LAO offers analyses of two Prop. 30 extension initiatives; merger of the two initiatives remains possible
Published: November 18, 2015
The Legislative Analyst’s Office, as is customary for all proposed ballot initiatives, has provided summary analyses of the two 2016 initiatives that have been filed to extend the income tax portions of Proposition 30.
The School Funding and Budget Stability Act of 2016:
- Backed by the California Teachers Association and others
- Would extend the income tax portions of Proposition 30 (which expire in 2018) through 2030
- Excludes the additional revenues from the Proposition 2 state rainy day fund
- The LAO estimates that:
- Increases in school spending over the ensuing 12 years could vary significantly, depending on several economic factors and Proposition 98 variables
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Increase in state revenue would likely fall between $5 billion to $11 billion annually, with the Proposition 98 share of that being in the $2 billion to $4.4 billion range
The Invest in California’s Children Act:
- Backed by the California Hospital Association and SEIU-United Healthcare Workers
- Would make the Proposition 30 income tax extensions permanent, with the added revenue split between schools and Medi-Cal funding
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A new reserve fund would be created with 3 percent of the measure’s revenues deposited annually until the balances reaches 20 percent of the measure’s revenue
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The allocation of added revenue from this measure would also change if the Governor declares a budget emergency under Proposition 2
- The Legislature may vote to use up to half of this measure’s annual revenues (those not deposited to the measure’s new reserve fund) to help balance the state budget
- The LAO estimates that:
- Increased revenue, which would vary similarly to the first measure above, would be between $7 billion to $15 billion initially
- 40 percent allocated to K-12 general purpose funding
- 10 percent to child care and child development programs
- 5 percent each to community college and California State University/University of California systems
Neither measure proposes to extend Proposition 30’s sales tax portions.
The Sacramento Bee reported on Nov. 4 that backers of the two measures are in talks to create a unified front behind one of the two proposed measures and withdraw the other.
“All parties involved know that having two Prop 30-like measures on the ballot could create substantial confusion for voters and hinder the chances of either measure passing,” said Dennis Meyers, CSBA assistant executive director of Governmental Relations. “Right now, we expect that we’ll see a merger between these two measures in the coming weeks to allow enough time to gather signatures.”
CSBA will continue to monitor the progress of these initiatives and report any significant developments.