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April 2000

California's Primary Election: What Did Voters Say?
By The Cal-Tax Staff

In the wake of the March 7 California primary election, debate focused on whether defeat of a measure to make it easier to pass local school bonds shut the door on other tax-hike measures waiting in the wings for the November general election ballot.

Did voter rejection of Proposition 26, the initiative to allow passage of local school bonds by a simple majority of voters, send a message to those promoting a constitutional amendment that would make it easier to raise sales taxes for transportation? Did it sound taps for the initiative effort by the California Teachers Association (CTA) to raise billions of dollars in taxes to fund education?

Months ago, pundits suggested that passage of Proposition 26 would be the first chink in the Proposition 13 armor, and it would be followed in November with other assaults on the 22-year-old tax revolt initiative, such as the CTA initiative in circulation that would require higher taxes to increase spending on schools.

Meanwhile, voters approved more than $4.2 billion in statewide bonds for water projects, parks and libraries (Propositions 12, 13 and 14), sending a message that they want to invest in infrastructure.

They soundly rejected a campaign finance initiative (Proposition 25) that would have allowed the spending of $50 million a year in tax dollars on political campaigns, including ballot propositions.

While voters did not want to reduce the threshold of two-thirds of voters needed to pass local school bonds - which automatically raise property taxes - they also didn't want to change the law passed in 1998 that raised tobacco taxes. Proposition 28, which would have repealed the 50-cent-a-pack cigarette tax (Proposition 10), was rejected.

Propositions 30 and 31, which would have allowed 1999 statutes permitting third-party lawsuits against insurance companies, were defeated. The message from the campaign against the trial lawyers was essentially a pocketbook issue: Votes for 30 and 31 would raise insurance premiums.

In passing Proposition 1A, enabling Native Americans to run casinos with Nevada-style slot machines, voters may have approved a measure unleashing a flood of high-rolling gaming palaces in California, with Nevada interests getting involved in the action.

Proposition 26, the "Fix our Schools" initiative sponsored mainly by Silicon Valley entrepreneur Reed Hastings and the CTA, failed by about 150,000 votes of more than 6 million cast. To get that close, proponents spent more than $23 million, compared to opponents' $1.6 million.

Senate President Pro Tem John Burton declared that the result on Proposition 26 was irrelevant to his SCA 3, a proposal to allow local sales taxes to be approved by a simple majority of voters when the money goes to transportation programs. He told reporters that he intended to pursue his measure.

However, Garry South, Governor Gray Davis' senior political advisor, was quoted as saying the governor's transportation funding plan, which eschews higher taxes, was buoyed by election results. As leaked to the media, the governor would use $1 billion from the state surplus for transportation, plus put a $6 billion transportation bond measure on the November ballot. These numbers are subject to change, depending on the size of the surplus.

Mr. South was quoted in the Contra Costa Times as saying that to go to voters twice in one year to cut the "sacrosanct two-thirds majority to a simple majority is asking for trouble."



Garry South was quoted in the Contra Costa Times as saying that to go to voters twice in one year to cut the "sacrosanct two-thirds majority to a simple majority is asking for trouble."

Nevertheless, lawyers for the CTA on March 10 filed eight initiative proposals with the attorney general for title and summary and potential circulation for the November ballot. They would reduce the threshold for approving local school bonds from two-thirds to a simple majority, or require approval by 55, 58 or 60 percent of the voters. Four of the measures also propose a $1 billion state bond measure for repairing or replacing unsafe school buildings.

Meeting transportation needs, according to Senator Burton, requires ongoing revenue sources. "Bonds don't do the job If you don't have something like SCA 3 that's an ongoing source of revenue, the rest of it is all a bunch of bandages to make people feel good or try to get off the hook."

Senate Republican Caucus Chair Jim Brulte said it is clear the public is unwilling to make it easier to raise taxes, boding ill for another tax-hike measure in November.

Senator Burton, meeting with reporters, criticized a San Jose Mercury News headline two days after the election that said: "Transit setback: School measure's loss hurts copycat amendment."

Carl Guardino, leader of the Silicon Valley Manufacturing Group that has been a prime backer of SCA 3, sounded glum. "Even optimists like me think the mountain just got much steeper," he told the Mercury News. "With the demise of Proposition 26, I fear many will replace SCA with DOA."

