Oct 262010
Official "Vote NO on Prop 8" logo
Image via Wikipedia

Okay, the midterm election is another day closer, and here’s the next installment of my Voter’s Guide. So, if you have the time and are so inclined, you can read on. I’ll give you my position on each issue and also share why I’m voting the way I am.

Of course, if you’re a conservative, you’re not likely to agree with my positions, as I just today reviewed the guides assembled by several Democratic leaning groups, like the Courage Campaign, CREDO and the California Democratic Party (okay, so a little more partisan than just a lean), and it looks like I’ll be voting the party line on all issues for which they’ve taken a position. Perhaps this content could still have some value for conservatives though — as an anti-guide, or maybe just to help understand why somebody might vote along the Democratic line.

Proposition 22: Prohibits the state from borrowing or taking funds used for transportation, redevelopment, or local government projects and services.

Under the State Constitution, state and local governments share revenue from certain sources. This arrangement leads, from time to time, to the state affecting the distribution of funds to local agencies. This initiative will apply new limits to the authority of the state over local finances.

Specifically, the measure will limit the state’s access to fuel tax revenues, including temporary borrowing for cash flow purposes; it will also prohibit the redirection of redevelopment funds and eliminate the state’s ability to temporarily shift taxes from cities, counties and special districts to schools. There is also a provision to prohibit the use of Vehicle License Fees to cover state mandated costs.

In a nutshell, this initiative is designed to tie the state government’s hands in matters of the distribution of shared revenues. On the surface, this seems to have some merit. Those promoting the initiative label it a measure to “stop state raids” of local funding. Who wouldn’t be for that?

The problem is found in the detail. First off, Prop-22 attempts to constrain the state at a time when we have a $20 billion budget crisis. And it does so in a manner that prohibits the state from even performing such innocuous maneuvers as temporary borrowing to avoid cash flow issues. It also takes money from schools and codifies into the State Constitution protections for redevelopment agencies.

These measures seem unwise and imprudent in such a time of fiscal crisis. Proponents argue that the money should flow to its originally intended targets, while the opposition would argue that when money is tight, it should flow in order of precedent for the services most needed.

Good organizations are split on this proposition, with cities, most police, and local firefighters in favor, and teachers, nurses, and state firefighters opposed. The truth is that, if passed, the initiative will take significant funds from schools and healthcare and send it to redevelopment agencies and the private developers who rely on their funding. This is just bad policy and deserves to be defeated by an informed electorate.

Proposition 23: Suspends implementation of Air Pollution Control Law (AB32).

The state enacted AB32, the California Global Warming Solutions Act, in 2006. AB32 set a target of reducing the Green House Gas (GHG) to their 1990 levels by 2020. The legislation required the Air Resources Board (ARB) to adopt the rules required to make this happen. Proposition 23 seeks to suspend the implementation of AB32 until the unemployment rate in California drops to 5.5 percent or below for four consecutive quarters.

Proponents of the initiative promote the measure as a smart move to minimize energy costs and spur job creation. They insist that the move is needed, in spite of pollution concerns, because of the state’s $20 billion budget deficit and high unemployment. They contend that, while Global Warming may be a serious concern, California cannot solve the issue on its own.

What the proponents don’t want to reveal is the fact that since 1970, California has had only three periods when the unemployment rate was below 5.5 percent, and that those periods each lasted only around 2-1/2 years. The fact is that with unemployment currently over 12 percent, it will be a long while before California experiences a full year where unemployment dips below 5.5 percent.

The other thing that Prop-23 supporters don’t want California voters to understand is that main backers of the proposition are Valero and Tesoro oil companies — two Texas firms who are amongst the worst polluters in the state.

This proposition has nothing to do with jobs. These oil companies are simply trying to use the state’s unemployment situation as leverage to rationalize legislation that will only serve to increase pollution and bolster their bottom lines. For them, this is all about maintaining the status quo, about keeping the profits in the coffers of polluters instead of transferring the wealth to a new generation of clean energy companies.

California is on the leading edge of developing a clean energy economy. Millions of jobs will be established as this effort is allowed to move forward. Californians need to reject the self-serving propaganda of these old-world, dirty energy polluters and embrace the future. Clean energy will return America to the forefront of technology, establishing new export industries and putting the planet on a track for a sustainable future, while simultaneously addressing our nation’s security and economic issues associated with dependency on foreign oil.

Prop-23 is a death blow for progress that serves but one purpose — to save the profits of polluters. There is absolutely no reason to vote in favor of this proposition except to support dirty energy and the oil companies behind it. VOTE NO — Please!

Proposition 24: Repeals recent legislation that would allow businesses to lower their tax liability.

The background on this proposition is that the legislature and governor recently made certain agreements that changed the rules for business tax treatment in California. This proposition seeks to repeal these deals and return the tax rules to their previous status.

Prop-24 will repeal deals involving business use of financial losses, the determination of income for multistate businesses, and the ability of businesses to share tax deductions.

With regard to losses, the initiative will repeal the deal that allowed businesses to claim present losses on amended returns for previously filed tax years. It will also return the allowance permitting losses to be carried forward for 20 years back to only 10 years.

On the topic of California taxable income, the measure will eliminate a new rule that allows businesses to be taxed based only on the portion of their sales in California. It will return the process to its former state where business income was based on three factors: the value of the businesses properties in California, its payroll within the state and its sales. It will also, obviously, prevent business from changing the method they choose to use each year.

Finally, the initiative will repeal a deal where businesses within a unitary group of businesses were allowed to share tax credits, and it will return the rules to their former status where only the business that earns a tax credit can use it.

The fiscal impact of Prop-24 amounts to an increase of state revenue of around $1.3 billion by 2012-13. Most of that increase will be channeled to schools under Prop-98.

Proponents of Prop-24 label the measure the “Tax Fairness Act.” Opponents call it the “Jobs Tax.” Therein lies the debate. But oddly enough, Republicans and Democrats alike support Prop-24. Why? Because they understand that giving special tax breaks that apply only to multistate businesses is not only bad governing —  it’s also BAD BUSINESS.

California is in dire economic straits, and making special deals for large, multistate businesses that will greatly reduce tax revenues and require further cuts to essential services is as imprudent as it is unfair. Businesses that are based in California need to pay taxes to California, regardless of where they make their sales — just like other California businesses.

A vote for fairness is in order — vote YES on Prop-24.

So, that’s installment #2. If you’re interested, stay tuned and tomorrow we’ll finish the propositions with installment #3 of Dave’s 2-cents on the California election.

Enhanced by Zemanta

 Leave a Reply

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>