Originally published in the Orange County Register on February 28, 2016:
For years now, I’ve been saying that Proposition 30 is an essential component of California’s public education system, and needs to be extended if we want to continue providing the state’s students with the infrastructure they need to succeed well into the future.
But you don’t have to just take my word for it. The nonpartisan Legislative Analyst’s Office recently released a report forecasting the impact a Prop. 30 extension would have on the state’s economy. As we have seen since California voters passed Prop. 30 in 2012, an extension continues to provide additional revenue benefiting millions of people by asking the wealthiest to pay a bit more in personal income tax.
Back in 2012, educators across the state fought hard for the passage of Prop. 30. With California just beginning to pull itself out of the throes of the Great Recession, the state’s education system was reeling financially. With the support of Gov. Brown and others, we constructed a fair and reasoned ballot initiative that California’s voters passed overwhelmingly.
Prop. 30 increased the state sales tax rate by one-quarter cent. This provision of the initiative will bring in $1.5 billion this current fiscal year, and will expire at the end of 2016. The second, more substantial component of Prop. 30 is a small income tax increase on the top 1 percent of earners. This increase is expected to bring in $6 billion to $8 billion this fiscal year alone, but expires at the end of 2018.
The expiration of Prop. 30 and the subsequent loss of income tax revenue is a problem that cannot be remedied through wishful thinking. That is why the California Federation of Teachers is working with a coalition of unions and community organizations on a petition drive to place a new initiative on the 2016 ballot that will extend only the income tax on the wealthy provision of Prop 30. through 2030.
In addition to letting the sales tax increase sunset, one other difference between the proposed initiative and Prop. 30 will be an increase in Medi-Cal funding, though most of the revenue raised will still go to education. The proposed initiative also now meets Gov. Brown’s and Proposition 2’s requirements to put some money aside for the state’s Rainy Day Fund and pay down some debt.
Overall, the impact on the state’s projected budget through 2030 by extending the income tax increase on the wealthy would be dramatic. According to the LAO, this measure will increase state projected revenues by as much as $11 billion annually through 2030, with those funds going to schools, community colleges, budget reserves, debt payments and other purposes.
But those are just numbers, projections and unknowns. What is known is that a modest obligation from California’s wealthiest has resulted in a significant revenue increase benefiting millions of students across the state. Programs, cancelled classes and lost jobs have been restored; and more money has been directed to the neediest communities through the Local Control Funding Formula. Prop. 30 has also had a positive impact on the state’s fiscal stability in general and plays a major part in why we are now on such stable footing.
In stark contrast to scary predictions by its opponents that California would lose jobs and millionaires would flee the state with passage of Prop 30., thousands of new jobs have been created, and more millionaires than ever call California home.
The case for extending the income tax portion of Prop. 30 has been made, not just in the form of matter-of-fact LAO findings, but in classrooms across the state. A small, fair increase on California’s highest earners has resulted in a solid bolstering of our education system.
Signature gatherers are on the street, and this is one petition the public needs to sign. We cannot let the gains and potential of Prop 30. slip away.