Full disclosure: I recorded this interview with Erinn Ryberg – Leg. Director to Assembly Member Cristina Garcia and McGeorge Class of ’13 – in late December 2017. So, we refer frequently to “this year” and “next year” with this year meaning 2017 and next year meaning 2018. It dates the conversation a little bit, but not enough to make anything either of us said incorrect.
Erinn and I talked about a pair of bills that came from her office and went nowhere fast in 2017. One is a constitutional amendment, and the other is a redefining of what counts as food in California’s tax code. Neither of the bills are dead – even though there’s been no motion on them and the deadline for two-year bills is tomorrow – because the rules in the California Legislature exempt constitutional amendments and tax levy bills from the normal two-year bill deadlines.
The new tax of seven cents on the dollar that Asm. Garcia is proposing would raise roughly $900 million, which would go into the General Fund and potentially a few Special Funds and provide extra revenue to address the obesity epidemic, the diabetes epidemic, return nutritional counseling to schools where it had been cut from, and, hopefully – from the point of view of Asm. Garcia’s team – back fill enough programs to free up $20 million to pay for exempting tampons from the sales tax.
Despite not having to worry about the Legislature’s deadlines, getting snack and/or candy taxes re-instituted in California is a series of uphill battles. For background, California did briefly have a snack tax in the 1990’s. It was put in place by the Legislature to fill a budget deficit. The tax was opposed by candy companies who ran (and won) a ballot initiative campaign to change the California Constitution to classify snack foods and candy as food. Food is classified as essential and therefore is not taxed. In doing so, any attempts thereafter to tax candy and snack foods require going back to the voters and getting another constitutional amendment.
The process of getting a constitutional amendment passed is uphill battle number one. For a legislator to get a constitutional amendment on the ballot, it has to pass both houses of the California Legislature, and both houses need to pass it by a two-thirds vote. If they are successful in that endeavor, it then goes to the statewide ballot where a campaign to pass the new snack tax would require millions of dollars to have a chance at winning. It would also likely face extremely well funded opposition. The process, in a vacuum, is difficult.
Factoring in the fact that last year legislators passed a major increase to the gas tax and an extension of California’s Cap and Trade program, it makes getting the constitutional amendment through the Legislature that much more difficult. On the ballot initiative side – should this amendment make it to the ballot – voters would be looking at creating this new tax in the same year in which they may be voting on not only repealing the aforementioned gas tax, but enshrining in the California Constitution that all new gas taxes must be sent to the voters for approval. Taking that into account, this is about as steep of an uphill battle as one can have. We’ll have to wait and see on how this shakes out.