What it does: Proposition 30 increases personal income tax on top tier taxpayers (those with taxable incomes of $250,000/year and higher for seven years). It increases sales tax by ¼ cent for four years and makes new funds available to meet Proposition 98 school funding requirements, thereby freeing up revenues to spend for other purposes. If the initiative passes, it constitutionally guarantees funding for public safety services that were realigned in 2011 from the state to local governments.
Who’s for it: Governor Jerry Brown sponsors the measure. Supporters include the California Federation of Teachers, the “Millionaire’s Tax” nonprofit and labor coalition, the California Pan-Ethnic Health Network, the League of Women Voters of California, SCOPE (Strategic Concepts in Organizing and Policy Education), the California Budget Project (partial list).
What it means for Nonprofits: Depending on how freed-up revenues (perhaps $4.5 billion annual) are allocated, nonprofits affected by government funding declines may obtain some modest fiscal relief. If the measure fails, $6 billion in automatic trigger cuts to education will occur, leaving nonprofits to pick up more of the slack than we already do to support education programs such as sports and arts.
What it does: The initiative increases state personal income tax rates for most Californians for 12 years. It earmarks most of resulting revenue for K-12 schools, with 10% for early childhood development and dedicates 30% to retire school debt, thus relieving pressure on the deficit-plagued general fund.
Who’s for it: Molly Munger, Los Angeles attorney and co-founder of the nonprofit Advancement Project, Americans for Tax Reform, California State PTA, California Head Start Association (partial list)
What it means for Nonprofits: Depending on how freed-up revenues are allocated, nonprofits affected by government funding declines may obtain some modest fiscal relief. Depending on how school districts allocate funds, additional funding will be provided to early childhood programs.
How we see it (Proposition 30 and 38): Both propositions are flawed as neither provides long-term solutions to California’s fiscal problems. Both restrict dollars in ways that tie hands of legislators in overall budget management. But both are still efforts in the right direction. Depending on how the new revenues are spent – both will directly or indirectly advance nonprofit missions that are concerned with social equity and mobility, community development, and educational opportunities. We simply cannot address community need without increased revenues. As a result, the CalNonprofits board of directors voted unanimously at its July meeting to endorse both measures, and to encourage nonprofit staff, volunteers and constituents to vote for them.
What it does: Attempts - in the words of sponsor California Forward - to "change the culture of governance in the state" by adjusting budget cycles and procedures, establishing performance measures for state programs, and authorizing local governments to change how state-funded programs apply to them.
Who’s for it: California Forward Action Fund, California Church Impact
Who’s against it: California Democratic Party, California League of Conservation Voters, League of Women Voters of California
How we see it: While Prop. 31 is well-intentioned, it has several significant flaws: its untested budget process tweaks are dubiously good ideas; its performance measures are likely to result in unfunded and byzantine reporting burdens that will impact nonprofits with government funding; and the local option for state requirements sets the stage for huge variations, especially when it comes to environmental laws, creating regulatory headaches and health and conservation problems for already over-extended nonprofits to have to deal with.
What it does: Puts new limits on the ability of unions and corporations to collect and use payroll tax deductions for "political purposes" and makes it illegal for government contractors to contribute to elected officials who have a hand in awarding them a contract, at least while that contract is under consideration or is in effect.
Who’s for it: Various business associations (California Manufacturers and Technology Association) and wealthy individuals (Charles Munger, Jerry Perenchio, Tim Draper, Howard Ahmanson, Richard Riordan)
Who’s against it: Organized labor, California Common Cause, League of Women Voters of California
How we see it: Prop. 32 weakens the power of unions to raise political funds through payroll deduction while preserving the abilities of corporations and business owners to use funds for political purposes. Although nonprofits and unions are sometimes allies and sometimes opponents in the political realm, we believe Prop. 32 would result in an even more unbalanced political system.
What it does: Under current Three Strikes Law, if a person has two or more serious felonies on record, then a third felony conviction -- even for a nonviolent crime -- automatically leads to a sentence of life imprisonment. Prop 36 would automatically impose life sentences on the third strike only when the third felony conviction is serious or violent.
Who’s for it: NAACP, George Soros
Who's against it: Mike Reynolds, author of the Three Strikes Law, enacted by voters in 1984
How we see it: Three Strikes is a big part of the reason why California has an unusually large prison system. As a result, a disproportionate amount of the of the California budget is used for prisons, and our prisons and jails are crowded with individuals whose third strike of drug possession or petty theft does not warrant life imprisonment. We believe that a portion of the anticipated savings should go to re-entry programs and other services -- often best delivered by nonprofits -- such as violence prevention.
What it does: UChanges the way multistate businesses -- the third largest source of revenue for the state's General Fund, totaling $9.6 billion in 2010-11 -- pay taxes in California. Right now corporations doing business in multiple states pay taxes on the profits they earn in California based on the lowest tax rate of any state they operate in. This measure would ensure that they pay our state the taxes they owe based on California law, just like businesses that only work in California.
For the first five years half the anticipated $1 billion in new revenue would go to create and support the Clean Energy Job Creation Fund. Remaining revenues would go toward funding the state's schools budget and other state programs, many of which support or partner with nonprofits.
Who’s for it: Tom Steyer, Silicon Valley entrepreneur and philanthropist
Who's against it: Chrysler, General Motors, International Paper, Kimberly-Clark
How we see it: Prop. 39 serves several important purposes: by giving California a fairer share of taxes paid by multistate businesses, it generates new revenues to fund essential state services; it creates an estimated 40,000 jobs while improving the environment; it has the potential to reduce government and nonprofit energy costs.
For questions, please contact:
Jan Masaoka, CEO or Linda Davis, Board Chair
c/o Edan Enriquez email contact form