Title
Adoption of Resolution Opposing Proposition 43, “Limit Voters’ Ability to Raise Revenues for Local Government Services, Legislative Constitutional Amendment,” on the November 3, 2026, California Statewide Ballot. (City Manager 10021030)
Body
To: Honorable Mayor and Members of the City Council
From: Gerry Beaudin, City Manager
EXECUTIVE SUMMARY
Proposition 43, “Limit Voters’ Ability to Raise Revenues for Local Government Services,” will appear on the November 3, 2026, California statewide ballot. Proposition 43 is a legislatively referred amendment to the California Constitution that would require voter-proposed local special taxes to receive two-thirds voter approval, rather than the majority vote currently applicable to such measures. The change would apply to voter-proposed local special tax measures approved after January 1, 2027.
The City of Alameda’s (City) 2025-26 Legislative Agenda includes Revenue, Taxation, and Employee Relations as a Legislative Focus Area. The Legislative Agenda states that the City will oppose measures that put City revenues from fees, charges, and tax revenue at risk or limit the ability of local governments to increase revenue, and support state efforts that would reduce the vote threshold for local initiatives.
BACKGROUND
The California Constitution permits local governments to increase taxes with voter approval. In California, there are two types of taxes-General and Special taxes. A general tax is imposed for general governmental purposes, deposited in the General Fund, and requires majority voter approval at a regularly scheduled election for members of the governing body. A special tax is imposed for specific purposes, with revenues restricted to those purposes, and requires approval by two-thirds of voters if placed on the ballot by a local governing body or a majority vote if placed on the ballot via the voter initiative process.
Proposition 43 would amend the California Constitution so that, beginning January 1, 2027, voter-proposed measures to impose, extend, or increase a local special tax would also require approval by two-thirds of voters instead of a majority.
The nonpartisan Legislative Analyst’s Office (LAO) states that Proposition 43 could result in lower local government tax revenues in the future than would otherwise occur because of the higher voter-approval threshold. The LAO notes that the actual fiscal effect is unknown and would depend on future decisions by local governments and voters.
City Legislative Agenda
The City’s 2025-26 Legislative Agenda guides the City’s legislative advocacy efforts and identifies the City’s legislative focus areas, general principles, and positions on state and federal legislative matters.
The Legislative Agenda identifies Revenue, Taxation, and Employee Relations as a Legislative Focus Area and includes the following relevant policies:
• Support efforts that maintain City revenue streams and create a positive financial impact on the City, and leverage county, state, and federal funding.
• Oppose measures that put City revenues from fees, charges, and tax revenue at risk and limit the ability of local governments to increase revenue.
• Support state efforts that would reduce the voter threshold for local initiatives.
The Legislative Agenda also states, as a general principle, that the City will strongly consider opposing legislation or regulations that negatively affect the City’s budget, residents, and businesses or impose unfunded mandates on the City.
DISCUSSION
Proposition 43 would change the voter-approval threshold for a specific category of future local revenue measures: special taxes proposed through the voter initiative process. Under current law, those measures may be approved by a majority vote; Proposition 43 would require two-thirds voter approval for measures approved after January 1, 2027.
The measure itself does not impose, increase, reduce, or repeal a City tax. Rather, its direct effect would be to change the approval threshold applicable to future voter-proposed local special taxes. The LAO concludes that the higher threshold could result in lower local government tax revenues in the future than they otherwise would be, although the magnitude of any future revenue effect cannot be determined in advance.
Potential Implications for Alameda
The potential implications of Proposition 43 are relevant to the City because locally generated tax revenues are a primary and significant component of the City’s General Fund and support core municipal services.
General Fund revenues support services including police and fire, libraries, parks and recreation, infrastructure and traffic safety, homelessness response, and most other municipal services. Approximately 70 percent of the City’s General Fund is allocated to police and fire services.
Going forward, Proposition 43 could affect the approval of certain future local revenue measures. If Alameda voters were asked after January 1, 2027, to approve a new, increased, or extended voter-proposed special tax for a specific local purpose, that measure would require two-thirds voter approval rather than the majority vote that currently applies to voter-proposed special taxes.
Based on the City’s adopted Legislative Agenda policies regarding Revenue, Taxation, and Employee Relations, the importance of locally generated revenues to funding City services, and the LAO’s analysis that Proposition 43 could result in lower local government tax revenues in the future, staff recommends that the City Council adopt a resolution opposing Proposition 43.
ALTERNATIVES
• Direct staff to draft a resolution supporting Proposition 43.
• Do not adopt a resolution regarding Proposition 43, thereby taking no City position on the measure.
FINANCIAL IMPACT
There is no direct financial impact to the City from adopting a resolution establishing a position on Proposition 43, and Proposition 43 does not place the City’s existing voter-approved tax revenues in jeopardy.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
City of Alameda 2025-26 Legislative Agenda focus area: Revenue, Taxation, and Employee Relations
City of Alameda 2023-26 Strategic Plan priority: Practice Fiscally Responsible, Equitable, and Inclusive Governance
ENVIRONMENTAL REVIEW
This action does not constitute a “project” as defined in California Environmental Quality Act (CEQA) Guidelines Section 15378 and therefore no further CEQA analysis is required.
CLIMATE IMPACT
There is no direct climate impact from adopting a resolution establishing a position on Proposition 43.
RECOMMENDATION
Adopt a resolution opposing Proposition 43: Limit Voters’ Ability to Raise Revenues for Local Government Services, Legislative Constitutional Amendment, on the November 3, 2026 California Statewide Ballot.
Respectfully submitted,
Gerry Beaudin, City Manager
By,
Amanda Gehrke, Management Analyst
Financial Impact section reviewed,
Ross McCarthy, Finance Director