Senator Huff Discusses Taxes, Taxes, Taxes

OCBC’s Government Affairs Committee Co-Chairs Alice Bisno, AAA and Lisa Haines, Disneyland Resort, welcomed The Honorable Bob Huff, California Senate Republican Leader; to discuss his perspective on the State of the State, the budget battle, and what to expect from the Legislature in this election year. Mr. Huff spoke about Governor Brown’s budget proposal and November ballot tax initiative, in particular the negative impacts the initiative would have on education and California’s economy. Only about $2.5 billion of the $7 billion in new taxes is dedicated to education. However, revenues dedicated to education are expected to increase by $2 billion naturally as the economy slowly recovers. So the governor’s tax increases would currently have a minimal effect on education but would still be a severe hit to California’s economy. And while the proposed tax increase gives little to education, should the initiative not pass, 97 percent of the trigger-cuts are targeted on education. “This tactic holds a gun to the head of voters,” Huff said.

The committee also discussed the impacts of Proposition 29, California Tobacco Tax for Cancer Research Act. The proposition would increase the tax on cigarettes by $1.00 per pack, aiming to fund cancer and tobacco-related disease research, smoking reduction programs and maintaining funding levels from the existing tobacco tax. The committee voted in opposition of the proposition, sending the recommendation to OCBC Board of Directors. The proposition would create a nine-member governing committee to administer the funds, with no accountability as to how or where the funds will be spent. The Legislative Analysts’ Office calculates over 100,000 lives could be saved and the tax would generate over $855 million annually, however, there are no conditions outlined requiring to keep that revenue within California, or even the U.S.

California has the 33nd highest tobacco tax in the U.S. with a current tax of 87 cents per pack, with an equivalent tax on other types of tobacco products, which is levied on cigarette distributors who supply cigarettes to retail stores. The additional $1.00 levied by the California Cancer Research Act would make California tobacco taxes the 15th highest in the U.S.

The committee also voted in support of California Forward’s potential November ballot initiative, Government Performance and Accountability Act. The initiative make common-sense improvements to California’s system of budget and governance, bringing state government closer to the people and giving local communities a stronger voice, by:

  • Requiring state bills be printed and available no later than 72 hours before a vote is taken
  • Requiring the State to establish a two-year budget cycle
  • Requiring state budgets to establish measurable goals and outcomes
  • Providing flexibility to local governments in order to meet local needs

The measure is consistent with the reform, accountability and transparency principles set forth in Think Long’s “Blueprint to Renew California,” a list of bipartisan recommendations for fixing state government and rebooting California’s future, released in November 2011. The measure also would implement recommendations developed by California Forward through a public stakeholder process that identified best practices and successful community-based programs. For more information contact Kate Klimow, Vice President of Government Affairs.

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