Setting Aside Politicians: The Effects of Set-Aside Initiatives on California's Local Governments

Abstract

THE CALIFORNIA Journal of Politics & Policy Volume 2, Issue 1 Setting Aside Politicians: The Effects of Set-Aside Initiatives on California Local Governments Nicholas Hromalik University of California, San Diego Abstract Through direct democracy, California voters pass local and state initiative mea- sures, assuming the role of the legislature and many times mandating how gov- ernment should act or spend funds. But are voters really getting what they want through the initiative process? Initiatives known as “set-asides” provide a unique aspect of local direct democracy to study because they interact with fiscal policy differently than other ballot measures. A set-aside initiative directs a local govern- ment to spend money on a specific program without identifying a new source of revenue. This study analyzes the effects that set-asides have on local fiscal policy. It asks whether local governments respond to set-asides either by spending more overall or by taking funds from one service to increase spending on another. It finds that the passage of set-asides causes cities to spend and tax more than cities with- out these ballot measures. There is no preponderance of evidence to suggest that governments take from one service to meet the mandated funding of a set-aside. Instead of “robbing Peter to pay Paul,” they impose slightly higher taxes on all. Keywords: initiative, local government, direct democracy, fiscal policy, set-aside www.bepress.com/cjpp