Restoring Trust: The Urgent Need for Ethics Reform in the Supreme Court.

Judge J. Michael Luttig, 2005.
Work of Dept. of Labor, Public Domain.
via Wikimedia Commons. 

The New York Times' Abbie VanSickle reports on the recent Senate Judiciary Committee hearing, where retired conservative Judge J. Michael Luttig joined legal experts in urging Congress to establish new ethical standards for Supreme Court justices. This call to action comes in light of recent revelations about undisclosed gifts, luxury travel, and property deals involving justices. Judge Luttig contends that Congress has the constitutional power to enact laws prescribing ethical standards for the nonjudicial conduct of Supreme Court justices.

The hearing saw heated debates between Republicans and Democrats on the necessity of such ethical standards. Democrats argued an ethical code is essential to prevent misconduct and conflicts within the Supreme Court. Meanwhile, Judge Luttig and other legal experts emphasized the importance of upholding the highest ethical standards to maintain the public's trust in the institution.

Regrettably, recent revelations involving justices such as Clarence Thomas and Neil M. Gorsuch have highlighted the lack of reporting requirements and the self-policing nature of the justices, sparking increased calls for the establishment of an ethics code. Although all nine justices signed a "statement of ethics principles and practices" outlining their general ethical standards, many argue that this is insufficient and advocate for more stringent measures.

A Marist poll from last week reveals that 62% of Americans lack confidence in the Supreme Court, with only 37% expressing a great deal or quite a lot of confidence in the institution. This marks the lowest level of confidence in the Court since 2018, when 59% reported having faith in the institution. The ongoing debate on ethics reform within the Supreme Court highlights the need to restore public trust in this vital institution.

In light of the most recent series of revelations about undisclosed gifts, luxury travel, and property deals, it is clear that the time has come to establish and enforce ethical guidelines that will preserve the integrity of the Supreme Court. The Republican-dominated court has significantly undermined confidence and eroded the public's respect for the institution, which has come to define Americans' belief in their judicial system. An ethics code is not only necessary but also a step towards safeguarding the rule of law in America.

Fox News' Settlement and Future Defamation Suits.

Justice William J. Brennan, 1972. 

(Author of opinion in New York Times v. Sullivan.)

Library of Congress, Public Domain.

via Wikimedia Commons. 

The Economist today reports on the recently settled defamation lawsuit between Fox News and Dominion Voting Systems for $787.5m over Fox's coverage of the 2020 US election. Dominion accused the network of knowingly spreading lies about its voting machines, resulting in Joe Biden's victory. The lawsuit revealed the extent to which Fox's coverage is shaped by a desire to tell its audience what it wants to hear and by its competition. The case also shed light on the network's tumultuous relationship with former President Donald Trump.

Fox's audience declined after the 2020 election, as Trump urged his supporters to switch to other networks. The network then sought to appease Trump's supporters, giving credibility to false claims made by his lawyers. Fox tried to shift its audience's focus to Florida Governor Ron DeSantis, but viewers ultimately did not follow this lead. The network continued to defend Trump during various legal troubles, as its influence on viewers appeared limited.

Despite the significant financial settlement, the lawsuit's impact on Fox News is, in the opinion of the Economist, negligible. The network can afford the payout, which is about a quarter of its estimated revenue last year, and it will not have to air retractions or corrections. As the lawsuit did not receive extensive coverage on Fox, viewers who learned about it elsewhere were likely to take the network's side. Another voting technology company, Smartmatic, is suing Fox for $2.7bn over its 2020 election coverage, which may draw more attention to the problem.

I think the article misses an important potential consequence of this case. The article highlights the network's influence on the American right, but fails to address the broader implications for libel law jurisprudence. Despite Fox News' potentially defensible behavior under  New York Times v. Sullivan, which protects news organizations from defamation suits unless they knowingly published false information or exhibited "reckless disregard" for the truth, the article does not discuss how the case could affect future defamation suits.

