Proposition 55: Extend Personal Income Tax Increases another 12 Years? Why or why not...

An initiative that would extend income tax increases approved by voters in 2012 to bolster education funding will be among the issues on the ballot Tuesday.

Proposition 55 would extend by 12 years the temporary personal income tax increases on earnings over $250,000 for single filers, over $500,000 for joint filers and over $340,000 for heads of household.

The measure includes provisions allocating 89 percent of the tax revenue from the increases to kindergarten through 12th-grade education and 11 percent to community colleges. It would also allocate up to $2 billion per year in certain years for health care programs.

The initiative bars the use of education revenues for administrative costs, but allows local school boards discretion to decide, in open meetings and subject to annual audit, how revenues are to be spent.

Passage of the initiative would result in increased state revenues annually from 2019 through 2030, likely in the $5 billion to $11 billion range initially, with amounts varying based on stock market and economic trends, according to an analysis conducted by the Legislative Analyst's Office and Department of Finance.

Backers, including State Superintendent of Public Instruction Tom Torlakson, argue the measure will simply maintain an existing tax and continue providing funding to public schools, preventing classroom cuts and teacher layoffs.

Opponents, most notably the Howard Jarvis Taxpayers Association, counter that voters approved the tax hike in 2012 based on the promise that it would be temporary, and would end in 2017.

On the same ballot, voters will also decide whether to authorize the issuing of $9 billion in bonds for the construction and upgrading of schools across the state.

Proposition 51 would split the bond proceeds, with $3 billion earmarked for new construction and $3 billion dedicated to modernization of K-12 public schools. Another $1 billion would be reserved for charter schools and vocational education facilities, while $2 billion would go toward California Community Colleges.

The state Legislative Analyst's Office estimated that the bonds would cost the state a total of $17.6 billion to pay off over 35 years, depending on interest rates when the bonds are issued.

Backers contend the measure will help educational facilities meet basic health and safety requirements, including seismic safety and will represent the first statewide school bond in 10 years. Opponents, however, argue that the state is already overburdened with payments on $35 billion in school bonds issued since 1998, and adding another $500 million in annual debt payments is something the state cannot afford.

City News Service, Shutterstock