Prop

California’s sky-high housing costs cast a dark shadow on its sunny disposition, sending some fleeing to more affordable climes.

Yet voters decisively rejected a state ballot measure that promised to make it easier and cheaper to build housing by changing the law often blamed for driving up costs: the California Environmental Quality Act. Proposition 45 even divided pro-housing groups.

So what gives? And where do we go from here?

Proposition 45 would have offered expedited environmental review and put a shot clock on legal challenges for projects defined as essential, including those involving housing, water, transportation and internet access. Supporters said it would cut costly delays, while opponents warned it would weaken environmental protections and public input.

Skeptics pointed out that state lawmakers already changed CEQA last year, exempting the lion’s share of urban infill housing from the law. They argued that means the proposition would have largely benefited low-density development on the outskirts of cities — sometimes labeled “sprawl.”

But supporters say the measure would also boost projects in cities left out of those exemptions. All types of housing, some say, are needed to dig the state out of its shortage.

For housing advocates, where they stood on the measure “ultimately depends on how you feel about exurban development” and whether the state should be making it easier to build it, said Ethan Elkind, director of the climate program at the UC Berkeley Center for Law, Energy and the Environment, who didn’t take a public position on the measure.

Jordan Grimes, legislative director for the Greenbelt Alliance, an environmental nonprofit that opposed the measure, is among those that see it as the wrong type of development.

According to Grimes, it increases greenhouse gas emissions as residents are forced to drive more; gobbles up natural areas and farmland to build; and requires outsize investment from taxpayers in the urban core to pay for the needed infrastructure.

“It’s definitely not climate friendly for sure,” he said. “But sprawl is also a pretty huge economic drag.”

The significant legislative changes enacted last year under Assembly Bill 130 are paying off, he said. He estimated some 18,000 units have since been permitted statewide.

“If you want to build a new apartment building in Los Angeles or Beverly Hills or Palo Alto or San Francisco, you can do that now,” he said, describing it as a “watershed moment” in the state’s urban housing production.

But many who laud the changes believe there’s more that can be done. For instance, infill projects over 20 acres don’t qualify for the CEQA exemption.

“So there’s still these massive projects where you know developers want to be able to do redevelopments of shopping malls and parking structures, but they just can’t,” said Paul Shafer, public policy manager for the nonprofit California Council for Affordable Housing, which backed the measure.

He added that there are certain rural areas that didn’t benefit from last year’s changes because projects there don’t fit the definition of infill housing.

“There’s a lot of hesitation around what greenfill looks like,” he said. “But when we’re in a 2.5-million-unit housing shortage, it really requires more than just that infill development to fill that gap.”

Shifting public opinion

A July poll by the Public Policy Institute of California found that 73% of likely voters would support Proposition 45. By October, voters were divided, with 50% opposed and 46% in favor, according to another survey by the nonpartisan think tank.

Experts pointed to a number of possibilities for voters’ decisions, including what some characterized as successful but potentially misleading messaging by the opposition and confusion over the complex measure. Others suggested voters rejected it based on its substance, deciding they didn’t want to fast-track some projects it covered.

Supporters raised several million dollars more than opponents, according to state campaign finance data. Yet Jason Elliott, a consultant who helped craft the measure, said proponents were outspent 2 to 1 on paid advertising, “making it hard to compete.”

What’s next

Some want to see state lawmakers take up parts of Proposition 45, including imposing timelines for review and litigation related to CEQA. The measure generally would have meant that environmental impact reports could take no more than 365 business days and lawsuits no more than 270 calendar days.

“Death by delay is a real strategy, particularly for affordable housing,” said Linda Mandolini, chief executive of Eden Housing, which develops and owns affordable housing.

For five years, she said, the nonprofit was embroiled in a series of lawsuits over a 130-unit project it’s developing in the eastern edge of the Bay Area. It’s starting construction this year, but she estimates the delays cost them $29 million.

Shafer, of California Council for Affordable Housing, said shot clocks would offer some certainty that the state’s current development process lacks. Some say it’s hard to secure financing and insurance when you don’t know how long it will take before you can break ground.

But Shafer is not optimistic that the Legislature will prioritize making such changes.

“I don’t think there’s going to be an appetite to see reforms in this area, certainly not as far-reaching as we saw in Prop. 45, for many years to come,” he said.

Not everyone sees the environmental law as the area to target.

UC Berkeley’s Elkind believes the first step to boost housing in already developed areas would be for state lawmakers to allow denser housing in communities where it’s restricted — such as permitting apartments in areas zoned for single-family homes.

“We’re really at that point where we’ve got to start kind of chainsawing through the thicket of local requirements that keep the infill housing we need from getting built,” he said. “And it’s not really about CEQA at this point.”

President Trump fancies himself a farsighted man of destiny and if his vision has often proved lacking — witness the Iranian quagmire — he was right about one thing: 2026 was going to be a rough year for Republicans.

That’s typically how midterm elections work for the party in the White House.

And so Trump, knowing the GOP’s House majority was hanging by the slenderest of threads, strong-armed Texas into redrawing its congressional map to boost Republican chances of keeping control by nabbing up to five extra seats.

The move was stunningly brazen — redistricting usually takes place once, early in a decade after the census — and it was a terrible thing to do.

Lest there’s any doubt how your friendly political columnist feels, let us repeat: It was a very, very, very, very, very bad thing. And provocative, at that.

In response, California — egged on by its White House-hankering governor — passed a ballot measure to gerrymander five of its House seats to give a big advantage to Democrats. With that, the battle was joined. More than half a dozen Republican-led states ultimately ended up redrawing their congressional districts in an effort to bypass voters and predetermine the outcome of the November election.

It didn’t work. (Yay, voters! Way to show who’s in charge!)

But that’s not nearly the end of it.

A mind-blowing election

Last week’s Republican wipeout was beyond anything that anyone, save the most hopium-addled Democrat, could have imagined. The party needed a gain of three seats to flip the House. Democrats are on track to pick up more than 40, despite all that Republican gerrymandering.

And what of those five rigged seats in California? Democrats captured them all.

“We fought fire with fire,” Gov. Gavin Newsom crowed on social media. “And won.”

