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California Backs Tax Measure

November 7, 2012

After four consecutive years of appropriations cuts, tuition increases, constricted enrollment, and concern that one of the best systems of higher education was suffering a death by a thousand cuts, higher education leaders in California got a bit of good news Tuesday night when state voters passed a tax hike that averts what many called potentially disastrous cuts.

With 91 percent of precincts reporting, the measure had won the support of 53.8 percent of Californians to 46.2 percent against. Governor Jerry Brown declared victory for the measure in a late-night speech to supporters. "I know a lot of people had some doubts, had some questions -- can we really go to the people and ask them for a tax?" Brown said. "Well here we are, we have a vote of the people," he added, according to the Sacramento Bee. "I think the only place in America where a state actually said, let's raise our taxes for our kids, for our schools, for our California dream."

The measure’s passage averts immediate cuts of $250 million for both the California State University and the University of California systems and a $300 million cut for the state’s community colleges that were written into the state budget earlier this year.

If the measure failed the systems would likely have been forced to enact cuts four months into the fiscal year; administrators said they would have had to increase tuition, restrict enrollments, cut course sections, and lay off adjunct faculty.

The measure's passage is good news for students worried about their tuition bills. Because the measure passed, the Cal State system has to refund a 9 percent tuition hike that took place this semester. It will also forgo further tuition increases this year. 

Students at the University of California system didn't see a tuition hike this year, but administrators threatened to increase tuition by 20 percent by January if the measure failed. 

The proposition will impose a temporary quarter-cent sales tax and an income tax on individuals with incomes greater than $250,000. Lawmakers expect the measure to bring in an additional $34 billion in revenue while it is in place.

Brown and other Democratic state lawmakers pushed the proposition after they failed to get Republican legislators’ support for a budget that included increasing taxes. While Democrats have majorities in both houses of the state legislature, a constitutional amendment passed by voters in the 1980s requires a supermajority for any measure that increases taxes.

The proposition's scope is not limited to the state's colleges and universities. Revenue generated through the measure will help support K-12 education and public safety as well.

The measure was the highest-profile contest in the state this year and tied closely to Brown's administration. The governor and other state lawmakers personally stumped for the measure, and the measure attracted more money than any other contest in the state. The measure’s backers spent  $66 million supporting it, much of it coming from teacher's unions; opponents, mostly anti-tax groups, spent $84 million.

Polls earlier this year showed strong support for the measure, as high as 64 percent of respondents, but that support began to wane as the election neared. Polls in October showed the measure with less than 50 percent support.

The measure also faced competition from a second ballot measure, pushed by Molly Munger, daughter of the partner of Warren Buffett, which would have increased taxes on high-income households and earmarked that money for K-12 education. Administrators were concerned this measure would siphon off support for Brown's measure, as voters would be reluctant to support two tax increases. That measure failed overwhelmingly, gaining fewer than 30 percent of votes.

Higher education administrators said they hoped the measure's would begin to turn around the revenue picture for California's colleges and universities. Between 2007 and 2012, state appropriations for higher education decreased 21 percent while enrollment increased. To compensate for that decline, administrators increased the tuition price at state's colleges and universities. Tuition now makes up a larger portion of revenue than state appropriations for the University of California system.

Board members in both systems endorsed the measure. Administrators, while not allowed to use their offices to advocate for or against a ballot measure, did take controversial steps to inform the public about what the measure's failure would mean. The Cal State system limited new enrollment in its institutions for the spring semester and sent letters to all applicants for slots for next fall saying their admissions could be contingent on the measure's passage.

The California Faculty Association, which represents faculty members in the Cal State system, heavily supported the measure. Union members gathered signatures to get the measure on the ballot, phone-banked in support of the measure, led teaching sessions, and engaged in get-out-the-vote efforts.

Administrators and faculty also hoped students would get behind the measure. 

The measure's passage is not a panacea for the problems California higher education faces. Because the measure was designed to address previous cuts, and because the state is still struggling with multiple fiscal challenges, including entitlement and public safety costs, there is a a chance that the state's colleges and universities could see further cuts in coming years.

 

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