The Senate's Homelessness Proposal May Need To Go To The Ballot

A budget plan by California senators to reduce homelessness has a potential hitch — it may require voter approval.

The plan, outlined by Senate President pro Tem Kevin de León (D-Los Angeles) on the first day of this year's legislative session, would fund $2 billion in new housing for homeless people with mental illnesses. It's drawn the support of some Republicans in addition to majority Democrats.

To finance those bonds without raising taxes or spending, the plan would use Proposition 63 funds — a 1 percent tax on earnings over $1 million, which voters approved in 2004 for county mental health programs. Senators say they could pass the plan through the Legislature with a two-thirds vote.

But the housing bond idea is not new. Proposition 63 author Darrell Steinberg, the former Senate leader who's currently running for mayor of Sacramento, first proposed using its funds to finance bonds ten years ago. The state Attorney General's Office analyzed whether it could be done without voter approval. 

In an advice letter, the attorneys cautioned they could not certify the bonds would be constitutional.

The letter says voters were never asked to approve bonds, which would remove flexibility the ballot measure promised.

Steinberg disagrees with the opinion. He says a primary intent of Proposition 63 was to fight homelessness and the bond plan would more effectively do that.

"It was not specifically laid out in the initiative, but it is the issue we campaigned on — this was the motivation," says Steinberg.

But the state gave up the bond idea. Instead, then-Gov. Arnold Schwarzenegger directed $400 million from Proposition 63 into a state homeless housing program. Those funds are projected to run out next year.

A decade later, Steinberg is once again backing the housing bond idea — this time, it's the Senate proposal. He says he's confident a judge would uphold the measure.

"I’m very comfortable with it, and if there is any dispute, I look forward to being the first witness," Steinberg says.

Read The Full Advice Letter Here 

He could be called in. If lawmakers do pass the housing proposal, they’ll likely seek a court’s blessing before issuing the bonds, to ensure creditors are willing to buy them.