Stories about California

Second version of California split roll tax initiative qualifies for November ballot

On May 29, the office of California Secretary of State Alex Padilla announced that enough signatures were deemed valid for the second version of a ballot initiative to require commercial and industrial properties to be taxed based on their market value. In California, the proposal to assess taxes on commercial and industrial properties at market value, while continuing to assess taxes on residential properties based on purchase price, is known as split roll.

Proposition 13 (1978) requires that residential, commercial, and industrial properties be taxed based on their purchase price. The tax is limited to no more than 1 percent of the purchase price (at the time of purchase), with an annual adjustment equal to the rate of inflation or 2 percent, whichever is lower. According to the state Legislative Analyst’s Office, market values in California tend to increase faster than 2 percent per year, meaning the taxable value of commercial and industrial properties is often lower than the market value.

The first version of the split-roll tax ballot initiative qualified for the November 2020 ballot in October 2018. In August 2019, the campaign Schools and Communities First, which is behind the proposal, announced that signatures would be collected for a revised version of the ballot initiative. Tyler Law, a campaign spokesperson, said that the campaign would not withdraw the qualified initiative from the ballot until the revised initiative qualifies. Law said, “The committee’s got the money. We’re going to get it on the ballot.”

About 1.75 million signatures were filed for the second version on April 2, 2020. At least 997,139 (57.02 percent) of the signatures needed to be valid. Based on a random sample of submitted signatures, 74.60 percent were projected to be valid.

Both versions of the ballot initiative would create a process in the state constitution for distributing revenue from the revised tax on commercial and industrial properties. First, the revenue would be distributed to (a) the state to supplement decreases in revenue from the state’s personal income tax and corporation tax due to increased tax deductions and (b) counties to cover the costs of implementing the measure. Second, 60 percent of the remaining funds would be distributed to local governments and special districts, and 40 percent would be distributed to school districts and community colleges (via a new Local School and Community College Property Tax Fund).

Whereas the first version would have taxed property whose business owners have $2.00 million or more in holdings in California and operate on a majority of the property, the second version eliminated the majority-operation requirement and increased the threshold to $3.00 million.

The second version also redefined the exception for small businesses. The first version would have continued to tax businesses with 50 or fewer full-time employees based on purchase price. The second version would likewise define small businesses as those with 50 or fewer full-time employees but would also require businesses to be independently owned and operated and own real estate in California to be exempted from the change.

Other changes involve replacing the state’s existing funding distribution formula for schools and colleges with a new formula for distributing the revenue from the ballot initiative. The second version would also give retail centers, whose occupants are 50 percent or more small businesses, more time before being taxed at market value.

Since the campaign Schools and Communities First will withdraw the first version of the ballot initiative, the qualification won’t change the number of measures on the ballot in California. As of May 31, six citizen-initiated measures have qualified for the ballot (excluding the first version of the split roll tax initiative). Three more ballot initiatives are pending signature verification. The verification deadline is June 25, 2020. June 25 is also the last day that the California State Legislature can place measures on the November ballot.

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U.S. Supreme Court rejects challenge to California law limiting church attendance

On May 29, 2020, the United States Supreme Court rejected a challenge to California’s religious gathering limits, which order attendance in churches or places of worship to a maximum of 25% or 100 attendees.

The 5-4 decision was joined by Chief Justice Roberts who warned against intervening in emergencies: “Where those broad limits are not exceeded, they should not be subject to second-guessing by an ‘unelected federal judiciary,’ which lacks the background, competence, and expertise to assess public health and is not accountable to the people.”

Justice Kavanaugh joined the remaining three Republican-appointed justices in dissenting from the ruling, arguing that the California limits “indisputably discriminates against religion.”

California school board recall to be held Tuesday

A recall election seeking to remove Leanne Ibarra and Jose Lara from their positions on the El Rancho Unified School District Board of Education in California is scheduled for June 2, 2020. The election is being conducted by mail-in ballot in response to the coronavirus pandemic. The candidate filing deadline passed on March 6; Allan Maciel and Joseph Rivera filed to run for Lara’s position, and Esther Mejia filed to run for Ibarra’s position.

Although Ibarra is still contesting the recall effort, Lara resigned from his seat effective February 5, 2020. At a school board meeting on January 21, Lara said he was leaving in order to focus on his family while his son recuperated from an illness. His name will still be on the recall election ballot, and if a majority of voters cast ballots to retain him, the school board will appoint his replacement.