At least, Newsom did. His headlining role as champion of Proposition 50, his Trump-trolling and online towel-snapping antics have turned the gallivanting governor into one of the party’s most talked-about 2028 presidential prospects.

But the body politic that he yields to incoming-Gov. Xavier Becerra didn’t fare nearly as well.

Registered Republicans make up 25% of California’s electorate and many more regularly support the GOP. In Garden Grove, supporters await GOP gubernatorial candidate Steve Hilton’s arrival at his election night event on Nov. 3, 2026.

(Allen J. Schaben / Los Angeles Times)

The map drafted to bolster Democrats has resulted in the near-extinction of California Republicans on Capitol Hill. When the next session of Congress convenes in January, the state’s four remaining House members can caucus inside a Toyota Camry, with room to spare.

Consider: Registered Republicans make up 25% of California’s electorate and many more regularly support the GOP. The party’s share of the 52-member House delegation will be less than 8%.

If you’re a fiercely partisan Democrat, a give-no-quarter lefty or someone who’s animating political impulse is to drive your fist into the other guy’s face, this is all lip-smackingly delicious.

For everyone else, not so much.

Especially if you’re one who believes in the representative part of representative democracy and thinks that if our government and political system are to function properly, it’s important that citizens of all stripes and all political persuasions feel as though they’re invested and have a stake. In short, they need to feel as though their voice and their votes matter.

Millions of Californians now have good reason to doubt that.

Anger and agita

We’ve just witnessed an election that amounted to a primal scream. Much, if not most, of the distemper was aimed at the would-be authoritarian in the White House. But a goodly amount of anger was directed at politicians of both parties and a sense they’re focused more on power and their own interests — such as holding on to power — than the needs of those they’re supposed to represent.

In hindsight, it’s obvious that gerrymandering those five California House seats was unnecessary for Democrats to seize the majority. Given the magnitude of the blue wave, it’s quite possible they might have flipped a few of those seats even without partisan tinkering.

But that’s not just assessing the results with a 20-20 rearview.

On the day that voters approved Proposition 50 last November, Trump’s approval rating was already heading south. More than half a century of history shows a strong correlation between a president’s standing in polls and his party’s performance in the midterm election; on average, the opposition party gained more than two dozen seats. So even then it appeared highly likely that Democrats would take control of the House, even if the Texas gerrymander worked as planned.

(It didn’t. Democrats ended up winning four of the five seats the GOP intended to flip.)

Proposition 50, which undid the lines carefully drawn by the state’s nonpartisan, independent redistricting commission, was billed as a one-time, break-glass solution to a political emergency. However, the new map will stay in effect through 2030.

So much for a temporary fix.

Voters should hold Democrats to their word and see to it that the nonpartisan commission resumes its map-making role after the next census. (With California projected to lose anywhere from two to four House seats, Democrats will be sorely tempted to again hijack the process to protect their interests.)

With their new majority in Congress, Democrats should act to ban gerrymandering nationwide. The Problem Solvers Caucus, a bipartisan group, has put forth a proposal to begin that process, demonstrating that support exists on both sides of the aisle.

Gerrymandering is a dirty business, notwithstanding its practice dating to the Colonial era. It needs to stop.

Once and for all.

What else you should be reading

Get smart: In search of post-midterm message, Trump waffles on trusting election, immigration policy
The deep dive:Empowered congressional Democrats gear up for battles over immigration and ICE oversight
The L.A. Times Special:As Stephen Miller rises, California hopes it can blunt his force with Democratic gains
Until next time,
mzb
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California voters have rejected the controversial billionaire tax.

Proposition 40 sought to impose a one-time 5% tax on California billionaires’ assets to try to offset federal healthcare funding cuts.

Despite the blue wave in the midterm elections, the novel tax on the ultra-wealthy had trailed from the first day of vote counting and was officially rejected on Monday.

Roughly 53% of Californians voted against the measure, while 47% supported it, the Associated Press said when it declared that the proposition had failed.

Although the billionaire tax was rejected in the vast majority of counties, the late tally showed major pockets of support in Los Angeles and San Francisco — home to the lion’s share of the state’s 200 billionaires. Orange County, however, voted no by a wide margin.

The political battle over the ballot measure and two competing proposals divided the state and was among the most expensive in California history. More than $400 million had been spent on the three intertwined ballot measures, with more than 90% spent opposing the billionaire tax, according to fundraising disclosures filed with the secretary of state’s office.

Billionaires, notably Google co-founder Sergey Brin, poured hundreds of millions of dollars into groups that funded ads to kill the billionaire tax. California Gov. Gavin Newsom, the California Teachers Assn. and Planned Parenthood Affiliates of California are among the powerful Democrats and other Democrat-aligned groups that expressed fears that billionaires would flee the state. Some, including Brin and fellow Google co-founder Larry Page, moved out of California because of the proposal.

An onslaught of advertisements against the billionaire tax argued it could impact all Californians, not just the ultra-wealthy. Teachers, firefighters and other middle-class Californians became the face of their campaigns, fueling growing opposition ahead of election day.

Opponents of Proposition 40 said Californians made the “right decision,” calling Proposition 40 a “reckless experiment” that would hurt the state’s economy. The group included the California Medical Assn., California Primary Care Assn. and the California School Boards Assn.

“Proposition 40 risked California’s economic competitiveness and fiscal stability, as well as the revenue we rely on to fund our top priorities — from education and healthcare to public safety and infrastructure,” the group said.

Leaders of the Service Employees International Union-United Healthcare Workers West, which sponsored the proposition, vowed to put a billionaire tax proposal on the 2028 ballot if Sacramento leaders don’t find a way to better support the public health sector. Given California’s volatile budget, which is expected to be particularly problematic next year, it appears unlikely that state lawmakers will find a way to backfill an estimated $100 billion of federal healthcare funding cuts.

Supporters said the proposed tax on more than 200 California billionaires aimed to raise that amount, with 90% funding healthcare, and the remainder going to schools and food assistance.

“Billionaire-funded propaganda may have influenced the outcome of this election, but as hospitals reduce services, emergency rooms close and families lose access to care, the truth will become increasingly difficult to hide,” said Suzanne Jimenez, chief of staff for the SEIU-UHW. “Californians will see for themselves what was at stake.”