Justices Clarence Thomas and Neil Gorsuch have questioned the basis of New York Times v. Sullivan, and the Fox News case may impact the Supreme Court's willingness to maintain such a powerful shield for the press. The network's repeated dissemination of misinformation, deception, and conspiracy theories could prompt the Court to reevaluate the limits of defamation protections for news organizations.

Overall, the article provides a detailed account of the Dominion lawsuit, Fox News' influence on conservative politics, and the network's relationship with former President Donald Trump. However, it would have been valuable for the piece to discuss the potential consequences of the case for future libel law jurisprudence and the role of the Supreme Court in shaping these outcomes.

Trust in the Supreme Court.

"Confidence in Institutions"
Gallup, June 1-4, 2013, 
available at http://tinyurl.com/m8dl5vg

 From Gallup this morning:

"Trust in many U.S. institutions has declined in recent years, but the loss of faith in the Supreme Court is especially notable, given the high levels of trust it has enjoyed historically."

As I wrote back in 2013, and as I have done pretty often over time, trust in government is the sine qua non of democracy. The "great deal/quite a lot" level of trust for the Supreme Court is down to 25%; this is less than banks used to be in 2013, and is within the margin of error for big business at that time. Most institutions in American life (with the exception of organized labor) have lost trust recently, but none from so high a starting place, and so precipitously. As the article's lede notes:

"This represents a 20-percentage-point drop from two years ago, including seven points since last year, and is now the lowest in Gallup's trend by six points. The judicial branch's current tarnished image contrasts with trust levels exceeding two-thirds in most years in Gallup's trend that began in 1972."

Prior posts re the United States Supreme Court:

1. Turnout, Serrano, and the Outlier.
2. 34 Cents of Your Property Tax Dollar Goes To Our Schools. 
3. Brown, Budgets, Prisons, and Contempt.
4. A Society Can Be Judged By Entering Its Prisons.
5. Standing, Blogging, and Prop 8. 

Turnout, Serrano, and the Outlier.

Percentage Voter Turnout Above (Below) Expected

Versus Number of Registered Voters

California Primary Election, June 4, 2014
Results available at http://tinyurl.com/l3xbpqw  

Back in June of 2014, I took a look at the provisional results of the California Primary. It was partly due to a comment in a newspaper article arguing the Bay Area leads the State in voter turnout.  Based on the data, I concluded
that the northern counties, and those of the Sierra foothills should really hold the title.

I've wanted to revisit the final results for a while. I did so today. The coefficient of determination was essentially unchanged (R²=.757 versus R²=.758). In doing so, though, I realized there was a way to get at the point Paul Mitchell, the vice-president of Political Data Inc., had made to the newspaper reporter that led to my post in the first place.

Paul had contended that "[p]oor people from Sonoma are far more likely to cast a ballot than someone living in poverty in Echo Park [Los Angeles]." This time, after plotting the results, I then set the y-axis to 100% of turnout as predicted by the trend line, leaving the x-axis at the number of registered voters per county.  Graphing the data this way actually supports Paul's argument – that Sonoma County is the outlier from the trend.  Sonoma County comes in at 137% of expected turnout, the highest in the table.

Voter turnout has been on my mind because of a line from Serrano v. Priest that's come up here before.  In contemporary discussions of education, the "twin themes" of the Serrano I decision tend to be collapsed into one – "[t]he pivotal position of education to success in American society."  But it is the second of the twin themes, where Serrano I finds its support in Brown v. Board of Education, that causes me to return to this data.

I hand the microphone to California's former governor, circa 1954:

"[E]ducation is perhaps the most important function of state and local governments. Compulsory school attendance laws and the great expenditures for education both demonstrate our recognition of the importance of education to our democratic society. It is required in the performance of our most basic public responsibilities, even service in the armed forces. It is the very foundation of good citizenship." [Emphasis added.]

The language is lofty, but not complicated. Democratic society is (of course) based on voting. In performing that public responsibility, education is a lens allowing us to distinguish the differences between competing choices. But Earl Warren (and a unanimous Supreme Court behind him) say it's more – that education is the foundation of good citizenship. Education doesn't just help us when we step into the voting booth, it shows when we choose to go to the polls in the first place.  Education is the self-evident spark, pump primer, and boot loader of democracy.

