Should local taxes require two-thirds voter approval? Proposition 43 explained

California voters will decide this November whether to make it harder for citizens to approve local taxes for specific purposes.

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Proposition 43 would amend the state constitution to require two-thirds of voters to approve local special taxes proposed through citizen initiatives. Those measures currently require a simple majority to pass.

Special taxes are taxes dedicated to specific purposes, which could include services such as education, fire protection, affordable housing or infrastructure.

Local special taxes placed on the ballot by government bodies already require two-thirds voter approval. Prop. 43 would apply that same requirement to special taxes placed on the ballot through citizen initiatives.

Prop. 43 would also generally prohibit local governments from creating new taxes based on property values, with exceptions for certain voter-approved taxes used to repay bonds.

The ballot measure is a compromise from the Legislature to kill a proposal that would have invalidated any property-related special taxes previously adopted with an approval rate below two-thirds. Opponents said the previous ballot initiative would have threatened billions in local funding.

What a ‘yes’ vote means

A vote for Proposition 43 is a vote to require two-thirds voter approval for local special taxes, regardless of whether they are placed on the ballot by a local government or proposed by citizens.

If Proposition 43 passes, a citizen-initiated special tax that receives more than 50% but less than two-thirds of the vote would no longer pass. The new requirement would apply beginning Jan. 1, 2027.

A yes vote would also approve the measure’s restrictions on local property taxes.

What a ‘no’ vote means

A vote against Proposition 43 is a vote to maintain the current distinction between citizen-initiated and government-initiated local special taxes.

If Prop. 43 fails, citizen-initiated local special taxes could continue to pass with a simple majority, while special taxes placed on the ballot by local governing bodies would continue to require two-thirds voter approval.

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The measure’s proposed restrictions on local property taxes would also not take effect.

Supporters of Prop. 43

Yes on Prop 43 — The Local Taxpayer Protection Act is leading the campaign supporting the measure. Supporters include the Howard Jarvis Taxpayers Association and Reform California.

Supporters argue that Prop. 43 closes a loophole that allows citizen-initiated special taxes to pass with less support than special taxes proposed by local governments.

The Howard Jarvis Taxpayers Association has argued that the measure would restore the two-thirds requirement intended by Proposition 13.

Opponents of Prop. 43

No on Prop 43: Stop the Local Taxpayer Deception Act is leading the campaign opposing the measure.

Opponents include Assemblymember Buffy Wicks, the California Democratic Party and Evolve California.

Opponents argue that requiring two-thirds approval would make it more difficult for communities to raise money for local services even when a majority of voters support doing so. Evolve California argues that the measure would make California the hardest state in the country to raise local revenue.

Fiscal impacts of Prop. 43

The state’s fiscal analysis says Prop. 43 could result in local government tax revenues not increasing as much in the future because some taxes would face a higher voter-approval threshold.

The analysis does not provide a specific statewide dollar estimate for how much revenue local governments could forgo.

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