This will not be the end of the debate about taxing the rich. U.S. Sen. Bernie Sanders (I-Vt.) and Rep. Ro Khanna (D-Fremont), who both backed Proposition 40, are pushing for the passage of a federal 5% tax on American billionaires.

Earlier this year, they introduced the “Make Billionaires Pay Their Fair Share Act.” Despite Democrats winning control of the House and Senate last week, the legislation will probably face constitutional challenges if it passes.

California voters have passed Proposition 38, authorizing the state to issue $8.4 billion in bonds to fund immunology and immunotherapy research aimed at curing and preventing certain chronic diseases.

The measure, which the Associated Press called on Monday evening, requires at least $4.2 billion of the funds to be used for immunology research on cancer, heart disease and Alzheimer’s disease. It also authorizes the state to enter into a partnership with an unnamed immunology and immunotherapy research institute selected by the California Department of Public Health, and to allocate half of the bond revenue to it.

Opponents argued that the measure would saddle taxpayers with decades of debt and that the requirements to qualify for grants created such a narrow pool of candidates that only one research institute in California, the California Institute for Immunology and Immunotherapy, currently meets the criteria to receive half the bond revenue. Gary K. Michelson, a wealthy philanthropist who wrote the proposition, co-founded the institute. He was also the proposition’s largest supporter, pouring $45 million into the campaign, according to state data.

Remaining funds will be used for competitive research grants that focus on immunology and immunotherapy. Those grants would be awarded by a council of representatives from University of California campuses, universities and nonprofit research institutions.

Supporters celebrated the passage on Monday saying in a press release that it “comes as federal research funding cuts have disrupted clinical trials and delayed medical discoveries nationwide.”

“This victory belongs to the patients and families who have spent years fighting devastating diseases and waiting for the next medical breakthrough,” Chris Tarver, a nurse and president of the American Nurses Association\California, said in a prepared statement.

Californians will take on an increased cost of $500 million to $600 million annually to repay the bond for an anticipated 20 years, according to the Legislative Analyst’s Office. Some or all of the cost could be offset if any funded research generates revenue. However, it’s difficult to predict how many, if any, research projects would lead to marketable treatments.

Times staff writer Hannah Fry contributed to this report.

Days after the midterm elections, Proposition 40 has yet to be decided. The ballot measure, which would impose a one-time 5% tax on California billionaires to help fund healthcare, is failing by more than 8 percentage points.

Statewide, more than 4 million votes remain to be counted in this race, according to the Associated Press, which calculates the expected vote using returns and other data. That includes more than half a million from Los Angeles County, where the “yes” vote leads by more than 7 percentage points.

The proposition has so far found support in nine counties: Alameda, Humboldt, Los Angeles, Mendocino, Monterey, San Francisco, Santa Cruz, Sonoma and Yolo. In Southern California, Los Angeles is the only county leaning toward “yes.”

Propositions 41 and 42

While Proposition 40 focuses narrowly on taxing billionaires, competing Propositions 41 and 42 would have broader impacts on the state’s ability to enact new taxes. And the measures could undercut Proposition 40 if it passes.

As of Friday, the latest vote tallies showed “yes” on Proposition 41 trailing by more than 7 points, while “yes” on Proposition 42 was ahead by more than 6 points.

Proposition 41 would would require audits for new state special taxes and prohibit new state taxes from being exempted from a voter-approved state spending limit. Proposition 42 would prohibit new taxes on retirement holdings, individually owned assets and other personal savings. If Proposition 40 passes and either of these measures passes with more “yes” votes than Proposition 40, it would prevent the billionaire tax from becoming law.

A late October poll showed voter opposition to Propositions 41 and 42 had grown even as support for the billionaire tax declined.

The money behind the measures

Support for Proposition 40 has totaled to nearly $35 million, mostly from the Service Employees International Union-United Healthcare Workers West, the healthcare workers union that proposed the tax.

Backers of Propositions 41 and 42 also opposed Proposition 40. Combined, they raised more than $300 million. Most of that money came from the billionaires who would be subject to the tax.

The proposition creates a down payment loan program, totaling up to $25 billion, for middle-income families looking to buy a new home in California. The program would be run by the California Housing Finance Agency, which already oversees several homeownership assistance programs.

The state would sell bonds to fund the program. It would pay back investors using interest and loan payments from the program — not taxpayer money. The California Housing Finance Agency would administer the program, including setting interest rates for the loans.

To qualify, prospective borrowers would need to buy a newly constructed home or a home that never has sold before, such as a commercial building that was converted into condos. Borrowers wouldn’t need to be first-time homebuyers, but they would need to earn no more than 200% of the median local income; for a family of four in Los Angeles County, that amounts to no more than $216,200 a year.

There also would be limits on the sales prices of homes bought with help from this program. While the exact price would depend on the county, generally the homes would need to sell for between $1 million and $1.5 million. Homebuyers would need to put at least 3% down, and the state finance agency could provide a loan up to 17% of the sales price.

The loans would function like fixed-rate second mortgages.

According to the California Budget and Policy Center, the earnings that would qualify a family for down payment assistance could vary greatly depending on where they planned to buy a home. Per the center’s calculations, a family of four buying a home in Madera County would have to earn no more than $166,800 a year, while a family in Santa Clara County could earn up to $375,800 a year and still qualify.

Other specifics would be worked out if voters pass the measure. That includes the interest rates charged on this second mortgage, which, according to the Budget and Policy Center, likely would be higher than the current rates for conventional mortgages, which have hovered around 7% for a 30-year mortgage.

Because revenue bonds, which would be used to fund this program, are riskier than other bonds, investors might demand a higher return, translating to a higher interest rate.

There are about 2,000 safety-net clinics in California that deliver primary care to underserved populations. Proposition 44 would set limits on how these federally qualified health centers spend their money.

The basics

Proposition 44 asks voters to require federally funded community health centers to spend at least 90% of their total annual revenue on “program services advancing their charitable purpose.”

The impact

If the proposition passes, the state attorney general will be responsible for determining what services fall into that category. If spending on administrative or non-healthcare functions exceeded 10% of total revenue, a clinic would have to pay a penalty equal to the amount it overspent.

