The March 5 primary is right around the corner in California. Headlining the ballot—alongside a slate full of legislative Democrat-on-Democrat primary battles reflecting significant turnover due to term limits—is Proposition 1. The legislatively referred ballot measure, championed by Gov. Gavin Newsom, would issue a $6.38 billion bond and make statutory changes to the Mental Health Services Act. Other measures were initially planned for the March primary ballot. However, SB 789 (Sens. Allen and Wiener) moved SCA 2 (Allen), ACA 5 (Low) and ACA 1 (Aguiar-Curry), to the November ballot with the intent of maximizing voter turnout.
Looking to November, there were a handful of other measures that missed the cutoff for eligibility for the November 2022 ballot but collected enough signatures to be eligible for November 2024, namely the “California Pandemic Early Detection and Prevention Act” and the “Living Wage Act of 2024,” which would raise the state minimum wage from the current $15 an hour to $18 an hour with upward adjustments to account for inflation.
There are 27 initiatives and referenda cleared for circulation to collect signatures and another seven awaiting title and summary from the Office of the Attorney General to then circulate for signatures.
Eligible initiative measures will become qualified for the ballot on the 131st day prior to the next statewide general election (June 27, 2024) unless withdrawn by the proponents prior to its qualification by the secretary of state. For a proposed referendum measure, if the number of valid signatures is greater than 110% of the required number of signatures, the referendum measure is considered qualified without further verification. A referendum can qualify up to 31 days prior to a statewide general election. Spreadsheets containing the progress of a proposed initiative or referendum measure in the signature verification stage are updated regularly with the secretary of state. Currently, none of the measures circulating have reported hitting the 25% signature threshold as of yet with a lot of time out before the November general election.
The below summary chart and analysis outlines measures that are qualified and eligible for the November ballot as of December 2023. Brownstein’s California Government Relations team continues to monitor these developments and will provide an updated analyses once proposals are solidified as election day approaches.
*Indicates a measure that is qualified for the ballot. Measures without asterisks are eligible but not yet qualified. Eligible initiative measures will become qualified for the ballot on the 131st day prior to the next statewide general election unless withdrawn by the proponent(s) prior to its qualification by the secretary of state
MARCH PRIMARY
Prop. 1: Mental Health Services Act of 2024
SUMMARY: These reforms refocus billions of dollars in existing funds to prioritize Californians with the deepest mental health needs, living in encampments or suffering the worst substance use issues. The $6.38 billion bond will provide funding to build more than 11,150 new behavioral health beds and housing and 26,700 outpatient treatment slots filling critical needs across the state for homeless Californians with severe behavioral health issues.
Specifically, the proposal is comprised of two legislative vehicles from 2023, SB 326 (Eggman) and AB 531 (Irwin).
SB 326: Modernizes and reforms the Mental Health Services Act (MHSA), which was passed as Proposition 63 by voters in 2004. These reforms expand services to include treatment for those with substance use disorders, prioritizing care for those with the most serious mental illness, providing ongoing resources for housing and workforce and continuing investments in prevention, early intervention and innovative pilot programs.
AB 531: A $6.38 billion general obligation bond to build 11,150 new treatment beds and supportive housing units as well as 26,700 treatment slots to help serve tens of thousands of people annually—from intensive services for homeless people with severe mental illness to counseling for kids suffering from
depression and everyone in between. This investment would be the single largest expansion of California’s behavioral health treatment and residential settings in our state’s history—creating new, dedicated housing for people experiencing or at risk of homelessness who have behavioral health needs, with a dedicated investment to serve veterans.
ANALYSIS: Recent polling from the Public Policy Institute of California (PPIC) found an overwhelming majority (87%) of Californians say there is a mental health crisis in the United States. This measure has no formal opposition and is supported and championed by Gov. Gavin Newsom.
NOVEMBER GENERAL ELECTION
California Pandemic Early Detection and Prevention Act
SUMMARY: This initiative and constitutional amendment provides funding for pandemic detection by increasing the personal income tax on filers with income over $5 million by 0.75 percent for 10 years. These funds would be distributed to the California Institute for Pandemic Prevention, the Community Prevention Response Fund and the School Disease Spread Prevention Fund. The legislative analyst estimates that the new tax would bring in between $500 million and $1.5 billion annually.
