The California Constitution conditions the imposition of a special tax by a city, county, or special district upon the approval of ²/₃ of the voters of the city, county, or special district voting on that tax, except that certain school entities may levy an ad valorem property tax for specified purposes with the approval of 55% of the voters within the jurisdiction of these entities.

This measure would require that the imposition, extension, or increase by a local government of a special tax as may otherwise be authorized by law, whether a sales or transactions and use tax, parcel tax, or other tax by a local government for the purpose of providing funding for transportation purposes, as specified, purposes be submitted to the electorate by ordinance and approved by 55% of the voters voting on the proposition. The measure would authorize an ordinance submitted to the voters for approval under these provisions to provide, as otherwise authorized by law, for the issuance of bonds payable from the revenues from the special tax. The measure would require an ordinance submitted to the voters under these provisions to include an expenditure plan specifying the transportation programs and projects to be funded by the revenues from the special tax and a requirement for an annual independent audit to ensure that the revenues are expended only for authorized purposes. The measure would also make conforming and technical, nonsubstantive changes.

The California Constitution provides that a proposed amendment of the constitution, Constitution, upon submission to, and approval by, the voters takes effect the day after the election unless the measure provides otherwise.

This measure would provide that the amendments of the constitution in this measure shall take effect on the date of the election.

The California Constitution conditions the imposition of a special tax by a city, county, or special district upon the approval of ²/₃ of the voters of the city, county, or special district voting on that tax, except that certain school entities may levy an ad valorem property tax for specified purposes with the approval of 55% of the voters within the jurisdiction of these entities.

This measure would require that the imposition, extension, or increase of a special tax by a local government for the purpose of providing funding for transportation purposes, as specified, be submitted to the electorate and approved by 55% of the voters voting on the proposition. The measure would also make conforming and technical, nonsubstantive changes.

The California Constitution conditions the imposition of a special tax by a city, county, or special district upon the approval of ²/₃ of the voters of the city, county, or special district voting on that tax, except that certain school entities may levy an ad valorem property tax for specified purposes with the approval of 55% of the voters within the jurisdiction of these entities.

This measure would require that the imposition, extension, or increase of a special tax by a local government for the purpose of providing funding for transportation purposes, as specified, be submitted to the electorate and approved by 55% of the voters voting on the proposition. The measure would also make conforming and technical, nonsubstantive changes.

Resolved by the Senate, the Assembly concurring, That the Legislature of the State of California at its 201718 Regular Session commencing on the fifth day of December 2016, two-thirds of the membership of each house concurring, hereby proposes to the people of the State of California that the Constitution of the State be amended as follows:

Except as otherwise provided by Section 2 of Article XIIIC, a city, county, or special district, by a two-thirds vote of its voters voting on the proposition, may impose a special tax within that city, county, or special district, except an ad valorem tax on real property or a transactions tax or sales tax on the sale of real property within that city, county, or special district.

Notwithstanding any other provision of this Constitution:

(a)A tax imposed by any local government is either a general tax or a special tax. A special district or agency, including a school district, has no authority to levy a general tax.

(b)A local government shall not impose, extend, or increase any general tax unless and until that tax is submitted to the electorate and approved by a majority vote. A general tax is not deemed to have been increased if it is imposed at a rate not higher than the maximum rate so approved. The election required by this subdivision shall be consolidated with a regularly scheduled general election for members of the governing body of the local government, except in cases of emergency declared by a unanimous vote of the governing body.

(c)Any general tax imposed, extended, or increased, without voter approval, by any local government on or after January 1, 1995, and prior to November 6, 1996, may continue to be imposed only if that general tax is approved by a majority vote of the voters voting in an election on the issue of the imposition, which election is held no later than November 6, 1998, and in compliance with subdivision (b).

(d)(1)Except as otherwise provided in paragraph (2), a local government shall not impose, extend, or increase any special tax unless and until that tax is submitted to the electorate and approved by two-thirds of the voters voting on the proposition. A special tax is not deemed to have been increased if it is imposed at a rate not higher than the maximum rate so approved.

