Proposition 30 allows tax hikes
SACRAMENTO, Calif. – California Gov. Jerry Brown took a big step toward delivering on a campaign promise he made two years ago to fix the state’s perpetual budget deficits and to raise taxes to do it only if voters agreed.
Brown said voters put their trust in his plan during Tuesday’s election by approving Proposition 30, which raises the statewide sales tax and boosts income taxes on the wealthy.
The changes will provide $6 billion to balance the state budget.
Brown, a Democrat, said Wednesday that Proposition 30 will put California on a course to fiscal stability after five years of battering by the recession. He characterized his victory as “a vote of confidence with some reservations.”
Now, he said, he must retain voters’ trust by avoiding spending binges.
“There are two things that I’m very skeptical about. One is mandates and the other is legacies,” he said. “So I’m just going to carry on.”
With Democrats poised to secure a two-thirds supermajority in both houses of the state Legislature, Brown should have an easier time pursuing his broader agenda.
That makeup would allow Democrats to pass budgets and make other spending decisions without any Republican support.
Observers have said Brown’s desire for a lasting gubernatorial legacy was one of the chief reasons he sought the job again in 2010 after first serving as governor from 1975 to 1983, before voters approved term limits.
He has said he wanted to return to the governor’s office after nearly three decades to “get stuff done,” explaining he would lay out his best ideas and leave the choices to voters.
His broader agenda includes building a $68 billion high-speed rail line, streamlining the state’s environmental regulations, and building two giant underground tunnels to funnel water from the Sacramento-San Joaquin Delta, the heart of the state’s water system.
Proposition 30, which raises the statewide sales tax for four years and income taxes for seven years on those who make more than $250,000 a year, got an immediate nod of approval from the credit rating agency Standard & Poor’s. It called the measure “the linchpin to the governor’s broader, multiyear strategy for reversing the state’s negative budget position.”
Revenue from the initiative will help the state avoid deep cuts to public schools and more tuition hikes at California’s colleges.
Business groups that had feared a downward slide if the measure failed and forced huge education cuts, also cheered the win, despite higher tax bills for some Californians.
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