Capitol Update, Oct. 23, 2014

Last week the CMTA Board approved positions on several propositions on the upcoming November 4^th General Election. Below is a brief summary of the propositions and CMTA’s reason for those positions.

Proposition 1: Funding for Water Quality, Supply, Treatment, and Storage Projects

CMTA Position: Support

Proposition 1 authorizes $7.545 billion in general obligation bonds for state water supply infrastructure projects, including surface and groundwater storage, ecosystem and watershed protection and restoration, and drinking water protection.

Reason for CMTA Position: Proposition 1 creates a comprehensive state water plan, including new storage facilities, that help ensure a reliable water supply for farms and businesses during severe drought, protecting both the economy and the environment.

Proposition 2: State Budget. Budget Stabilization Account.

CMTA Position: Support

Proposition 2:

• Requires annual transfer of 1.5 percent of general fund revenues to state budget stabilization account;
• Requires additional transfer of personal capital gains tax revenues exceeding 8 percent of general fund revenues to budget stabilization account and, under certain conditions, a dedicated K–14 school reserve fund;
• Requires that half the budget stabilization account revenues be used to repay state debts and unfunded liabilities;
• Allows limited use of funds in case of emergency or if there is a state budget deficit; and
• Caps budget stabilization account at 10 percent of general fund revenues, directs remainder to infrastructure.

Reason for CMTA Position: Proposition 2 forces the state to save money in a Rainy Day Fund, requires politicians to live within their means and protect against unnecessary tax increases. In good times, money will be placed in a constitutionally protected reserve and used to pay down debt. In bad times, the Rainy Day Fund can be used to protect schools, public safety and other vital services.

Proposition 45: Healthcare Insurance. Rate Changes

CMTA Position: Oppose

Proposition 45requires Insurance Commissioner’s approval before health insurer can change its rates or anything else affecting the charges associated with health insurance. Provides for public notice, disclosure, and hearing, and subsequent judicial review. Exempts employer large group health plans.

Reason for CMTA Position: Proposition 45gives sweeping control over healthcare coverage rates to one elected politician, the Insurance Commissioner, and unnecessarily creates a new layer of bureaucracy causing costly confusion. Proposition 45 also fails to take into account the major causes of rising medical care costs.

Proposition 46: Drug and Alcohol Testing of Doctors. Medical Negligence Lawsuits

CMTA Position: Oppose

Requires drug testing of doctors. Requires review of statewide prescription database before prescribing controlled substances. Increases $250,000 pain/suffering cap in medical negligence lawsuits for inflation.

Reason for CMTA Position: Due to legislative action nearly 40 years ago, Californians have benefited from limits on medical malpractice awards for noneconomic damages (“pain and suffering”) in the form of better access to healthcare and lower healthcare premiums due to affordable malpractice insurance. In fact, California healthcare costs are lower than the rest of the nation. Proposition 46 quadruples the limit on medical malpractice awards in California leading to higher healthcare insurance costs for all consumers and taxpayers.