It’s hard to recall when the county’s business and political interests have been as divided as they now are over California’s May 19 special election ballot.
The six measures on the ballot have defied traditional political fault lines and split political parties and businesses.
Among businesses, the split breaks down by size, with big versus small, establishment versus the little guy.
Some larger businesses, moderate Republicans and groups such as the Orange County Business Council back the ballot measures, though many see them as the lesser of two evils.
Smaller businesses and conservative Republicans oppose the measures because they extend tax increases and have other features they say are bad for business.
Some are caught in the middle.
“It’s almost split my personality,” said Dale Dykema, a Republican activist and chief executive of Santa Ana-based T.D. Service Financial Corp., which helps lenders process foreclosure paperwork.
Dykema, who has helped nearly all of the county’s congressional delegation get elected with advice and money, is a member of the moderate Republican group New Majority, which has given money to support what’s seen as the most important of the ballot measures, Proposition 1A.
He’s also part of the more conservative Lincoln Club, which opposes 1A and the other measures.
“I want to support the governor, but on this one I’m parting ways,” Dykema said. “I’ve been very conflicted.”
Supporters are equally conflicted. Many of them declined to go into detail about their support for the measures because of divisions and mixed feelings about them.
The Orange County Business Council, which is for some measures and against others, declined to comment for this story. Chief Executive Lucy Dunn was away on vacation last week.
The New Majority, which gave $200,000 for 1A, sees it as a “step in the right direction in the road to recovery,” said Larry Higby, the group’s California chairman.
“California’s budget situation is dire,” he said.
For many in the New Majority, the measure’s extension of taxes raised in February is a reluctant compromise.
With public employee pensions and other obligations, the state couldn’t have cut its way to fixing the $42 billion deficit it faced earlier this year, said one source familiar with the group’s thinking. So higher taxes became a tradeoff for 1A’s spending cap, which members believe will help prevent Sacramento’s boom-and-bust budgets in the future.
“We felt whatever tax there was should be as broadly based as possible,” said Tom Ross, New Majority political director. “California already has a label as being anti-business.”
Big companies largely back the ballot measures out of a concern for stability, according to Adam Probolsky, chief executive of Laguna Hills-based Probolsky Research LLC, a political research group.
“They see passing this as better than a very severe collapse of government,” he said. “People want to know what they’re dealing with in the next few years.”
Getting opponents to speak out against the measures is easier.
“The ballot measures are a travesty,” said Tracy Price, past president of the Lincoln Club and chief executive of Linc Group LLC, which provides services to building owners. “I think this has really divided moderates and conservatives.”
The tax hikes in the measures would hinder Price’s business, he said.
“Most in the Legislature have never run a business,” he said. “How is it that the state can’t cut one job?”
For some, opposition to the measures borders on rage, which has been brewing since Sacramento in February came up with a budget that included higher income and sales taxes and vehicle licensing fees.
That rage shows up in public opinion polls, which show all but one of the measures,the one that limits legislators’ pay during tough times,trailing.
The measures stand to be decided by the few who come out to vote, with turnout expected to be low.
Some private polls of likely voters are close, according to political insiders.
Proposition 1A extends the budget’s tax hikes from two to four years. It also calls for a limit on spending by the Legislature.
The other measures: Proposition 1B aims to guarantee school funding; 1C would borrow $5 billion from the state’s future lottery revenue; 1D and 1E would allow for more state spending on children and mental health programs; and 1F would limit pay for lawmakers during deficits.
Proponents of 1A claim the state’s current $8 billion deficit,which exists even after February’s budget patch,stands to nearly double if the measure isn’t passed.
If it doesn’t pass, the result would be drastic cuts among teachers, firefighters and other state employees, according to the measure’s biggest backer, Gov. Arnold Schwarzenegger.
Dissidents already fed up with higher taxes see 1A as a short-term fix to the state’s deeper problem of too much spending spurred by runaway growth in government. Some say that the measure will actually encourage future tax increases.
The Democratic side also is split by the measures. Many of their labor union allies take opposing sides.
Those expecting to benefit from the measures,such as unions representing teachers and law enforcement,are facing off with those that are opposed, including the Service Employees International Union, which spent $500,000 to fight it.
Opponents see a low turnout helping their side. Angry voters are more likely to show up than those who aren’t, said Michael Capaldi, a past Lincoln Club president and a lawyer with Newport Beach law firm Spach, Capaldi & Waggaman LLP.
But supporters have the bigger megaphone. Ninety percent of advertising money spent so far has been in support of the measures, according to Probolsky.
