SACRAMENTO, Calif. — The decisions California voters are likely to face this fall came into sharper focus Wednesday as Gov. Jerry Brown, legislative leaders and a coalition with which he had been at odds announced a deal for a proposed ballot measure to temporarily raise the state's sales and income taxes.
The budding compromise is a fallout from California's ongoing budget deficits and a result of the governor's failure last year to get Republican support in the Legislature for an extension of tax hikes that have since expired.
If passed by voters in November, the tax hikes would raise anywhere from $7.1 billion to $9 billion a year at their height, according to the state Department of Finance.
Californians also are likely to confront a competing ballot initiative that would raise income taxes for nearly all wage-earners to help fund schools. That proposal is backed by wealthy Los Angeles attorney Molly Munger, who so far has refused to back away from her putting her initiative on the fall ballot.
The Democratic governor announced the deal with proponents of a ballot initiative that would have raised incomes taxes on millionaires. Democratic-leaning interest groups moved quickly to align behind the single, high-stakes budget proposition.
"It's the tax program that balances the budget, and that's the key," Brown told The Associated Press after a news conference at a Boeing Co. facility in Long Beach. "Joining the forces creates a higher probability of victory, and that's good for school kids, it's good for public safety."
Brown said working together provides a greater chance of success in November.
Joshua Pechthalt, president of the California Federation of Teachers, the chief financial backer of the millionaire's tax, said his group always sought to collaborate with the governor. He said it became clear to Brown and other powerful Democrats within the last couple of weeks that the teachers union was unlikely to simply drop its ballot proposal.
"I think No. 1, the governor and the legislative leaders saw that we were committed to this, we were not backing down, and last week we published some recent polling we did, which continued to show our measure polling very, very strong," Pechthalt said.
The millionaires' tax had continued to fare better in public polling than the governor's more nuanced approach, which called for a four-year, half-cent increase in the sales taxes and a five-year sliding scale income tax hike starting with people who make $250,000 or more a year.
A Public Policy Institute of California poll last week found Brown's measure with just 52 percent, far lower than initiative supporters like to see so early in an election cycle.
None of the tax proposals has yet qualified for the ballot. The compromise struck by Brown and the groups backing the millionaires' tax will require them to start a new effort to gather petition signatures.
The compromise proposal would reduce the four-year sales tax hike to a quarter-cent instead of a half-cent and increase the income tax rates on high-income earners by 1 percentage point to 3 percentage points, depending on income. The income tax also would last seven years rather than the five years as Brown had proposed.
Rick Jacobs, chairman of the Courage Campaign, another sponsor of the millionaires' tax called the deal "a victory for progressives and everybody who believes that the state of California needs to re-fund itself."
He acknowledged that backers now face a short deadline to qualify the measure and collect the 807,615 signatures needed to place it on the ballot. Signatures that Brown and the millionaires' tax supporters had already gathered will not count toward the new initiative, meaning they will have to spend millions of dollars more.
"It's going to cost a lot of money, but we can get this revised measure on the ballot. It can be done, and from our perspective, it must be done," Jacobs said.
Brown's campaign submitted new language on Wednesday to the state attorney general's office, which must draft a title and summary. The secretary of state's office must certify all ballot initiatives June 28, according to its website.
California Republican Party Chairman Tom del Beccaro slammed the compromise as a "backroom deal with special interests."
He said a tax increase of any kind was the wrong approach because California has still not fully recovered from the recession.
"Gov. Brown should be working with taxpayers and small businesses to craft a plan that would put Californians back to work, not finding ways to make it harder for hardworking people to participate in the economy," Beccaro said in a statement.
The compromise was reached after months of public sniping in which the governor urged the other groups to drop their own tax proposals or risk having all of them fail in November. The proposals seek to address California's ongoing budget deficits and provide stable funding for public schools.
It also will dedicate a certain portion of the revenue to counties, in part to help pay for Brown's realignment of the prison system that is sending low-level offenders to county jails. To protect that funding, the initiative would be a constitutional amendment if approved by voters.
To further complicate matters, the governor also plans to continue collecting signatures on his existing proposal as insurance in case supporters do not meet the deadline for the new measure.Comment on this story
Munger is not part of the compromise announced Wednesday. Addisu Demissie, campaign manager for the "Our Children, Our Future" initiative, said he did not have enough information about the deal between Brown and the teachers union to comment on it.
"We don't anticipate that it will change our plans. We have an open line of communication with the governor's office and we look forward to continuing the dialogue," Demissie said in an emailed statement.
Munger's proposal would raise income taxes on a sliding scale for virtually all taxpayers and give the money directly to school districts.
Williams reported from Sacramento. Associated Press writer Hannah Dreier also contributed to this report.