On the eve of the election, Governor Davis, like other proponents, said Proposition 26 would not raise taxes. The measure, in and of itself, would not raise taxes, but by changing the rules so that virtually every local school bond succeeds, property taxes would surely go up. The Legislature's nonpartisan fiscal watchdog, Legislative Analyst Elizabeth Hill, accurately depicted the fiscal impact of Proposition 26 in the ballot literature. In the minds of many, that was what turned voters against the measure.

Kris Vosburgh of the Howard Jarvis Taxpayers Association (HJTA), reacting to the governor's statement, told The Associated Press that the initiative "would make it a virtual certainty that local school bonds will pass, regardless of merit, and passage of these bonds triggers an automatic property tax increase. It's like saying it isn't the knife that kills someone, it is the loss of blood."

Jon Coupal, HJTA president, said, "We just barely dodged a bullet" with Proposition 26. He was aware that the teachers union had filed new initiatives two days after the election. Since this action was done without fanfare, he surmised that the teachers were "just keeping their options open."

Needing two-thirds voter approval, it will be difficult to gain renewal of 18 county sales taxes that fund transportation, the Mercury News reported, raising the question of whether California is on the verge of its worst traffic congestion crisis ever.

Meanwhile, a review of election results indicates that, in general, most California voters are not interested in increasing taxes directly. Four of six local sales tax measures were defeated. Local transient (hotel/motel) occupancy taxes and utility user taxes also fared poorly. Some parcel property tax increases were approved, and the outcomes on bond measures were mixed.

Both hotly contested sales tax increase proposals in Sonoma County received more than a majority vote, but failed to garner two-thirds approval required for passage. Measure B, a 0.5 percent sales tax to widen U.S. Highway 101, lost by a margin of 58.4 "yes" to 41.6 percent "no." Environmentalists pulled out all the stops to defeat Measure B. The Santa Rosa Press Democrat noted the irony of the Sonoma County Taxpayers Association and conservative business and political leaders urging a tax increase and liberal environmentalists opposing the tax.

Measure C, a 0.25 percent sales tax increase for transportation projects, was defeated by a margin of 60.2 percent "yes" to 39.8 percent "no."

Within a week of the election, Rohnert Park Council Member Jack Mackenzie proposed that Sonoma County put a measure on the November ballot to impose congestion impact fees on large companies when they expand their work forces.

In Santa Barbara County, a 0.5 percent sales tax increase to fund a north county jail received only 38.9 percent of the vote. The tax would have raised $116 million over five to seven years.

Chief Probation Officer Sue Gionfriddo, a supporter of Measure U, said, "There seemed to be a clear understanding of the need, but a non-appetite for new taxes. People feel taxes are high enough, and California has a surplus of several billion dollars."

 A review of election results indicates that, in general, most California voters are not interested in increasing taxes directly. Four of six local sales tax measures were defeated.
Results of March 7 Voting on Statewide Ballot Issues
    Yes % No %
Proposition 1A (Tribal Gaming) 64.6 35.4
Proposition 12 (Parks and Water Bond) 63.2 36.8
Proposition 13 (Drinking Water Bond) 64.8 35.2
Proposition 14 (Library Bond) 59.0 41.0
Proposition 15 (Crime Lab Bond) 46.3 53.7
Proposition 16 (Veterans' Homes) 62.5 37.5
Proposition 17 (Lotteries and Raffles) 58.6 41.4
Proposition 18 (Murder) 72.4 27.6
Proposition 19 (Peace Officers) 73.5 26.5
Proposition 20 (State Lottery) 53.1 46.9
Proposition 21 (Juvenile Crime) 62.0 38.0
Proposition 22 (Limit on Marriage) 61.4 38.6
Proposition 23 (None of Above) 36.0 64.0
Proposition 24 was removed by the courts.  
Proposition 25 (Campaign Finance) 34.8 65.2
Proposition 26 (Local Majority Vote) 48.8 51.2
Proposition 27 (Congress Term Limits) 40.5 59.5
Proposition 28 (Repeal Tobacco Tax) 28.0 72.0
Proposition 29 (Indian Gaming) 53.0 47.0
Proposition 30 (Insurance Lawsuits) 31.5 68.5
Proposition 31 (Insurance Amendments) 28.4 71.6
Editor's Note: Cal-Tax was prominent in the campaigns for Propositions 12 and 13 and opposition to Propositions 25, 30 and 31. The association also supported Proposition 28, opposed Proposition 20, and made no recommendation on the others.