And so I take that proposition, and come back to the graph once more.  And I ask myself – is it education in Sonoma County that has led to this result?

And if I accept for a moment that the statement is true, I then must turn to the far more difficult question.  For what, then, would I point to about Sonoma County that has made this difference?

And what can the rest of California learn from Sonoma's experience?

34 Cents of Your Property Tax Dollar Goes To Our Schools.

So, this post is about increasing the resources available to Sonoma's public schools. There's background here and here. Due to Sonoma Valley's basic aid status, local property tax revenue controls our school funding, and 34 cents of every new property tax dollar goes to our schools.

The Lodge at Sonoma

image available at http://tinyurl.com/mg2dku9 

This post is a long one, and it's in four parts.  The first part explains a bit of the history of school finance since 1971.  The second explains the impact of redevelopment.  The third part describes how property tax revenues can increase.  The fourth gives an example of a specific project, The Lodge At Sonoma -- for were the Lodge to be built today, the school district would get nearly $100,000 each year in additional revenue.

Because of the dramatic impact of property taxes on local schools, this issue should come up in every planning decision made by the City of Sonoma. 

---

"Education is a unique influence on a child's development as a citizen and his [or her] participation in political and community life ... '[t]he pivotal position of education to success in American society and its essential role in opening up to the individual the central experiences of our culture lend it an importance that is undeniable' ... [e]ducation is the lifeline of both the individual and society." Serrano v. Priest (1971), 5 Cal.3d 584 (Serrano I)

California State Supreme Court Chambers.

image available at http://tinyurl.com/k3ewj4k

In 1971, by far, the major source of school revenue was the local real property tax. The amount of revenue a district could raise depended largely on its tax base -- on the assessed valuation of real property within its borders. Then the California State Supreme Court ruled in Serrano v. Priest (1971), 5 Cal.3d 584 (Serrano I), finding that the funding scheme invidiously discriminated against the poor because it made the quality of a child's education a function of the wealth of his parents and neighbors.

The California Legislature responded by establishing a formula that calculates a ceiling on how much local property tax revenue each district should receive. If a K-12 district's local property tax revenue is not sufficient to meet this "revenue limit," the state provides additional funds up to that level. Today, we call most of the ~1,000 school districts in California "revenue limit" districts, because this formula applies to them, and their funding is determined by a (heavily modified) variant of the system created in response to Serrano I. 

The courts ultimately approved the State's plan, which continued to allow a relatively small number of districts to retain a higher level of funding, based on well-above-average local property taxes.  The rub was that if there was other State aid those districts were to receive, that aid would be reduced, dollar for dollar, by the amount that local property taxes exceeded the revenue limit.  These districts became known as "basic aid" districts, a term that comes from the State Constitutional requirement that all students receive a minimum level of state aid, defined as $120 per pupil, regardless of how much local property tax revenue their district receives.

Thus, we ended up with a naming system whereby the "revenue limit" districts are poorer than the "basic aid" districts.  Which is a wonderfully delightful piece of counterintuitive nomenclature.

The initial number of basic aid districts was small -- places like Pasadena and Beverly Hills. In the intervening decades, the number of basic aid districts has continued to increase, to the point now where nearly 15% of all districts are basic aid, and some of those districts are quite large indeed.  After forty years of trying to equalize school funding, places like Sonoma find themselves right back where they were before Serrano I -- that they are entirely dependent on local property tax revenue -- and for such districts, the exception has swallowed the rule.

---

For nearly a generation, local property taxes were essentially irrelevant to school funding in Sonoma Valley.  This was not merely due to the consequences of Serrano I.  Redevelopment also played its part.

As California's Legislative Analyst points out, prior to the dissolution of redevelopment agencies in 2011, most of the growth in property taxes from redevelopment project areas went to the redevelopment agency, rather than other local governments like school districts. In Sonoma, this meant that any significant commercial development, most of which took place inside city limits, almost always saw the increased property tax revenue redirected exclusively to the City of Sonoma, rather than SVUSD.