(2)The imposition, extension, or increase by a local government of a special tax, as may otherwise be authorized by law, by a local government whether a sales or transactions and use tax, parcel tax, or other tax, for the purpose of providing funding for transportation purposes requires the submittal of the tax to the electorate of an ordinance proposing the tax and the approval of 55 percent of the voters voting on the proposition. A tax provides funding for transportation purposes under this paragraph if 100 percent of the net revenues from the tax, after collection and administrative expenses, is dedicated to transportation programs and projects. An ordinance submitted to the voters under this paragraph may, as otherwise authorized by law, provide for the issuance of bonds payable from the revenues from the proposed tax. An ordinance submitted to the voters under this paragraph shall include an expenditure plan specifying the transportation programs and projects to be funded by the revenues from the proposed tax and a requirement for an annual independent audit to ensure that the revenues from that tax are expended only for authorized purposes.

That the amendments to Section 4 of Article XIII A and Section 2 of Article XIII C of the California Constitution made by this measure shall take effect on the date of the election at which they are approved by the voters.

Resolved by the Senate, the Assembly concurring, That the Legislature of the State of California at its 201617 201718 Regular Session commencing on the fifth day of December 2016, two-thirds of the membership of each house concurring, hereby proposes to the people of the State of California that the Constitution of the State be amended as follows:

Except as otherwise provided by Section 2 of Article XIIIC, a city, county, or special district, by a two-thirds vote of its voters voting on the proposition, may impose a special tax within that city, county, or special district, except an ad valorem tax on real property or a transactions tax or sales tax on the sale of real property within that city, county, or special district.

Notwithstanding any other provision of this Constitution:

(a)A tax imposed by any local government is either a general tax or a special tax. A special district or agency, including a school district, has no authority to levy a general tax.

(b)A local government shall not impose, extend, or increase any general tax unless and until that tax is submitted to the electorate and approved by a majority vote. A general tax is not deemed to have been increased if it is imposed at a rate not higher than the maximum rate so approved. The election required by this subdivision shall be consolidated with a regularly scheduled general election for members of the governing body of the local government, except in cases of emergency declared by a unanimous vote of the governing body.

(c)Any general tax imposed, extended, or increased, without voter approval, by any local government on or after January 1, 1995, and prior to November 6, 1996, may continue to be imposed only if that general tax is approved by a majority vote of the voters voting in an election on the issue of the imposition, which election is held no later than November 6, 1998, and in compliance with subdivision (b).

(d)(1)Except as otherwise provided in paragraph (2), a local government shall not impose, extend, or increase any special tax unless and until that tax is submitted to the electorate and approved by two-thirds of the voters voting on the proposition. A special tax is not deemed to have been increased if it is imposed at a rate not higher than the maximum rate so approved.

(2)The imposition, extension, or increase of a special tax, as may otherwise be authorized by law, by a local government for the purpose of providing funding for transportation purposes requires the submittal of the tax to the electorate and approval of 55 percent of the voters voting on the proposition. A tax provides funding for transportation purposes if 100 percent of the net revenues from the tax, after collection and administrative expenses, is dedicated to transportation programs and projects.

That the amendments to Section 4 of Article XIII A and Section 2 of Article XIII C of the California Constitution made by this measure shall take effect on the date of the election at which they are approved by the voters.

Resolved by the Senate, the Assembly concurring, That the Legislature of the State of California at its 201617 Regular Session commencing on the fifth day of December 2016, two-thirds of the membership of each house concurring, hereby proposes to the people of the State of California that the Constitution of the State be amended as follows:

Except as otherwise provided by Section 2 of Article XIIIC, a city, county, or special district, by a two-thirds vote of the qualified electors of such district, its voters voting on the proposition, may impose special taxes on such district, except ad valorem taxes a special tax within that city, county, or special district, except an ad valorem tax on real property or a transaction transactions tax or sales tax on the sale of real property within such City, County that city, county, or special district.

Local Government Tax Limitation. Notwithstanding any other provision of this Constitution:

(a)All taxes A tax imposed by any local government shall be deemed to be either general taxes or special taxes. Special purpose districts or agencies, including school districts, shall have no power to levy general taxes. is either a general tax or a special tax. A special district or agency, including a school district, has no authority to levy a general tax.

