Understanding the Differences Between an Initiative vs. Referendum

Updated: February 11th, 2025

An initiative and a referendum are two forms of direct democracy that allow citizens to shape laws through voting. The key difference is that an initiative lets voters propose new legislation or constitutional amendments, while a referendum gives the public the power to approve or reject laws passed by the legislature. 

These processes, along with recall elections, are essential tools for public participation in government. If you’ve ever wondered what a recall, referendum, and initiative are, understanding their distinctions is crucial to navigating civic engagement.

Referendum voting plays a significant role in state governance, but the rules vary across the country. State laws on referendums determine whether they are obligatory–required for certain legislative actions–or optional, triggered by citizen petitions. Whether used to uphold or overturn legislation, these processes ensure that voters have a direct voice in shaping the policies that govern them. In this article, we’ll break down initiatives and referendums, how they work, and their impact on the legislative process.

What Is an Initiative?

An initiative is a process that enables citizens to propose statutes–or in some states, constitutional amendments–and put them on the ballot or send them to the legislature. 

That said, not anyone can just draft a law and submit it. It requires sufficient backing, usually through a certain number of supporting signatures from registered voters. Once the proposed rule is on the ballot, the community can pass it with a majority vote, although there are exceptions in some cases..

Direct vs. Indirect Initiative

There are two types of initiatives: direct and indirect. With the direct process, proposals that pass the preliminary requirements go straight to the ballot. If it wins the popular vote, then the proposal becomes law.

Indirect initiatives are a bit different. The qualified proposal goes to the legislature indirectly. They can either approve it or offer a similar alternative to the law. In this case, submissions can become law without a popular vote. But, if the legislature doesn’t pass the initiative, it may still have the option of being included on a ballot and voted on. In this case, the public has the power to override the legislative decision. 

What Is a Referendum?

In some states with the indirect initiative process, the legislature can submit a countermeasure that shows up on the ballot alongside the original proposal. Citizens choose between the two.

Referendums are widespread in the US, appearing in all fifty states. They’re usually less controversial and are more likely to be voted on and approved by an electorate than initiatives are. In a referendum, the legislature refers a law to the public for rejection or approval through a vote.

Obligatory vs. Optional Referendum

In some situations (e.g., constitutional changes, bond measures, or tax changes), referendums are mandatory. These are also known as ‘obligatory’ or ‘compulsory referendums.’ Certain legislation classes require a popular vote for approval or rejection, and a referendum can either be mandatory or optional.

Legislation that doesn't require a popular vote can still be on the ballot in what’s referred to as an optional, popular, or facultative referendum. Here, a specified number of voters can demand, by petition, that a proposed law be put up to a vote, giving citizens the power to overturn laws in a quasi-public veto.

Under the optional or facultative referendum, a community requires a popular vote on a law passed by the legislature whenever it is petitioned by a specified number of voters. In this case, a population can overrule the actions of a legislature. 

What Is a Plebiscite?

There is another type of referendum called a plebiscite, or voluntary referendum. Here, the legislature decides to refer legislation to voters, usually to determine an issue or test public opinion. 

Depending on the nature of the plebiscite, the result may be binding or advisory. With the latter, even a majority vote won’t necessarily affect implementation.

What Is the Difference Between an Initiative and a Referendum?

Initiatives and referendums share the same goal of enabling citizens to take active roles in a democratic legislative processes. However, they differ in approach and origin. Initiatives start with the people. 

Citizens draft the proposal, petition to add it to the ballot and vote on it. Meanwhile, referendums originate with the government, and the legislature submits legislation to the people for approval.

Can I Apply Initiative and Referendum in Nonpolitical Voting?

Initiatives and referendums don’t just exist in governments. You can also apply both concepts to nonpolitical issues, such as those relevant to organizations, associations, unions, corporations, or schools.

For example, you can submit a petition to the board of your sports club and your buddies can decide to propose a new regulation that includes a change to the membership payment terms. When you get some backing and put it to a vote, this is how an initiative works in practice. Alternatively, if you’re part of the governing body of a company, and you want to get your employees to vote on a particular issue, you can initiate a referendum.

Whether you follow the initiative or referendum process, it’s essential to use an efficient election system like ElectionBuddy. This will ensure that you include all the necessary information and provide voters with secure access to their ballots, so that you can maintain the integrity of the elections in the same way traditional initiatives and referendums do.