California Proposition 89, Public Campaign Finance Program, Campaign Finance Limits, and Increased Corporate Tax Initiative (2006)

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California Proposition 89
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Election date
November 7, 2006
Topic
Elections and campaigns
Status
Defeatedd Defeated
Type
State statute		Origin
Citizens

California Proposition 89 was on the ballot as an initiated state statute in California on November 7, 2006. It was defeated.

A "yes" vote supported the following:

  • establishing a public campaign finance program for qualifying candidates running for state office;
  • lowering the campaign contribution limits for candidates who did not participate in the public program based on the elected office and contributing entity;
  • limiting the contributions ballot measure campaigns could receive from candidates and corporations;
  • increasing the income tax rate paid by corporations from 8.4% to 9.04% and the income tax rate paid by financial institutions from 10.84% to 11.04%.

A "no" vote opposed establishing a public campaign finance program for qualifying candidates running for statewide office; limiting campaign contributions for candidates not participating in the public campaign finance program; limiting campaign contributions for ballot measure campaigns; and increasing the income tax for corporate and financial institutions.


Election results

California Proposition 89

Result Votes Prozentualer Anteil
Yes 2,124,728 25.73%

Defeated No

6,132,618 74.27%
Results are officially certified.
Source


Text of measure

Ballot title

The ballot title for Proposition 89 was as follows:

"Political Campaigns. Public Financing. Corporate Tax Increase. Campaign Contributions and Expenditure Limits. Initiative Statute.”

Ballot summary

The ballot summary for this measure was:

"

• Provides that candidates for state elective office meeting certain eligibility requirements, including collection of a specified number of $5.00 contributions from voters, may voluntarily receive public campaign funding from Fair Political Practices Commission, in amounts varying by elective office and election type.

• Increases income tax rate on corporations and financial institutions by 0.2 percent to fund program.

• Imposes new limits on campaign contributions to state-office candidates and campaign committees, and new restrictions on contributions by lobbyists, state contractors.

• Limits certain contributions and expenditures by corporations.		”

Full Text

The full text of this measure is available here.


Fiscal impact

See also: Fiscal impact statement

The fiscal estimate provided by the California Legislative Analyst's Office said:[1]

" Increased revenues (primarily from increased taxes on corporations and financial institutions) totaling more than $200 million annually. The funds would be spent on the public financing of political campaigns for state elected officials.[2] ”

Support

"Yes on 89" website logo

Yes on 89 led the campaign in support of Proposition 89.

Supporters

Official arguments

The official voter guide arguments in favor of Proposition 89 were signed by Deborah Burger, R.N., president of the California Nurses Association; Harvey Rosenfield, founder of the Foundation for Taxpayer and Consumer Rights; and Susan Lerner, executive director of the California Clean Money Campaign:[1]

"

VOTE YES TO TAKE A STAND AGAINST THE POWER OF SPECIAL INTERESTS AND LOBBYISTS IN CALIFORNIA GOVERNMENT. VOTE 'YES' ON PROPOSITION 89, THE CLEAN MONEY AND FAIR ELECTIONS ACT

We have a crisis of corruption in our government marked by scandal after scandal and criminal investigations of politicians from both parties. It is time for Californians to clean up this corruption and make politicians accountable to voters instead of big money campaign contributors.

THE PROBLEM Right now, special interests like big oil companies, the drug giants, the insurance industry, and HMOs can get their way in Sacramento by donating millions to elect politicians who will owe them favors. Lobbyists and special interests use campaign contributions to pass their pork barrel projects and create tax loopholes—costing consumers and taxpayers like you billions of dollars each year.

THE SOLUTION: PROPOSITION 89 If you’re dissatisfied with the way campaigns are funded in California and the effect of campaign contributions on state government, Vote Yes on Prop. 89.

YOUR 'YES' VOTE WILL:

1. Help level the playing field and make our elections more fair and competitive—so that candidates with the best ideas have a chance to win, even if they are not rich or well connected to wealthy special interest groups and lobbyists.

2. Require candidates to adhere to strict spending limits and reject special interest contributions in order to qualify for public financing.

3. Ban contributions to candidates by lobbyists and state contractors.

4. Set limits on outside, so-called “independent” campaign committees created by big contributors to influence elections.

5. Limit to $10,000 the amount corporations can spend directly on ballot measure campaigns.

6. Restrict contributions by corporations, unions, and individuals to $500 for candidates for state Legislature, $1,000 to candidates for statewide office.

7. Establish tough penalties, including jail time and removing candidates from office who break the law.

NOT FUNDED BY INDIVIDUAL TAXPAYERS OR THE STATE BUDGET

Proposition 89 is specifically funded by a modest increase in the corporate income tax rate—raising it from 8.84% to 9.04%. The resulting corporate income tax rate would still be less than it was from 1980 until 1996. Corporations should pay their fair share in taxes.

