California Proposition 30, Sales and Income Tax Increase Initiative (2012)

California Proposition 30
Election date November 6, 2012
Topic Taxes
Status a Approved
Type Constitutional amendment	Origin Citizens

California Proposition 30 was on the ballot as an initiated constitutional amendment in California on November 6, 2012. It was approved.

A "yes" vote supported this ballot initiative to: • increase the state sales tax from 7.25% to 7.50% for a period of four years; • create four new tax brackets and tax rates for incomes exceeding $250,000, $300,000, $500,000, and $1 million for a period of seven years; and • distribute the revenue from the tax increases to K-12 schools and community colleges.

A "no" vote opposed this ballot initiative to increase the state sales tax for a period of four years, create four new tax brackets and tax rates for incomes exceeding $250,000, and distribute the revenue from the tax increases to K-12 schools and community colleges.

Overview

Proposition 30 was designed to increase the state sales tax and state income tax for limited periods of time. The sales tax increased from 7.25% to 7.50% for four years. The ballot initiative also created four new income tax brackets and tax rates for incomes exceeding $250,000, $300,000, $500,000 and $1,000,000 (for single payers) for seven years. In 2016, voters approved a ballot initiative, Proposition 55, to extend the income tax increase for an additional 12 years.

Proposition 30 was also designed to distribute revenue from the tax increases into an Education Protection, which would then be distributed to to K-12 schools (89%) and community colleges (11%).

Election results

See also: 2012 ballot measure election results

California Proposition 30
Result		Votes	Percentage
Yes		7,014,114	55.37%
No		5,653,637	44.63%

Results are officially certified.

Source

Text of measure

Ballot title

The ballot title for Proposition 30 was as follows:

“

Temporary Taxes to Fund Education. Guaranteed Local Public Safety Funding. Initiative Constitutional Amendment.

”

Ballot summary

The ballot summary for this measure was:

“

• Increases personal income tax on annual earnings over $250,000 for seven years. • Increases sales and use tax by ¼ cent for four years. • Allocates temporary tax revenues 89% to K–12 schools and 11% to community colleges. • Bars use of funds for administrative costs, but provides local school governing boards discretion to decide, in open meetings and subject to annual audit, how funds are to be spent. • Guarantees funding for public safety services realigned from state to local governments.

”

Full Text

The full text of this measure is available here.

Fiscal impact statement

See also: Fiscal impact statements for California's 2012 ballot propositions

The following is the fiscal impact statement for the ballot initiative:

“

Additional state tax revenues of about $6 billion annually from 2012–13 through 2016–17. Smaller amounts of additional revenue would be available in 2011–12, 2017–18, and 2018–19. These additional revenues would be available to fund programs in the state budget. Spending reductions of about $6 billion in 2012–13, mainly to education programs, would not take effect.

”

Support

Supporters

Officials

• Gov. Jerry Brown (D)

Parties

• California Democratic Party

Organizations

• California Federation of Teachers
• California Police Chiefs Association
• California State Sheriffs’ Association
• California Teachers Association
• League of Women Voters of California

Arguments

The following supporting arguments were presented in the official voter guide:

“ After years of cuts, California’s public schools, universities, and public safety services are at the breaking point. In the last four years alone, our schools have been hit with $20 billion in cuts, over 30,000 fewer teachers, and class sizes that are among the largest in the country. Our children deserve better. It’s time to take a stand and get California back on track. Proposition 30, the Schools & Local Public Safety Protection Act, is supported by Governor Jerry Brown, the League of Women Voters and a statewide coalition of leaders from education, law enforcement and business. There is broad support for Prop. 30 because it’s the only initiative that will protect school and safety funding and help address the state’s chronic budget mess: Prevents deep school cuts. Without Prop. 30, our schools and colleges face an additional $6 billion in devastating cuts this year. Prop. 30 is the only initiative that prevents those cuts and provides billions in new funding for our schools starting this year—money that can be spent on smaller class sizes, up-to-date textbooks and rehiring teachers. Guarantees local public safety funding. Prop. 30 is the only measure that establishes a guarantee for public safety funding in our state’s constitution, where it can’t be touched without voter approval. Prop. 30 keeps cops on the street. Helps balance the budget. Prop. 30 balances our budget and helps pay down California’s debt—built up by years of gimmicks and borrowing. It is a critical step in stopping the budget shortfalls that plague California. To protect schools and safety, Prop. 30 temporarily increases personal income taxes on the highest earners— couples with incomes over $500,000 a year—and establishes the sales tax at a rate lower than it was last year. Prop. 30’s taxes are temporary, balanced and necessary to protect schools and safety: Only highest-income earners pay more income tax: Prop. 30 asks those who earn the most to temporarily pay more income taxes. Couples earning below $500,000 a year will pay no additional income taxes. All new revenue is temporary: Prop. 30’s taxes are temporary, and this initiative cannot be modified without a vote of the people. The very highest earners will pay more for seven years. The sales tax provision will be in effect for four years. Money goes into a special account the legislature can’t touch: The money raised for schools is directed into a special fund the legislature can’t touch and can’t be used for state bureaucracy. Prop. 30 provides for mandatory audits: Mandatory, independent annual audits will insure funds are spent ONLY for schools and public safety. Join with the League of Women Voters and California teachers and public safety professionals. Vote YES on Proposition 30. Take a stand for schools and public safety. ”

