LOS ANGELES -- The Paul Gann's Citizens Committee missed a recent deadline to put its taxpayer's Consent Act on the November ballot in California.
The group is now targeting the state's March 1996 election for the proposed initiative, which would impose strict voting requirements on most local debt.
"It was kind of impossible, but we were trying anyway," said Sherry Curtis of the Gann group. "We were trying for an absolute miracle."
The May 15 deadline for gathering enough voter signatures apparently became an unrealistic goal after the organization was forced to pull its original measure to correct a flaw, and then resubmit the initiative in February.
"They lost 30 valuable days they needed to get it on the ballot in November," said Joel Fox, president of the Howard Jarvis Taxpayers Association.
The Gann initiative would impose a two-thirds voting requirement on virtually all local bond issues and certificates of participation. The measure is designed to prohibit local governments from raising taxes and issuing any form of short- or long-term debt, including notes, without a vote.
The organization has gathered more than half of the 615,958 signatures necessary to put the initiative on the ballot for the next regularly scheduled election in 1996, Curtis said. July 22 is the cut-off date for the Gann organization to get the signatures.
One reason the Gann organization failed to reach its signature goal was a lack of full support from the Jarvis taxpayers' group, Curtis said.
"The Jarvis people were not circulating this ... we would have hoped they would," Curtis said. "They were just dealing with the assessment issue."
On the contrary, Fox responded, the Jarvis association contributed money to the Gann campaign, mailed out information explaining the Gann initiative, and helped the Gann organization in drafting the initiative.
However, the Jarvis group also is working simultaneously on an initiative that would compete with the Gann effort on the March 1996 ballot. There is a possibility that the two organizations may work together on a single taxpayers' initiative, Fox said.
The framework for the Jarvis initiative is contained in Assembly Constitutional Amendment 43, which is awaiting a hearing in the Assembly's Local Government Committee.
The measure would impose voting requirements on assessment districts, which is the same vision the Jarvis group had with two bills it sponsored last year. Both died in the legislative process. The Jarvis group has threatened to go the initiative route if legislators fail to approve ACA 43 for the state ballot.
A difference of opinion between the Gann and Jarvis organizations over several aspects of tax reform still stands in the way of their joining forces, according to Jonathan Coupal, director of legal affairs for the Howard Jarvis Taxpayers Association. One of their differences concerns the practicality of a two-thirds vote requirement on certificates of participation.
"We want to make sure that an initiative does not go too far and that it doesn't impose too many restrictions ... on the issuance of debt," Coupal said during an interview earlier this year.
The fact that the Gann initiative is too far along in the process for the organization to amend its current proposal is another hindrance to the two groups' working together.
"Richard [Gann] is not in a position to change the text of his measure if we were to want to go in a different direction, which is likely," said Coupal. "There is nothing we could do to combine the two, unless he abandons this and we work on another one."
Richard Gann is the son of the late Paul Gann, a co-author of Proposition 13, the landmark 1978 tax limitation initiative. The Jarvis group is named after the late Howard Jarvis, the other co-author of Proposition 13.
Opponents seemed relieved to hear that the Gann initiative failed to make the May 15 deadline. They interpreted the delay as a sign that the measure may never get to the ballot.
"On behalf of our clients, we're pleased to hear that this attack ... is stalled," said William Madison of Jones, Hall, Hill & White, who has been monitoring the progress of the Gann initiative. "In can only speculate as a member of the public, but the Gann people are pretty organized, and if they've already exhausted their usual network of support, it doesn't look real good for them to collect the rest of the signatures in two months."
Madison questions whether voters would support the initiative in any event, partly because he believes the issues that the current proposal addresses are not "hot buttons" for Californians.
"I'm reasonably confident that even if it makes it to the ballot, voters will be able to sort out that this is not really a problem," he said.
Madison said that portions of the Gann initiative are contradictory to years worth of "reasonable" California laws. One example, he said, is language in the initiative that would require voters to approve tax and revenue anticipation warrants.
"This would take away control from local government," he said. "[They] want every financial obligation whatsoever to be approved by voters."
If the measure does gather enough signatures to get on the ballot and voters approve it, the Gann initiative will change the "whole financial landscape," he said.
Mary Moore is senior editor of California Public Finance, a Bond Buyer weekly newsletter.
