Category: Fiscal & Governance Reform

Voters More Optimistic, Less Engaged

A lot has changed since Californians cast ballots just four years ago.

Likely voters today are feeling much better about the direction and economic outlook of the state. In October 2010, most (77%) said that the state was headed in the wrong direction. In our latest survey, likely voters are much more positive about the state’s future—although they are still more likely to say wrong direction (54%) than right direction (40%). Similarly, in October 2010 less than a quarter of likely voters (20%) expected good economic times in the upcoming year and far more (65%) expected bad times. Today, the mood is decidedly different, with 42% expecting good times and 47% expecting bad times. In October 2010, most likely voters (59%) named jobs and the economy as the state’s most important issue. Today, just 30% name it as the top issue, which barely keeps it in first place, while 28% name water and the drought. Further, in September 2010 nearly all likely voters (90%) called the state budget situation a big problem—today, that number is 62%.

This year, likely voters are paying less attention to news about the candidates for governor than they did four years ago, when the race involved an open seat and a high-profile contest. In October 2010, an overwhelming majority were very (39%) or fairly closely (50%) paying attention to news about gubernatorial candidates. In our latest survey, just half of likely voters were doing so (18% very, 34% fairly). In addition, there is a big enthusiasm gap. Fewer voters today say they are “more enthusiastic about voting than usual” (53% 2010, 40% today).

In 2010, when many people were tuned into the top of the ticket race, nearly 60 percent of registered voters turned out to vote. With far fewer voters paying attention to the gubernatorial race—and with the lack of a Congressional senate race—what can we expect in 2014? Will concerns about the drought and the state budget drive people to the polls—and if so, how will this translate into votes on Proposition 1, the water bond, and Proposition 2, the establishment of a rainy day fund? Stay tuned to PPIC as we continue to follow the November 2014 election.

Drought Watch: What’s in Proposition 1?

This is part of a continuing series on the impact of the drought.

California voters are deciding the fate of Proposition 1—a $7.5 billion water bond. If Prop 1 passes, the water sector will get a big boost in funding. Prop 1 contains $7.12 billion in new debt (the remaining $400 million dollars is money that would be re-authorized from previously passed bonds).

So what kind of water projects will be funded if Prop. 1 passes? The bond focuses mainly on water supply ($3.6 billion) with the majority ($2.7 billion) designated as matching funds for storage projects. These matching funds are intended to support up to half the costs of projects that store water either in surface reservoirs or underground aquifers, and they can only be used to fund “public benefits.” Public benefits include, among other things, better flood protection and recreation opportunities, as well as improved environmental conditions. For instance, expanding surface reservoirs makes it possible to store more cold water, which can be released during warm months to support salmon habitat. Likewise, expanding ponds to recharge groundwater basins can create bird habitat.

The California Water Commission will determine which storage projects receive these funds through a competitive process. The rest of the water supply dollars are mainly for matching funds for water recycling and desalination projects ($725 million), with $100 million each for water conservation and groundwater sustainability planning.

Proposition 1 also has funds for the five areas PPIC has identified as critically underfunded “fiscal orphans” in our recent study of water system finance: ecosystems, drinking water quality, flood protection, stormwater pollution management, and integrated water resources management. Of the funds designated for water quality improvements, $520 million is intended for disadvantaged communities and $800 million is for cleaning up groundwater basins that have been contaminated with industrial and agricultural chemicals. Just over half a billion dollars is designed to encourage agencies to collaborate on water management priorities, with funds going to different regions for priority projects in Integrated Regional Water Management plans. These projects would overlap with the previously mentioned categories, and they would need to improve regional self-reliance and help adapt to the effects of climate change.

Since 2000, California voters have approved six water bonds, totaling nearly $20 billion dollars. These bonds looked a little different than Prop 1. Ecosystem improvement and flood protection were the main priorities, with smaller amounts for drinking water quality, integrated management, stormwater, and water supply projects (these bonds also had large amounts for parks and public access). While these bonds provided welcome support to these areas, they also came with fiscal tradeoffs: bonds are repaid with general fund tax dollars that also support other state programs.

