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Ideas for a New Statewide Gann's Cap Initiative

A Proposal to reintroduce a Spending Cap In California



In the May 19th Special Election voters flatly rejected Proposition 1A, a so-called spending cap, that would have extended tax increases and cost California taxpayers an additional $16 billion. Over 60% of voters turned it down. The question is now open as to what can be done to resolve the spending crisis without raising taxes. Isaac Kight, Vice President of the Silicon Valley Taxpayer’s Association (SVTA), has a taxpayer-friendly plan to resolve California’s fiscal woes. Although SVTA usually focuses on ensuring that taxpayers get the most for their money in Santa Clara and San Mateo counties, the budget crisis has SVTA working with other local taxpayer’s associations across California to promote instituting a limit on how fast the state budget can grow.

In the 1980’s and 90’s, when the Gann Cap limited budget growth in the California state budget, California had great roads, excellent schools, and lower taxes, along with extraordinary surpluses. Several propositions that diverted surplus funds to the pet projects of various special interest groups, such as Propositions 98 and 111, slowly repealed the Gann Cap. Since 1998, when the Gann Cap was officially repealed, the state budget has nearly doubled in size. What did we the taxpayer’s get out of all this spending? Even with a ballooning budget, taxpayers had to pass an expensive bond measure to fix the roads. In California, 25% of our students do not graduate high school (a figure that disproportionately effects minorities). We have among the highest sales tax rates in the nation.

The Legislature has proven that it cannot be trusted to spend the money Californians already send to them, why should it be allowed to have more? If budget growth is limited, the Legislature will be forced to accomplish more with less money. By turning the debate away from how much money the state can spend towards how it will spend what it already has, voters will see a marked improvement in state services. The Legislature will be forced to spend within a limited budget just as the taxpayers do in their personal budgets.

On behalf of the Silicon Valley Taxpayers Association, Mr. Kight gathered the support of taxpayer groups across the state to support the idea of a spending cap initiative. The next steps will be to put together an outline of what a spending cap initiative could look like, gather the necessary financial support to make an initiative viable, then get an initiative written and out for signature gathering. With Californians attending Tea Parties in droves, gathering the necessary signatures for such an initiative should not be difficult or expensive.

The local taxpayer’s groups are now collecting suggestions and proposals for the outline. It will be a cap based upon one or more California economic indicators with state spending increasing only in years where revenues are greater than the year before. In years of where there is a budget surplus it will be saved in a “rainy day” fund so it can be used to maintain state spending levels in years when state revenues are down.

One provision that local taxpayer’s groups are keen to see included would be a prohibition against unfunded state spending mandates that burden local governments and reduce local control.

If you are interested in learning more or helping out please visit SVTaxpayers.com, or contact your local taxpayer’s association, website addresses are provided below.

These local taxpayer’s organizations that are currently supporting a spending cap initiative:

Calaveras County Taxpayer’s Association (CCTA.camp8.org)
Contra Costa Taxpayer’s Association (CoCoTax.org)
Orange County Taxpayer’s Association (OCTax.org)
Santa Barbara County Taxpayer’s Association (SBCTA.org/)
Seaside Taxpayer’s Association (SeasideTaxpayers.org)
Silicon Valley Taxpayer’s Association (SVTaxpayers.org)
Sutter County Taxpayers Association (SutterTaxpayers.com)
Yolo County Taxpayer’s Association (YoloTaxpayers.com)








Organizer:
Isaac Kight, Vice President
Silicon Valley Taxpayer's Association

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Last Updated: Jul 01, 09

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