Tax Initiative Deal Struck, Gathering Signatures Will Be Pricey

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2:00 p.m. UPDATE: Governor Brown confirmed to reporters in southern California this afternoon that a deal has, in fact, been reached on a November tax initiative. As such, this posting includes updated information and has a slightly tweaked headline from its original form.

Is there time for a compromise tax initiative? (Photo: Justin Sullivan/Getty)

By all indications, there's now a détente in the works that would head off the otherwise expected November ballot clash between Governor Jerry Brown and liberal activists over a tax increase.

Multiple sources confirm a compromise is being crafted that would adhere in some ways to Brown's existing initiative -- mainly, by still including a small sales tax increase -- but would boost the income tax increase on the wealthy above where the governor has proposed, while still making all of the taxes temporary.

Neither leaders of the millionaires tax campaign nor Brown's political team have confirmed any of the details, after the story was first reported this morning online by the Los Angeles Times. But conversations with several Democratic and Capitol sources reveal a tax proposal that feels much more like the governor's than the one being promoted by a coalition including the California Federation of Teachers.

The signs of a negotiated truce between the two sides seems to be taking some in political circles by surprise, after weeks of increasing tensions between the two camps and Brown's own prognostication on Monday that multiple tax measures appeared a done deal for November.

But two questions seem most prominent as this news breaks. First, can the deal actually withstand the scrutiny of daylight? That is, will the most die-hard supporters of solely an income tax hike on millionaires... and one that's earmarked for a number of programs... accept an initiative that still includes a sales tax increase and does not permanently raise taxes on the wealthy?

Similarly, after a week which saw the state's powerful business groups formally oppose all but Brown's tax hike, what will those groups say if Governor Brown embraces a different measure? Sources report the proposed compromise goes beyond the Brown initiative's 11.3% tax on incomes over $1 million. It also would apparently be a longer temporary tax than the five years in the governor's current measure.

These are all questions that will no doubt be answered in the hours/days/weeks to come. But there's also a huge logistics question to answer: is there time to draft and qualify an alternative tax initiative?

Here's where it gets tricky. By law, an initiative must have collected sufficient valid signatures at least 131 days before election day -- that's June 28. But to hit that date, the Secretary of State's office is already suggesting that the second week of May is probably the de facto deadline for actually submitting signatures to elections officials.

Plus... any proposed compromise still has to receive an official title and summary from the Attorney General's office, which also takes time.

All of this means that a compromise tax initiative may have to break records in how fast it qualifies for the ballot... and how much money is spent gathering signatures. Keep in mind that Governor Brown's proposal, which is taxes plus language codifying the 2011 state/local realignment, is a constitutional amendment. That means 807,615 valid signatures.

There doesn't seem to be any official record of the fastest qualifying initiative in state history, but the consensus among politicos seems to be the November 1998 initiative authorizing Indian gaming, for which backers submitted more than a million signatures in just 28 days.

Even at that blistering pace, a compromise tax increase initiative would have to be on the streets by mid-April. And that means political and policy wrangling aside, the real question here could come down to campaign cash and logistics.

4:45 p.m. Update: Perhaps not surprisingly, the initiative's language had already been drafted and it's just now been officially filed with the Attorney General (PDF), though a more easy-to-digest version can be found in the governor's official news release on the deal from this afternoon.

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About John Myers

John Myers is senior editor of KQED's new multimedia California Politics & Government Desk.  He has covered California politics for most of the past two decades -- serving previously as Sacramento bureau chief for KQED News and, most recently, as political editor for KXTV News10 (ABC) in Sacramento. He moderated the only gubernatorial debate of 2014, and was named one of the nation's top statehouse reporters by The Washington Post. Follow him on Twitter @johnmyers.
  • Ash Roughani

    And the best part is that we get to keep (and even exacerbate) all of the flaws with our current system.  Our favorites include the myriad loopholes and manic volatility.  You know we’ll be endorsing this one for sure!

  • Anonymous

    At the conclusion of the meetings, the rumor is that all sides enjoyed a semen laced cookie.  

  • Anonymous

    It not a tax problem, it’s a spending problem. I wonder what happens when we run out of “rich” people to raise taxes on. Oh that’s right, we become Greece.