Taxpayers: Are You Getting Your Money’s Worth?

Rampant corruption in Sacramento.  Politicians beholden to special interests. Dominant corporations wielding enormous influence over the Legislature.  Ordinary Californians struggling to make their voices heard.  

Sound familiar?

The year was…1911.  

California’s audacious answer was to take power from Sacramento and give it directly to the people through the initiative process.  It was a profound transfer of political power built on a simple premise: voters themselves can make consequential decisions about their government–if they have the right information. 

Fast-forward 115 years.  

Californians confront Voter Information Guides that feel larger than a phone book, while millions of dollars in campaign advertising compete to shape how voters interpret what is inside.  The question is no longer whether voters have power at the ballot box, but whether they have enough independent information to exercise that power wisely.

That is where Proposition 41’s performance audit provisions come in.

Justice Louis Brandeis famously observed in 1913 that sunlight can be a powerful disinfectant for public funds.  The Golden State could use more of it.  A $350 billion government that has grown over 50% since the pandemic began makes it increasingly difficult for taxpayers to determine whether programs achieve their objectives, spend efficiently, and deliver meaningful results.

Proposition 41, the Prohibit Excluding New State Taxes from Spending Limit and Require Special Tax Audits Initiative, requires the independent, nonpartisan California State Auditor to examine programs that would receive money from new or increased special taxes proposed through voter initiatives.  Think of it as a pre-purchase inspection before buying a car.  Before Californians approve a new tax, they would receive an independent examination of the programs asking for their money and an executive summary in the Voter Information Guide.

Yes, the Guide could grow several pages longer.  But those pages would contain something incredibly valuable in modern political campaigns: information at a voter’s fingertips produced neither by the campaign asking for money nor the campaign opposing it.  

And the scrutiny would not end when voters approve the tax. 

Programs receiving revenue from new or increased special taxes would face another audit every four years after passage.  That would allow Californians to compare promises with results and identify opportunities to operate more efficiently. 

These would not be “check-the-box” financial audits.  The State Auditor would examine objectives, oversight, performance measures, costs, and return on investment.  Programs would report actual fraud, waste, and abuse, while costs will be compared with private-sector peers and audits would include recommendations to improve efficiency.

Continuous improvement and accountability protect taxpayer dollars, while improving the support provided to those who need it most. 

Nothing makes the case for independent performance audits more clearly than California’s high-speed rail project.  In 2008, voters narrowly approved $10 billion in bonds for a project whose costs have more than tripled while completion timelines have stretched by decades.  The California State Auditor has documented significant concerns involving oversight, contract management, cost overruns, and delays.

High-speed rail is not the only place where stronger accountability is critical. Recent headlines and high-profile arrests involving alleged fraud in California’s hospice and homeless services underscore the importance of ensuring public dollars deliver the services they are intended to fund.

Protecting taxpayers while ensuring that our most vulnerable residents receive services efficiently and effectively should be a principle that transcends political ideology.  

These audits will cost us money and produce savings only if the State Auditor’s recommendations are implemented.  Independent oversight has a cost—and so does government failure.

  Californians routinely vote on multi-billion-dollar financial decisions – they deserve more than glossy campaign mailers and slick televisions advertisements.  Independent information is the most powerful tool voters have to properly exercise their electoral power.

California’s initiative system was founded on a simple idea: 

Trust the people.

Proposition 41 adds an equally important principle:  

Give them the facts.

Mark Wille serves as Vice Chair of the Investment and Audit Oversight Committee for the County of Orange. He is a licensed CPA and former chair of the California State Accounting Principles and Auditing Standards Committee. Mark previously worked as an audit accountant for Arthur Andersen, Vice President of Finance for one of Southern California’s largest commercial real estate brokerages, and started a private professional services firm focused on finance and tax issues. He holds a B.A. from the University of Southern California and Th.M. from Fuller Theological Seminary.