2009 California Proposition 1A

Proposition 1A was a California ballot proposition that appeared on the May 19, 2009 special election ballot. It was a constitutional amendment that would have increased the annual contributions to the state's rainy day fund. The proposition was legislatively referred to voters by the State Legislature, and sponsored by by Assemblyman Roger Niello (R-Fair Oaks). The Proposition failed by a significant margin.

Background

In February 2009 the State Legislature narrowly passed the 2008–2009 state budget during a special session, months after it was due. As part of the plan to lower the state's annual deficits, the State Legislature ordered a special election with various budget reform ballot propositions, among them Proposition 1A.

Changes the budget process. Could limit future deficits and spending by increasing the size of the state "rainy day" fund and requiring above-average revenues to be deposited into it, for use during economic downturns and other purposes. Fiscal Impact: Higher state tax revenues of roughly $16 billion from 2010-11 through 2012-13. Over time, increased amount of money in state rainy day reserve and potentially less ups and downs in state spending.

On March 5, 2009, a court ordered changes in the ballot title, label, and summary.

Overview of the Proposition from the California Legislative Analyst's Office:

Measure Changes the State’s Budgeting. This measure would make major changes to the way in which the state sets aside money in one of its “rainy day” reserve accounts and how this money is spent. As a result, Proposition 1A could have significant impacts on the state’s budgeting practices in the future. The measure would tend to increase the amount of money set aside in the state’s rainy day account by increasing how much money is put into this account and restricting the withdrawal of these funds.

Measure Results in Tax Increases. If this measure is approved, several tax increases passed as part of the February 2009 budget package would be extended by one to two years, including the following: (1) A 1% increase in the state sales tax, from the current tax of 7.25% to 8.25% (and can total up to 10.25% when local sales tax is included), will be extended for one year through 2011-12 (2) The state's Vehicle License Fee will go from .65% to nearly 1.15% of a vehicle's value for two additional years through 2012-13 (3) An increase of 0.25% in the state's Personal Income Tax on every tax bracket, will also be extended for two more years through the 2012 tax year

State tax revenues would increase by about $16 billion from 2010-11 through 2012-13.Overview of the Proposition from the California Legislative Analysis Office:

The Legislature passed a different bill that included tax increases with the 2009-2010 budget. That bill had a provision that stated if Proposition 1A passed, the tax increases would continue for another 2 years.

Voting results

Proposition 1A

Choice	Votes	%
No	2,555,519	65.8
Yes	1,327,400	34.2
Total votes	3,982,919	100.00

External links

Prop 1A information from CaliforniaPropositions.org