ANALYSIS: This measure was initially aimed at the November 2022 ballot but barely missed the deadline. Qualification was bankrolled by several Silicon Valley high technology leaders, and the major source of funding was Gabe Bankman-Fried, who provided $12 million from a cryptocurrency fund founded by his brother Sam Bankman-Fried. How seriously this measure will be promoted in 2024 is questionable. The major funding source, Sam Bankman-Fried, was convicted of fraud and related crimes, and his cryptocurrency empire has fallen apart. A similar measure was killed in the legislature and Gov. Newsom has provided additional funds for public health in recent budgets.
The Fair Pay and Employer Accountability Act of 2024
SUMMARY: This measure eliminates the right of employees to file lawsuits seeking monetary penalties for labor law violations under the Private Attorneys General Act. It is an initiative statute sponsored by a number of business organizations, and it would replace the Private Attorneys General Act with a Fair Play Employer Accountability Act. Under the new act, statutory and civil penalties would be doubled for willful violations of labor laws, and it would award 100% of the monitory penalties to the harmed employees. But it would not allow awarding of attorneys’ fees, rather the Division of Labor Standards Enforcement would handle all labor law violation claims.
ANALYSIS: Business groups have long opposed the Private Attorneys General Act, contending that it leads to frivolous lawsuits. This will likely be a costly battle between labor and trial attorneys on one side and business groups on the other.
Taxpayer Protection and Government Accountability Act
SUMMARY: This measure will require all new taxes and tax increases passed by the legislature to also be approved by a vote of the people. The act will reinstate the two-thirds approval requirement for any new or higher “special taxes” proposed by initiative in a local election, while still maintaining the current majority vote requirement for general tax increases. The measure also would reverse recent court decisions making it easier for local governments to raise taxes.
ANALYSIS: Several anti-tax and business groups qualified this measure in what will be a big fight on the ballot. The official title for the measure could be challenging for voters as it reads:
“LIMITS ABILITY OF VOTERS AND STATE AND LOCAL GOVERNMENTS TO RAISE REVENUES FOR GOVERNMENT SERVICES.”
As written, it suggests that voters’ role in taxation is “limited” when the measure proports to increase voter involvement. However, the measure’s fate remains to be seen as of Nov. 30. In late September, the state legislature and Gov. Gavin Newsom filed the emergency petition with the California Supreme Court to remove the initiative from the November 2024 ballot. The petitioners allege it unlawfully revises the state constitution and would cripple essential government functions. In a motion late on Wednesday, Nov. 29, the court ordered California Secretary of State Shirley Weber and the ballot measure’s counsel to make their case for why the challenge should not proceed, a win for the opponents of the ballot measure which includes most Democrats and labor unions.
Living Wage Act of 2024
SUMMARY: This measure would raise the state minimum wage from the current $15 an hour to $18 an hour over several years. In 2016, then-Gov. Jerry Brown signed legislation to increase the minimum wage to $15 by 2023, with future minimum wage increases based on changes in the Consumer Price Index (CPI). The Living Wage Act would increase the minimum wage to $18, but it would increase it at different speeds depending on the number of workers an employer has. The minimum wage would reach $18 an hour for all employees on Jan. 1, 2026, and would increase thereafter based on the CPI.
ANALYSIS: Entrepreneur and anti-poverty advocate Joe Sanberg funded the qualification drive for the Living Wage Act in 2022, intending it for the November 2022 ballot. However, proponents were slow turning in their signatures and missed the 2022 deadline, and so the act will now appear on the November 2024 ballot. Opponents of this measure will argue that California is losing jobs because it is too expensive to do business here, and that this measure will make it worse. Proponents will argue that $18 an hour is necessary given the cost of living in California. The fate of this measure may well depend on how well the state’s economy is doing in 2024.
Referendum Challenging SB 1137, Oil and Gas Operations, Location Restrictions, Health Protection Zone
SUMMARY: This referendum would reject SB 1137, a measure passed in 2022 that imposes new regulations on oil and gas production. These regulations a would apply to any production facility within 3,200 feet of a school, residence, health care facilities and any business open to the public. The law requires the Air Resources Board and State Water Board to adopt standards for emission detections and imposes a number of other limitations on oil and gas production within the 3200-foot limit.