(b)No A local government may shall not impose, extend, or increase any general tax unless and until that tax is submitted to the electorate and approved by a majority vote. A general tax shall is not be deemed to have been increased if it is imposed at a rate not higher than the maximum rate so approved. The election required by this subdivision shall be consolidated with a regularly scheduled general election for members of the governing body of the local government, except in cases of emergency declared by a unanimous vote of the governing body.

(c)Any general tax imposed, extended, or increased, without voter approval, by any local government on or after January 1, 1995, and prior to the effective date of this article, shall November 6, 1996, may continue to be imposed only if that general tax is approved by a majority vote of the voters voting in an election on the issue of the imposition, which election shall be held within two years of the effective date of this article is held no later than November 6, 1998, and in compliance with subdivision (b).

(d)No local government may (1)Except as otherwise provided in paragraph (2), a local government shall not impose, extend, or increase any special tax unless and until that tax is submitted to the electorate and approved by a two-thirds vote. two-thirds of the voters voting on the proposition. A special tax shall not be is not deemed to have been increased if it is imposed at a rate not higher than the maximum rate so approved.

SENATE COMMITTEE ON APPROPRIATIONS

Senator Ricardo Lara, Chair

2017 - 2018 Regular Session

SCA 6 (Wiener) - Local transportation measures: special taxes: voter approval

This bill meets the criteria for referral to the Suspense File.

Bill Summary:

SCA 6 would lower the vote threshold for local government agencies to levy a special tax for transportation infrastructure projects from 2/3 to 55 percent.

Fiscal Impact:

This bill would result in one-time General Fund costs to the Secretary of State (SOS) in the range of $414,000 to $552,000, likely in 2018-19, for printing and mailing costs to place the measure on the ballot in a statewide election. Actual costs may be higher or lower, depending on the length of required elements and the overall size of the ballot.

Background:

Under the California Constitution, taxes levied by local governments are either (1) general taxes (subject to majority approval of its voters), or (2) special taxes (subject to 2/3 vote). Proposition 13 required a 2/3 vote of each house of the Legislature for state tax increases, and 2/3 vote of local voters for local special taxes. Proposition 62 (1986) prohibited local agencies from imposing general taxes without majority approval of local voters, and a 2/3 vote for special taxes. Proposition 218 (1996) extended those vote thresholds to charter cities and limited local agencies’ powers to levy new assessments, fees, and taxes. Local agencies generally propose to increase taxes by adopting an ordinance or a resolution at a public hearing. The Constitution further bars school districts from imposing general taxes, but allows school districts, community college districts, and county offices of education to issue bonded indebtedness for school facilities with 55 percent approval (Proposition 39, 2000).

Proposed Law:

This bill would do the following:

• Lower the vote threshold for local agencies imposing, extending, or increasing a special tax to fund local transportation projects within their jurisdiction to 55 percent.
• Make conforming changes to the Constitution.
• Provides that 100 percent of the net revenue of a tax imposed with 55 percent approval, after collection and administrative expenses, would be required to be dedicated to transportation programs and projects.
• Provide that a local agency may bond against the revenues of the proposed tax if the measure is approved by the voters.
• Require the proposed ordinance to include an expenditure plan specifying the projects and/or programs to be funded by the generated revenues.

Related Legislation:

ACA 4 (Frazier, 2015) would have lowered, from two-thirds to 55 percent, the voter approval threshold for a local government to impose, extend, or increase a special tax to fund local transportation projects under its jurisdiction. The bill was held under submission on the Suspense File of the Assembly Appropriations Committee. Additionally, SCA 4 (Liu, 2014) and SCA 8 (Corbett, 2014) similarly attempted to lower the voting threshold from 2/3 to 55 percent for transportation purposes. Neither bill reached the Senate Floor.