The current drought is likely helping the bond’s chances of passage: according to the most recent PPIC Statewide Survey a record-high 68% of all adults say that the supply of water is a big problem in their part of the state. In this context, it is important to keep in mind that while continued investments in our water system will help us be better prepared for future droughts, this bond is not designed to provide immediate relief from the current one. Most water projects take time to design and build. And, whether or not Proposition 1 passes, the state’s water system will face significant challenges that require funding sources more reliable than a bond can provide.

A Cautionary Tale for Fiscal Reformers

One of the biggest surprises in the PPIC Statewide Surveys this fall has been the inability of Proposition 2 (aka the rainy day fund) to garner majority support from voters. The measure—which was placed on the November ballot by the governor and a unanimous vote of the legislature—allows for annual transfers of revenues into an account to be used only for fiscal emergencies and to pay off state debt.

Support did rise from 43 percent in our September poll to 49 percent in October. This may be a sign that Proposition 2 can defy the conventional political wisdom about ballot measures starting out with less than 50 percent support being doomed to fail. Certainly, its supporters find this trend encouraging. But, given the widespread support for the idea of a rainy day fund in earlier PPIC polls, why is Proposition 2 struggling to achieve majority support? Further analysis of our survey results offers a cautionary tale about the political pitfalls of fiscal reforms.

We have been tracking a wide array of fiscal reforms in our polls, including the idea of a rainy day fund: “Do you favor or oppose increasing the size of the state’s rainy day fund and requiring above-average revenues to be deposited into it for use during economic downturns?” In the five times this question was asked before Proposition 2 was put on the ballot, likely voter support hovered around 70 percent. Today, support for the rainy day fund idea has fallen to 55 percent among likely voters. This suggests a strong link between supporting the rainy day fund concept and voting yes on Proposition 2—in fact, 7 in 10 of those who would vote yes on Proposition 2 express support for a rainy day fund. More important, why has a fiscal reform that was consistently and highly regarded fallen out of favor with so many voters?

We looked at the possibility that Californians are less inclined to support a rainy day fund because the state’s finances have been improving. But our tracking question on state budget perceptions found that slightly more likely voters say that the state budget situation is a big problem today (62%) than in January (56%). Moreover, those who see the state budget as a big problem are less likely to favor a rainy day fund today (48%) than they were in January (65%).

The steep decline in support for a highly popular idea seems to have political overtones. Since January, support for the rainy day fund idea has dropped from a solid majority to below 50 percent among several groups: Republicans (72% January, 47% October), conservatives (69% January, 47% October), those who disapprove of the job performance of both the governor (65% January, 42% October) and the legislature (65% January, 47% October), and those who say the state is going in the wrong direction (67% January, 48% October). Meanwhile, Democratic governor Jerry Brown has been touting the virtues of Proposition 2 on the campaign trail, and Republican leaders who supported it have been silent.

In an election context, the rainy day fund idea has thus become politically polarizing. The governor’s success in rallying his supporters around Proposition 2 is reflected in its recent rise in the polls. But the rainy day fund idea has lost favor among Republicans and conservatives who used to be loyal supporters. Today, support for idea is much higher among Brown voters (68%) than Kashkari voters (43%). Governor Brown may need to do more to reassure the Democratic base of the long-term benefits of a rainy day fund to prevent Proposition 2 from falling short of majority support.

In short, a rainy day fund that once had strong backing across party lines has become a divisive idea. This is a reminder that even a seemingly uncontroversial issue with unanimous support in the legislature is subject to political redefinition in the heat of an election. Future tax and spending reforms may face an even more challenging path if they can’t ride on the coattails of an incumbent governor with a 54 percent approval rating and 52 percent supporting his reelection.

The lesson is that the popularity of any given reform can fade unless voters know that it is supported by leaders who share their partisan views and reflect their political values.

PPIC’s Role in a Changing State

California is changing quickly and in ways that touch the lives of all of its residents. The state has enrolled millions of people in health insurance under the federal Affordable Care Act. It is moving ahead to expand the cap-and-trade program that is a cornerstone of AB 32, the landmark law mandating a reduction in greenhouse gas emissions.

In K–12 education, California is implementing two sweeping policy changes at the same time. New English and math standards, called the Common Core, require big changes in what is taught in the classroom. A new school funding formula, the Local Control Funding Formula, gives districts increased flexibility over spending and provides extra money for disadvantaged students.