Dig deeper

Proposition 44 was backed by the Service Employees International Union-United Healthcare Workers West, the same union that is pushing Proposition 40, the controversial billionaire tax. The union appears to be the main supporter of the proposal and says the restrictions would prevent excessive spending on executive salaries, fundraisers and other administrative expenses.

There is a diverse array of opponents, including the California Medical Assn., the California Teachers Assn., the Planned Parenthood Affiliates of California, the state Democratic Party and the state Chamber of Commerce. They say the proposition’s vague wording could result in vital services being excluded from the list of program expenses permitted. A study commissioned by the California Primary Care Assn. found that clinics could face up to $1.7 billion in collective penalties in the first year of the measure’s implementation.

More reading

What to know about Prop. 44 (L.A. Times)

An analysis of Prop. 44 (California Legislative Analyst’s Office)

More on the measure, spending (CalMatters)

Union involved in Prop. 44 faces questions (L.A. Times)

The Trump administration has frozen, terminated or delayed billions in congressionally approved research grants since last year. Proposition 38 aims to backfill some of that loss by creating a stable source of money to fund immunology and immunotherapy research.

The basics

Proposition 38 would authorize the state to issue $8.4 billion in bonds to fund immunology and immunotherapy research to uncover treatments that help the immune system fight diseases such as cancer and Alzheimer’s disease more efficiently.

The impact

The measure would require at least $4.2 billion of the funds to be used for immunology research on cancer, heart disease and Alzheimer’s. It also would authorize the state to enter a partnership with an immunology and immunotherapy research institute selected by the California Department of Public Health and allocate half of the bond revenue to it. The remaining funds would be used for competitive grants that focus solely on immunology and immunotherapy research.

Californians would take on an increased cost of $500 million to $600 million annually to repay the bond for about 20 years, according to the Legislative Analyst’s Office.

The Yes on 38 campaign says the proposition pays for itself: 10% of all proceeds from the licensing of immunotherapies must be returned to the state to offset the total cost of the bond measure, including interest.

However, it’s difficult to predict whether any research projects will lead to marketable treatments.

Dig deeper

Proposition 38 is backed by organizations including the Michael J. Fox Foundation for Parkinson’s Research and the ALS Assn., as well as a majority of local chapters of Democratic organizations across the state. Supporters say the proposed funding could give those afflicted with chronic illness hope and potentially more options for treatment.

Its opponents have said the proposed criteria for awarding the grant funding would appear to create an extremely small pool of qualified recipients. Only the California Institute for Immunology and Immunotherapy, co-founded by billionaire Gary K. Michelson, would qualify under the proposed criteria, according to No on 38, the campaign against the proposition.

Robin Swanson, spokesperson for the Yes on 38 campaign, said “lots of institutions would qualify for funds under this measure.”

But she said at a virtual news conference in mid-September that it was “very likely” that the California Institute for Immunology and Immunotherapy “will qualify for half of the funds under the current criteria.”

Ultimately, Swanson said, the decision lies with the California Department of Public Health.

More reading

Your guide to Proposition 38: Immunology and immunotherapy research funding (L.A. Times)

An analysis of Prop. 38 (California Legislative Analyst’s Office)

This CA proposition will send $4 billion to a single nonprofit. Who’s behind it? (Cal Matters)

This institute could get $4 billion from a ballot measure. With just three workers, is it ready? (Cal Matters)

The so-called billionaire tax has become one of the most contested California propositions in years, generating national interest and massive spending by opponents. It also has spawned two rival ballot measures.

Here’s a cheat sheet for sorting it all out.

Proposition 40

The basics

Proposition 40 would impose a one-time 5% tax on California billionaires’ assets. The tax applies to people with a net worth of at least $1 billion who resided in California on Jan. 1.

Impact

Ninety percent of the tax would fund healthcare, and 10% would go toward education and food assistance.

The tax would affect hundreds of billionaires whose net worth includes assets such as their businesses, stocks and other investments. Real property, pensions and retirement accounts generally would be excluded.

Proposition 41

It’s called the Improving Transparency, Effectiveness and Efficiency in California Government Act. But it is deeply connected to Proposition 40 and is funded by foes of the billionaire tax.

The basics

Proposition 41 requires the state auditor to review programs funded by proposed special taxes before they appear on the ballot. More importantly, it also prohibits new state taxes from being exempted from a voter-approved state spending limit.

Impact

The Legislative Analyst’s Office says passage of Proposition 41 could prevent Proposition 40, the proposed billionaire tax, from becoming law even if voters approve it. This could happen if Proposition 41 receives more “yes” votes than Proposition 40.

Proposition 42

Proposition 42 would limit the state’s ability to impose certain new taxes. But it’s more complicated and far-reaching than that description might sound. And, yes, it’s also backed by opponents of Proposition 40.

The basics

Proposition 42 would prohibit new taxes on “retirement holdings, individually owned assets, and other forms of personal savings” that take effect after Jan. 1, 2026. It also would bar retroactive taxes on past earnings unless the state is using revenue from the tax to respond to emergencies such as a fire or a flood.

Impact

The Legislative Analyst’s Office says Proposition 42 could nullify Proposition 40 because the two measures conflict with each other. If voters approve both, the one with the most “yes” votes generally would become law, the office says.

Dig deeper

The billionaire tax was pushed by the Service Employees International Union-United Healthcare Workers West and has some labor and progressive support, including from Sen. Bernie Sanders (I-Vt.) and the state Democratic Party. They say the tax is needed to help the less fortunate and that the super-rich can afford it. But key Democrats and some key unions are not supporting it.

Critics include some of California’s richest people, and they are spending a fortune to defeat it. They say it will hurt innovation and drive the wealthy out of the state, hurting the treasury.

More reading

A powerful union and the birth of the billionaire tax (L.A. Times)

Why unions are divided over Prop. 40 (L.A. Times)

The Google co-founder fighting the billionaire tax (L.A. Times)

Inside the massive spending to defeat Prop. 40 (L.A. Times)

How the billionaire tax could spark national movement (The New Yorker)

The academics behind Prop. 40 (Sacramento Bee)

Will Prop. 40 reallly bring an exodus? (L.A. Times)

Why healthcare is divided by Prop. 40 (Bloomberg)

Taxing the “ultrarich,” a guide (New York Times)

There has been much debate about efforts in California to tax the rich. But almost all of it centers around Proposition 40, the heavily contested billionaire tax, and two countermeasures, Propositions 41 and 42.

