By Haddon Libby
Early voting for November elections is here. There are ten statewide propositions on the ballot with three focused on healthcare, two on crime, housing and the environment with the remainder related to marriage, schools and wages.
Proposition 2 would authorize the state to issue $10 billion for use in upgrading the 11,300 schools in the state. 85% of these funds would be for public schools with $1.5 billion for community colleges like College of the Desert. Repaying the bonds would cost the state $500 million per year over the next 35 years.
Proposition 3 changes the state Constitution to allow you to marry the person you love. A vote ‘yes’ allows for marriage between any two people whereas a vote ‘no’ keeps marriages between a ‘man and woman’ only. Throuples are not covered.
Proposition 4 authorizes the state to issue $10 billion for use in projects related to climate changes. For example, $3.8 billion goes toward drinking water systems. Nearly $2 billion goes toward wildfire prevention with another $2 billion toward the protection of parks, land and wildlife. This bond would add $400 million to state debt obligations each year until it is repaid. Firefighters and conservationists are for the bill while taxpayer groups are against it.
Proposition 5 requires a ‘yes’ vote by 55% of voters. This proposition allows local municipalities to issue bonds for the development of low- and middle-income housing and the roads and infrastructure needed in support. Bonds would be repaid from property taxes. Like Propositions 2 and 4, firefighters, Habitat for Humanity and groups like League of Women Voters support the proposition while taxpayer groups are against it.
Proposition 6 is about prisoner rights while incarcerated. At present, inmates are required to work and punished if they refuse to work. A vote ‘yes’ removes mandatory work while a ‘no’ eliminates it.
Proposition 32 raises the minimum wage. Outside of fast-food workers who already have higher minimum pay, the bill will require all employers with more than 25 workers to pay $17/hour for the balance of 2024, a $1/hour raise. This would take place immediately after the elections. Wages would rise to $18/hour for 2025 and $18/hour for 2026. After that, the minimum wage would be adjusted for inflation. Anti-poverty activists support the bill while the Chamber of Commerce, Restauranteurs and Grocers are against it.
Proposition 33 allows local municipalities to enact rent controls. Groups like the Alliance for Retired Americans and Veterans groups support the measure while the Small Business Association, another Seniors group and the Hispanic Chamber of Commerce are against it. The key reason NOT to support the proposition relates to those uncomfortable with the government deciding how much a landlord can make. Many are concerned that rent controls will cause more slumlords while discouraging construction of rental units.
Proposition 34 requires healthcare providers to spend 98% of savings from federal discount prescription drug programs on the people who use those drugs. This also allows the state to negotiate drug prices for Medi-Cal – current laws prevent this.
Proposition 35 provides permanent funding for Medi-Cal – the current program provides funding through 2026.
Proposition 36 allows felony charges and increased prison sentencing for drug and theft crimes under $950. The District Attorneys Association, the Small Business Association and a Crime Victims group support the initiative while those concerned about police abuse and district attorney abuse of the law are against it.
Locally, we have Measure “AA” that essentially transfers Desert Regional Hospital from government control to Tenet Healthcare, the current operator of the facility. The issue with this proposal is that Tenet requires a non-compete clause in the agreement. Nurses are against the measure while many healthcare providers are for it. The argument for the measure resides in the concern that a Tenet withdrawal from the market leaving us without the hospital. Nurses and others consider that a false argument and are concerned that Tenet will put profits ahead of people. Tenet is a financially weak of healthcare provider with a B rating on its debt – one of the lower junk debt ratings in the market.
Haddon Libby is the Founder and Chief Investment Officer of Winslow Drake Investment Management. For more information on our services, please visit www.WinslowDrake.com.
