California Proposition 37, Defining Fees as Taxes (2000)
Proposition 37 came about when Sinclair Paints, a corporation doing business in California, objected to a law enacted by then-Gov. Pete Wilson that authorized the state to collect fees from paint companies to fund a Childhood Lead Poisoning Prevention Program. The California Supreme Court upheld the imposition of the fees as legal under California's existing laws. The vote in the California State Legislature to enact the fees did not reach the 2/3rds threshold that would have been needed, if the fee had been defined as a tax. This background led to the effort, through Proposition 37, to clarify in the California Constitution, which fees imposed by the state legislature should be regarded as taxes and, as taxes, should therefore require a 2/3rds supermajority vote in the state legislature for enactment.
A somewhat similar ballot proposition, California Proposition 26, Supermajority Vote to Pass New Taxes and Fees, was on the November 2, 2010 ballot in California, and was approved.
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Text of measure
The ballot title was:
- Requires two-thirds vote of State Legislature, or either majority or two-thirds of local electorate, to impose on any activity fees used to pay for monitoring, studying, or mitigating the environmental, societal or economic effects of that activity when the fees impose no regulatory obligation upon the payor.
- Redefines such fees as taxes.
- Excludes certain real property related fees, assessments and development fees.
- Excludes damages, penalties, or expenses recoverable from a specific event.
- See also: Fiscal impact statement
The California Legislative Analyst's Office provided an estimate of net state and local government fiscal impact for Proposition 37. That estimate was:
- Unknown, potentially significant, reduction in future state and local government revenues from making it more difficult to approve certain regulatory charges.
$2,844,374 was spent to promote the measure. $310,609 was spent opposing it.
Donors supporting the measure included:
- Official Voter Guide summary to Proposition 37
- Official ballot title of Proposition 37
- Official declaration of the November 7, 2000 vote (dead link)
- Full text of Proposition 37
- Smart Voter on Proposition 37
- Cal Voter on Prop 37
- Top Ten contributors