The coming labor-business fight over Bay Area transit

Politico

4 days ago

Presented by
FINAL DESTINATION — A group of transit unions, operators, and advocates calling itself Bay Area Forward is launching a last-ditch pressure campaign to rework a 2026 ballot measure designed to help rescue the Bay Area's struggling transit operators, Playbook has learned exclusively.
With the downtown economies of three of the state's largest cities at stake, the labor-oriented alliance argues that transit interests need to abandon a regional sales tax measure being advanced by the Metropolitan Transportation Commission. Up to five counties would add a half-cent sales tax that advocates say would generate about $500 million annually for BART and other networks.
'It's problematic for two reasons; one, it does not fully fund the operational shortfall. It's also a politically vulnerable ballot measure,' said Ryan Williams, the campaign director for Bay Area Forward, founded this year by local transit unions. 'Our position has been we need to fully fund the operational shortfall in a politically viable way.'
In recent weeks, the group commissioned pollster FM3 Research to survey likely 2026 Bay Area voters on different transit funding mechanisms. The results, they argue, are clear: voters are unlikely to go along with a sales-tax increase. Just 54 percent of respondents across the four counties surveyed backed the half-cent proposal, which failed to win majority support in San Mateo.
There was far more support for a gross receipts tax that would put the financial burden on businesses rather than individuals. When pollsters introduced such a proposal, it won support from 61 percent of likely voters, with its advantage shrinking only slightly once respondents had heard arguments for and against the proposal. (Weak support for a sales tax was identified by EMC Research in separate polling released earlier this year by the MTC.)
Bay Area Forward argues that its polling points to the need for not only a different policy but a change in ballot strategy altogether. Currently, the sales tax measure is marching through the legislature via SB 63, a bill introduced by Sens. Scott Wiener and Jesse Arreguín which serves as the primary vehicle for building consensus around the BART funding measure. If the bill passes, the sales tax would reach ballots as a special tax, which requires a two-thirds threshold to take effect.
But none of the measures tested in the poll were popular enough to clear that hurdle. If a tax proposal were to reach the ballot as a citizens initiative, it would require only a simple majority to pass. To get there, however, the measure would need to find a backer willing to fund a signature-collecting effort on top of the campaign to sell voters on the tax itself.
Bay Area Forward is already putting pressure on lawmakers to pivot from the sales-tax proposal when the bill reaches the Assembly this week. But that turn away from a tax paid by consumers towards a gross receipts tax on companies could set up a business-labor conflict with the Bay Area Council, the corporate-funded group that had been expected to pick up the tab for a ballot campaign.
Bay Area Forward says it is ready to pay for petitions.
NEWS BREAK: Climate risks firm predicts Sacramento 'depopulation' by 2055 … CEQA headed for major changes … DOJ issues new threats to school districts over trans athletes' participation in girls' sports.
Welcome to Ballot Measure Weekly, a special edition of Playbook PM focused on California's lively realm of ballot measure campaigns. Drop us a line at [e-mail] and [e-mail], or find us on X — @emilyrs and @wrmccart.
TOP OF THE TICKET
A highly subjective ranking of the ballot measures — past and future, certain and possible — getting our attention this week.
1. Sports betting (2026?): California's Native American tribes are thinking about speeding up their timetable for a return to the ballot as they work to find an agreement with online-betting giants FanDuel and Draft Kings. Giving a new sense of urgency are the emergence of sports prediction markets, the subject of a meeting last week between tribal leaders and the Commodity Futures Trading Commission.
2. Minimum wage (Los Angeles, 2026?): The tourism industry is pushing back on a new $30 minimum wage for its employees, launching a referendum effort last week to overturn the law recently passed by LA's city council. It might not be the only minimum-wage question coming before voters next year, as some of the labor interests behind last year's Prop 32 are considering whether to mount a 'better funded' campaign for a $20 statewide floor.
3. Measure Z (Santa Cruz, 2024): After months of anticipation, Big Soda is striking back against Santa Cruz's soda tax. Last Thursday, a group of trade associations, local grocers and convenience store owners sued the seaside college town over a per-ounce sugary drink tax passed by voters last November, arguing the measure violates state law. The city aims to enlist the aid of health organizations like the American Heart Association to defend the measure in court.