The recall effort began in May 2019. Recall supporters listed a number of concerns with the board, including a vote to notify 23 administrators they could be fired or reassigned, a vote to demote, transfer, or release six administrators, and the alleged mismanagement of a $200 million bond. In an interview with the Whittier Daily News, Lara responded and said, “The community of Pico Rivera has been driven along a misinformation campaign. They’ve only heard one side of the story.”

Lara was first elected to the five-member board on November 5, 2013, and Ibarra was first elected on November 6, 2018. Before Lara resigned, he and Ibarra were members of a three-person majority on the board, according to the Whittier Daily News. The third member of the majority, Gabriel Orosco, was not included in the recall effort since his term is up for election in 2020. The other two board members support the recall effort. To get the recall on the ballot, recall supporters had to collect at least 6,509 signatures by October 23, 2019.

In 2019, Ballotpedia covered a total of 151 recall efforts against 230 elected officials. Of the 66 officials whose recalls made it to the ballot, 34 were recalled for a rate of 52%. That was lower than the 63% rate and 57% rate for 2018 and 2017 recalls, respectively.

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In November, Californians will decide whether app-based drivers should be classified as independent contractors

At the election on November 3, 2020, Californians will decide a ballot initiative that addresses whether app-based drivers should be classified as independent contractors.

In September 2019, Gov. Gavin Newsom (D) signed AB 5, which established criteria to determine whether a worker is an employee or independent contractor. Uber, Lyft, and Doordash proposed a ballot initiative that would exempt app-based workers from AB 5. The ballot initiative would also adopt labor and wage policies specific to app-based companies, including a net earnings floor, healthcare subsidies, and occupational accident insurance for workers. Examples of companies that hire app-based drivers include Uber Technologies, Lyft, DoorDash, Instacart, and Postmates. The ballot measure would not affect how AB 5 is applied to other types of workers.

AB 5 established a three-factor test to decide a worker’s status as an independent contractor. The three-factor test requires that (a) the worker is free from the hiring company’s control and direction in the performance of work; (b) the worker is doing work that is outside the company’s usual course of business; and (c) the worker is engaged in an established trade, occupation, or business of the same nature as the work performed.

Tony West, the chief legal officer for Uber, and John Zimmer, president of Lyft, have both said that their companies continue to operate without reclassifying their workers as employees. California Attorney General Xavier Becerra (D), along with Los Angeles City Attorney Mike Feuer, San Diego City Attorney Mara Elliott, and San Francisco City Attorney Dennis Herrera, sued the rideshare companies on May 5, 2020, arguing their workers needed to be reclassified as employees. Uber and Postmates launched their own legal complaint, contending that AB 5 violated their constitutional rights and their workers’ constitutional rights. Courts have not yet decided either case.

Through May 17, 2020, the campaign Protect App-Based Drivers And Services, which is supporting the ballot initiative, raised $110.69 million, including $30.47 million from Lyft, Inc., $30.23 million from Uber Technologies, Inc., and $30 million from DoorDash, Inc. Instacart and Postmates, Inc. also contributed $10 million each.

The California Labor Federation, AFL-CIO, organized the Coalition to Protect Riders and Drivers to campaign against the ballot initiative. The campaign raised $690,000, with the Transport Workers Union of America providing $500,000.

Protect App-Based Drivers And Services filed 987,813 signatures. At least 623,212 (63.09 percent) of the signatures needed to be valid. On May 22, 2020, the office of Secretary of State Alex Padilla announced that a random sample of signatures projected that 77.50 percent were valid, which amounts to a projected 765,555 valid signatures.

The ballot initiative is the sixth citizen-initiated measure to qualify for the November ballot in California. Four citizen-initiated measures are pending signature verification. At least two additional campaigns have decided against filing signatures due to the coronavirus pandemic and will instead file signatures this summer to appear on the 2022 ballot. The California State Legislature can also place measures on the ballot through June 25, 2020.

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Garcia (R) defeats Smith (D) in special election for California’s 25th Congressional District

Mike Garcia (R) won the May 12, 2020, special election for California’s 25th Congressional District after Christy Smith (D) conceded on May 13.

He will fill the U.S. House vacancy left by Katie Hill (D), who resigned the seat on November 1, 2019, amid allegations of extramarital relationships with staffers. The remainder of the term will expire on January 3, 2021.

Smith and Garcia will run again in a regular general election on November 3, 2020, for a full, two-year term. At the time Smith conceded, Garcia had 56% of the vote to Smith’s 44%.