But there is another ballot measure that also would tax California’s wealthiest citizens that is getting far less attention — and has even garnered support from some billionaires who oppose Proposition 40.

The basics

Proposition 3 would make an expiring state income tax on high earners permanent.

The impact

Tax rates for the top 2% of earners would remain as they are. Income brackets rise with inflation, but last year the top 2% of taxpayers earned at least $371,000 for single filers and $743,000 for joint filers. Money generated by Proposition 3, like the current tax, would flow to education, with 89% going to K-12 schools and 11% to community colleges.

Dig deeper

In 2012, California voters approved a temporary increase in the income tax rate for the top 2% of California earners. In 2016, voters approved another extension through 2030. Proposition 3 would make the additional levy permanent.

Backers say the measure is crucial to maintain education funding levels and predict there would be grave problems if the measure is not approved. The state could expect to lose $5 billion to $15 billion annually in tax revenue starting in 2031, according to estimates from the Legislative Analyst’s Office.

Opponents say taxes are already too high and the state should focus on cutting waste.

More reading

What to know about Prop. 3 (L.A. Times)

How Prop. 3 fared in Berkeley poll (L.A. Times)

Prop. 3 ballot language (California secretary of state)

Inside the Prop. 3 campaign (EdSource)

Ireland’s Tadhg Furlong has been cleared by a disciplinary committee of grabbing Gavin Coombes in the groin during Leinster’s United Rugby Championship win over Munster.

Munster back row Coombes raised the allegation with match referee Andrew Brace in the first half of Leinster’s 24-18 win at Aviva Stadium, but television match official (TMO) Colin Stanley could not find conclusive video evidence.

However, three-time British and Irish Lions tourist Furlong was subsequently cited over an act of foul play under Law 9.27, which says “a player must not do anything that is against the spirit of good sportsmanship including but not limited to grabbing, twisting or squeezing the genitals”.

The disciplinary panel, comprised of Simon Thomas (Wales), Attie Heyns (South Africa) and Pamela Woodman (Scotland) met on Thursday and “unanimously concluded the citing complaint against the player should be dismissed, on the basis that he did not commit an act of foul play contrary to Law 9.27”.

While they dismissed the complaint, the disciplinary committee concluded Coombes had given “an honest account of his recollection of events surrounding the incident”.

Having avoided a sanction, Furlong, 33, will be available for selection for Ireland’s Nations Championship home matches against Argentina, Fiji and South Africa and the finals weekend fixture at Twickenham’s Allianz Stadium.

Buried in the language of Proposition 45, the initiative that would overhaul California’s powerful law on environmental review, are provisions that would mean government agencies have to consult only with certain tribes in the state, and not others when they develop major projects.

Tribes that are federally recognized would be consulted; those without recognition would not.

This effort mirrors similar ones supported by tribes that have federal recognition to limit the say of tribes without it in recent years. Non-recognized tribes see it as another move by economically powerful tribes to protect their own interests and avoid having to negotiate with other local tribes over territorial disputes and how to best protect important sites.

“Our concern is that wealthy casino interests and political influence are being allowed to outweigh ancestral connections,” Andrew Salas, chairperson of the Gabrieleño Band of Mission Indians — Kizh Nation, said in a statement to The Times.

Proposition 45 on the Nov. 3 California ballot would create a streamlined environmental review process for projects deemed “essential” — including most housing, transportation, water, health, wildfire mitigation, education, internet access and clean energy projects. The streamlining would mean stricter deadlines for review and court challenges, would bar local governments from requesting repeated analyses and allow developers to propose a single alternative with less environmental impact rather than several.

One of the largest contributors to the Yes on Prop 45 committee is a federally recognized tribe, the Yuhaaviatam of San Manuel Nation, which contributed $750,000.

“Federal recognition is the legal and constitutional foundation of tribal sovereignty and establishes a government-to-government framework for consultation,” Amelia Matier, spokesperson for Yes on Prop 45, said, noting tribes without recognition still can still meaningfully participate alongside members of the public.

The Yuhaaviatam of San Manuel Nation reaffirmed its support for the measure in a statement to The Times but did not respond to specific questions.

Critics, meanwhile, say moves such as this would give federally recognized tribes the power to consult on development projects hundreds of miles outside their homelands, overriding local tribes.

“Proposition 45 is part of a much longer struggle over whose voices California chooses to hear,” Salas said. “For decades, non-federally recognized ancestral tribes in Southern California have fought to protect our homelands while facing pressure to accept a ‘lesser role’ than federally recognized tribes.”

“Our rivers, habitats, and the animals that depend on them lose their protection when the people who know these places are removed from the table,” he said.

None of the Gabrieleno and Tataviam tribes within the greater L.A. area have federal recognition.

Last year, three tribes with federal recognition championed a bill that would have significantly limited how tribes without it could participate in the consultation process for all projects — not just the ones deemed “essential” ones under Proposition 45. A few months later, the small state agency that maintains the official list of tribal contacts unveiled a proposal that some non-recognized tribes argued would effectively exclude them. Multiple federally recognized tribes supported the effort.

The environmental review process under the California Environmental Quality Act, better known as CEQA, is one of the primary ways that tribes have a say over how the state and local governments develop land within their ancestral territories. It allows tribes to comment on how a proposed housing or infrastructure project might harm graves, ceremonial grounds or ancient villages. A separate law lets tribes comment on general plans that outline where developers can propose housing, and commercial and industrial facilities.

Tribal consultation differs from general public comment. It allows Indigenous leaders to discuss the location and details of sensitive information — such as burial sites — confidentially, before draft environmental reviews are published.

The Kizh Nation has used the CEQA process to consult on hundreds of land development projects a year around the Los Angeles Basin. In one instance, the process generated extra protections for one of the oldest living plants in the world, a more-than 13,000 year-old oak tree in the Inland Empire, that Indigenous people have taken care of for millennia. It also resulted in the Kizh Nation winning one of the largest land returns in Southern California history for a tribe without federal recognition — while still creating a development of nearly 1,700 homes and industrial and business parks.

