All is fair in love, war, and taxes. At least, California Democrats are hoping to make it so.
This past week, two constitutional amendments moved to the Senate.
Assembly Constitutional Amendment 1 (ACA-1) would lower the two-thirds supermajority currently required in local elections to levy general obligation bonds and special taxes to a 55% majority. Special taxes include those imposed to fund public infrastructure projects and affordable housing projects.
Assembly Constitutional Amendment 13 (ACA-13), would ensure that any ballot measure intent on increasing a voter threshold itself be approved by that same voter threshold.
So what does this all mean?
What it boils down to is the ease at which state and local governments can impose taxes on their constituents. Republicans want to raise the voting hurdle which proposed taxes must surmount. Democrats want to keep the rules just as they are.
As it stands, local general taxes only require a simple majority vote by citizens for approval. The voting majorities required to approve special taxes are variable—special taxes initiated by local citizens can pass with a simple majority, while special taxes initiated by the government require a supermajority.
Here, another legislative initiative comes into play.
A measure that has already qualified for inclusion on the November 2024 ballot has been dubbed the “Taxpayer Protection and Government Accountability Act.” It seeks to do just that—protect business interests and anti-tax sentiment by raising the hurdle for all special taxes back up to two-thirds, regardless of their initiation. It would also require approval by not only the Legislature, but California voters as well.
That two-thirds requirement by the Legislature might sound familiar if you know anything about Prop 13. It was a landmark tax limitation initiative passed in 1978 in response to California’s property tax increases and the state’s growing revenue surplus. At the time, it rolled back those very property taxes and restrained the role of the state. It allowed for the Legislature to hike state taxes as it saw fit, but required a supermajority to do so. Republicans worry that that built-in tax limitation is being eroded. Hence the ballot measure.
Republicans are wary of any measures that could facilitate tax hikes. Jon Coupal, President of the Howard Jarvis Taxpayers Association, sees ACA-13 as an unnecessary burden on the shoulders of already beleaguered Californians.
“California has the highest income tax rate in America at 13.3%. We have the highest state sales tax rate at 7.25%. We have the highest gas tax in the nation, which I think probably impacts you folks in Mammoth Lakes that have to drive great distances. And even with Prop 13, we ranked 14th out of 50 states in per capita property tax collection.”
And while Coupal admits that public works issues, such as housing, are a problem for the state, he is hesitant to concede that higher taxes will solve the issue.
“Until we have things like CEQA reform, and allowing developers to build housing stock, all you’re doing is rearranging the deck chairs on the Titanic.”
But Democrats have responded to ACA-13 opposition by dismissing the claims against it. Author of the bill, Assemblymember Christopher Ward (D), affirmed that the measure would not be retroactive, and would not affect Prop 13.
Another interesting thing about Prop 13—itself an item of legislation concerned with raising the voting majority threshold. The proposition just barely eked by with a two/thirds majority when it was originally passed. Democrats want to ensure that ballot measures concerning raising voter thresholds can play by the rules of their own game. In Democrats’ eyes, then, ACA-13 “is about fairness” said Assembly Speaker, Robert Rivas (D). “[It] stops an unfair double-standard and protects the majority vote.”
Both ACA-1 and ACA-13 have real-time implications for California voters. I guess that goes without saying. Many Californians pushing for ACA 13 work in the public sector—the higher the obstacle to raising taxes, the harder the hit they take to potential pay raises and employee benefits.
ACA-1 ranks high on the list for those lobbying for community infrastructure and affordable housing. It’s worth noting that the forebearer to ACA-1 was a vote passed 23 years ago, pertaining to special taxes. Californians decided that a supermajority for taxes levied to fund school construction was too high, and lowered the threshold to 55%.
“ACA-1 will make it possible for all levels of local government—the governments closest to the people—to have the same tools,” said Walnut Creek Mayor, Cindy Silva.
The State Senate will vote on both ACA-1 and ACA-13 today, September 14. Should they pass, they’ll land on Newsom’s desk.