Opposition

Opponents

Parties

• California Republican Party

Organizations

• Americans for Prosperity
• Americans for Tax Reform
• Howard Jarvis Taxpayers’ Association
• National Federation of Independent Business California
• Small Business Action Committee

Arguments

The following opposing arguments were presented in the official voter guide:

“ NO on Prop. 30: It is just a $50 Billion Political “Shell Game”—But Doesn’t Guarantee New Funds for Schools The politicians behind Prop. 30 want us to believe that if voters approve Prop. 30’s seven years of massive tax hikes, the new money will go to classrooms. Nothing could be further from the truth. Prop. 30 allows the politicians to play a “shell game” instead of providing new funding for schools: They can take existing money for schools and use it for other purposes and then replace that money with the money from the new taxes. They take it away with one hand and put it back with the other hand. No matter how you move it around, Prop. 30 does not guarantee one penny of new funding for schools. Many educators have exposed this flaw and even the California School Boards Association stated that “ . . . the Governor’s initiative does not provide new funding for schools.” (May 20, 2012) The Wall Street Journal identified the same flaw, stating that “California Governor Jerry Brown is trying to sell his tax hike to voters this November by saying it will go to schools. The dirty little secret is that the new revenues are needed to backfill the insolvent teacher’s pension fund.” Wall Street Journal Editorial, April 22, 2012 Even the official Title and Summary of Prop. 30 says the money can be used for “ . . . paying for other spending commitments.” In addition, there are no requirements or assurances that any more money actually gets to the classroom and nothing in Prop. 30 reforms our education system to cut waste, eliminate bureaucracy or cut administrative overhead. NO on Prop. 30—No Reforms The politicians and special interests behind Prop. 30 want to raise taxes to pay for their out of control spending, but refuse to pass meaningful reforms: Special interests and the politicians they control have blocked pension reforms. We have $500 billion in unfunded pension liabilities in California and still the politicians refuse to enact real reforms. The same people have blocked budget reform. The politicians continue to spend more than the state has. Prop. 30 rewards this dangerous behavior by giving them billions of dollars more to spend with no reforms, no guarantee the money won’t be wasted or that it will really get to the classroom. NO on Prop. 30—Stop the Politician’s Threats The Governor, politicians and special interests behind Prop. 30 threaten voters. They say “vote for our massive tax increase or we’ll take it out on schools,” but at the same time, they refuse to reform the education or pension systems to save money. We need to grow our economy to create jobs and cut waste, clean up government, reform our budget process and hold the politicians accountable instead of approving a $50 billion tax hike on small businesses and working families that doesn’t provide any accountability or guarantee new funding for schools. NO on Prop. 30—Reforms and Jobs First, Not Higher Taxes ”

Media editorials

See also: Endorsements of California ballot measures, 2012

Support

• The Bay Area Reporter: "We support Prop 30 for several reasons, not the least of which is that it is the product of the political process (although attempts to reach a legislative compromise failed) in which the governor, the Democratic majorities in the Legislature, and affected stakeholders were all part of the negotiations and compromise that resulted in the proposition before the voters."

• The Daily Democrat (Woodland, California): "This tax increase is supported by Gov. Jerry Brown and would avoid deep cuts to public schools, community colleges and universities."

• The Fresno Bee: "California's fiscal house remains shaky. Prop. 30 offers a way for the state to start climbing out of its pit. It's not ideal. But it is the best available option."

• The Lompoc Record: "...a tax increase to avoid calamity for school funding."

• The Long Beach Press-Telegram: "Proposition 30 lets our children -- not lawmakers -- off the hook."

• The Los Angeles Daily News: "Yes, our schools are being held hostage. The right thing to do is pay up -- and then demand that the reforms begun in Sacramento this year with pension and workers' comp reform continue. Proposition 30 lets our children -- not lawmakers -- off the hook."