There are over 100 tribes in the state with federal recognition, a status that brings protections, funds and services from the federal government, including funding for Indigenous elementary and secondary schools, access to healthcare and the potential for a reservation. Yet dozens more remain unrecognized.

Federal agents negotiated treaties in the 1850s with more than 130 Indigenous communities in the new state of California, setting aside roughly 7% of the state for reservations. But Congress refused to ratify the very treaties it had ordered and failed to notify tribes of its decision.

The federal recognition process today is long and grueling. Only 18 tribes have successfully achieved recognition through it since it was created in 1978. Only one was in California — Death Valley’s Timbisha Shoshone Tribe.

Tribes along the coast who were coerced into building the missions, including the Gabrielino, have had an especially hard time gaining recognition. They endured three waves of settlers: the Spanish, Mexican, and American. With these came death, forced displacement and cultural suppression. When the federal government sent agents to create reservations for California’s mission-affected tribes in the 1890s following reports of dire circumstance, the agents inexplicably overlooked the Gabrieleno.

At least one-third of tribal cultural resources protected under CEQA are in the homelands of tribes without federal recognition, Jonathan Cordero, executive director of the Assn. of Ramaytush Ohlone, estimates.

If Proposition 45 passes, “that means that hundreds of sacred sites and thousands of invaluable and irreplaceable tribal cultural resources would be destroyed in subsequent years,” he said in a statement.

Buying a home in California requires a colossal amount of money — and coming up with a 20% cash down payment of $180,000 for a median price home is a staggering hurdle for many would-be buyers.

That down payment amount is based on the statewide median $900,000 price tag for a house, according to recent data from the California Assn. of Realtors. In Los Angeles County, the median price for a single-family home is $935,000. In Orange County, it’s $1.5 million.

Proposition 37 on the Nov. 3 ballot would allow the state to amass a $25 billion down payment assistance program for middle-class households. For perspective on the enormity of the measure before voters, one of the state’s existing down payment programs, California Dream For All, launched several years ago with $500 million, just 2% of the funding involved in Proposition 37.

The ballot measure would allow qualified prospective homebuyers to borrow up to 17% of the sales price of a new home, contributing 3% of the down payment from their own funds.

The program would not be funded by taxpayers, but instead by the interest charged to borrowers on their down payment loans, also referred to as second mortgages. The measure has garnered widespread support, including from Gov. Gavin Newsom, statewide unions and mayors from Santa Monica to San José.

“Prop. 37 is a historic opportunity to expand homeownership opportunities for generations of working families — at zero cost or risk to taxpayers,” Newsom said in a statement.

But Proposition 37 carries a significant caveat: Any home purchased through the program must be new construction, which could limit its potential reach because of the high cost of building, some critics said.

Also, the proposition does not spell out the terms or interest rates on the loans, which would be worked out if the measure is approved. And some have questioned whether there will be sufficiently robust interest from investors to buy the state-issued bonds that will be used to fund the down payment loans.

The concept of down payment assistance is not new. Cities and states, including California, have long offered such programs to low- and middle-income homeowners, either in the form of loans or grants, and there are reportedly more than 2,700 such programs across the country.

Nevada, Connecticut, Massachusetts and New York all have programs to help homebuyers afford a down payment. Since 2021, New York has dispersed $70 million in down payment assistance. In Massachusetts, more than $146 million has been doled out in down payment help to homebuyers since 2020.

How the program would work

Under Proposition 37, down payment loans would work like any other, and would carry an interest rate and payback period — all of which would be determined by the California Housing Finance Agency.

To qualify, borrowers would need to have lived in the state for at least a year and earn no more than 200% of the local median income; in Los Angeles County, for example, that equates to a family of four earning no more than $216,200 a year.

Borrowers don’t have to be first-time homebuyers, which is often a requirement of down payment aid programs. But they would need to live in the home.

The program would restrict the price of qualifying homes, depending on the county where someone is trying to buy. A general estimate, though, is that would-be homebuyers would be limited to houses costing between $1 million and $1.5 million and the homes, more importantly, would need to be new construction.

While Proposition 37 has little opposition, and is supported by unions, chambers of commerce and organizations representing builders, the League of Women Voters opposes the ballot measure, concerned it would saddle residents with too much debt and that the terms of these loans are opaque, the details worked out only after the vote.

New homes only

Only buyers of newly-built homes would be eligible for these loans. That could include existing commercial buildings that had been converted into homes, such as condos or townhomes.

This provision is uncommon as many existing down payment assistance programs don’t strictly limit the type of home someone can buy — only the sale price. Bob Hertzberg, former Senate Majority Leader and the architect of the proposal, said he wanted Proposition 37 to spur new construction.

“The problem is we have to increase supply,” Hertzberg said. The shortage of homes in the state is estimated to range anywhere from 840,000 to upwards of 3 million.

By creating more demand for new homes, he said, the hope is that builders will respond en masse.

But some groups are wary of this logic. One analysis, funded by the Proposition 37 campaign, estimated that this program could result in the building of 190,000 homes in the state, although the report’s author said it was “impossible to know” the true number given the various factors that impact housing.

Matthew Lewis, director of communications for California YIMBY, an organization that advocates making it easier and cheaper to build homes, said high prices make it clear that the demand for homes already exists and that Proposition 37 does little to address a bigger issue: the cost of building.

“In concept, [Proposition 37 is] a great idea,” Lewis said. “The thing we’re concerned about is, California is still way behind on its housing production goals, so there’s the risk of an unintended consequence of instead of having 10 people bidding on a house, now you’ve given a couple folks down payment assistance, and so there’s now 12 people bidding on the same house.”

To drive builders to construct eligible homes, the measure would allow them to opt into a “qualified builder” option. As long as they adhere to price caps, agree to certain labor requirements and fix repairs that arise, they’re protected from lawsuits from buyers concerning defects 10 years after construction of the home.

Homebuilders say even given some relief from litigation, they aren’t sure Proposition 37 would push construction into overdrive.

