The Question

Should the Legislature be required to dedicate and direct revenues from the Road Repair and Accountability Act of 2017 (SB 1) to transportation purposes and exempt this revenue from California’s annual spending limit?

The Situation

This Proposition was part of a legislative package, which included SB 1, signed by Gov. Brown in April 2017.

SB 1 increased the state’s excise tax on gasoline and diesel fuel, dedicating this revenue to transportation purposes as provided by the Constitution. In addition, SB 1 increased sales taxes on diesel fuel and created a new vehicle registration fee, the Transportation Improvement Fee (TIF) based on a vehicle’s value. The Constitutional provision restricting the use of the excise tax on diesel fuel to transportation purposes does not to apply sales tax on such fuel; nor does it apply to the newly created TIF.

The Proposal

Prop 69 would amend the State Constitution to:

• Restrict the new diesel sales tax revenue and a Transportation Improvement Fee (TIF) on vehicles from SB 1, to be used solely for transportation purposes,
• Prohibit borrowing from the Public Transportation Account for non-transportation purposes or using TIF revenues to repay state transportation bonds without voter approval.
• Allow revenues from SB 1 to be excluded from California’s spending limit which places an “upper bound” each year on the amount of monies that can be spent from state tax proceeds.

Fiscal Effect

Because Prop 69 does not change the tax and fee rates established in SB 1, there is no direct fiscal effect. Prop 69 could affect how some monies are spent in the future by restricting the use of revenues from diesel sales taxes and TIF fees.

A YES Vote Means

The Legislature will be required under the State Constitution to continue to spend revenues from recently enacted fuel taxes and vehicle fees on transportation purposes (such as repairing roads and improving transit).

A NO Vote Means

The Legislature in the future could change current law, allowing it to spend a portion of the revenues from recently enacted fuel taxes and vehicle fees on purposes other than transportation.

Supporters Say

• Prop 69 won’t raise taxes one cent. It ensures recently enacted transportation revenues we pay at the pump and when we register our vehicles can be used only for road and transportation improvement projects. 
• Prop 69 constitutionally protects transportation funds by prohibiting the Legislature from using these revenues for non-transportation purposes and prioritizes repair of deteriorating roadways.
• We need Prop 69 to protect revenues to fix the poor condition of our roads which pose a major safety threat to California drivers and to provide smoother, less congested roads and highways.

Opponents Say

• Sacramento has had plenty of money to fix crumbling roads through transportation-related fees and taxes, but the state has repeatedly spent money on everything but transportation.
• Proponents say Prop 69 will safeguard dollars to fix the poor condition of our roads, but a portion of the money is for transit, including high-speed rail and bike lanes, not roads.
• Prop 69 fails to protect ALL transportation dollars such as the $1 billion annually collected in vehicle weight fees used to backfill the State’s General Fund through debt service.

Link to Official Support

This Proposition is on the ballot by action of the Legislature and the Governor.

Yes on 69 Committee
https://fixcaroads.com/yes-prop-69/

Link to Official Opposition

At press time, there is no known formal campaign opposing this Proposition.