• The Los Angeles Times: "Two years of belt-tightening have left parts of the state safety net in tatters and pushed college costs out of the reach of many families. Cuts in aid to the poor and working poor in this year's budget eliminated child-care subsidies for 14,000 children and preschool slots for 12,500 children. State aid for low-income seniors and the disabled is now as low as it was in 1983; welfare checks are smaller than they were 25 years ago. And K-12 spending per pupil remains $1,000 less than it was five years ago. California now spends less per student than all but three states."

• The Marin Independent Journal: "Passage of Proposition 30 would protect public schools — and our children's educational foundation and opportunities — from being slashed."

• The Merced Sun-Star: "Some entities, notably the California School Boards Association, recommends a 'yes' vote on both measures. We think it's more likely voters will support only one, and we think that Proposition 30 is preferable of the two."

• The Modesto Bee: "California's fiscal house remains shaky. There is massive debt and immense need. Proposition 30 offers a way for the state to start climbing out of its pit. It's not ideal. But it is the best available option."

• The Redding Record Searchlight: "The truth is there's not enough money for the state to do everything its citizens demand. The state frankly overspent straight through the Schwarzenegger administration, even in good years, and now we're at a moment of truth."

• The Sacramento Bee: "Gov. Jerry Brown's initiative to raise taxes by $6 billion a year is vital to California's future on many different levels."

• The San Bernardino Sun: "California already ranks among the lowest in per-pupil spending. The state's largest school district, Los Angeles Unified, already has the shortest school year in the nation. There's too much at stake to oppose this measure on principle."

• The San Francisco Bay Guardian: "And in a state with more billionaires than any other place in America, a fabulously rich place with the world's eighth-largest economy, the notion that we have to argue about raising $6 billion in taxes is farcical."

• The San Francisco Chronicle: "The governor and the ruling Democrats in the Legislature have given Californians who care about schools and the current-year deficit only one real choice: support Prop. 30, which would raise taxes on incomes starting at $250,000 for individuals, $500,000 for married couples, and the state portion of the sales tax (now 7.25 percent) by a quarter cent ... Prop. 30 provides a necessary budget patch - especially with the Legislature's Republicans unwilling to consider any tax increases."

• The San Gabriel Valley Tribune: "The overall tax burden will still be lower than it was two years ago."

• The San Jose Mercury News: "Proposition 30 is no substitute for long-term reforms in education funding, pensions and other areas, but it is a measured and sensible response to this crisis."

• The Santa Cruz Sentinel: "Critics of the measure say the governor won't dare administer such cuts. So far, however, we're unaware of any alternative plan for making up the $6 billion."

• The Vallejo Times-Herald: "Proposition 30 is no substitute for long-term reforms in education funding, pensions and other areas, but it is a measured and sensible response to this crisis."

• The Ventura County Star: "It is a reasonable, well-thought-out approach to an interim fix for the state's recurring deficit, thus giving lawmakers time to seek a long-term solution."

Opposition

• The Bakersfield Californian: "As desperate as the state is for money, we oppose Prop. 30 because it promotes the same bad budgeting policies that pushed the state into the mess it's in today."

• The Contra Costa Times: "Proposition 30 is like taking an Alka-Seltzer for your aching head when you need brain surgery. Sure, the pain might lessen for a while, but the root cause remains. Proposition 30 is not so much a solution as it is a cynical political calculation meant to determine just how much the voters will tolerate. And those voters have had to tolerate a lot recently. While claiming poverty, the Legislature and Gov. Jerry Brown forged ahead with the ill-advised and costly high-speed rail boondoggle."

• The North County Times: "The utter failure of Brown to fulfill his primary campaign promise and institute some kind of meaningful public pension reform means that any money raised from Prop. 30 is simply going to feed the beast. For voters to approve Prop. 30 at this time, when no real reform has been passed, would be to reward Sacramento's wasteful, irresponsible behavior."

• The Orange County Register: "The tax-and-spend culture in Sacramento needs a complete overhaul. Voters might be agreeable to paying more if they saw true reform, such as freeing families from underperforming public schools with tuition vouchers or enough charter schools to meet demand. Maybe if there were genuine reform to public-sector pensions. Or, if meaningful reform in providing public services could be achieved, rather than merely promised, or, if new spending meant equal reductions in old spending, perhaps voters would have reason to give more. We don't see these reforms ahead. As always, instead, we hear pleas to increase taxes for a broken system those in charge refuse to fix."

• The Press-Enterprise: "California would be foolish to raise taxes without providing real and enduring solutions to the state’s chronic budget shortfalls. Yet Props. 30 and 38 would increase taxes on Californians without putting state finances on a sustainable course. Voters should demand a comprehensive fix to the state’s yearly budget turmoil, and reject the flawed half-measures offered by Props. 30 and 38."