“There are so many more things the state, city and county could do to help add more supply [of homes],” said Paul Schon, a developer who builds apartments in L.A. County. He said tackling permitting times and red tape involved in building would have a greater impact. “This is minor,” he said.

Interest rates could be a tough sell

Many down payment assistance programs offer interest-free loans to homebuyers, including an existing program run by CalHFA.

But in order to be self-funding, the fixed-rate loans offered through Proposition 37 would carry interest. If passed, the state would issue revenue bonds, selling them to investors and using that money to issue loans to homebuyers. The investors are repaid with the interest paid on the loans.

According to the Legislative Analyst’s Office, CalHFA would decide the total amount of bonds to issue and over what period of time.

Revenue bonds are generally viewed as riskier than other types of government bonds, in part because they’re backed by the promise of revenue from a specific project — in this case, payment by individual borrowers. That means interest rates on these loans could be higher than borrowers might like or be able to afford.

Hertzberg said he’s talked to investors who may be willing to buy these bonds at cheaper rates, given the crushing issue the funding is trying to solve. This would keep interest rates down for borrowers. He said he’s appealing to foundations and socially-minded tech leaders.

One of the biggest financial backers of the measure is the political nonprofit Building a Better California, which has been fighting the billionaire’s tax with help from wealthy donors, including Google co-founder Sergey Brin.

Hertzberg, for his part, refused to name any organization or person who may be interested in buying the bonds that would fund this program.

This article is part of The Times’ equity reporting initiative, funded by the James Irvine Foundation, exploring the challenges facing low-income workers and the efforts being made to address California’s economic divide.

About 260 California billionaires would be subject to Proposition 40’s one-time 5% wealth tax according to the Forbes Real-Time billionaires list. Just 30 of those billionaires or their spouses, or 1 in 8, spent money opposing Proposition 40, the billionaire tax, according to a Times analysis of recent campaign filings.

Billionaires have individually contributed $293 million to oppose the tax measure and to support Proposition 41 and 42, which would nullify the billionaire tax if either receives more votes, according to a Times analysis. Sergey Brin, co-founder of Google, has given $102 million, more than a third of all billionaire money against the measure. But this is less than 1% of his estimated tax bill.

Several billionaires also contributed to the political action committee of the California Business Roundtable, which is spending to oppose Proposition 40 and support Proposition 43. Peter Thiel gave $3 million, Eric Schmidt gave nearly $2.6 million, Marco DeGeorge’s wife, Kim, gave $1.9 million, Chris Larsen gave $750,000 and Douglas Leone and his wife gave $500,000.

Proposition 40 would apply the tax to billionaires who were California residents on Jan. 1, 2026, and the taxable amount would be based on their net worth on Dec. 31. The tax is payable over five years.

Altogether, these individuals would owe at least $107 billion in taxes, according to an analysis by economists Jasper Boll, Emmanuel Saez and Gabriel Zucman. Their research was published in the National Bureau of Economic Research in August. Saez and Zucman are also architects of the tax proposal.

This amount is 5% of their combined estimated wealth by Forbes as of Oct. 16 and factors in a certain amount of tax avoidance and evasion. Spread across all 39 million Californians, the $107 billion would be roughly $2,700 per person. The Public Policy Institute of California estimates that the median household net worth in California was $303,000 in 2023.

The four richest Californians — Sergey Brin, Jensen Huang, Larry Page and Mark Zuckerberg — would owe 40% of the estimated taxes to be collected from the billionaire tax, according to a Times analysis. Their wealth largely comes from ownership of stock in extremely high-value technology companies.

Their net worth would increase 5% in about four months if their stock investments continues to grow as they have since December.

California billionaire wealth grew nearly threefold from 2022 to 2026, according to Times analysis of Forbes data collected by Boll and his colleagues, and much of that growth was not taxed. Billionaires’ taxable income is small compared with their wealth, because most of that wealth is invested in public stocks, and gains aren’t taxed until the stock is sold.

Page and Brin disclosed no taxable income in three of the years since 2019. Many others had similarly no publicly disclosed income. For that reason, Boll and his colleagues estimate that the Proposition 40 one-time tax would raise more than $100 billion, “with comparatively minor impacts on income tax revenue” from some billionaires leaving the state.

Based on Meta’s filings, the economists estimated that Zuckerberg’s taxable income was about $947 million in 2025, just 0.4% of his net worth.

Over the summer, Zuckerberg shared with Meta advisors his plans to relocate outside California to avoid the possibility of a significant reduction in his control over the company as a result of selling enough stock to fund a 5% tax. The advisors determined that Zuckerberg’s leadership presence at Meta headquarters was essential to the company’s success. On Wednesday, Meta announced the creation of new, nonvoting Class C common stock, which will allow Zuckerberg to sell the amount he needs to pay his potential tax bill while maintaining his voting power in exchange for his commitment to remain in the state for eight years.

Researchers at the Hoover Institution estimate the revenue to the state to be closer to $40 billion based on reports of billionaires’ residential purchases outside the state before and after Jan. 1 and their estimate of unannounced residency moves.

Chris Hoene, executive director at the California Budget and Policy Center, a nonpartisan group, said the residency question hinges on the amount of time spent living in the state. “Purchasing property in another location does not mean that they have changed their residency,” he said.

Ultimately, the state’s Franchise Tax Board, responsible for administering the tax, will have to assess residency. Hoene says this task is “easier for them to do than people realize.” The board will also calculate the amount of wealth subject to the tax using publicly available stock information and private assessments of personal property, such as artwork and jewelry. Real property, pensions and retirement accounts would be excluded.

Opponents of Proposition 40 are concerned that the threat of wealth taxes will lead to billionaires continuing to leave the state, resulting in a long-term decrease in state income tax revenue. Forbes recently reported that Brin registered to vote in Nevada last year. Peter Thiel disclosed Dec. 31 that he opened a new office in Miami; Florida has no wealth tax or income tax. But in July, he purchased a $130-million mansion in Bel-Air.

“The reality is the income tax loss can never get anywhere near the scale of what the wealth tax gain would be,” Hoene said.

Ninety percent of that gain would be spent on healthcare services to fill a gap in Medi-Cal from losses in federal funding that the measure’s authors estimate would total $190 billion over the next 10 years. Medi-Cal provides healthcare coverage for one-third of low-income Californians, according to the Legislative Analyst’s Office.

