California Proposition 226, the "Paycheck Protection" Initiative (1998)
Proposition 226 would have made two changes to California's Political Reform Act of 1974:
- It would have established new requirements with regard to payroll deductions for political activities.
- It would have established a provision similar to federal law prohibiting campaign contributions from a foreign national for a candidate for public office.
Proposition 226 was an example of a paycheck protection ballot measure and attracted strong opposition from unions. In 2005, another paycheck protection measure (Proposition 75) was on the California ballot. It, too, was defeated.
Video distributed to union members opposing Prop 226
Supporters of Proposition 226 spent $6,422,661. The top contributors to pass the measure were:
- Californians for Paycheck Protection, A Committee of Governor Pete Wilson Supporting Proposition 226: $4,022,926
- Campaign Reform Initiative, A Project of the California Foundation for Campaign Reform: $1,346,219
- Lincoln Club of Orange County, Inc. PAC: $368,929
- Yes on Proposition 226, A Project of California Foundation for Campaign Reform: $684,587
Opponents of Proposition 226 spent $24,840,395. The top contributors to pass the measure were:
- AFL-CIO No on 226 Education Fund: $2,723,521
- California Teamsters Public Affairs Council Issues Account: $186,133
- Californians to Protect Employee Rights, A Committee of Firefighters, Teachers, Nurses & Other Employee Organizations – No on 226: $19,709,442
- Consumer Attorney Issues Political Reform Committee: $150,668
- PMC-Nonprofits Concerned About 226: A Committee Against Proposition 226 sponsored by: Public Media Center: $45,430
- Workers’ Rights Protection Fund of the California Labor Federation, AFL-CIO – No on 226 (formerly Workers’ Issues Fund of the California Labor Federation, AFL-CIO): $2,025,201
The ballot title was:
The official ballot summary for Proposition 226 was:
- Requires all employers and labor organizations to obtain employee's or member's permission before withholding wages or using union dues or fees for political contributions. Employee's or member's permission is to be obtained annually using a prescribed form. Requires record keeping.
- Prohibits contributions to state and local candidates by residents, governments or entities of foreign countries.
The California Legislative Analyst's Office provided an estimate of net state and local government fiscal impact for Proposition 226. That estimate was:
- "Unknown, but probably not major, net state enforcement costs."
- "Annual costs of up to about $2 million and one-time costs of $2 million to $5 million to the state for administration of employee payroll deductions for political activities; costs offset by fees."
- Unknown, but probably not major, costs to local governments for administration of employee payroll deductions for political activities; probably offset by fees."
- Payroll Deductions.
- Employers make a variety of payroll deductions from their employees' wages, such as deductions for Social Security, income taxes, medical plans, and charitable contributions. The deductions are sent to various organizations, businesses, and governments. Existing law does not require employers to identify how the organizations will use the monies.
- Political Contributions from Labor Unions.
- Many workers in California belong to labor unions. In addition, many workers who do not belong to a union work for a business or organization in which a union provides collective bargaining and representation for all of the employees, both union members and nonmembers.
- Workers who are represented by unions pay dues or fees to the unions. In most cases, such dues or fees are automatically deducted by the employer from the workers' wages and sent to the union. The union may use some of the dues or fees for political activities. A union member may request that his or her dues or fees not be used for political activities, although there is no legal requirement that the union honor the request. If a nonunion member requests that the fees not be used for political activities, the union must comply with the request.
- Campaign Contributions by Foreign Interests.
- Currently, federal law prohibits a foreign national from making a contribution to or expenditure for a federal, state, or local election campaign for a candidate for public office. A foreign national includes a foreign government, certain foreign businesses and organizations, and any person who is not a citizen or lawful permanent resident of the United States. Federal law also prohibits a person from accepting a campaign contribution from a foreign national.
- In addition, state law prohibits a foreign government or business, or a person outside of the U.S. who is not a U.S. citizen, from making a contribution or expenditure in connection with a campaign for a state or local ballot measure. State law also prohibits a person or a political campaign committee from soliciting or accepting a contribution for a ballot measure from a foreign government, business, or person outside the U.S.
- Political Reform Act.
- California's Political Reform Act of 1974, an initiative adopted by the voters, establishes guidelines and requirements for political candidates and campaigns. The state's Fair Political Practices Commission (FPPC) enforces the requirements of the act.
State of California
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