I don't think that any local leaders were intending that the consequence of this policy would be that the School District would thereby qualify for additional State assistance as a revenue limit district, but that was the actual consequence.

Along came ABX1 26 in 2011, which dissolved all redevelopment agencies. Under the dissolution process, the property tax revenue that formerly went to redevelopment agencies is first used to pay off redevelopment debts and obligations, and the remainder is distributed to local governments, and the school districts receive their share.

When redevelopment went "boom," this was thus a stark change.  It's difficult to point out just how significant the change was.  Indeed, many individuals who are quite knowledgeable regarding California's school system had no idea at all how much property tax was being diverted from the schools through the use of redevelopment, and City officials themselves hotly disputed that money was being redirected away from schools at all -- a point that is now nearly universally recognized to have been incorrect.

---

I've touched on the importance of increased funding for schools in previous posts here and here.  Because local property tax revenue controls school funding for Sonoma Valley due to the district's basic aid status, more revenue depends on increasing local property tax revenue.

How can that happen?  California's Legislative Analyst, as usual, has a nice explanation.  There are three mechanisms -- recently sold properties, newly improved (or newly built) properties, and then Proposition 8 "decline in value" properties.

• When a property sells, its assessed value resets to the purchase price. This represents additional value that is added to the tax base because the sale price of the property is often much higher than its previous assessed value. 
• Newly built property and property improvements add new value to the county's tax base when new construction takes place or improvements are made — mainly additions, remodels, and facility expansions — because structures are assessed at market value the year that they are built. 
• Finally, Proposition 8 "decline in value" properties contribute significantly to growth or decline in a county's tax base because their assessed values may increase or decrease dramatically in any year. A particularly large impact on assessed valuation tends to occur in years when a large number of these properties transfer from Proposition 13 assessment to reduced assessment (due to falling real estate prices) and vice versa in a rising market.

What do these changes in revenue look like, and how can someone determine how much property tax revenue will change?  The San Francisco Chronicle has a nice overview of calculating the numbers for a home purchase, and the rules generally hold up for commercial properties, too.  If you pick a typical Sonoma Valley tax revenue area (TRA), like, say, 006-032 (which covers part of the City of Sonoma), the rate's easily determinable by checking Sonoma County's table here. 

There's one piece of data that I've not been able to find, though, and that's the portion allocated to each entity of the property tax collected.  If a reader happens to know where Sonoma County's put that data, please forgive this bleg and let me know. 

However, the number (ratio) is not too difficult to determine for a particular entity for a particular year.  For Sonoma Valley Unified, the numerator is the property tax received for a particular year (in 2012-13, that appears to have been $25,176,110).  The denominator is the total assessed value of all real property in the school district ($7,176,806,784) multiplied by the rate (1.108800%). 31.44% of each property tax dollar thus ends up going to SVUSD.

"Allocation of Ad Valorem Property Tax Revenue"
"Understanding California's Property Taxes"
California Legislative Analyst
available at http://tinyurl.com/ljkr59b

That's not the end of the story.  As the Legislative Analyst's graph on the right shows, about 40% of property tax revenue is allocated to K-14 (not K-12) education; about 8% of every property tax dollar heads to the Santa Rosa Junior College.

Further, there's another 8% marked as "redevelopment," which is ending.  The school district will end up with about 3/9ths of that money.

When redevelopment is wrapped up, the school district will therefore receive ~34% of each property tax dollar.

---

So how much money is at issue with a particular project?  Well, consider, for a moment, The Lodge At Sonoma. It's a good example, because the development is unitary -- it's on one piece of land for tax purposes -- and because its development was relatively recent (opening in 2000, IIRC).

The land that the Lodge sits on is valued at $7.2 million for property tax purposes, and the improvements (the structures) are valued at ~$19.2 million.  The total assessment is thus $26,387,300.   Knowing that the effective tax rate for the parcel is 1.108800%, we just multiply those two numbers and get $292,582.38 per year.  The official "bill" is $381,108.52, but that includes non-property tax water charges, among other things.

