WASHINGTON (AP) - The Supreme Court refused Monday to hear a challenge to an Oregon law that requires tax-related ballot measures to include a warning that taxes may increase more than 3 percent.

Last September the 9th U.S. Circuit Court of Appeals in San Francisco overturned a ruling by U.S. District Judge Ancer Haggerty in Portland that had found the tax warning, a byproduct of the 1997 Measure 50 property tax limitation, unconstitutionally vague.

The ruling stemmed from a case brought by Michael Caruso, a retired fruit and vegetable wholesaler from Dundee, after voters turned down his ballot measure to raise $9,700 to study formation of a public utility district to replace PG&E.

Caruso had argued that allowing the 3 percent warning to stay in place would allow opponents of similar measures to wage campaigns of distortion.

Caruso contended that his free speech rights were violated by forcing him to include misleading information on the ballot measure, and his due process rights as a voter were violated.

Haggerty agreed with the free-speech claims, ruling that the 3 percent warning was false and misleading, and obscured the actual subject of Caruso's ballot measure by implying it would increase property taxes 3 percent by itself.

The appeals court found that the required warning might actually encourage more speech, because petition circulators would want to inform voters that their ballot measure would not, by itself, cause such an increase. The appeals court justices added that voters were likely to be familiar with the terms of the 3 percent warning, because it was adopted by referendum.