The Two-Thirds Vote Lawsuit Needs a Revision
The lawsuit filed Friday by former UCLA Chancellor Charles Young has all the appearance of an act of desperation on the part of spending interests. The basis of the lawsuit claims that Proposition 13 did not merely amend the constitution but revised it, which an initiative cannot do.
Where has Chancellor Young been these past 31 years? Why, all of a sudden, did he and his attorneys “discover” this constitutional flaw?
The fact is the California Supreme Court, the same court Young wants to take original jurisdiction over his lawsuit, addressed the argument that Proposition 13 was a constitutional revision in 1978.
In its ruling on a case brought by the Amador Valley School District and joined by many Prop 13 opponents, the court confirmed that an initiative may not “revise” California’s constitution. However, the court then said that Prop 13 did not amount to a revision.
As Deadline Fades, Budget Talks Slow
Controller John Chiang’s grim report on the state’s year-end cash figures Friday added another red flag to the sea of scarlet surrounding the state budget, but it was the “good” news that may be the most worrisome.
While the state originally was projected to run out of the cash needed to pay its debts and its workers later this month, the use of IOUs “will preserve enough cash to make those protected payments through September,’’ the report stated.
Urgency? What urgency? With the latest absolutely, positively, no-kidding-this-time deadline now somewhere out there in the distance, that leaves plenty of time for the posturing, finger-pointing, name-calling, sulking and other political game-playing that make up the annual budget dance.
Democrats For a Flat Tax?
The below story about the Commission on the 21st Century Economy — California’s tax reform commission — appeared Saturday in the Wall Street Journal. As I reported it, I began to wonder how the approach that many of the commissioners seem to favor (a simpler and flatter income tax, combined with a business net receipts tax) might be sold to skeptical liberals, who are already starting to fight it. (If you want to learn more, go to this page and read some of the PDF files, which show the efforts by some Democratic appointees on the commission to change the package to attract the support of progressives).
The answer? Link adoption of the tax commission recommendations to an elimination in the requirement of a 2/3 vote to raise taxes or pass the budget.
Why? Polling shows that there’s little chance that voters will eliminate the 2/3 requirement. But Democrats could change the conversation by approaching 2/3 at the same time they are pushing tax commission changes that could very easily be sold as a tax decrease. (Income taxes would be reduced for some, and corporation and state sales taxes would be reduced or eliminated under packages being considered). Legislative Democrats would be wise to put the tax commission recommendations up for a vote but make sure the legislation is linked to voters changing 2/3 next year. That is, the tax commission recommendations go into effect only if 2/3 is eliminated.
Fiorina responds to SF Chronicle Story
Many of you likely read the story in this past Friday’s SF Chronicle, accusing possible US Senate hopeful Carly Fiorina of a lack of compliance with government filings in reference to two entities she owns – Carly Fiorina Enterprises and the Fiorina foundation.
Deborah Bowker, Fiorina’s Chief of Staff, contacted us with a brief response:
Carly Fiorina gives of her time and money to help alleviate poverty around the world, empower women, advance freedom of the press, and help the needy throughout the Bay Area. Her activities are fully in compliance with California and federal law and she has fulfilled her tax obligations.
Regarding Carly Fiorina Enterprises (CFE), like many small business owners, she is a sole proprietor and files her taxes as such in the state of California. State registration is not required as CFE is not a separate legal entity. Regarding the Fiorina Family Foundation, it is not a private foundation and there are no required legal filings with the State of California or the IRS.
New Study Finds AB 32 Scoping Plan Imposes Staggering Costs on California’s Families and Small Businesses
Our study released today finds that small businesses in California will pay an additional $49,691 as a result of the California Air Resources Board’s implementation of AB 32. The study, which we conducted at the request of the California Small Business Roundtable, analyzes the potential economic impacts of AB 32 on the state of California, its consumers and its small businesses.
The study focuses on the costs to be incurred by consumers in five specific areas: housing, transportation, natural gas, electricity and food. Using three different scenarios to measure the economic costs, we find that the potential loss of output, jobs, indirect business taxes and labor income is substantial and significant.