4. High-earners tax extension (2026?): Unions looking to extend the high-earners tax introduced in 2012's Prop 30 and extended with 2016's Prop 55 are taking the steps necessary to push for renewal in 2026. The big question around the issue has never been if but when, and a recent online post from the California Teachers Association says the union is already organizing for a potential signature-gathering campaign to begin this fall.
5. California Forever (Solano County, 2026?): Suisun City is looking for at least a $500,000 payout from developer California Forever in any deal to annex the company's land and help it avoid a countywide ballot measure, according to the Daily Republic in Fairfield.
6. Health-care insurance denials (2026): The Luigi Mangione Act, an initiative aimed at preventing health insurance denials and named for the alleged UnitedHealthcare CEO killer, can now begin gathering signatures, the secretary of state's office announced last week. It is joined in the field by a proposed initiative to increase ethnic studies coursework requirements for California State University students.
7. Prop 33 (2024): The No on 33 anti-rent control campaign won a Pollies gold prize — the so-called 'Oscars of political advertising' — in the direct mail category for the 12.8 million pieces sent last year by Josh Pulliam's Sacramento firm JPM+M.
ON OTHER BALLOTS
Activists who led the 2020 campaign to legalize cannabis in Montana are now considering a constitutional amendment to keep judicial elections nonpartisan … Oklahoma Gov. Kevin Stitt signed legislation last week that introduces geographic distribution requirements for signature-gatherers looking to qualify an initiative for the ballot …
A federal judge in Florida heard arguments in a case challenging the new initiative-related law signed by Gov. Ron DeSantis, which places strict new restrictions on the signature-gathering process … Arkansas Attorney General Tim Griffin issued a new title and summary for a proposed constitutional amendment pushing back on legislative efforts to restrict the ballot process, clearing the League of Women Voters of Arkansas to begin gathering signatures to appear on the November 2026 ballot …
Oregon's Ballot Measure 119, which made it easier for cannabis workers to unionize, will no longer be in effect after a federal judge ruled it unconstitutional on First Amendment grounds … And the city council in Boston advanced a proposal to introduce ranked-choice voting, which must still get approval from the mayor, the state legislature and the governor before coming before voters as a ballot measure.
I'M JUST A BILL
NO LONGER IN SUSPENSE: Lawmakers looking to put measures on the 2026 ballot are figuring out their next steps after learning respective bills' fates in the suspense file hearings late last month.
All three constitutional amendments in contention for 2026 were turned into two-year bills. That means Assemblymember Matt Haney's ACA 3, to provide down payments on home loans for University of California staff, and Assemblymember Corey Jackson's ACA 7, to revive affirmative action, are off the table for this year and won't have a chance to make their way through the rest of the legislative process until spring 2026.
Jackson is now considering converting his ACA 4, a constitutional amendment that would require sending 5 percent of General Fund revenue toward homelessness, into a citizen initiative.
'We have to solve housing in a major way,' he told Playbook. 'If the Legislature is not going to do it, we might need to start gathering some signatures.'
Jackson said it's imperative that money to address the state's housing crisis ends up on the 2026 ballot in some form, whether it's his proposal or AB 736, the $10 billion affordable housing bond from Assemblymember Buffy Wicks.
'The Legislature allowed this problem to turn into a crisis, so it's time for us, it's time for Democrats to solve it,' he said. 'This happened under our watch.'
Wicks' bond has the clearest path to the ballot. After getting an endorsement from Gov. Gavin Newsom, AB 736 made it out of suspense and now needs to pass a floor vote in the Assembly before going through the committee process on the Senate side.
Wicks told Playbook she feels good about its chances in the Senate and is 'cautiously optimistic' about the bond getting Newsom's approval when it crosses his desk. Last cycle, 'the climate bond and the school bond ended up taking priority,' she said. 'So I think there's certainly a feeling now amongst lawmakers that we have to prioritize housing, particularly because there isn't money in the budget for housing.'
WHATEVER HAPPENED TO ...
