the law requires, R.C. 733.58 and Cleveland Charter § 89 require the law director to seek a writ of mandamus forcing the Clerk to perform the duty. Should the law director also fail to fulfill her duty, the taxpayers will exercise their right to file litigation under R.C. 733.59 and Cleveland Charter § 90 against the Council, the Council Clerk, and the law director, to ensure that Cleveland citizens' right to subject the arena-subsidy ordinance to referendum is not further violated. 

"If you and Council fail to act swiftly," the letter states, "you will be subjecting Cleveland's taxpayers to needless cost of litigation, when your respective duties to act otherwise under the Charter are plain."

"It's shocking to see elected officials attempt to thwart their constituents' will like this," said Peter Pattakos, the taxpayers' counsel. "If the City Council members who passed this ordinance are truly confident in its merits, they should be glad to have it put to the test at the ballot. The law guarantees Clevelanders' right to this referendum. The Clerk's refusal to fulfill her legal duties should be met with a swift correction in court."

Also representing the taxpayers is Subodh Chandra of The Chandra Law Firm LLC. Chandra is a former Cleveland law director who has litigated numerous taxpayer lawsuits in Cleveland and across Ohio from both a plaintiffs' and defense perspective.

The demand letter is available here.

UPDATE 5/26/17: Cleveland's law director has sued Council clerk Patricia Britt in the Ohio Supreme Court, obstensibly to force her to accept the voters' referendum petition. But the law director did not comply with the taxpayers' request in the demand letter that they named in any suit to ensure that proper arguments are made. And the law director made at least one improper legal argument seemingly calculated at "throwing" the case. Mayor Frank Jackson and Council President Kevin Kelley held a joint press conference touting the virtues of the suit when all Kelley has to do is order his subordinate--Britt--to comply with the charter and accept the petitions.

Due to the obvious self-interested collusion afoot here, the taxpayers plan to seek to intervene in the Supreme Court matter.

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