Fiscal Constraints and the Loss of Home Rule: The Long-Term Impacts of California's Post-Proposition 13 Fiscal Regime

Abstract:     
The passage of Proposition 13 in 1978 was a watershed event that ushered in both a new era and a new fiscal regime for California’s local governments. We argue that, in the wake of follow-on initiatives, a protracted recessionary period, and the state’s use of newly authorized revenue-transfer powers, this still-evolving regime entered a new phase in the 1990s. This article analyzes the primary impacts of and responses to the changes in California’s post-Proposition 13 fiscal regime in the 1990s in five local jurisdictions. The results reveal that the most significant long-term impacts of this regime have been an altered fiscal structure and an unintended decrease in local home rule. These impacts, in turn, have led to cuts in non-essential services, the expansion of sales tax-generating redevelopment efforts, implementation of new taxes and user service fees, and increased reliance on one-time fiscal measures.

Number of Pages in PDF File: 58

Keywords: Proposition 13, public administration, local governments, fiscal constraints, home rule

Accepted Paper Series