How the election could impact the local economy

By Metro Chamber|November 11, 2016|Advocacy, News Coverage|

The Business Journal asked Mayor-elect Darrell Steinberg and three local business advocates for their reactions on the outcomes of select state and local ballot races. The question: What does this mean for Sacramento’s economy?


Local measures

Measure B — Regional sales tax for transportation infrastructure

Outcome: Failed with 64 percent support (needed 67 percent to pass)

Description: Measure would have increased sales tax by a half-cent for 30 years to improve roads, with 30 percent of the proceeds directed at public transit.

Notable support/opposition: The measure was supported by a range of state and local construction trades groups, and the Sacramento Metro Chamber.

What does it mean?:

  • Darrell Steinberg: “The vast majority of city and county residents want investment in transportation infrastructure. The campaign got started late. We ran a real campaign, and I thought it was a very good campaign but the two-thirds threshold is always a challenge. We have to dust ourselves off and go right back at it.”
  • Roger Niello: “It might have been better to see projects that had capacity enhancement in commercial corridors, particularly the potential for Highway I-5 to the airport. I suspect there would be another try at that, and I would hope there would be a economic development lens placed on that.”
  • Josh Wood: “Looking at how much we moved the numbers shows how much public support there is. If anything, we have to come back and look at it in a couple years.”
  • Peter Tateishi: “We absolutely supported Measure B. The region has to understand that investing in infrastructure is a top priority if we are to retain and grow our business community. When looking at quality of life components, traffic is measured, as is the ability of businesses to bring products in or out of the region. If we are going to attract businesses, we don’t want them sitting in traffic and experiencing roads that are deteriorating.”

State measures

Proposition 51 and local school bonds

Outcome: Passed with 54 percent support.

Description: Proposition 51 authorizes $9 billion in bonds for new and upgraded school facilities. Two local school facility bond measures, Measure M and Measure P, provide $476 million for upgrading schools in Elk Grove Unified School District and a $750 million bond for upgrading schools in San Juan Unified School District, respectively.

Notable support/opposition: Proposition 51 was supported by state and local business groups, including the California Building Industry Association.

What does it mean?

  • Josh Wood: “It’s a lifeline for those who do school construction and a lifeline to homebuilders who won’t have a significant amount of cost for school construction shifted to them. It’s a big deal for people looking to buy homes because that cost would have been passed on to them.”
  • Peter Tateishi: “The chamber supported Proposition 51. We need great facilities to educate our youth and future workforce. Also, the existing construction industry is able to take those dollars and use their skill sets and put people to work.”

Proposition 64 — Legalization of recreational cannabis

Outcome: Passed with 56 percent support

Description: This measure legalizes recreational marijuana and allows adults 21 and older to possess up to an ounce of the product and grow up to six pot plants at home.

Notable support/opposition: It was supported by statewide cannabis business groups and the California Medical Association, and opposed by numerous law enforcement groups.

What does it mean?

  • Darrell Steinberg: “The voters have spoken, and we have the opportunity to do it right. We have to regulate it to ensure that we keep marijuana out of the hands of kids. We will come down hard on any continued underground market, which includes illegal grows. We need to tax it and use the revenue to bolster a needed investment in law enforcement, in kids, and in infrastructure. And we need to properly mitigate the impact where these (businesses) are located.”
  • Roger Niello: “It’s a radical change from a societal standpoint. Certainly businesses will struggle somewhat with how to detect (employee intoxication) in the interest of having a drug-free workplace.”
  • Josh Wood: “Reaction in the business community is mixed. There is a segment worried about crime and loss of worker productivity. But lots in businesses are excited and trying to figure out how to get into the industry. I think a lot of people will become players in that industry, and there will be a push to make Sacramento the Napa Valley of weed, given the nice weather here and transportation infrastructure. I think it will redefine farm-to-fork in some way.”
  • Peter Tateishi: “The chamber did not take a position on Proposition 64. We heard from lots of our members who had concerns with its passage, but also saw opportunities to legalize and regulate and bring it in as a viable business. We’ve never been able to win the war on drugs, and in this case we heard from folks that want to bring it in the light and tax it as a business. We have members who are medical cannabis dispensaries. We don’t discriminate against any legal and valid business.”

Proposition 55 — Higher income tax for affluent Californians

Outcome: Passed with 62.1 percent support

Description: This measure extends for 12 years a higher income tax bracket on single filers earning more than $250,000 a year and joint filers earning double that income.

Notable support/opposition: Major supporters and donors include the California Teachers Association and California Hospital Association. The California Chamber of Commerce opposed the measure but did not contribute funding toward stopping it.

What does it mean?:

  • Darrell Steinberg: “Passage of Proposition 55 was very significant because it continues the state’s fiscal stability. That is important, not only to the state, but to Sacramento as well.”
  • Peter Tateishi: “The chamber was neutral on Proposition 55. The business community recognizes that we need to invest in education and our future and existing workforce. We didn’t oppose because we felt that (schools were) an appropriate use of those dollars. But at the end of the day, is keeping a temporary tax the right solution? Is that the right optics for business asked to trust and have faith (in government)? This may not be the right or best way to do it.”

Source: Sacramento Business Journal 

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