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Passage of Proposition 26 Alters Future of Regulatory Fees in California

December 15, 2010

By Jill E.C. Yung, Sanjay M. Ranchod & Gordon E. Hart

On November 2, 2010, California voters approved Proposition 26, an initiative that broadens the definition of taxes to include many regulatory fees currently imposed by the State of California and its municipalities. This change will make enactment of regulatory fees more difficult by requiring a supermajority vote of the State Legislature or, in the case of local fees, direct voter approval. The regulatory fees affected by Proposition 26 fund many of Californias environmental and other regulatory programs, and they include fees imposed in 2010.