BOARD OF SUPERVISORS REFORM (2024): Last year, Los Angeles County voters narrowly passed Measure G, a charter amendment to establish an ethics commission, expand the powerful board of supervisors from five members to nine and create a new county executive office to oversee their government.
Now comes the hard part, as Emily wrote this weekend: determining the scope of a position that will, by representing the nearly 10 million people of Los Angeles County, become perhaps the most powerful in American local government and immediately reshape California politics.
Members of a 13-member task force met for the first time Friday to begin the process of implementing Measure G, including to establish the powers that will accompany the new county-executive office. Nothing concrete was decided at the meeting, which served as something of a victory lap for the supervisors who asked voters to rethink a body long criticized as distant and unaccountable.
'I want to thank the voters of Los Angeles County who decided that this reform was necessary and made it happen, because all of us want to see change in how we do this work,' said Supervisor Lindsey Horvath, who led the 2024 campaign and said she's thought about a run for the county-executive position when it is first filled by voters in November 2028.
POSTCARD FROM ...
… MENLO PARK: Residents of this Silicon Valley city may soon be asked to choose whether they want to prioritize parking or affordable housing in their quaint downtown business district. The parking lots seem to be winning.
Earlier this month, a group of local retailers began organizing a signature drive for a ballot measure that would require voters to approve any effort to convert Menlo Park's downtown parking plazas for another use.
The lots, on four parcels owned by the city, sit behind the businesses on Santa Cruz Avenue, Menlo Park's primary commercial corridor. On weekday afternoons and weekends, the 300-some parking spaces fill up with customers who come to patronize the grocery stores, bagel shops and banks on the main strip. But in recent months, the Menlo Park city council has begun soliciting development plans to build apartments on those plots as a way to fulfill its state housing requirement.
Retail businesses quickly pushed back by forming the Save Downtown Menlo alliance and filing a lawsuit that argued the city lacked legal authority to develop the parking lots. Soon after, the group began collecting signatures for the ballot measure requiring voter approval for such projects. (The group did not reply to requests for comment.)
'If these plans move forward, the Downtown we know will be changed forever,' the group wrote on its website. 'More traffic, fewer small businesses, and less access for everyone who depends on it.'
Menlo Park Mayor Drew Combs says the council's plans to develop downtown housing have been even more controversial than he expected, with the city's first meeting on the topic drawing more public commenters than any other item of his 8-year tenure in city government. He has no doubt that the group will gather enough signatures to put the parking-lot question before voters.
'Job rich communities with high quality schools, those communities have an obligation to address a housing shortage,' said Combs, who has not taken a position on the proposed ballot measure. 'But we also have an obligation to listen to voters and residents.'
With their affluent constituents in open revolt, Menlo Park's leadership is taking a delicate approach. Tomorrow, the council will give direction to staff on how it wants to proceed with the development proposals. Combs, at least, seems interested in slowing down a process that could result in two separate ballot questions before the city can move ahead with construction.
'I think there's some validity to the argument that maybe we should look at pausing and checking in with residents,' Combs said. 'Seeing if there is a path forward that doesn't divide the city, but that actually produces housing as quickly as possible.'
THAT TIME VOTERS ...
… PREPARED FOR A COLLISION: Californians have seen ballot measures on a wide variety of questions related to car insurance, including to:
Provide motor vehicle insurance discounts for good drivers, provide comparative auto insurance prices and prohibit discrimination and price-fixing by insurance companies (1988, failed) … Require insurers cut rates by at least 20 percent and that insurance commissioners approve future rate changes (1988, passed) … Replace private car insurance with a state-administered program of required, basic insurance and create an 'automobile claims court' for claims of up to $15,000 (1990, did not qualify) … Require no-fault car insurance, meaning a person's car insurance would pay for personal injuries resulting from an accident (1996, failed) … Repeal laws requiring every driver to maintain automobile liability insurance (2010, did not qualify) … Allow car insurance companies to increase or decrease rates based on the years and miles a customer has driven (2010, failed) … And allow car insurance companies to set prices based on whether the driver previously carried insurance coverage with any company over the last five years (2012, failed).