Californians: Vote YES on Prop. 39
November Ballot Measure Will Close a Tax Loophole and Fund Clean Energy Projects
California is known world-wide for its innovation, its creativity and its world-class economy. But between the national economic downturn and state policies like the corporate tax giveaway created in 2009, California is struggling to remain competitive.
On November 6, voters in California have an opportunity to support Proposition 39, the California Clean Energy Jobs Act, which will close a job-killing corporate tax loophole and create jobs throughout the state. Earth Day Network has joined a coalition of businesses, education, labor, environmental and taxpayer groups to support Prop. 39
Middle-of-the-Night Budget Deal Hurt California Businesses
At the end of the 2009 state budget negotiations, in a last-minute, middle-of-the-night deal, a tax loophole was created that allows out-of-state companies to manipulate the tax system and get a tax advantage from keeping jobs out of California. The law was changed to allow multi-state businesses to pick one of two income tax formulas: one based on the company’s sales, property, and employees and the other based simply on in-state sales. Firms are allowed to pick the method that is most advantageous for tax purposes.
Prop. 39 Levels the Playing Field
Prop. 39 levels the playing field for California businesses by requiring that all multi-state companies doing business in California pay taxes based on in-state sales. Eliminating this unfair loophole will make California-based businesses more competitive and restore balance and fairness to the tax system. The reform will also bring California’s tax policy in line with the policies of many other states, including New York, Indiana, Texas, and Michigan.
New Funding will Help Vital State Services
Closing the loophole will recover $1 billion a year in lost revenues, which will help close the state’s budget deficit and provide increased funding for vital state programs – such as education, health and social services, public safety and transportation. Prop. 39 will generate an additional $500 million in General Fund revenues starting in 2013 and $1 billion a year after five years.
Measure Creates New Resources for Clean Energy Projects
For the first five years, Prop. 39 dedicates a portion of the recovered $1 billion in state revenues to energy efficiency programs, which will create thousands of new jobs and reduce the state’s long-term energy costs. The measure will fund clean energy projects and energy efficiency improvements for public buildings to help reduce long-term energy costs for local governments, schools and other public agencies. It will also authorize local public agencies to create low-interest loan programs for businesses investing in energy efficiency improvements, helping make California businesses more competitive.
Creates Tens of Thousands of New Jobs
California’s current policy rewards companies with fewer employees in California, thus discouraging multi-state companies from locating and creating new jobs in California. Closing this loophole will create tens of thousands of new jobs in California, according to the independent, non-partisan California Legislative Analyst. In addition, another 20,000 to 30,000 new construction-related jobs will be created by the increased investment in energy efficiency and clean energy projects.
Support Tax Fairness, Join the Coalition
The nation—and the world—looks to California for cutting-edge innovation and creativity. Perpetuating a system that encourages business to move jobs out of state in order to reduce their tax bill defies logic. California needs to restore fairness to its tax system by closing this job-killing loophole and leveling the playing field for California-based businesses.
With your help, California can return fairness to its tax policy and create needed resources for vital state programs and clean energy projects.