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Proposition 30: Options and Consequences

Proposition 30 (Prop. 30) would raise approximately $6 billion in annual revenue by implementing temporary increases in sales taxes for all taxpayers in California and in marginal personal income tax rates for high-income earners. This piece outlines the elements of Prop. 30 and discusses the consequences for taxpayers and public programs if it passes, as well as the impact of its failure. The 2012-2013 budget for the State of California, which the California Legislature passed and Governor Brown signed, assumes passage of Prop. 30 in the November 2012 General Election. The Governor and his coalition of supporters gathered the required number of signatures to place the measure on the ballot for voters’ approval. If the ballot measure fails, the budget would require $6 billion in budget cuts, or “trigger cuts,” to education, health, social services, and corrections.

Prop. 30 also defines the rules for the recent realignment of certain public services (incarceration of non-violent, non-sexual, non-serious adult offenders; supervising parolees; providing mental health and substance abuse treatment services; and foster care and child welfare services) from the state to the counties.

Taken together, the effects this ballot measure will meaningfully affect many Californians regardless of whether it passes or fails.