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California Passage of Tax Measures Growing, Analyst Says

California voters are approving tax increases and bond measures more frequently because of a lower bar for passage, rather than growing support for the issues, the state’s Legislative Analyst’s Office said.

Almost two-thirds of tax measures won passage in 2012, compared with fewer than half in 1998, the office said yesterday in a report. Voters granted 80 percent of bond measures in 2012, compared with 58 percent in 1998, the independent fiscal agency said.

California municipalities have limited ability to boost revenue. They can’t impose higher taxes without going to voters, and the state caps real-estate levies to 1 percent of a property’s most-recent sales price. The collapse of the housing market eroded tax dollars for many cities in the wake of the recession and left many grappling with mounting pension and retiree health-care costs.

The change wasn’t due to “an increase in voter support for taxes, because the average percent of electors voting yes for tax measures was fairly flat during this period,” according to the report.

The report found that voters were presented with fewer so-called special taxes, such as those levied on property, which require two-thirds approval, and instead were offered more general tax measures, which aren’t dedicated to a specific purpose and require only a simple majority for passage.

The increase in bond approvals followed a change in state law that reduced the voter-approval threshold for school facility bonds from two-thirds to 55 percent, the report said.

To contact the reporter on this story: Alison Vekshin in San Francisco at avekshin@bloomberg.net

To contact the editors responsible for this story: Stephen Merelman at smerelman@bloomberg.net Pete Young, Michael Shepard

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