Historic changes are playing out in the corrections system as well. Realignment, which shifted responsibilities for many offenders from the state to the local level, has had a significant impact on the state, counties, and communities.

Amid these policy shifts, California is coping with a major drought that has focused attention on the state’s need to improve its water management.

These changes are also taking place in an election year—and California’s elections have also undergone major changes. This is the first election in which state constitutional officers, such as governor and controller, will be elected under the top-two primary system.

At PPIC we are focused on monitoring and analyzing the impact of these changes—both short and long term—and examining other steps the state can take to meet its critical challenges. In recent months, we have delivered objective, nonpartisan research on all of these topics. We plan to release many more publications in the months ahead. Our PPIC Statewide Survey will continue to give California residents a voice in the policy changes that affect them, as it has since 1998. The PPIC blog provides regular updates on the impact of the drought, as well as news and analysis on a range of policy topics from our experts.

Through our extensive outreach, we have hosted discussions on these important topics and more. We invited California’s two top legislative leaders to share their priorities for the upcoming session. At another recent event, the two secretary of state candidates talked about how they would improve elections and increase voter participation, if elected. Both of these events were webcast live to engage Californians from all over the state.

We encourage you to sign up for our announcements to learn about future events. We hope you’ll stay up to date with our publications and videos by signing up for our monthly e-bulletin, following us on social media, and subscribing to the PPIC blog.

As always, we welcome your comments and suggestions.

California’s New Leaders Focus on Poverty

Assembly Speaker Toni Atkins and Senator Kevin de León, who will take over as senate president pro tem later this month, each told a Sacramento audience about growing up in poverty and the role it has played in their shared view of the state’s responsibility to those in need.

“We share similar values and similar stories that have made us care about the values and the issues that we’re talking about today,” said Atkins, who was raised in a poor, rural Virginia family and now represents the San Diego area. De León, who was born in San Diego and represents Los Angeles, said he is the youngest child of a single immigrant mother and the only family member to graduate from high school. Atkins and de León, both Democrats, were elected by their respective legislative chambers earlier this year to serve as leaders.

Both lawmakers cited a recent PPIC report — Child Poverty and the Social Safety Net in California by Caroline Danielson and Sarah Bohn — that said about 50% of California children live in poverty or near-poverty. The remarks, part of the PPIC 2014 Speaker Series, were made to a capacity audience of about 400 in the ballroom of the Sheraton Grand Hotel. The discussion was moderated by PPIC President Mark Baldassare and streamed live to hundreds more.

The wide-ranging conversation touched on a number of major issues—including health care, the drought, immigration, and taxes. Both leaders said that they believe the state should talk about changes to the state tax structure and consider whether to extend the temporary taxes that voters passed in Proposition 30. Atkins cautioned that it will be difficult to gain support from voters for an extension of the taxes.

De León expressed strong support for affirmative action, which he credited for his ability to attend college and become a legislator. He also said California should continue to lead on immigration issues because the federal government has been unable to pass a reform plan. And he noted that polls suggest Californians support health coverage for undocumented residents.

Atkins, meanwhile, encouraged more cities to follow San Francisco and San Jose, which recently increased the minimum wage. Both leaders also said they have worked together in the past and believe they will have a good working relationship going forward.

Majorities Favor State Government Downsizing

The recent PPIC Statewide Survey offers an early snapshot of voters’ choices as we enter the November election cycle. The majority support for Governor Jerry Brown’s reelection and the Proposition 1 state water bond was widely cited in the media last week. But the poll also reveals surprising news about the voters’ overall mood this year: by a wide margin, likely voters would rather pay lower taxes and have a state government that provides fewer services (53%) than pay higher taxes and have a state government that provides more services (41%).

What is so special about this finding? We have been observing a slow but steady rise in the preference for lower taxes and fewer services since November 2012—when voters approved the Proposition 30 tax increase. In the 24 times since we first asked this question in our February 2003 poll, the preference for lower taxes and fewer services has usually been below 50 percent. Moreover, this preference has never exceeded 55 percent, placing the current reading close to the historic high.

This finding seems to run counter to the strong support we found for the Democratic governor and the multi-billion dollar state water bond on the November ballot. It is also seems at odds with another Golden State mega-trend: the steady decline in the number of Republican voters. The secretary of state recently reported that Republicans now account for just 28 percent of the electorate.

