Examining the landmark cases that have shaped the powers and limitations of California charter cities
Charter cities in California derive their authority from Article XI, Section 5 of the California Constitution, which grants them autonomy over "municipal affairs."
This constitutional provision has led to decades of litigation as the boundaries between "municipal affairs" (under local control) and "matters of statewide concern" (under state control) continue to be tested and refined through court decisions.
The legal landscape surrounding charter cities involves complex issues of federalism, local control, and the appropriate balance of power between state and local governments. This page explores the major legal precedents that have shaped our understanding of charter city powers and limitations.
"The constitutional concept of municipal affairs is not a fixed or static quantity. It changes with the changing conditions upon which it is to operate."
Whether charter cities are exempt from state prevailing wage requirements for locally funded public works projects.
Reaffirmed charter cities' autonomy over "municipal affairs" even in the face of conflicting state law.
The City of Vista, after becoming a charter city in 2007, enacted an ordinance prohibiting city contracts from requiring compliance with the state's prevailing wage law. The State Building and Construction Trades Council sued, arguing that the state's interest in prevailing wages outweighed local control.
In a 5-2 decision, the California Supreme Court held that the wage levels of contract workers constructing locally funded public works are a "municipal affair" not subject to state regulation. The Court found that Vista, as a charter city, could exempt itself from the state's prevailing wage laws for projects funded entirely by local revenues.
"We conclude that the state law at issue here addresses a municipal affair (the spending of a charter city's own money on public works projects), and that Vista's ordinance is therefore beyond the reach of the Legislature."
How to determine whether a matter is a "municipal affair" or a "matter of statewide concern."
Established the modern test for resolving conflicts between state law and charter city ordinances.
The case involved the City of Los Angeles' attempt to impose a business tax on financial institutions despite state law prohibiting local taxation of certain financial entities. The case required the Court to develop a framework for analyzing conflicts between state law and charter city authority.
The Court established a four-part analysis that continues to be used today:
"The constitutional concept of municipal affairs is not a fixed or static quantity. It changes with the changing conditions upon which it is to operate."
Whether state labor laws apply to charter city employees.
Established that the compensation of charter city employees is a municipal affair not subject to state regulation.
City of San Jose employees claimed they were entitled to receive the prevailing wages required by state law. The city contended that as a charter city, it had authority over the compensation of its own employees.
The California Supreme Court ruled that the setting of employee compensation is a municipal affair within the exclusive control of charter cities. The Court held that the state's prevailing wage law did not apply to charter city employees performing municipal functions.
"The salaries of local employees of a charter city constitute municipal affairs and are not subject to general laws."
Whether charter cities must comply with California's sanctuary state law (SB 54) limiting local cooperation with federal immigration authorities.
Limited charter city authority when state law addresses matters of "statewide concern."
Huntington Beach challenged California's "sanctuary state" law (SB 54), which limits cooperation between local law enforcement and federal immigration authorities. The city argued that as a charter city, it had the constitutional authority to regulate its police department and was exempt from SB 54.
The courts rejected Huntington Beach's arguments, finding that immigration enforcement cooperation is a matter of statewide concern that overrides local control, even for charter cities. The California legislature subsequently passed additional legislation (SB 1333) specifically stating that certain housing laws apply to all cities, including charter cities.
"The Legislature has found that the benefits of housing production and affordability are vitally important statewide interests that outweigh the municipal interest in subjecting certain housing approvals to the referendum."
Whether a charter city must meet and confer with unions before placing a citizen-initiated pension reform measure on the ballot.
Established that certain procedural requirements apply to charter cities even when exercising charter authority.
San Diego's mayor helped promote a citizen initiative (Proposition B) to reform city pensions by replacing defined benefit plans with 401(k)-style plans for most new city employees. Labor unions challenged the initiative, arguing the city violated state law by failing to "meet and confer" with unions before placing the measure on the ballot.
The California Supreme Court unanimously ruled that even though employee pensions are a "municipal affair," the procedural requirement to meet and confer with unions before making changes to employment terms is a matter of statewide concern that applies to charter cities. The Court invalidated San Diego's pension reform initiative because the city failed to follow this procedural requirement.
"When a local government measure touching on labor relations is enacted by voter initiative, we presume the voters have acted with awareness of the existing law."
1879
The California Constitution was amended to include the "home rule" provision, allowing cities to adopt charters and exercise greater control over "municipal affairs."
1959
California Supreme Court established that labor relations in the public sector are matters of statewide concern, limiting charter cities' autonomy in this area.
1969
California Supreme Court ruled that charter cities have exclusive control over the compensation of their employees, as this is a municipal affair.
1976
Court invalidated state legislation restricting local governments' ability to provide cost-of-living increases to employees, reinforcing charter cities' control over employee compensation.
1991
Established the four-part test for determining whether a matter is a municipal affair or of statewide concern, creating the framework still used today.
2012
California Supreme Court ruled that charter cities may exempt themselves from state prevailing wage requirements for locally funded public works projects.
2018
Court ruled that charter cities must meet and confer with labor unions before placing certain measures on the ballot, even when exercising charter authority.
2019
State sued Huntington Beach over its refusal to comply with state housing laws, leading to legislation clarifying that housing laws apply to all cities, including charter cities.
2019
California Legislature passed legislation explicitly stating that certain housing laws apply to charter cities, limiting their autonomy in this area.
The legal precedents surrounding charter cities reveal an evolving interpretation of what constitutes a "municipal affair" versus a "matter of statewide concern." While early cases tended to favor broad charter city autonomy, more recent decisions have expanded the scope of what qualifies as a statewide concern, particularly in areas such as housing, labor relations, and immigration.
The four-part test established in California Federal Savings & Loan Assn. v. City of Los Angeles continues to be the primary framework for resolving conflicts between state law and charter city ordinances. This test requires courts to consider not only whether an issue is municipal or statewide, but also whether state intervention is reasonably related to the statewide concern and narrowly tailored to minimize interference with local governance.
Recent legal developments suggest a trend toward increased state authority in areas traditionally considered municipal affairs:
These legal precedents have significant implications for charter cities:
"The notion of 'municipal affairs' is not a static concept, but changes with the changing conditions upon which it operates. What may at one time have been a matter of local concern may at a later time become a matter of state concern controlled by the general laws of the state."