ANALYSIS: The measure is strongly opposed by oil and gas producers, who qualified the referendum against it. This is part of the larger fight over the future of fossil fuels in California, with major environmental organizations supporting the law. Opponents have already raised more than $20 million to oppose the law and obtain a vote to reject it in 2024.
Justice for Renters Act
SUMMARY: The Costa-Hawkins Rental Housing Act of 1995 prevents local government from limiting the initial rate that landlords may charge new tenants and also prevents local governments from limiting rent increases on existing tenants. This initiative repeals the Costa-Hawkins Act and would prohibit the state from limiting the right of local governments from enacting rent control ordinances.
ANALYSIS: AIDS Healthcare Foundation has spent over $7 million to qualify their rent control measure, the third attempt in recent years after previous efforts were rejected by voters by close to 20% in contests that saw the combined spending from both sides exceeding $100 million each time.
ACA 1, Local Government Financing: Affordable Housing and Public Infrastructure: Voter Approval
SUMMARY: This constitutional amendment—subject to voter approval—would allow a city, county or special district, with 55% voter approval, to incur bonded indebtedness or impose specified special taxes to fund projects for affordable housing, permanent supportive housing or public infrastructure. Contained in this measure are also a series of accountability measures that far exceed current law requirements:
- Funds must be used only for housing and supportive infrastructure—no salaries or operating expenses.
- Local initiative expenditure plans must:
- identify specific projects or programs to be funded.
- certify alternative funding sources have been evaluated.
- Annual, independent performance and financial audits, until all proceeds have been expended to ensure funds are expended as intended.
- Audits posted and available to the public.
- Requires appointment of citizen’s oversight committee to oversee funds are expended as approved by voters.
- No entity owned or controlled by a local official voting to put an ACA 1 initiative on the ballot will be allowed to bid for work funding by that initiative.
- The state auditor shall review and oversee financial and performance audits.
- A cap on administrative expenses at 5%.
- Requires members of a citizen oversight committee to receive educational training about bonds and fiscal oversight.
- All proceeds of an ACA 1 initiative shall be committed for projects and programs in the expenditure plan before a local government can proceed with another initiative under ACA 1.
- All ACA 1 initiative funding shall be spent on projects and programs that serve the jurisdiction where the initiative is passed.
ANALYSIS: A companion measure for January 2024 is expected—carried by the author of ACA 1, Assemblymember Cecilia Aguiar-Curry (D-Winters)—to amend provisions of the constitutional amendment before it goes to the voters with the aim of developing a consensus on what Californians will vote on. As it stands now, however, the business community is split on the measure and has voiced some concerns with the proposal.
ACA 13, Voting Thresholds
SUMMARY: Introduced as a response to the Taxpayer Protection and Government Accountability Act— which proponents of ACA 13 argue could result in funding cuts to fire and emergency response, law enforcement, programs to address homelessness and supportive service programs—ACA 13 would require future ballot measures that increase voter approval requirements to also pass by the same margin. It would, in effect, require next year’s business-sponsored tax limit to itself receive a two-thirds vote to be enacted.
ACA 5, Marriage Equality
SUMMARY: A constitutional amendment intended to protect same-sex marriage with plans to remove Proposition 8’s (2008) language from the state’s constitution that was approved by voters. Prop. 8 declared “only marriage between a man and a woman” as valid or recognized in California.
SCA 2, Repeal of Constitution Article 34, Relating to Public Housing Projects.
SUMMARY: Repeals Article 34 of the California Constitution, which requires development, construction or acquisition of publicly funded low-rent housing projects to be approved by a majority of voters in a city or county.
ANALYSIS: For more than 70 years, the construction of publicly subsidized affordable rental housing in California has faced an added barrier that no other type of housing must clear: a constitutional requirement for local voter approval. This extra barrier has had a number of consequences for the state’s ability to create affordable housing. First, in the decades following the adoption of Article 34, the state lost out on significant federal funding for affordable low-income housing. Specifically, California housing authorities missed out on millions in federal resources that the federal Department of Housing and Urban
Development (HUD) would have provided to construct low-income public housing if local city and county voters had not rejected proposed public housing developments at the ballot in 1950.