While a preference for smaller government has long been expressed by Republicans, the 53 percent of California likely voters who want lower taxes and fewer services are a politically mixed group. Forty- eight percent are registered Republicans and 55 percent are self-described conservatives—which means that many who hold this view are Democratic and independent voters, and see themselves as political moderates. They are predominantly homeowners (81%), and most are white (66%). But only a slight majority are age 55 and older (54%), and less than half are college graduates (41%) or have annual household incomes above $80,000 (44%). So, this likely voter group has a diverse demographic profile.

What do they have in common? Seven in 10 say the state is headed in the wrong direction. Three in four say that the state budget situation—that is, the balance between government spending and revenues—is a big problem for the people of California. Eight in 10 say that major changes are needed in the state budget process in terms of both revenues and spending. In sum, they are the core audience for fiscal restraint and reform.

Governor Brown’s emphasis on fiscal prudence, including the downsizing of the state water bond, seems to have struck a chord here. Among those who prefer a smaller role for state government, one in three are supporting Jerry Brown in the governor’s race. This trend helps to explain the Democratic candidate’s sizable 21-point lead over Republican challenger Neel Kashkari. This group is also leaning toward support for the Proposition 1 state water bond (46% yes, 37% no), helping this multi-billion dollar spending measure to now have a commanding two-to-one lead.

This likely voter group may be a major hurdle for a Democratic Party seeking to regain a supermajority in the state legislature. Seven in 10 of these likely voters say they disapprove of the way that the state legislature is handling its job. Six in 10 say it would be a “bad thing” for the Democrats to gain a two-thirds majority in the legislature in the November election. Only 18 percent say that this would be a “good thing.”

Our poll’s findings on the preferred role of state government suggest that the election is unlikely to result in a mandate for expanding services and raising taxes—they also point to an opening next year to discuss fiscal reforms that the state needs for the 21st century economy.

Briefing Focuses on Survey Election Findings

Less than two months before the election, PPIC’s latest survey looked at Californians’ views on the governor’s race and four statewide ballot measures. Dean Bonner, associate survey director, presented the findings at a briefing in Sacramento on Wednesday. As most of the media coverage noted, the survey found that Governor Brown is doing well in his reelection bid and that the water bond he approved is fairly popular.

The survey found that Proposition 2, labeled the Budget Stabilization Act in the ballot statement but known elsewhere as the rainy day fund, does not currently have majority support among likely voters. Proposition 45, which would regulate health insurance premiums, has a similar level of support, but Proposition 47, which would reduce sentences for some crimes, is favored by 62 percent of likely voters. The survey also found high levels of concern about the drought and mixed feelings about the Affordable Care Act and immigration policy priorities.

A Closer Look at Early Jail Releases

Almost three years after California’s public safety realignment took effect, county sheriffs have few options for handling jail populations that are approaching historical highs reached in 2007. To help address these capacity challenges and responsibilities, the legislature recently passed SB 863, which dedicated $500 million to county jail construction. This is in addition to the $1.7 billion provided through two previous measures: AB 900 in 2007 and SB 1022 in 2012. Overall, these three construction programs will add more than 13,000 jail beds across the state. However, given projected growth in the overall population—and if there are no new policies and practices that reduce incarceration—this investment in county jails will probably be insufficient to meet the state’s long term needs.

After realignment began in October 2011, the number of inmates in state prisons decreased quickly and substantially, as intended. But the prison population is still too large to meet the federal mandate and has recently started to increase somewhat. In that same period, the county jail population has increased by about 11,000 inmates. Because relying solely on expanding jail and prison capacity to handle future pressures would be very costly and would have a limited crime preventive effect, serious consideration should be given to sentencing reform. Conversations about sentencing changes are ongoing in Sacramento and an initiative reducing the penalty for certain property and drug offenses (Proposition 47) is on the November ballot.

As county sheriffs wait for long-term and sustainable solutions to the incarceration problem, they must handle the growing and fluctuating demand for jail beds. This is particularly true in the 19 counties facing court-ordered jail population caps. Releasing inmates early because of space constraints is nothing new for sheriffs. In fact, data from the Board of State and Community Corrections Jail Profile Survey show that the current level of about 13,000 of these releases statewide per month is well short of the highs of 16,000–17,000 reached in 2007.

