California Budget ChallengeAbout Next 10Budget Overview

Budget Basics

Key Policies & Recent Reforms

Considering the decade-long deficits, it is no surprise many organizations and individuals are urging governance reform. In fact, a number of reforms have actually been enacted over the last few years, with potentially more to come before the voters.

Proposition 2: This initiative was passed by the voters in 2014 and requires that a certain amount of state's revenues must be placed in a Rainy Day Fund. The amount is generally 1.5% of General Fund revenue, and a share of capital gains revenue in good economic years.

Proposition 25: This initiative, which was passed by the voters in 2010, reduces the vote requirement to enact the state budget from 2/3rds to a simple majority in each legislative chamber.

Top-Two Primary: Established by Proposition 14 (also passed by the voters in 2010), voters are now able to choose any candidate in the primary election regardless of the candidate's or voter's political party preference. The measure also provides that the two candidates receiving the greatest number of votes appear on the general election ballot regardless of party identification. This is also called a "jungle primary."

Redistricting: Proposition 11, enacted by the voters in 2008, took the power to establish the boundaries for Assembly, Senate, and Board of Equalization seats away from the Legislature and put it in the hands of an independent 14-member commission. Proposition 20, passed by voters in 2010, moved the power of redrawing congressional district boundaries to the independent commission created by Proposition 11.

Term Limits: This initiative, which was approved by the voters on the June 2012 ballot, modified legislative term limits by permitting a person to serve no more than a total of 12 years (rather than 14), but permits that time in office to be served entirely in either the Senate or the Assembly instead of shorter time periods in each house. 

Proposition 26: This measure amended the state Constitution to say that "any change in state statute which results in any taxpayer paying a higher tax" requires a two-thirds vote of each house of the state legislature. Prior to Prop. 26, only bills changing state taxes "for the purpose of increasing revenues" required a two-thirds vote. Bills that increased some taxes but reduced others by an equal or larger amount could be passed by a simple majority vote of each house of the state legislature.

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