Proposition 56

By Ash Bhatt

A Vote for Fiscal Health

Second, it creates a requirement for the legislature to put revenue into a reserve account at levels in proportion to the level of receipts in a given year. This effectively creates more stable revenue streams. And finally, it establishes consequences for lawmakers and governor if the budget is late by cutting pay and benefits until it is passed and leaving the legislature in session until then. This may be a gimmick but it does bring the issue home.

We need to pass Proposition 56 on March 2. Its benefits are many and immediate. Here are the main ones in my view:

1. But reducing the number of legislators needed to pass a budget to a level more typical of other states, Prop 56 limits the dire, annual consequences of gridlock and thus helps the state's credibility. Instead of bipartisan consensus, the 2/3 requirement has encouraged partisan bickering and gridlock -- Arkansas and Rhode Island are the only other states requiring at least a 2/3 vote to pass a budget.
2. Even though the new voting requirements apply to tax builds as well as the budget, this does NOT necessarily encourage higher taxes. Since the 1970s, there has been enormous restrains on tax hikes that the voters themselves have applied. ballot box, but it does allow for tax increases when they are absolutely necessary.
3. For both of these reasone, Prop 56 will very likely help the state's credit rating because the legislature will have greater flexibility and incentive to create a sound budget with adequate revenues. A lower credit rating that we have seen in the past year costs the state valuable resources over the long run. If we have to raise taxes, it should be to provide essential services, improve education, and expand transportation and safety rather than pay for excessive debt costs.
4. Prop 56 will help stabilize state spending and likely additionally help the state's credit rating because the reserve account will be available at higher levels in years when tax revenues are low. The reserve account will also contain spending in higher-revenue years because of the requirement that the state put more money into it when revenues are high. This is the kind of long-term planning and fiscal restraints that provide discipline in the budgeting process.
5. Although withholding pay affects different lawmakers in various ways depending on their financial situations, withholding pay and even benefits will bring make delay and partisanship as concrete a problem for legislators as it is for the teachers, hospitals, and everyday citizen when a budget is not completed in a timely fashion.

In short, Proposition 56 offers a reasonable solution to California's financial difficulties caused by brute political bickering. It is not radical, since it brings us into line with most US states. It is one step of many we need to take to move the state forward.