City of Sonoma GIS, APN 128-261-009
"The Lodge at Sonoma"
1325 Broadway, Sonoma CA
available at http://tinyurl.com/nxfz9rk  

So how much does the school district get? You'd think $91,987.90 if you just applied the rules I posted above. You'd be completely incorrect, but at least you'd have followed instructions properly.

The reason you'd be wrong is due to redevelopment.  As Bob Klose reported in the Press Democrat on June 14, 1998, the Lodge was built in part with money from the City of Sonoma's Redevelopment Agency. Thus, the entire increase in property tax went to the City of Sonoma.  The school district's share was limited to the assessed value of the parcel prior to the project.  I've looked at the records, and it looks like the assessed value of the parcel before the construction of the Lodge was $425,000.  The assessed value may have been higher than that due to some increase over time under Prop. 13, so call it $600,000 as an estimate.  The school district's share of the property tax collected is ~$2,091.64.

It is probably therefore unsurprising that people have rarely brought up the school district budget at planning commission meetings in the City of Sonoma.  But they probably should. Because were the Lodge to be built today, the school district would get approximately $100,000 each year.  That's equivalent to an Impact 100 donation every twelve months.

---

A final point: because Preserving Sonoma is under discussion in town, I can certainly see how someone like Darius Anderson would try to use a post like this to his advantage. This post, though, is about more than the debate about any single project.  It's about a factor that's just not being weighed at all in the planning process in Sonoma. 

Because commercial development (and, increasingly, tourist-oriented development) is concentrated in the City of Sonoma, the impact on our schools of planning decisions in the long run is profound indeed. To paraphrase Serrano I, education is a unique influence on a child's development as a citizen and her or his participation in political and community life. The pivotal position of education to success in American society and its essential role in opening up to the individual the central experiences of our culture lend it an importance that is undeniable -- education is the lifeline of both the individual and society. Failing to consider education in the planning process is a disservice not least to our students, but to our entire Valley.  

Brown, Budgets, Prisons, and Contempt.

The enduring wild card in California's budget is the situation in California's prisons.  This one came up here in January and back in November. The failure of the Brown administration to regain control of California prison's mental health services (which came up in April twice) led most people to believe that the State's plan to deal with prison overcrowding would similarly fail when reviewed by the courts.

Thursday, the three judge panel supervising the State's reduction of prison overcrowding duly rejected the State's plan to deal with the problem. Jerry Brown narrowly avoided being held in contempt of court, but the panel made clear that, failure of the State to comply with the latest order "shall constitute an act of contempt."

Michael Bien

Image available at http://tinyurl.com/mmegjnc

It's interesting to contrast this case with the decisions that are expected in Perry v. Hollingsworth and Windsor v. United States (prior blog posts on that topic are here and here) on the 24th 26th of June. The consequences of the prison overcrowding litigation will easily be as far reaching as the Prop. 8 cases, and Michael Bien deserves a lot of credit for doggedly pursuing the issues for years.

The result in the prison overcrowding case also provides a nice explanation for an oddity that was in the back of my mind last week, when the Economist noted (with amazement) that Jerry Brown 2.0's conservatism was having unexpected consequences in dealing with California's budget:

"POLITICIANS seldom show the caution required of fiscal analysts. Revenue projections are too rosy, deficit targets are blithely missed and rash promises are lavished on voters. Yet last month California’s Legislative Analyst’s Office, an independent fiscal monitor, rebuked the governor, Jerry Brown, for his 'unduly pessimistic' account of the state’s
economy. Mr Brown had predicted a $1.2 billion surplus for the coming fiscal year; the LAO put the figure at over $4.6 billion. This week the state’s leaders found themselves in the unusual position of agreeing a budget that did not include whopping cuts."

However, it makes perfect sense for the Governor to have been pessimistic -- the estimated amount necessary to address overcrowding by housing some prisoners out of state for 2013 is $1.9 billion.  The Governor and his advisors had to have known this kind of a ruling was coming, and that the difference between budgeted and projected revenues would probably need to be spent pursuant to the court order on reducing prison overcrowding ...

A Society Can Be Judged By Entering Its Prisons.

