Largest State Tax Increase or Responsible Budget Management?
California Proposition 1A, also known as the Budget Stabilization Act, will appear on the special, statewide May 19, 2009 ballot in California as part of a package that state legislators believe will fix the state's budget problems.
Proposition 1A will extend for as long as four years the approximately $16 billion tax increase that is part of the budget deal struck in Sacramento. It will also impose a limit on the amount the state can spend each year.
Although six of the seven statewide ballot propositions on the May ballot (1A, 1B, 1C, 1D, 1E and 1F) are intended to close an approximately $42 billion budget gap. A new report by the California Legislative Analyst's Office said in early March that tax revenues flowing into the state treasury are "well below" the projections it used earlier in the year, and that California's government now faces an additional $8 billion gap in addition to the earlier $42 billion gap.