Six special elections have been held during the 116th U.S. Congress—the current meeting of the Senate and House of Representatives. Three such elections were held in 2019, and three more are scheduled during the rest of this year.

Voters decided 136 congressional special elections between 1985 and 2012—19 in the Senate and 117 in the House of Representatives. In those elections, nine seats changed partisan hands, with Republicans gaining six seats and Democrats gaining three.

California to send mail-in ballots automatically to all registered voters in the general election

On May 8, Gov. Gavin Newsom (D) signed an executive order directing county election officials to deliver mail-in ballots automatically to all registered voters in the November 3, 2020, general election. Newsom announced that in-person voting locations would also be available.

Under normal circumstances, California allows any registered voter to cast a ballot by mail, but the voter must first request a mail-in ballot. Under Newsom’s order, a voter will not have to take any action in order to receive a mail-in ballot.

To date, in response to the COVID-19 outbreak, five states have chosen to send mail-in ballots automatically to all voters in certain elections. California is the first to extend the practice to November’s general election.

Special election to be held in California Senate district

A special election is being held for District 28 of the California State Senate on May 12. Elizabeth Romero (D) and Melissa Melendez (R) are competing in the special election. The filing deadline for candidates was January 9. A primary was held on March 3.

The special election was called after Jeff Stone (R) resigned the seat on November 1, 2019, to take a position in the Donald Trump presidential administration as Western Regional director in the Department of Labor. Stone had represented the district since 2015.

Heading into the election, Democrats have a 29-10 majority in the California Senate with one vacancy. California has a Democratic state government trifecta. A trifecta exists when one political party simultaneously holds the governor’s office and majorities in both state legislative chambers.

As of May, 43 state legislative special elections have been scheduled or held in 20 states. Between 2011 and 2019, an average of 77 special elections took place each year.

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Local California voters approve three and defeat two tax measures on May 5

Voters in Blythe and four special districts within Contra Costa, Mendocino, Plumas, Riverside, and Sonoma counties voted on five different local tax measures on Tuesday. According to unofficial election night results, three were approved, and two were defeated.

  • Voters in the city of Blythe approved an additional 1% sales tax, thereby increasing the total sales tax rate in the city from 7.75% to 8.75% and generating an estimated $1.144 million per year in general fund revenue. It was ahead by 71% to 29%, and it required a simple majority to pass.
  • Voters in Contra Costa County Service Area No. P-2 Zone A (Blackhawk) approved a parcel tax to fund police services. It was ahead by 73% to 27%, and it required a two-thirds (66.67%) supermajority vote for approval. The measure authorized a parcel tax of $395 per residential unit, $2,370 per parcel for property designated as commercial/industrial/institutional, and $11,852 per parcel for property designated as commercial/theater.
  • Voters in the Coast Life Support District, a district primarily providing ambulance services and that overlaps parts of Sonoma and Mendocino counties, approved a parcel tax ranging from $61 to $1,220 per year depending on the property type. It was ahead by 81% to 19%, and it required a two-thirds (66.67%) supermajority vote for approval.
  • Voters in the Hamilton Branch Fire Protection District defeated a parcel tax measure to increase its annual parcel tax by $175 per parcel by replacing the existing rate of $108 per parcel with a rate of $283 per parcel in order to fund fire protection and emergency medical services. It was behind the 66.67% supermajority requirement with a vote of 64% to 36%.
  • Voters in the Northern Sonoma County Fire Protection District defeated a measure to increase the district’s annual parcel tax rate to between $160 and $240 for residential parcels depending on size and to $0.11 per sq. ft. for non-residential buildings, $54 per building for agricultural structures, and $170 for every vacant parcel or parcel above 20 acres for fire services. It was behind the 66.67% supermajority requirement with a vote of 63% to 37%.

Parcel taxes are taxes unique to California that are based on units or characteristics of property rather than assessed value.

In the March 3 primary, local California voters decided 293 local measures, which was more than double the average of 139 decided at even-year June primaries from 2010 through 2018. Of the 293 local measures, 237 (81%) were bond or tax measures.