Interestingly, these data also show that although the jail population continues to creep up, the number of monthly early releases increased but recently appears to have plateaued. After reaching a post-realignment high of 14,553 in August 2012, early releases declined to a monthly average of roughly 12,900. In other words, the data does not indicate a recent surge in the number of releases and they have certainly not approached the 17,000 level recently reported in the media.

However, these releases do raise public safety concerns. The leveling off of early releases despite the growing demand for jail beds suggests that sheriffs share these concerns. The extent to which early releases jeopardize public safety depends not only on the number of inmates released but on which ones are now spending time on the streets instead of in jail. There is no widely available information about how, and more importantly whether, sheriffs effectively identify and release the lowest risk inmates. Taking steps to assess these decisions would help ensure that future releases protect public safety.

Drought Watch: Crises as Catalyst for Policy Change

This is part of a continuing series on the impact of the drought.

Today Governor Brown signed three bills that require portions of the state to start managing groundwater sustainably. These bills are historic. Until today, California was the only western state that did not regulate groundwater, typically the source of more than one-third of the state’s supply, and much more during dry years.

Why, after a century of failing to address much-needed reform, has the state finally acted on this problem? It’s the drought.

The problem of groundwater overuse is nothing new in California. Calls for reform began as far back as the early 1900s, when severe excess pumping in many groundwater basins began to cause problems. Chronic overdraft—taking more out of the ground than nature puts back in—has left many basins severely depleted.

When the current drought arrived and communities and farms turned to groundwater to make up for shortages in surface water supply, a century of neglect—the hydrologic equivalent of deficit spending—caught up with California. The groundwater that, managed well, should have been cheap and plentiful, became expensive and scarce, leading to an economic and social crisis. The well-publicized effects of unsustainable pumping include sinking ground, dry wells, crumbling canals and roads, intense competition to drill deeper (and more costly) wells, the fallowing of more than 410,000 acres of farmland, and losses of more than $2 billion in farm revenues and more than 17,000 farm-related jobs. These factors combined to create pressure to tackle what had been, up to now, off limits to reform.

In our 2011 book, Managing California’s Water: From Conflict to Reconciliation, we note that significant advances in state water policy are often tied to droughts and floods, along with the inevitable lawsuits that follow. Extreme events like the current drought reveal fundamental weaknesses in California’s water management policies and practices. Perhaps more importantly, they create pressure on government to respond.

This is the silver lining of water crises in California: they are often the way we get things done. (The comprehensive reform of flood management enacted in 2007 was spurred on by the graphic images of Hurricane Katrina two years earlier, for example.) Indeed, one strategy for advancing water management reform is to plan and prepare for the inevitable, and then take advantage of a crisis to push ahead on needed reforms.

This year’s groundwater package is indeed historic, but California still has a long way to go in improving the way it manages water. With our changing climate, we should expect more frequent droughts and floods (and lawsuits)—so there will be no shortage of opportunities to tackle other problems in the future.

California’s Secretary of State Candidates in Conversation

The two candidates running for California secretary of state bring different resumes to the campaign but found much to agree on in a conversation sponsored by PPIC Thursday. Alex Padilla, California state senator, and Pete Peterson, executive director of the Davenport Institute at Pepperdine University, talked about their priorities in a question-and-answer session moderated by Mark Baldassare, PPIC president and CEO.

Both candidates advocated improving the use of technology—to engage voters and improve the voting experience, speed up the disclosure of campaign contributions, and improve the business registration process. Both advocated better use of data and research from outside organizations—from civic engagement groups to the U.S. Census to think tanks and universities—to more proactively register and inform voters. Some of the research PPIC has done on voter participation figured into the discussion of voter engagement, including Voter Turnout in Primary Elections and Expanding California’s Electorate: Will Recent Reforms Increase Voter Turnout?

Each candidate listed a number of goals for their term in office, if elected. Asked to reduce their voter turnout goals to a number, Padilla said he was committed to the addition of 1 million more active voters to the rolls and Peterson said he expected to generate an increase in turnout of 5 or 10 percent.

The event was part of PPIC’s 2014 Speaker Series on California’s Future. PPIC does not support, endorse, or oppose any political parties or candidates for public office.