HMA Election Download, by Doug Houston
November 12, 2018
As predicted by most pundits, California got decidedly “bluer” during the mid-terms at all levels of elected office. If trends hold at the statewide office level, there were few surprises as it appears to be a clean sweep in the Democratic column. The race for Insurance Commissioner between Senator Ricardo Lara and businessman Steve Poizner (running as an Independent) remains too close to call. In the State Senate, Democrats picked up two seats: Senate District 12 as Assemblywoman Anna Caballero wrested a seat from the Republicans and Republican incumbent Andy Vidak conceded to upstart Sanger City Councilwoman Melissa Hurtado in Senate District 14. These combined victories now place the Senate firmly in Democratic control where they will enjoy a 28-12 “Supermajority.” Similarly, at close of the polls, Democrats in the Assembly now enjoy a 57-23 supermajority as Assemblywoman Sabrina Cervantes (AD 60) and Assemblyman Rudy Salas, Jr. (AD 32) surged late for victories. Assemblywoman Cervantes is leading by a mere three votes over challenger Bill Essayli so this race may not be decided for weeks. There are two other races in the Assembly for Districts 38 and 74. Republican incumbents hold slight leads but this may be subject to change as provisional votes, etc., continue to be tallied. It is conceivable that after the dust settles, Speaker Rendon and the Democrats could hold a 59-21 advantage in the Assembly.
The California Democratic Congressional delegation also saw an uptick as it appears that three seats will flip. Specifically, Republican incumbents Steve Knight (CD 25) and Dana Rohrabacher (CD 48) were ousted and, in the seat to replace retiring incumbent Darryl Issa, Board of Equalization member Diane Harkey was defeated by Democrat Mike Levine. California Democrats now hold a 42-11 advantage in the state’s congressional seats. This is a microcosm of what transpired at the national level as Democrats regained control of the House of Representatives and, while a few races are yet to be determined, the ledger stands at 222-196 in the Democrats favor. If there was a downside from the Democrats perspective, it came in the form of the U.S. Senate, where Republicans appear to have made some gains. All told, most suggest that the outcomes represent a Republican backslide that reflects a repudiation of the Trump administration and his unfavorable public opinion. It has been further suggested that if it were not for a strong economy, the backslide could have been much more dramatic.
In terms of ballot propositions, Proposition 3, the Water Bond, appears to have gone down to defeat. This bond and the campaign around this measure, which called for the issuance of $8.9 Billion in debt for water improvements across the state, suffered from a lack of funding and had significant opposition, albeit not organized, in the form of the Sierra Club, Assembly Speaker Anthony Rendon, and nearly every major daily publication in the state. If approved, this funding vehicle could have underwritten a number of beneficial projects for resources related improvements in California by way of significant funding to the ten state conservancies. If there is a “silver lining,” the need for the improvements identified in the bond will not go away and it is the hope of many that the content of this bond can be repackaged in the form of a legislatively advanced water and resources vehicle similar to Proposition 68 that would be for statewide voter consideration in an upcoming election. Another highly controversial measure is Proposition 6, which was a referendum to eliminate a recent tax of fuels for road and transit improvements (SB 1), went down to defeat. This was important on two fronts. The fuel tax package adopted by the Legislature (SB 1) contained an additional $100 Million over previous year allocations for 10 years of Active Transportation projects. If Proposition 6 were approved, this new funding would have evaporated. The defeat of this measure and the protection of ATP funds paves the way for renewed discussions with Governor Elect Gavin Newsom’s administration and the Legislature about clawing back funds diverted to the ATP from the Recreation Trails Program and the Environmental Enhancement Mitigation Program for restored funding for natural surface trails and greenways. If successful, this action could result in nearly $6 million annually for this purpose. Lastly, CPRS was encouraged by The League of California Cities and others to oppose Proposition 5. As drafted, this initiative sponsored by the California Realtors Association, would have permitted persons 55 or older to transfer tax assessments from a previous home to a new home regardless of the market value. In other words, persons with a home originally purchased for $200,000 with an ad valorum rate at 1% ($2,000 in annual property taxes) could transfer this base tax rate to a home valued at $1 million without paying additional property taxes. According to the Legislative Analyst’s Office, this new dynamic would have resulted in a loss of hundreds of millions of dollars, reaching to one billion dollars to the state and local agencies over time. This proposition was handily defeated by the voters.
In local elections, there were two significant victories of note. Measure FF, an East Bay Regional Parks District parcel tax renewal, cruised across the finish line with 84.4%, and Measure M, a Sonoma County sales tax increase for park improvements, passed by nearly 70%. These outcomes enable both of these entities to secure additional funding through Proposition 68 pursuant to a funding program that provides for additional per capita allocations for agencies that self-tax for parks. The manner in which these funds will be allocated is yet to be determined and will be subject to the Department of Parks and Recreation’s review and determination.
In terms of takeaways, while the defeat of Proposition 3 was disappointing to many and leaves California with less flexibility to fund resource related projects, the election outcomes signal terrific promise and hope for the future of park and resources related policy and funding activities into the future. Supermajorities in both legislative houses, along with a “green-minded” Governor cannot be discounted and forecasts great things to come. Enthusiasm around this election also must come with a cautionary note. Some may recall that eight years ago, California was swimming in “red ink” as the Golden State had a budget deficit of nearly $40 billion. Many have predicted that Governor Newsom may not possess the same fiscal austerity genome as his predecessor and that he may be prone to freer spending, particularly as it relates to the environment. However, recent articles suggest that Governor-elect Newsom may be tacking more toward conservatism as it relates to the budget and spending given California’s “boom and bust” revenue cycles. Much of this will unfold in the coming months and years. It is safe to say that, barring an economic downturn, California’s parks, resources, and outdoor communities have an unprecedented opportunity to engage and shape positive policy and enhanced investments in our natural and people related landscapes for years to come.
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