  • There were 45 sales tax measures on the March 3 ballot. Twenty-four (53.3%) were approved, and 21 (46.7%) were defeated. From 2014 through 2019, 76% of local sales tax measures were approved.
  • There were 54 parcel tax measures on the March 3 ballot. Nineteen (35.2%) were approved, and 35 (64.8%) were defeated. From 2003 through 2019, 57.5% of local parcel tax measures were approved.
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Signatures filed for California ballot initiative to fund stem cell research institute

On May 5, 2020, the campaign Californians for Stem Cell Research, Treatments & Cures filed signatures for a ballot initiative to issue $5.5 billion in general obligation bonds for the California Institute for Regenerative Medicine (CIRM). CIRM was created in 2004 when voters approved Proposition 71 and funded with $3.00 billion in bond revenue. As of October 2019, CIRM had about $89 million from the original bond remaining. The ballot initiative would provide CIRM with more revenue in order to remain open and continuing to provide grants for stem cell-related research, trials, and programs.

The campaign reported filing about 925,000 signatures. At least 623,212, or around 67 percent, of the signatures need to be valid. The recommended deadline to file signatures to appear on the election on November 3, 2020, was April 21, 2020. Counties need to validate the signatures before June 25, 2020, for the ballot initiative to appear on the ballot in 2020. Otherwise, the ballot initiative would appear on the ballot on November 8, 2022.

Californians for Stem Cell Research, Treatments & Cures aimed to collect 950,000 signatures but decided to stop in-person signature gathering when the state’s shelter-in-place order was issued on March 19. The campaign raised $6.06 million, as of the most recent campaign finance report on April 3. Robert Klein, a real estate investor based in Palo Alto, is chairperson of the campaign and provided $4.63 million of the campaign’s total funds. Klein is also the chairperson of the organization Americans for Cures and former chairperson of the campaign behind Proposition 71 (2004).

The ballot initiative is the 10th to file signatures to appear on the ballot for November 3, 2020. As of May 6, five had qualified and five were pending signature verification. The California State Legislature also has until June 25, 2020, to refer measures to the general election ballot.

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Signatures filed for ballot initiative to expand California’s Consumer Privacy Act

On May 4, 2020, the campaign Californians for Consumer Privacy reported filing more than 900,000 signatures for a ballot initiative to expand the provisions of the California Consumer Privacy Act (CCPA), which was passed in 2018. At least 623,212 of the signatures need to be valid to qualify for the ballot. As the suggested deadline to file signatures was April 21, 2020, the ballot initiative could appear on the ballot for November 3, 2020, or November 8, 2022, depending on how long the process of signature verification takes. Signatures need to be verified before June 25 to secure a spot on this year’s general election ballot.

Alastair Mactaggart, a San Francisco-based real estate developer, filed the ballot initiative. He was the proponent of a different proposal that qualified for the ballot in 2018, but the ballot initiative was withdrawn after negotiations with the California State Legislature. Negotiations resulted in the California Consumer Privacy Act of 2018 (CCPA).

With the new ballot initiative, Mactaggart said his intention “is to go to the ballot.” He described the CCPA of 2018 as a “great baseline. But I think there are additional rights that Californians deserve.” Unlike the CCPA, which the legislature passed, the ballot initiative couldn’t be amended without the approval of voters at the ballot box due to the state constitution’s limits on legislative alteration. “The only thing I want to make sure is they can’t undo the act,” said Mactaggart, “There is basically unlimited resources on one side of the fight. If you don’t do anything, they will win eventually.”

The CCPA was designed to require companies that store personal information to disclose to consumers what types of information are collected and allow consumers to request that certain businesses not disclose or sell their personal information. The ballot initiative would also require businesses to not share a consumer’s personal information upon the consumer’s request; provide consumers with an opt-out option for having their sensitive personal information, as defined in law, used or disclosed for advertising or marketing; obtain permission before collecting data from consumers who are younger than 16; obtain permission from a parent or guardian before collecting data from consumers who are younger than 13; and correct a consumer’s inaccurate personal information upon the consumer’s request. It would create the California Privacy Protection Agency to implement and enforce the CCPA. The ballot initiative would also remove the ability of businesses to fix violations before being penalized for violations.

Through March 31, 2020, Californians for Consumer Privacy raised $4.75 million, with Mactaggart as the sole funder. Currently, there is no organized opposition. Mactaggart’s last proposal, which resulted in the CCPA being passed, was opposed by Google, Amazon, Facebook, and Microsoft, among others.

As of May 5, 2020, five citizen-initiated ballot measures have qualified for the November ballot in California. Four more, including the ballot initiative to expand the CCPA, are pending signature verification. The California State Legislature also has until June 25 to refer measures to the ballot.

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