California Governor Jerry Brown

Jerry Brown has my attention today.  He declared that the emergency conditions in California's prisons have ended. Brown credited realignment, which has basically meant shifting state prison inmates to the county jails, with reducing the scope of the problem. I've blogged about it previously, noting that the remaining portion of California's budget deficit can largely be explained by the requirement that 10,900 prisoners will be housed in out-of-state prisons in 2013, in order to deal with the overcrowding emergency. From a budget perspective, if Jerry Brown can get the federal courts to agree that the prison capacity crisis has ended, and allow the Governor to move those prisoners back into the State's prisons, he will have balanced the California budget this year. 

"Crime Rate at Historic Low"

Cal Facts 2013

California Legislative Analyst

available at http://tinyurl.com/a8paa6e

The problem Jerry Brown's discussing, while it is unlikely to be solved by the judges going along with his proposal, is one that it appears will be resolved as a result of other factors in the next few years.  The recent changes to three strikes, combined with realignment, have helped.  But the graph on the right is really what's driving the situation.  California, like the rest of America, faces continued declining rates of crime. As Richard A. Oppel, Jr. of the New York Times pointed out two years ago, no-one really knows why this is the case.  If anything, most experts had expected crime to pick up during the recent economic crisis, but the opposite actually occurred. I don't have any particular insight to why this has happened, aside from noting that whatever's causing it, the same phenomenon is occurring next door in Canada.

Brown's quotes are specifically interesting, though, because Jerry Brown almost certainly knows he's telling a whopping lie by saying California has "one of the finest prison systems in the United States." Brown is navigating through the last portion of what was a near-meltdown of California's government.  To paraphrase Viscount Snowden, truth is the first casualty in a crisis, and Dostoyevsky's observation that "a society can be judged by entering its prisons" is as true as it ever was.  California's prisons are institutions that, like the State, are stepping back from the precipice of an economic collapse. Things have gotten better, yes, but calling California's prisons the nation's finest is, rhetorically, almost certainly a bridge too far.

Standing, Blogging, and Prop 8.

From time to time I post on other people's blogs.  I used to believe blog comments were a one-way conversation with the blogger.  That's not really why I do so any more -- the reason now is that, while there's something interesting on the blogger's site, I generally want to read what their other readers think of a particular point -- the comment threads can become Condorcet juries.  Some blogs are especially useful for that purpose.  One is the Volokh Conspiracy.

From "Supreme Court Grants Prop 8, DOMA Cases"
Orin Kerr, The Volokh Conspiracy
available at http://tinyurl.com/c9nt497

I posted a message over there on Friday to Orin Kerr, who is an expert on 4th Amendment case law regarding the Computer Fraud and Abuse Act.  The specific post concerns standing to defend California's Proposition 8.  The nice part was that twenty-two other comments on the message helped me take my own thinking on the subject a couple of more steps down the road, so to speak.

The issue being discussed, standing in the context of the Prop. 8 case, is a big deal for lawyers, but its importance to the public at large is questionable.  For instance,  Margaret Warner of the PBS Newshour referred to it as the "so-called" standing question on Friday's broadcast.  I tend to think the standing question is important, but that the issue will probably prove to be merely interesting rather than determinative.

Inscription on the wall of the Supreme Court Building
from Marbury v. Madison.

I think we as Americans believe courts have the inherent power to hear constitutional challenges of this type, which I think is the pillar of truth at the core of Marbury v. Madison (1803), 5 U.S. 137.  That inherent power cannot be fairly exercised without advocates for either side in the courtroom.  Indeed, if the Prop. 8 advocates are barred from the room, the constitutional question would, ultimately, be a de facto decision by the executive branch, not the judiciary.

We as Americans have more or less accepted that the ultimate arbiters of all constitutional questions will be the courts.  Executive and legislative interference with the court's ability to do so tends to be considered game-playing by the courts, and the Supreme Court appoints counsel to make such "orphan" arguments about once per term. The Prop. 8 case may thus become something of a natural experiment concerning the inherent power of the courts to hear disputes despite efforts by the executive and legislative branches to deprive them of the ability to do so, which should prove interesting to civil procedure scholars, if not ultimately proving important in deciding the case.