This election, voters across the country will vote on a variety of ballot questions affecting local governments.  While social issues such as same-sex marriage, affirmative action, abortion, and assisted suicide may be receiving more coverage by the media, voters in November are also deciding tax changes, budget and spending reforms, and other issues involving local government finances and governance.  Governing reports on the following ballot questions in its Elections Edition.

Tax Initiatives

California, Arizona, South Dakota, Missouri and Oregon all have proposed income and sales and tobacco tax increases to provide additional funding for education and health initiatives on their ballots.  As reported, California’s

Proposition 30, sponsored by Democratic Gov. Jerry Brown, would increase the income tax on earnings over $250,000 for seven years and increase the sales tax by 0.25 percent for four years. A competing measure, California Proposition 38, would raise all income taxes and dedicate 60 percent of the revenue to education.

In Arizona, Proposition 204 would make permanent an existing, temporary sales tax increase and mandating yearly increases in state education spending.  Meanwhile, South Dakota’s Measure 15 would increase the state sales tax in order to fund education and health care and Missouri’s Proposition B would increase tobacco taxes by one dollar per pack, with revenue directed to health education.

Other states would limit taxes.  As reported, Oregon’s proposal would eliminate inheritance taxes, while Oklahoma’s would limit property tax growth.  Michigan’s Proposal 5 and Washington state’s Initiative 1185 would require a two-thirds vote from their legislatures to enact new taxes.  New Hampshire’s Question 2 would prohibit any new income taxes.

In California, a change in the way multistate businesses calculate their state taxable income would result in some having to pay additional corporate income taxes. Almost half of the increased tax revenue over the next five years would be earmarked for energy efficiency and alternative energy projects.

Budget Reform

Two states will decide whether to put additional controls on state spending through ballot questions on budget reform.   South Dakota voters review a constitutional amendment that clarifies the rules for the state to have a balanced budget, and California’s constituency will see a proposal that includes a host of measure designed to rein in state spending.  As reported, the California proposition would

establish a two-year state budget cycle; prohibit the Legislature from creating expenditures of more than $25 million unless offsetting revenues or spending cuts are identified; permit the governor to cut the budget unilaterally during declared fiscal emergencies if the Legislature fails to act; require performance reviews of all state programs and performance goals in state and local budgets; and require publication of all bills at least three days prior to legislative vote.

Marijuana Revenues

According to Governing, six states will have marijuana-related measures on the ballot in November — three to legalize recreational use (Colorado, Oregon and Washington state) and three on medical marijuana (Massachusetts, Montana and Arkansas).

Colorado’s Amendment 64 would allow adults 21 and over to possess marijuana and requires the state to license and regulate cultivation and retail centers. In essence, marijuana would be regulated and taxed like alcohol.  The amendment requires that the first $40 million in revenue be directed to the state’s public school capital construction assistance fund. A study by the Colorado Center on Law and Poverty estimates that legalization would create up to $40 million in new tax revenue and save an additional $12 million in criminal justice costs.

Local Governance and Michigan’s “Dictator Law”

Michigan voters will decide a ballot question on whether local officials may maintain authority over their jurisdiction throughout times of economic hardship.  When a local jurisdiction is deemed to be struggling in Michigan, the state appoints “emergency managers” and gives them the authority usually held by mayors and other locally elected officials to pass ordinances, and make changes to labor contracts.

Critics say this “dictator law” is a subversion of democracy, and that it is used to lay off public workers and reduce their pay and benefits while outsourcing work to private-contractors.  Supporters claim it’s the only way the state can prevent some localities from becoming insolvent and declaring bankruptcy.  As reported,

Flint, Mich. Mayor Dayne Walling, whose authority has largely been displaced as a result of the state’s emergency intervention, says the law also undermines the ideals of democracy. He says the state should consider alternative approaches to local financial challenges. “There has to be a long-term solution that matches the economic realities but also the public expectations of democratic participation,” Walling says.

Meanwhile, a spokesperson for the Michigan Chamber of Commerce says the new law has helped localities get back on track.

[The Chamber of Commerce] is urging voters to support the existing law. “Our members pay a substantial amount in tax revenue at the school level, local level, and state level,” she says. “We’ve always had an inherent interest in the other side of the equation… how that money is being spent.”