Staff Comments:

SOS indicates that printing and mailing costs associated with placing a measure on the statewide ballot are approximately $69,000 per page, depending on the length of the ballot. The fiscal estimates noted above reflect the addition of 6-8 pages in the Voter Information Guide. Actual costs would depend upon the length of the title and summary, analysis by the Legislative Analyst’s Office, proponent and opponent arguments, and text of the proposal.

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SENATE COMMITTEE ON TRANSPORTATION AND HOUSING

Senator Jim Beall, Chair

2017 - 2018 Regular

Bill No: Hearing Date: 5/9/2017

SUBJECT: .

DIGEST: This bill lowers the vote threshold for local government agencies to levy a special tax for transportation infrastructure projects from 2/3 to 55 percent.

ANALYSIS:

The State Constitution:

1. Provides that taxes levied by local governments are either general taxes, subject to majority approval of its voters, or special taxes, subject to 2/3 vote.
2. Prohibits local agencies from imposing general taxes without majority approval of local voters, and a 2/3 vote for special taxes. Further establishes voter-approval thresholds for local agencies to levy new property assessments, fees, and taxes.
3. Requires a 2/3 vote of each house of the Legislature for state tax increases.
4. Bars school districts from imposing general taxes, but allows school districts, community college districts, and county offices of education to issue bonded indebtedness for school facilities with 55% percent approval.

Existing Law:

1. Permits cities and counties to impose transactions and use taxes, in addition to the state taxes levied for transportation purposes, provided that the combined rate in the county does not exceed 2 percent and upon a 2/3 vote of the local agency’s governing board and voter approval.
2. Permits a county board of supervisors to create a countywide transportation authority to plan and fund transportation projects within the county. Authorizes transportation authorities to impose a local sales tax for transportation purposes, if the tax ordinance is within the local sales tax cap and abides by the constitutional restrictions on local taxes.

This bill:

1. Lowers the vote threshold for local agencies imposing, extending, or increasing a special tax to fund local transportation projects within their jurisdiction to 55%.
2. Makes conforming changes to the Constitution.
3. Provides that 100% of the net revenue of a tax imposed with 55% approval, after collection and administrative expenses, is required to be dedicated to transportation programs and projects.
4. Provides that a local agency may bond against the revenues of the proposed tax if the measure is approved by the voters.
5. Requires the proposed ordinance to include an expenditure plan specifying the projects and/or programs to be funded by the generated revenues.
6. Specifies that the amendments made by this measure take effect immediately upon approval by California’s voters.

COMMENTS:

1. Author’s statement. According to the author, “existing state revenue sources for transportation are either unreliable and highly volatile, like cap-and-trade dollars, or are restricted by Article 19 of the California Constitution. The result is that we have insufficient funding for transportation, and the funding we do have is restricted to a narrow scope of transportation projects that do not match the complex and multimodal transportation systems our statewide policy goals for climate, equity, and sustainable population growth. Senate Bill 1 that was passed through the legislature in March 2017 was an enormous step forward for the “fix it first” backlog of maintenance, but California’s transportation needs are so much greater than the anticipated revenue from Senate Bill 1.

California’s local and regional governments have started to assume more responsibility for generating transportation revenue for our growing population as infrastructure continues to sit in a state of disrepair.

In November 2016, fifteen local governments tried to raise their sales taxes to pay for transportation, while others authorized bonds and raised local property taxes in other areas. Contra Costa County’s $2.9 billion sales tax measure was defeated with 62% voter approval. Under SCA 6, that county measure would have succeeded, and the other packages would likely have been more robust and ambitious given the increased chance of electability.

SCA 6 would lower the vote threshold for cities, counties, and special districts to dedicate new revenue for the purpose of funding all transportation-related capital, operations, and programs, to 55% instead of two thirds of the voters voting in an election.”