• The San Diego Union-Tribune: "California voters have a crucial choice this November. On Propositions 30 and 38, they can vote for higher taxes and accept the premise that this won’t hurt the struggling economy and that the main problem with our already-high-tax state is that its government doesn’t get enough money from its residents. Or they can vote no and force change in our broken status quo, starting with the public schools that eat up by far the biggest chunk of the state budget."

• The Victorville Daily Press: "Proposition 30 on November's ballot would raise money by increasing the California sales tax by a quarter cent. That doesn't sound like much, until you recall that California’s sales tax rate is already the highest in the United States. Couple that with the fact that the Congressional Budget Office says median U.S. family income has declined more than $4,000 a year since the advent of Obama nearly four years ago, and it’s easy to understand why none of us needs the additional burden. Gov. Jerry Brown argues that the money will go to California’s public schools, but that’s dishonest at best. He wants you to believe that when he says “schools” he means students. He doesn’t; he means teachers’ benefits, mostly pensions."

Polls

See also: Polls, 2012 ballot measures

Date of Poll	Pollster	In favor	Opposed	Undecided	Number polled
March 14-19, 2012	By GQR & AV for USC Dornsife/LAT	64%	33%	3%	1,500
April 3-10, 2012	PPIC	54%	39%	7%	823
May 14-20, 2012	PPIC	56%	38%	7%	2,002
May 21-29, 2012	Field Poll	52%	35%	13%	710
June 21-July 2, 2012	Field Poll	54%	38%	12%	997
August 3-7, 2012	PACE/USC Rossier School of Education	55%	36%	9%	1,041
September 9-16, 2012	PPIC	52%	40%	8%	2,003
September 6-18, 2012	Field Poll	51%	36%	13%	902
September 17-23, 2012	USC Dornsife/Los Angeles Times	54%	37%	9%	1,504
October 7-9, 2012	SurveyUSA	33%	38%	29%	700
October 7-10, 2012	California Business Roundtable	49.5%	41.7%	8.8%	830
October 11-15, 2012	Reason-Rupe	50%	46%	4%	696
October 14-21, 2012	PPIC	48%	44%	8%	2,006
October 21-28, 2012	California Business Roundtable	49.2%	42.9%	7.8%	2,115
October 17-30, 2012	Field Poll	48%	38%	14%	1,912

Background

Income tax in California

The following table summarizes Proposition 30 compared to the prior tax brackets and rates:

Bracket	Previous Marginal Tax Rate	Proposition 30 Marginal Tax Rate
$0 - $7,142	1.0%	1.0%
$7,142 - $17,346	2.0%	2.0%
$17,346 - $27,377	4.0%	4.0%
$27,377 - $38,004	6.0%	6.0%
$38,004 - $48,029	8.0%	8.0%
$48,029 - $250,000	9.3%	9.3%
$250,000 - $300,000	9.3%	10.3%
$300,000 - $500,000	9.3%	11.3%
$500,000 - $1,000,000	9.3%	12.3%
$1,000,000 +	10.3%	13.3%

Path to the ballot

See also: California signature requirements

• Karen Getman and Thomas A. Willis submitted a letter requesting a ballot title on March 14, 2012.
• A ballot title and summary were expected by May 3, 2012. However, the Office of the Attorney General produced the ballot title and summary just two days after proponents filed the language for the initiative, on March 16, 2012.
• A total of 807,615 valid signatures were required for qualification purposes.
• The 150-day circulation deadline for #12-0009 was August 13, 2012.
• Signatures to qualify the measure for the ballot were filed on May 4.
• On June 20, the California Secretary of State announced that the initiative had qualified for the November 6, 2012, ballot.

Cost of signatures

See also: California ballot initiative petition signature costs

Two campaign committees ("Brown; Yes on Prop. 30 - To Protect Our Schools and Public Safety" and "Californians Working Together to Restore and Protect Public Schools, Universities and Public Safety") paid money to vendors to collect signatures to qualify Proposition 30 for the ballot.

The cumulative expenditure on signatures was $8,773,490.48. This amounted to a per-required-signature cost of $10.86.

All but $25,321 of the money spent on signatures went to Kimball Petition Management.

External links

• November 6, 2012, General Election Voter Guide

See also

2012 measures

• 2012 ballot measures
• Taxes on the ballot
• 2012 legislative sessions

California

• California ballot measures
• California ballot measure laws

News and analysis

• Ballot measure lawsuits
• Ballot measure readability
• Ballot measure polls