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A Hostile Legislative Environment

Proposition 99 arrived at the Legislature with some controls in the form of specific accounts, each with a percentage allocation. Even so, the Legislature was still responsible for deciding which agencies would run the programs, the forms those programs would take, and the allocations to those programs. The text of Proposition 99 had been worded as simply as possible to build support with the voting public. This brevity and simplicity, while keeping the initiative clear for the voters, meant that the initiative was not written to withstand the special-interest lobbying and legislative manipulation that would greet it at the Legislature.

Five realities about the California Legislature were particularly relevant to Proposition 99.

First, the tobacco industry was a major political player in the Legislature. There had been no tax increase on tobacco for over twenty years, reflecting the power of the industry and the weakness of the voluntary health groups. The tobacco industry had spent $21 million in its unsuccessful bid to defeat Proposition 99 and was not likely to turn a blind eye to its implementing legislation. The industry responded to Proposition 99 by increasing its already substantial lobbying presence and campaign contributions to members of the California Legislature. In the 1985-1986 election cycle, before Proposition 99 passed, the industry had spent only $274,394 on campaign contributions and lobbying in California. In 1987-1988, when ACA 14 (Proposition 99's legislative predecessor) was being considered by the Legislature and when Proposition 99 passed, expenditures for industry lobbying and campaign contributions increased to $2,818,534 (excluding the $21 million the industry spent trying to defeat Proposition 99 at the polls); in 1989-1990, when the Legislature was considering the legislation to implement Proposition 99, they jumped to $4,077,264.[16]

Second, no health organization with a California lobbying presence was dedicated solely to tobacco issues, which meant that every organization lobbying for Proposition 99 programs had to consider how its stance on Proposition 99 might affect its relationship with the governor and the Legislature on other matters. The primary organizations with an interest in tobacco control (ALA, ACS, and AHA) had only a limited lobbying presence in Sacramento, consisting of one or two full-time lobbyists, and these organizations had not traditionally been willing to adopt strong positions or risk making enemies.[17][18]


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Third, the California Medical Association (CMA) and the California Association of Hospitals and Health Systems (CAHHS) were powerful players in Sacramento as a result of their large campaign contributions and extensive information resources. While these organizations paid lip service to anti-tobacco activities, these activities were of minor importance compared to economic issues affecting their members. The dominance of economic issues over public health issues was starkly illustrated by the CMA's collaboration with the tobacco industry in 1987 to pass the Napkin Deal, with the attendant “tokenizing” of support for Proposition 99.

Fourth, within the Legislature, led by Assembly Speaker Willie Brown (D-San Francisco) and his longtime aide, Steve Thompson, there was a core of liberal Democrats who were committed to funding health care for children and who were likely to see new monies as a route to doing this.[19] As of 1988, the tobacco industry had given Willie Brown $124,900 in campaign contributions, more than any other member of a state legislature in the United States and more than the tobacco industry had given many members of Congress. Moreover, contributions to Brown from the industry increased rapidly after Proposition 99 passed; by the time he left the Legislature in 1996, Brown had accepted $635,472 in tobacco industry campaign contributions.[16][20] There was a natural confluence of interests between Brown, Thompson, the CMA (another major source of campaign contributions to Brown), and the tobacco industry in shifting anti-tobacco education money into paying for medical services for poor children. This axis was continued after Thompson left Brown's staff in 1985 to become the head of the Assembly Office of Research. According to Thompson, in 1989 he “basically was representing the position of the Speaker's office. …I did most of the health advising for their office. So I was basically speaking for them on this issue [Proposition 99].”[14] The ties between Brown, Thompson, and the CMA became even stronger in 1992, when Thompson left the Legislature to become vice president and chief lobbyist for the CMA.[19][21]

Joining the CMA, CAHHS, and Brown in their interest in health care for children was the highly regarded lobbyist Peter Schilla, of the liberal advocacy group Western Center for Law and Poverty, whose priority was to increase health care for poor people. Although the Western Center was not involved in the initiative campaign, Schilla was very influential with liberal members of the Legislature, particularly on issues related to health care for the poor. John Miller, chief of staff for Senator Diane


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Watson (D-Los Angeles), and Mary Adams, the AHA's lobbyist, shared the opinion that Schilla was one of the major forces behind Proposition 99's implementing legislation. Miller later recalled that Schilla “never cared much about health education, but he did care about funding the other programs. And he was putting it all together and knew we needed to be placated and so he did some of that.” Adams agreed, saying, “I recall personal conversations that I had with John Vasconcellos [D-San Jose, a prominent liberal member of the Assembly] about the overarching Prop 99 accounts. I was really surprised at the information that he had and asked him where he got it. And he said from Peter Schilla…it was already very clearly thought out, not just that but then one step more.”[15]

Fifth, the Legislature was hostile toward Proposition 99 because it earmarked money; it represented voters' restrictions on legislative decisions concerning the funds and thus limited the Legislature's fiscal prerogatives. As John Miller commented, “They despise it. And it is a built-in antagonism. A serious one.”[22]

Within this hostile environment, the answers to three key questions would determine the fate of Proposition 99 in the Legislature.[23] First, would Proposition 99 advocates be able to maintain the source of their power—public opinion? Second, would they be able to advocate sound proposals for spending the tax revenues and to keep the issue framed as “following the will of the voter”? Third, would program advocates find a leader for their cause, an “entrepreneur” who could recognize opportunities to act and who had a commitment to challenge the status quo? Without an entrepreneur to identify opportunities to act, to guide legislation, and to be confrontational within the process, Proposition 99 was likely to have difficulties surviving in the Legislature.[24]


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