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School Services of California, Inc.
Community College Update
October 1, 1996
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November 1996 Ballot Measures &emdash; Impact on Education

The 1996 elections have seen an increase in ballot measures over recent years. Twelve measures appeared on the March 1996 ballot and 15 more will be on the November ballot &emdash; 12 initiatives and three bond proposals. As readers are aware, a capital outlay bond measure for public education was not supported by the Legislature, resulting in there being no bond measure on the November ballot for school facilities. However, there are several initiatives on the ballot that will have an impact (if they are approved by the voters) on funding for K-14 schools and public policy pertaining to affirmative action programs.

This article will focus on the two initiatives that may affect funding for K-14 schools &emdash; Propositions 217 and 218. The third measure on the November ballot that could have significant implications for postsecondardy institutions is Proposition 209 &emdash; a controversial measure that some say could gut many of the state's affirmative action programs and potentially deny access to under-represented students and faculty.

PROPOSITION 217: STATE INCOME TAX RATES

Beginning in 1973, tax rates of 10% and 11% were established for California's top income earners. These rates continued in effect until 1987, when the rate ceiling lowered to 9.3% after California restructured its tax brackets following federal tax reform. When the recession hit California and revenue shortages occurred, lawmakers and Governor Wilson revived the 10% and 11% tax bracket, but a sunset date of 1996 was included in the legislation. Legislative efforts in 1994-95 to prevent the 10% and 11% rates from "sunsetting" proved unsuccessful, leading to a return of the 9.3% rate effective January 1, 1996.

Proposition 217 would reinstate on a permanent basis the 10% tax rate for individuals with more than $100,000 in taxable income and 11% rate for individuals with more than $200,000 in taxable income. The Legislative Analyst projects a revenue increase of $900 million for 1996-97, and $750 million in each succeeding year. Approximately half of the revenue will go to K-12 schools and community colleges under the Proposition 98 formulas and the other half to local governments. Each local entity will receive a proportional share based upon their losses from the property tax shifts of the early 1990s. Proposition 217 also limits future legislative attempts to reallocate property tax revenue by creating a "floor" for local government funding.

Some of the supporters of Proposition 217 include the California Tax Reform Association and California Federation of Teachers. The major opponent is the California Taxpayers Association.

PROPOSITION 218: LOCAL TAXES

Proposition 218 would limit local government (including community college and K-12 school districts) use of fees, assessments and taxes. It stipulates that fees and assessments can only be used for specified purposes and not for projects or services benefiting the general public, such as for public safety or libraries. All new fees and assessments, plus increases in existing ones, must be approved in an election by a majority of property owners. Approximately half of all existing assessments would also be subject to voter approval by no later than July 1, 1997. Proposition 218 further requires that all public agencies and K-12 schools pay assessments for services rendered by local city and county agencies, such as law enforcement (currently, schools and public agencies are exempt).

The Legislative Analyst estimates an annual loss of $100 million for local governments if Proposition 218 passes. One of the most notable impacts on community colleges and K-12 schools will be the loss of their ability to establish Maintenance Assessment Districts (MADs) without a vote by local property owners.

Proposition 218 is sponsored by the Howard Jarvis Taxpayers Association and Paul Gann's Citizen Committee &emdash; the organizations that brought to California Proposition 13. Opponents of Proposition 218 include the League of Women Voters of California and the California Teachers Association.

&emdash; Arnold Bray
[Posted 10/1/96]