1. Voter-approval requirements for local taxes. For most of California's history, local governments could raise taxes by a vote of the governing board. Beginning in 1978, voters approved a series of constitutional amendments that established voter-approval requirements for new local taxes. Specifically, Proposition 13 (1978) greatly constrained the ability of local governments to raise property tax rates and required all new local government "special taxes" (revenues associated with the tax are used for specific purposes) to be approved by two-thirds of voters. Proposition 62 (1986) and Proposition 218 (1996), in turn, required new "general taxes" to be approved by a majority of voters, and extended voter-approval requirements to other property-related levies not covered by Proposition 13. Finally, Proposition 26 (2010) broadened the definition of a "tax" to include some levies previously considered fees or charges, resulting in a wider application of voter-approval requirements.
2. Transportation needs. The deterioration of California’s state and local streets and roads has been widely documented. For example, at the January 2017 California Transportation Commission (CTC) hearing, a local streets and roads needs assessment presented to the CTC found that the statewide average pavement condition index (PCI), which rates the condition of the surface of a road network, to be 65. This score indicates that statewide, roads on average are in “fair/at risk” condition and are becoming worn down to the point where rehabilitation, rather than routine maintenance, may be needed to prevent rapid deterioration. The needs assessment further found that in order to maintain local roads at their existing condition would require an additional $3.5 billion annually. Overall, according to the “Fix Our Roads” Coalition, total deferred maintenance shortfalls total approximately $73 billion, while the shortfall is estimated at $59 for the deferred maintenance backlog at the state level. Relative to transit, a needs assessment prepared for the California Transit Association found that the 10-year funding needs (2011-2020) total approximately $71.8 billion — $50 billion for capital improvements and $21 billion for operations.
3. SB 1. Recently passed by the Legislature and signed by the Governor’s SB 1 (Beall, Chapter 5, Statutes of 2017) is a transportation funding package projected to bring in $5.2 billion annually for road rehabilitation, transit improvement, and trade corridor enhancement projects. The historic passage of this transportation funding package was in response to the clear message that the state’s roads and highways and transit systems are in dire need of significant improvements and rehabilitation. This past winter season’s storms exacerbated this need by requiring the State Department of Transportation (Caltrans) to issue over $800 million in emergency contracts for road repair. Once implemented, SB 1 revenues will assist local transportation and transit agencies in cutting down on the existing backlog in their respective jurisdictions.
4. Local needs. Despite this new wave of transportation funding, the need is great. In order to address the overall need and historic funding shortfalls, 24 counties have passed local sales tax measures dedicated for transportation purposes. These “self-help counties” combined generate approximately $3.5-$4 billion annually to be used on transportation projects and programs that have been approved by county voters. While these 24 counties have been successful at attaining 2/3’s approval, many counties have struggled with overcoming this requirement. In fact, several counties have attempted multiple unsuccessful efforts at passing a local sales tax measure – reaching an approval of over 60 percent, however failing to pass the 2/3 threshold. This bill aims to remedy this issue by lowering the voter-approval threshold to a reasonable 55 percent. As the author points out, while SB 1 will provide new funding targeted at road repair and rehabilitation, local agencies continue to struggle to fund other local transportation projects and programs such as transit operations and highway improvements.
5. Prior attempts. Several unsuccessful legislative proposals have been introduced over the years attempting to lower the threshold for local transportation tax measures. Most recently, in 2015, ACA 4 (Frazier) would have lowered from 2/3s to 55%, the voter approval threshold for a local government to impose, extend, or increase a special tax to fund local transportation projects under its jurisdiction. ACA 4 was held in the Assembly Appropriations Committee. Similarly, SCA 4 (Liu, 2014) and SCA 8 (Corbett, 2014) were identical measures which aimed to lower the voter threshold for transportation tax proposals. Both measures were held in the Senate Appropriations Committee.
6. Double referral. This bill was also heard in the Senate Governance and Finance Committee where it was approved on April 5, 2017 on a 5-2 vote.

Related Legislation:

ACA 4 (Frazier, 2015) — lowers, from two-thirds to 55%, the voter approval threshold for a local government to impose, extend, or increase a special tax to fund local transportation projects under its jurisdiction.

SCA 4 (Liu, 2014) and SCA 8 (Corbett, 2014) — similarly attempted to lower the voting threshold from 2/3 to 55% for transportation purposes.

FISCAL EFFECT: Appropriation: No Fiscal Com.: No Local: No

POSITIONS: (Communicated to the committee before noon on Wednesday,

May 3, 2017.)

