‘EXISTENTIAL THREAT’: Opponents of a sweeping ballot measure to rein in taxes are trying to hit Democrats where it hurts, warning the initiative would imperil some of their cherished programs: gun controls, family care and movie industry perks. In a draft letter seen by Playbook, labor heavyweights including the Service Employees International Union and California Teachers Association warned legislative leaders that the “Taxpayer Protection Act” is a “dangerous and existential threat to California” that would jeopardize such signature programs. In a way, they’re preaching to the choir: Legislative leaders and Gov. Gavin Newsom already oppose the measure. But it does raise the personal stakes for lawmakers by threatening their own policymaking legacies, heaping on public pressure as labor unions and local governments seek to negotiate the measure off the ballot before a June 27 deadline. And it reflects the overall heavy lobbying we can expect to see ramp up over other ballot efforts as that date approaches. Here’s a quick refresher: The California Business Roundtable-backed proposal would make it harder to create new taxes by raising the voter approval threshold for some local levies to two-thirds and requiring voters to approve state-level tax increases passed by the Legislature. The business group argues this will help relieve Californians from more taxes that they say are overly burdensome, strain the economy and make the state an unaffordable place to live. But the unions’ missive contends the proposal would also put at risk several programs that lawmakers have passed since the beginning of 2022 that were predicated on tax changes because it would take effect retroactively on Jan. 1 of that year. “The measure would also overturn recent legislative wins, including new laws funding gun violence prevention, mental health, paid family leave, and disability insurance, environmental programs and the Film and Television Tax Credit,” the letter, dated today, states in bold text. The argument builds on a core opposition complaint: that the initiative would make it nearly impossible for schools and local governments to generate needed revenue. The California Business Roundtable dismissed the argument as political fear-mongering with little to no legal basis. They conceded the guns and ammunition tax would have to be approved by voters within a year of the measure taking effect, or it would be repealed. But they said policies like the film credit, paid family leave and disability insurance would not be affected because the Legislature didn’t present them as tax increases. “These are all essentially lies and misrepresentations,” Business Roundtable President Robert Lapsley told Playbook. “We have been qualified for a year and a half, and suddenly, there are all these, essentially, attacks coming when we're about two weeks out from the constitutional deadline for [the initiative]. It's all very ironic.” Meanwhile, Sacramento Democrats have sought to scrap the measure through different means. They spurred a case now before the state Supreme Court on whether to strike the initiative from the ballot and pushed forward a dueling proposal (also up in November) that would require measures like the one backed by the Roundtable to be approved by a two-thirds margin. The industry group has yet to yield though. “We believe it's the best policy for California moving forward for a check and balance in the face of a permanent, two-thirds, super-progressive Legislature,” said Lapsley. “This is going to be critical for business, to be able to try and have a climate where there are some checks and balances and hopefully some ability to influence the process.” IT’S TUESDAY AFTERNOON. This is California Playbook PM, a POLITICO newsletter that serves as an afternoon temperature check on California politics and a look at what our policy reporters are watching. Got tips or suggestions? Shoot an email to bjones@politico.com.
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