Gov. Jerry Brown’s Proposition 30 ballot proposal is aimed at funding public schools, prison realignment, and reducing the state’s debt. A competing measure, Proposition 38, by tax attorney Molly Monger, focuses on public school financing and reducing the state’s debt.
Brown’s plan would raise state income taxes on persons making more than $250,000 a year for seven years and raise the state’s sales tax rates for four years.
The Legislative Analyst says Brown’s plan would generate about $6 billion. After paying minimum guaranteed amounts for higher education and prison realignment, the remaining funds would be used to reduce the state budget, the analyst concludes.
Brown’s 2012-13 Budget Summary says the tax increase would generate $6.9 billion. It states that after paying minimum guaranteed money to the schools, $4.4 billion would be available in “net benefit to the General Fund.”
The Brown plan includes a state constitutional amendment that would extend the current vehicle-licensing fee and increase the sales tax by one-half percent to pay for prison realignment.
Realignment is Brown’s plan of confining low-level offenders in county jails instead of state prison.
“In 2010-11, before realignment, CDCR managed all imprisoned and paroled felons with a budget of $8.9 billion. In 2012-13, the state paid both CDCR and local governments to manage this same population, a combined cost of $9.8 billion ($.8.9 billion for CDCR and $857 million for local governments). Thus, the cost for managing this felon population has increased as a result of realignment,” according to a report by the Public Policy Institute of California.
It remains unclear what overall effect the Brown plan would have on both state and local finances because some of these actions would shift costs from local governments to the state, and others do the opposite, according to a report by Insure the Uninsured Project.
The Monger plan would increase personal income tax rates on most individual earners; lower earning individuals would pay a lower tax rate than higher earning individuals. The tax would stay in place for 12 years.
The Monger plan would generate an estimated $10 billion in 2013-14.
In the first four years of Monger’s plan, 60 percent of funds would go to K-12 schools, 30 percent to repay the state debt, and 10 percent to early childhood programs. Thereafter, 85 percent would go to K-12 schools, and 15 percent to early childhood programs, according to official estimates.
Revenues generated from the Monger plan would be allocated on a “school-specific, per-pupil basis, subject to local control, audits, and public input.”
Officials say without the proposed tax increase, “trigger cuts” of about $6 billion would occur automatically, 90 percent affecting schools and community colleges.
The remaining cuts would be in the University of California, California State University, Department of Developmental Services, city police department grants, CalFire, the Department of Water Resources flood control programs, local water safety patrol grants, Department of Fish and Game, Department of Parks and Recreation and the Department of Justice law enforcement programs.
If both measures pass, the California Constitution specifies that the provisions of the measure receiving more “yes” votes prevail. Proposition 30 and Proposition 38 both increase personal income tax rates and, as such, could be viewed as conflicting, the Legislative Analyst reports.