SUPPORT:

Associated General Contractors

California Alliance for Jobs

California Conference Board of the Amalgamated Transit Union

California Conference of Machinists

California Labor Federation

California Teamsters Public Affairs Council

California Transit Association

Capitol Corridor Joint Powers Authority

El Dorado County Transportation Commission

Move LA

National Association of Electrical Contractors

SF Bay Area Rapid Transit District

Santa Clara Valley Transportation Authority

Solano County Transportation Authority Southern California Contractors Association

Teamsters

Transportation Agency for Monterey County

Transportation California, United Contractors

OPPOSITION:

Apartment Association of Greater Los Angeles

Apartment Association of Orange County

Apartment Association, California Southern Cities

Association of California Life and Health Insurance Companies

Calaveras County Taxpayers Association

California Association of Realtors

California Bankers Association

California Taxpayers Association

Coalition of Sensible Taxpayers – Marin County

Contra Costa Taxpayers’ Association

East Bay Rental Housing Association

Howard Jarvis Taxpayers Association

Kern County Taxpayers Association

National Federation of Independent Business

North Valley Rental Property Association

San Diego County Apartment Association

San Gabriel Valley Economic Partnership

Santa Barbara Rental Property Association

Solano County Taxpayers Association

Sutter County Taxpayers Association

Western States Petroleum Association

Western States Trucking Association

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SENATE COMMITTEE ON GOVERNANCE AND FINANCE

Senator Mike McGuire, Chair

2017 - 2018 Regular

Local transportation measures: special taxes: voter approval

Lowers the vote threshold for cities, counties, or special districts to levy a special tax for transportation infrastructure projects from 2/3 to 55%.

Background

The California Constitution states that taxes levied by local governments are either general taxes, subject to majority approval of its voters, or special taxes, subject to 2/3 vote (Article XIII C). Proposition 13 (1978) required a 2/3 vote of each house of the Legislature for state tax increases, and 2/3 vote of local voters for local special taxes. Proposition 62 (1986) prohibited local agencies from imposing general taxes without majority approval of local voters, and a 2/3 vote for special taxes. Proposition 218 (1996) extended those vote thresholds to charter cities and limited local agencies’ powers to levy new assessments, fees, and taxes. Local agencies generally propose to increase taxes by adopting an ordinance or a resolution at a public hearing. The Constitution further bars school districts from imposing general taxes, but allows school districts, community college districts, and county offices of education to issue bonded indebtedness for school facilities with 55% percent approval (Proposition 39, 2000).

Cities and counties may impose transactions and use taxes, in addition to the state sales and use taxes levied for transportation purposes, provided that the combined rate in the county does not exceed 2 percent and upon a 2/3 vote of the local agency’s governing board and voter approval.

Additionally, SB 314 (Murray, 2003) authorized the Los Angeles County Metropolitan Transportation Authority (MTA) to levy a 0.5% transactions and use tax that was not subject to the 2% countywide cap for six and a half years, but MTA never put the measure to the voters. AB 2321 (Feuer, 2008) reauthorized MTA to place the 0.5% transactions and use tax for 30 years before the voters subject to the cap. SB 314 and SB 2321 required MTA to spend the tax proceeds in certain ways or for specified projects. MTA placed a sales tax ordinance, referred to as Measure R, on the November 2008 ballot. 67% of the voters approved the increase. Los Angeles County Transportation Commission has two additional 0.5% transactions and use taxes still in effect: one enacted on April 1, 1991 and one enacted on July 1, 1982.

As the need for transportation infrastructure investment continues to rise, the author wants the Legislature to place a measure on the statewide ballot to lower the vote threshold to 55% from 2/3 to help local agencies succeed in raising revenue for transportation projects.

Proposed Law

Senate Constitutional Amendment 6 lowers the vote threshold for local agencies imposing, extending, or increasing a special tax to fund local transportation projects within their jurisdiction to 55%. The measure also makes conforming changes to the Constitution.

