BY HOWARD FINE
California’s November ballot is shaping up to be one of the most crucial in years for business.
Besides a stark choice for governor, the ballot is set to contain nearly a dozen measures that could have sweeping impacts on the state’s business climate for years to come.
Grabbing the headlines have been the four bond measures that would raise $37 billion for much-needed public works projects, including highways, shipping, schools, housing and levee repair.
Business groups, including Orange County’s New Majority, pushed to get the bond measures on the ballot and are expected to endorse them.
Other initiatives are drawing attention. Among them: measures hiking taxes on cigarettes, oil and property; a proposal sharply limiting government seizures of private property; and a public campaign financing initiative that would clamp down on corporate contributions.
“There have been ballots with big measures aimed at business before, but I don’t recall one with so many measures across such a wide range of areas that have the potential to dramatically impact specific industries or the state’s business climate,” said Allan Zaremberg, president of the California Chamber of Commerce in Sacramento.
There are so many measures that many business groups have gotten off to an early start taking positions on them, just weeks after the polls closed for the primary election.
The Orange County Business Council’s government affairs committee is expected to ask the Irvine-based business group to formally back the governor’s four measures next week, according to Todd Priest, the council’s vice president of government and community affairs.
Business groups will be forced to spend tens of millions of dollars staking out their positions during the fall campaign, less than a year after they raised nearly $50 million for Gov. Arnold Schwarzenegger’s special election initiatives that failed last year.
The governor’s four November measures include $20 billion for highway, mass transit and port-related projects, $10.4 billion for schools, $4 billion for levee repair and flood control and $2.8 billion for affordable housing.
When first placed on the ballot in May, the infrastructure bond package was expected to win easy approval, especially with Gov. Schwarzenegger and Democrat legislative leaders all promising to campaign for it.
Voter Fatigue?
But the defeat of a $600 million library bond earlier this month and poll results showing tepid support for an affordable housing bond could signal a tough campaign for these proposals.
Business interests also are supporting a measure to safeguard gas tax funds collected under Proposition 42 for congestion relief projects.
Shortly after voters passed Proposition 42 in 2000, the Legislature raided the funds to balance the budget. Only last year was the money finally freed for transportation projects. The proposal on this fall’s ballot would restrict the Legislature’s ability to make future raids on Proposition 42 funds.
On the other side of the ledger, business groups are most concerned about the campaign finance reform measure sponsored by the California Nurses Association. The initiative qualified for the ballot last week.
The proposal is a double-whammy of a hit on business: not only would it restrict corporate contributions to $1,000 for candidates and $10,000 for measures, but to fund the public financing component, banks and corporations would be hit with an annual tax increase of $200 million.
“This initiative would virtually deny the ability for anybody besides a labor union to participate in the political process,” Zaremberg said.
Proponents of the initiative argue it would place corporations on the same level playing field as unions and individuals.
Most business groups also are expected to oppose a measure to tax oil companies for any oil they extract from California soil. The measure is expected to raise $400 million a year for research into alternative fuels. The main argument against the proposal is that it would raise gas prices for businesses and consumers.
The $2.60 per pack cigarette tax hike raising $2 billion a year for hospital services is another matter. The state chamber is opposed, with Zaremberg calling it a “ridiculous tax on one industry (tobacco) imposed by another (hospitals).”
Other groups support the tax, saying it provides funding for the state’s overstretched hospital system.
The most controversial of all for the state’s business interests is the measure restricting government seizures of private property.
The measure threatens to split business right down the middle. Many businesses, especially large retailers, support the use of eminent domain as a way to expedite major redevelopment projects. But many small businesses want to see eminent domain restricted, since they often are targeted for property seizures to make way for large redevelopment projects.
In the June primary, Orange County voters approved a ballot measure barring the Board of Supervisors from using eminent domain to take away private property for private development.
Fine is a staff writer with the Los Angeles Business Journal.