WHEN YOU HEAR THE ARGUMENTS AGAINST PROPOSITION 89, REMEMBER:

  • Opposition to Proposition 89 is being led and funded by the big oil companies, drug companies, the insurance

industry, HMOs, and other entrenched interests.

  • Proposition 89 was drafted and reviewed by experts in constitutional and election law and put on the ballot and backed by Democrats, Republicans, and independent voters.
  • The opponents of Proposition 89 want to keep the system exactly the way it is, because they know it works for them, NOT for you. They are making false claims against Proposition 89 because they want to keep political power for themselves rather than having fair elections that make politicians accountable to the voters.

VOTE YES ON PROPOSITION 89! RETURN ELECTIONS TO THE VOTERS AND REDUCE THE POWER OF THE SPECIAL INTERESTS.[2]

”


Opposition

"No on 89" website logo

No on 89 led the campaign in opposition to Proposition 89.

Opponents

The official voter guide arguments opposing Proposition 89 were signed by Allan Zaremberg, president of the California Chamber of Commerce; Tony Quinn, former commissioner of the California Fair Political Practices Commission; and Larry McCarthy, president of the California Taxpayers Association:[1]

"

Don’t be fooled by Proposition 89. Prop. 89 is NOT about cleaning up politics. But, it is 56 pages of new, complicated, confusing election rules that won’t work.

Proposition 89 was put on the ballot by a single special interest group, the California Nurses Association, that wants an UNFAIR advantage in California elections while small businesses and individuals are effectively SHUT OUT of the political process. Even other labor organizations like those representing teachers, firefighters, and law enforcement do not support Proposition 89, because it RESTRICTS their participation in the political process as well. PROPOSITION 89: NOT JUST ABOUT BIG CORPORATIONS.

The authors of Prop. 89 say they are trying to stop big corporations from having too much influence. But, Proposition 89 restricts many small businesses from backing candidates or supporting and opposing initiatives. Even a mom-and-pop business, if it is incorporated like many are, is restricted under Prop. 89.

Proposition 89 also restricts many nonprofit groups that want to educate voters about the issues they care about. For example, a group of crime victim advocates will be limited in warning voters about a candidate who is soft on crime. Teachers will be limited in helping elect candidates who will support improving our schools.

PROPOSITION 89: INCREASES TAXES TO PAY FOR NEGATIVE CAMPAIGNS.

California has many urgent priorities to get our state back on the right track. Proposition 89 contains a $200 MILLION TAX INCREASE and gives that money to politicians to spend on their negative TV ads and junk mail.

Proposition 89 places virtually no limits on how the politicians spend their taxpayer-financed campaign funds. It means that we, the taxpayers, will be paying for their negative ads!

PROPOSITION 89: WON’T STOP WEALTHY CANDIDATES. Proposition 89 puts no limits on wealthy candidates who try to buy California elections. Under Proposition 89, a politician using taxpayer funds and running against a wealthy candidate can get up to ten times the normal taxpayer money to run his campaign. A candidate for Governor could qualify for up to $200 million of taxpayer money to run his or her campaign. PROPOSITION 89: IT’S UNCONSTITUTIONAL!

James Hall, past Chairman of the California Fair Political Practices Commission, says: 'Proposition 89 is unconstitutional, unfair, and won’t work.'

Supporters of 89 say it is modeled after measures in other states. But, the United States Supreme Court recently found the contribution and expenditure limits in a similar measure from Vermont unconstitutional because they limit free speech and violate the First Amendment.

PROPOSITION 89: WE ALREADY HAVE CAMPAIGN LIMITS. Californians have already passed a campaign finance reform law, Proposition 34, which strictly limits contributions to candidates. This law has survived several court challenges and is working. We don’t need Prop. 89.

SAY NO to PROPOSITION 89! Proposition 89 is unfair to small businesses, nonprofits, and groups representing working Californians. It is a waste of our precious tax dollars, it’s unconstitutional, and it’s just another confusing measure that won’t work. Please join small businesses, taxpayers, educators, organized labor, and so many others in voting NO on Proposition 89.[2]

”


Path to the ballot

See also: California signature requirements

In California, the number of signatures required for an initiated state statute is equal to 5 percent of the votes cast at the preceding gubernatorial election. For initiated statutes filed in 2006, at least 373,816 valid signatures were required.

See also

2006 Measures

California

News and analysis


External links

Footnotes

  1. ↑ 1.00 1.01 1.02 1.03 1.04 1.05 1.06 1.07 1.08 1.09 1.10 1.11 1.12 1.13 University of California Hastings, "Voter Guide," accessed March 22, 2021
  2. ↑ 2.0 2.1 2.2 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
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