SCA 6 provides that 100% of the net revenue of a tax imposed with 55% approval, after collection and administrative expenses, must be dedicated to transportation programs and projects.

SCA 6 states that the amendments made by this bill take effect immediately upon approval by California’s voters.

State Revenue Impact

No estimate.

Comments

1. Purpose of the bill. According to the author, “California roads and bridges are underfunded by $11 billion per year, and a 2015 Governor’s report calculated $59 billion in deferred transportation maintenance. Existing state revenue sources for transportation are both unreliable and highly volatile, like cap-and-trade dollars, or are restricted by Article 19 of the California Constitution. The result is that we have insufficient funding for transportation, and the funding we do have is restricted to a narrow scope of transportation projects that do not match the complex and multimodal transportation systems our statewide policy goals for climate, equity, and sustainable population growth. California’s local and regional government have started to assume more responsibility for generating transportation revenue for our growing population and economy as state support has declined and infrastructure continues to sit in a state of disrepair. In November 2016, fifteen local governments tried to raise their sales taxes to pay for transportation, while others authorized bonds and raised local property taxes in other areas. Contra Costa County’s $2.9 billion sales tax measure was defeated with 62% voter approval. Under SCA 6, that county measure would have succeeded, and the other packages would likely have been more robust and ambitious given the increased chance of electability.”
   
2. More or less. Majority rule is a two-edged sword: democratically elected governments are supposed to enact policies that the voters want, but both federal and state systems of government restrict the majority’s ability to oppress a minority interests. For the great majority of public issues, fifty-percent plus one of a legislative body or an electorate rule. But for some issues, the United States and California Constitutions provide that a majority is not enough and a higher threshold is necessary, such as amending the U.S. Constitution, impeaching a president, or overriding a veto. States largely import the 2/3 vote from the United States Constitution into their own for those same purposes, but also require 2/3 vote on taxes or other measures. In a series of voter initiatives, Californians have elevated local special tax increases and legislatively enacted state tax increases to this level, while almost every other change can be enacted by majority vote: local agencies can enact general taxes, and voters can approve tax initiatives increasing state taxes by majority vote, as they did with Proposition 55 (2016). As such, local agencies need a majority vote to assess taxes and spend the proceeds on whatever purposes they want to, but 2/3 if they restrict the use of the tax proceeds.
   

SCA 6 adds another layer onto the complex system above. If enacted, local agencies can enact special taxes for transportation purposes at 55% vote, paralleling Proposition 39’s similar allowance for school bonds. However, the measure doesn’t affect thresholds for any other kind of tax. SCA 6 raises two questions. First, what should be the voting threshold for local special taxes? The Legislative Analyst’s Office says there’s no right answer, as requirements vary across states, but adds that the process should be easy enough for voters to understand and reflect overarching objectives for voter participation in tax decisions. Second, should the thresholds be different based on the use of the tax proceeds, like transportation? The Committee may wish to consider the reasons for affording transportation taxes special treatment when contemplating the overall system of voter thresholds necessary to increase taxes.

1. Prior Legislation. In 2014, SCA 4 (Liu) and SCA 8 (Corbett) also attempted to lower the voting threshold from 2/3 to 55% for transportation purposes. While similar, SCA 4 and SCA 8 went further in proposing additional oversight requirements. Specifically, they required any ballot measure to include:

• A specific list of programs to be funded.
• A requirement for an annual independent audit of tax proceeds collected and expended.
• A requirement for the governing board of the local agency to create a citizens’ oversight committee to review all expenditures of the tax proceeds.

The committee may wish to consider if similar transparency and accountability requirements would be appropriate to include in SCA 6.

4. Double-referred. The Senate Rules Committee referred SCA 6 to both the Committees on Governance and Finance, which considers bills affecting local property taxation, and Transportation and Housing.

Support and Opposition

(3/30/17)

Support: California Conference Board of the Amalgamated Transit Union; California Conference of Machinists; California Transit Association; San Francisco Bay Area Rapid Transit District; Teamsters.

Opposition: California Association of Realtors; California Taxpayers Association; Howard Jarvis Taxpayers Association; Western States Trucking Association.

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