Editor's note: This article was written by Tom Nussbaum and Chris Micheli.
Just over a century ago in California, the initiative process was proposed by Progressives, the labor movement, and others as a means of addressing a Legislature which was perceived to be under the control of the Southern Pacific railroad and other special interests. In 1911, the California voters followed the recommendation of Progressive Governor Hiram Johnson and California became the tenth state to enact the initiative, referendum, and recall.
The initiative and referendum are intended to be available to the people when their elected representatives (i.e., the Governor and Legislature) are unwilling or unable to adopt legislation. The initiative is a method of lawmaking that requires a vote of the people instead of a vote of the Legislature in order for a measure to become law. To qualify for a statewide ballot, statutory initiatives must receive signatures of voters equal to 5% of the votes cast for all candidates for Governor at the last gubernatorial election. Constitutional amendment initiatives must receive signatures equal to 8% of the same number of votes. In both cases, proponents have 180 days to collect the required number of signatures.
With the referendum, the People also have the power to approve or reject statutes or parts of statutes with the exception of urgency statutes, statutes calling elections, statutes providing for tax levies, or statutes making appropriations for the usual and current expenses of the state. The petitions must be signed by registered voters in an amount equal to 5% of the votes cast for all candidates for Governor at the last gubernatorial election, and proponents have only 90 days from the date of enactment of the legislation (the time the Governor signs the bill) to collect the required signatures.
Ironically, California’s initiative and referendum processes have not always been used as former Governor Hiram Johnson envisioned. Especially within recent years, initiatives have been used primarily by interest groups and wealthy individuals who fund multi-million dollar campaigns to change the law, often in a self-serving manner with little regard as to whether the ballot measure promotes good public policy.
The referendum process has also been a successful tool in recent years for special interest groups. For example, competing Indian tribes placed Prop. 48 on the November 2014 general election ballot and spent millions of dollars to overturn two gaming compacts that had been negotiated by the Governor and then ratified by the Legislature. In addition, there is an effort underway to overturn the statewide plastic bag ban by referendum. The “plastic bag ban” legislation (SB 270, Chapter 850, Statutes of 2014) was signed into law in September 2014. If the measure qualifies for the ballot, the new will be suspended from going into effect until at least until the November 2016, general election when the public votes on whether to approve the new law. With these examples, the referendum process appears limited in its use to very select instances where a financially powerful interest group can pay for qualifying a referendum and getting it before the statewide electorate.
The continued growth in the use of the initiative can be attributed to several factors. First, public opinion polls show a continuing decline in confidence in elected leaders and political institutions by those responding to these polls. According to numerous surveys conducted by the Public Policy Institute of California, the public believes it does a better job via the initiative process than the Legislature and Governor do via the legislative process.
Second, when it comes to controversial and complex issues, the Legislature and Governor have often been unable or unwilling to act. Sometimes there has been no other alternative but to go the initiative route. Third, during recent decades there has been a significant increase in special interest groups, both in number and size. Special interest groups have sponsored many of the initiatives that have been brought to the people on the statewide ballot.
Fourth, the professional petition industry has itself prompted many interest groups and individuals to use the initiative process. Large organizations depend on continuing initiative activity for their very existence and such organizations are now part of what has been dubbed as the “initiative industry complex.”
Finally, we have seen an increase in the use of the initiative because of the growing use of counter-initiatives. To combat a threatening or unwanted initiative, groups have resorted to drafting and qualifying their preferred alternative. In addition, groups have pursued initiatives as a means of pressuring the Legislature and Governor to deal with issues legislatively.
As the number of initiatives being considered and brought to the people has increased dramatically, so have the costs of pursuing ballot measures. The two main areas where costs have increased are in signature gathering and advertising. The Center for Governmental Studies found that the median cost to qualify an initiative in California (i.e., gather signatures) reached $2.8 million in 2006, up from $45,000 in 1976. Current rates are $1 to $3 per signature, with costs of qualifying often $2 million or more.
The cost of advertising an initiative has also skyrocketed. Interest groups for and against ballot measures have waged huge campaigns to influence the voters. For example, an initiative to temporarily increase the income tax and sales tax (Prop. 30) was taken to the voters in November 2012. A total of more than $120 million was spent -- $67.1 million for the “yes” campaign, and $53.4 for the “no” campaign. Also on the November 2012 ballot was an initiative to restrict political contributions by unions and corporations (Prop. 32). A total of more than $133 million was spent -- $60.5 million for the “yes” campaign, and $73.3 million for the “no” campaign.
It is an unfortunate reality that most of these statewide ballot measures usually require tens of millions of dollars to be spent for and against the proposals, thus tending to preclude ordinary citizens from this method of changing the law. And, more often than not, exorbitant spending neither predicts the success or failure of a measure. Sometimes the issue gets punted back to the Legislature to try to resolve the public policy dispute, despite the fact that the "people have spoken." As a result, many legislators feel their hands are tied and are hesitant to act, leaving the public policy issue unresolved and the status quo winning the day.
It is probably a fool’s errand to attempt to debate and decide whether the initiative process is either a needed check on elected officials or a tool of special interests. There are arguments that can be made for either side of the question. The fact of the matter is that the California public has consistently supported the initiative process and feels it has done a good job with the responsibility. At the same time, the public as well as elected officials have been critical about various aspects of the process, and have been calling for reforms in recent years.
In 2014, legislation was passed (SB 1253, Steinberg, Chapter 697, Statutes of 2014) that made several important modifications to the initiative process. First, a proposed initiative will be subject to a 30-day public review period at the start of the process. Based on this input, proponents would then have an opportunity to amend the proposal. The new law also requires that when proponents have collected 25% of the signatures necessary to qualify an initiative for the ballot, state legislative committees will hold public hearings on the measure. Proponents would then be given an opportunity to withdraw their proposal if they are content with the legislative solution. To accommodate these extra steps, the new law also extends the signature gathering period from 150 to 180 days. Finally, the law requires the state to post the top 10 donors in support and opposition of an initiative.
Even though there may be an appropriate role for ballot measures, direct democracy has its limitations and it makes good public policy sense for some additional review by the public and even elected representatives in order to address potential drafting problems or even to give the Legislature "one last shot" at addressing the public policy issue before the voters have to make a decision. The Legislature’s actions in 2014 represent a step forward in improving the initiative process.
A major challenge that remains with respect to both the initiative and the referendum is the huge expense entailed in accessing this method of changing the law. The costs of qualification and advertising are simply too much for ordinary citizens or small organizations to bear. As to the referendum, a recent law change in 2011 (SB 202, Hancock, Chapter 558, Statutes of 2011) creates potential problems. This measure essentially requires initiative and referendum proposals only to be voted on at statewide general elections in even-numbered years. Thus, if a proponent can collect 500,000 plus signatures on a referendum proposal, a new law is suspended from going into effect at least until the outcome of a statewide general election that could be almost two years in the future.
Finally, there’s a bit of reality that may help assuage some of the problems that continue to remain. Simply put, the track record for proponents is not very high. The Secretary of State has done an analysis of the success rate for initiatives in California. During the past 101 years (1912 to July 2013):
- 1,767 initiatives were titled and summarized for circulation
- Of these, 1,311 (74.1%) failed to qualify, and another 92 were withdrawn from circulation
- 360 initiatives (20%) qualified for the ballot
- Of the 360 that qualified, only 122 were approved by the people.
Historically, therefore, only one in five proposed initiatives has qualified for the ballot, and only one in three of those that qualified have been approved. Even if initiatives are the tool of special interests, the odds of success are very slim.
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