Proposition Payday

California's ballot initiatives have become big business

In California, voter initiatives have created some strange bedfellows. Bill Zimmerman, a liberal who helped airlift supplies to protesters at Wounded Knee, S.D., in 1973 and was a key proponent of auto-insurance rollbacks, is teaming up with Ken Khachigian, an adviser to Ronald Reagan and a Richard Nixon speechwriter, to promote a trio of tort-reform initiatives.

Golden State ballot measures are doing more than bringing would-be enemies together. Started in 1911 to promote grassroots democracy, the initiative process in California has become big business. Proponents and opponents of the tort-reform measures, for instance, will have spent some $17.5 million by the Mar. 26 primary to promote their views. The result: a bonanza for consultants, signature gatherers, and fund-raisers. These days, "people go out and propose these initiatives so they can make money," says Joe Cerrell, a Los Angeles political consultant. "In 1996, it's become a straight business."

California will have five initiatives on its ballot this March, including the tort-reform proposals, and it could have as many as 18 in November. Everything from campaign reform to education vouchers could be put to a vote this year at a likely cost of $2 million to $40 million apiece for opponents and proponents of the measures. For proponents, $1 million or so of that goes to gathering the hundreds of thousands of signatures required to get an initiative on the ballot. For either side, 48% of a measure's budget typically goes to TV. And with some of the most expensive television markets in the country--a 30-second spot during the hit show E.R. costs $70,000 in Los Angeles--California consultants who pull in 10% to 17% on the costs of ads are reaping huge rewards.

There are examples of fee abuse, including a much-discussed Orange County consulting team that collected up to 90% of tax crusader Howard Jarvis' budget in the mid-1980s. Unfortunately for donors, however, the amount spent on a campaign seems to have little effect on its outcome. Among the expensive losers: the tobacco industry's $18 million attempt in 1994 to weaken antismoking laws.

BIG BALLOTS. Initiatives can also have unintended results. Ruth Holton, the executive director of California Common Cause, says proposals such as 1988's Proposition 98, which guarantees schools 40% of tax revenues, have major side effects--in Prop. 98's case, less money for health care. "The public isn't thinking about the broader picture," she says. Still, special interests continue to spend because initiatives are a way around the state's long-gridlocked legislature.

The waves of initiatives can make voting a chore. In 1990, it took Los Angeles residents an average of 15 to 18 minutes to vote on 45 state and local initiatives and a full assortment of candidates. Still, poll after poll shows that Californians love their ballot measures. "Democracy's not always a pretty process," says Khachigian. But it can be a beautiful business.

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