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When California voters in 1978 passed Proposition 13, the iconic property tax limitation, they simultaneously rejected Proposition 8, which had been placed on the ballot by the Legislature as an alternate tax relief measure. While Prop. 13 flatly limited property taxes, Prop. 8 merely empowered the Legislature to lower property taxes on owner-occupied homes.
It may have been the first use of a campaign tactic that later became known as a “countermeasure.” Rather than just oppose a measure, a rival interest group could place its own measure on the ballot, thus muddying the waters. Voters would either choose between the two or be confused enough to reject both.
A classic example occurred in 2022 when California’s casino-owning Indian tribes proposed a measure to give them a virtual monopoly on sports wagering and digital sports betting companies countered with a measure of their own. Hundreds of millions of dollars were raised for the rival measures and voters rejected both, thus preserving the state’s ban on sports wagering.
It also exemplified another aspect of ballot measure politics: the tendency of competing interests take their issues to the ballot when the Legislature could not resolve them.
Over time, both trends had made the ballot measure process — rather than legislation — California’s dominant method of resolving big issues.
Legislative leaders disliked being forced into a reactive role. Thus, in 2016, the Legislature changed the rules of the ballot measure game to reassert its place. It decreed that even after they had qualified for the ballot, sponsors of initiative measures could remove them up to a deadline.
Sponsors of rival qualified measures could negotiate compromises with input from legislative leaders, have them written into law and avoid very expensive pro and con campaigns.
The 14 measures that will appear on the Nov. 3 ballot were going to be as many as 20 before last-minute compromises settled three dueling measure conflicts. One pitted personal injury lawyers against rideshare companies, a second involved hospital executives and a health care union, and the third dealt with vote minimums for local taxes.
Whether the compromises make policy sense or not, contending parties got enough out of them to warrant dropping their ballot measures.
However, the most prominent ballot measure conflict — over whether California should impose a 5% wealth tax on billionaires — defied resolution. The measure, sponsored by the SEIU healthcare workers union, will be Proposition 40 and will compete with two countermeasures sponsored by billionaire Sergey Brin and other Prop. 40 foes, Proposition 41 and Proposition 42.
They could, if passed with higher vote counts, kneecap the wealth tax.
At one point the wealth tax advocates offered to reduce its bite to 2% as a compromise, but made no headway with opponents, most prominently Gov. Gavin Newsom.
Another tax measure, sponsored by the California Teachers Association, would make permanent a temporary surtax on high-income taxpayers first enacted in 2012 — but it could get caught in the shootout over Prop. 40. Democratic legislative leaders gave it some protection with a last-minute decree that it would be appear on the ballot as Proposition 3. Thus voters will deal with it before confronting Props. 40, 41 and 42 much further down the ballot.
Given its high stakes and the attention it is getting in national media, the wealth tax is destined to be not only the single most controversial ballot measure this year but probably have the most expensive dueling campaigns, possibly setting a record.
At a webinar on Tuesday covering the array of ballot measures voters will face in November, campaign consultant Tino Rossi said “the pace car (for spending) is the billionaire tax.”
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