Gov. Gavin Newsom opposes a California-only tax and has instead called for a national wealth tax. Democrat Xavier Becerra and Republican Steve Hilton, who are running to replace Newsom, have spoken out against the tax. Other opponents include the California Teachers Assn., the California Medical Assn., and Planned Parenthood Affiliates of California. Supporters include Service Employees International Union, U.S. Sen. Bernie Sanders (I-Vt.), the California Democratic Party and the California Federation of Labor Unions AFL-CIO.

Times staff writer Queenie Wong contributed to this report.

When a county judge put the brakes on what would be the largest data center in California, ruling the whole project needed extensive environmental review, Kristian Salgado was relieved.

The community organizer lives in Imperial County, where the nearly one-million-square-foot facility was proposed. The rural county near the Mexico border struggles with bad air pollution and has one the state’s highest rates of asthma hospitalization for kids, according to the National Institute of Environmental Health Sciences. One of Salgado’s nephews lives right next to the site and struggles with the respiratory disease.

“It just seemed very unusual that a project of this scale, with that many backup generators could be permitted without requiring any further [analysis] of what that would mean for residents,” she said.

Now, Salgado and others who share her concern believe Proposition 45 on the November ballot could roll back their wins. The initiative changes the California Environmental Quality Act, or CEQA, a law intended to inform decision makers and the public about a project’s possible environmental impacts — and mitigate them to the extent possible.

Supporters say Prop 45 will speed up environmental review for essential housing, transportation, water, health, education and other projects, cutting costly delays and passing the savings on to consumers. Opponents say it not only weakens environmental protections for many developments, but will cover potentially polluting ones — including data centers. The Yes on 45 campaign forcefully rejects the data center claim, but independent legal experts are divided.

At the heart of the debate is the definition of one of the categories covered by Prop 45: “broadband internet access projects” or “mass-market retail service … that provides the capability to transmit data to, and receive data from, all or substantially all internet endpoints.”

Dan Dunmoyer, president and chief executive of the California Building Industry Assn., which supports the proposition, was adamant: “We specifically excluded data centers” when crafting the measure.

Yet the proposition expressly names certain excluded projects: nuclear energy, high-speed rail, jails and Delta conveyance facilities. Data centers aren’t among them.

Dunmoyer maintains that even if they’re not explicitly listed, data centers just don’t fit the measure’s definition.

In a Daily Journal op-ed, Rachelle Chong, a former Federal Communications Commission member, similarly argues that the definition refers to internet access bought from a provider like AT&T or Comcast. “A conventional data center ordinarily performs an entirely different function,” she wrote, arguing data centers aren’t in play.

But land use attorneys Matthew McKerley and Richard Frank, in another op-ed, say many modern data centers fit the bill because they house equipment used to transmit consumer data to and from the internet.

They also highlight conspicuous campaign finance contributions, including $250,000 from Prologis, which developed two data centers in San Jose.

Ethan Elkind, director of the climate program at UC Berkeley Law, said data centers will argue they fit the definition — and then it will be up to the courts to decide.

“Anyone telling you that it’s definitely not going to be data centers, they cannot read the future,” he said. “The way they’ve written the language, they can’t provide 100% assurance.”

Eric Biber, a UC Berkeley law school professor with expertise in environmental law, pointed to language in the measure requiring it to be interpreted broadly “to afford the fullest possible weight to the interest of, and the approval and realization of, essential projects.” In a blog post, he called it “a thumb on the scale” that could lead courts to conclude that projects should be covered when their eligibility is in doubt.

But Ryan Thomason and J. Scott Miller, partners at the law firm Mitchell Chadwick with CEQA expertise, think it’s likely courts would rule otherwise. In an article, they note that the definition used in the measure hews closely to another section of California law, which distinguishes providing internet services from offering content, services and applications online. “Courts generally interpret identical language in related statutes to have the same meaning,” they write.

Dunmoyer, of the California Building Industry Ass., stressed that the measure doesn’t overthrow local zoning rules.

Opponents are “making it sound like in your backyard will be a data center,” he said. “Well, that doesn’t happen at all by this initiative. That has to happen by a county board of supervisors voting to put a data center in your backyard. And if they decide to do that, this initiative does nothing to expedite that CEQA review.”

But what if local officials run afoul of their constituents? In the case of the Imperial Valley Data Center Campus, the roughly 75 acres of unincorporated land where it would go had already been zoned for data centers. As a result, county officials said they had the power to move forward with the facility for artificial intelligence computing infrastructure without city approval.

They granted the project an exemption from the state environmental review.

Then came the backlash. Residents spoke out at public meetings, rallied on the streets, circulated a petition and formed a community organization. The city of Imperial and the Sierra Club sued. In the wake of the outrage, the county walked back its decision, declaring a moratorium on data centers. (The developer sued the county over the ban, and the county recently rescinded it following a court order.)

If Prop 45 passes — and data centers are covered by it — Eric Biber, of UC Berkeley Law, told The Times that such a moratorium wouldn’t be possible. That’s because the measure prevents state and local officials from changing the rules for a project once its application is submitted, he said. So if a community didn’t have a moratorium in place and its zoning laws allow a data center, “They’re done,” said. Existing bans aren’t expected to be affected.

Attorneys for the No on Prop 45 campaign argue that it could have real-world impacts for the Imperial Valley facility, saying the developer could claim the new rules apply. For instance, the measure would prevent courts from overturning approvals of qualifying projects because of CEQA violations. Courts would only be able to halt the affected portion of the project while the issue is fixed.

Sebastian Rucci, principal developer of the Imperial Valley data center, said he will fight for his project to move forward and that there’s an environmentally sound way to do it. He said he’s willing to negotiate and mitigate where necessary — but will not go through the CEQA process. If push comes to shove, he said he’ll move the project elsewhere. California could “get in the game” or be left in the dust, he said.

Imperial Valley Computer Manufacturing, the company behind the project, says it will create at least 100 permanent jobs and generate $28.7 million in annual property tax revenue.

CEQA requirements “are not about the environment,” Rucci said. “They may be for some, but they’re not for many. For many, they are about killing things.”