Measure To Repeal Employer-Sponsored Benefits Law May Appear on March Ballot
Californians Against Government Run Healthcare, a coalition of business groups led by the California Chamber of Commerce, on Monday announced that it has collected more than 620,000 signatures to place a referendum on the March 2004 statewide ballot to repeal a law (SB 2) that would require some employers to provide health coverage to workers or pay into a state fund that would provide such coverage, the San Francisco Chronicle reports. Election officials must certify 373,816 signatures to qualify the repeal measure for inclusion on the ballot (San Francisco Chronicle, 12/2). SB 2, scheduled to take effect Jan. 1, 2006, mandates that employers with 200 or more employees provide health coverage to workers and their dependents by 2006 to avoid paying into the fund; businesses with 50 to 199 workers will have to offer health insurance only to employees by 2007; and employers with fewer than 20 workers will be exempt from the law. Those with 20 to 49 employees will be exempt from the law unless the state provides tax credits to offset the cost of health benefits. Employers who already offer health benefits that comply with the new law can continue offering those plans provided that the plans meet the law's minimum requirements. Former Gov. Gray Davis (D) signed the law in October (California Healthline, 11/26). Spokesperson Vince Sollitto said that Gov. Arnold Schwarzenegger (R) supports the referendum (San Francisco Chronicle, 12/2). The secretary of state has 68 days to certify the signatures (Gittelsohn, Orange County Register, 12/2).
The coalition, which includes the California Restaurant Association, the California Taxpayers Association, the California Retailers Association and the California Business Properties Association, has spent about $1.5 million to get the signatures and plans to invest another $15 million between now and March to campaign for the repeal. The Sacramento Bee reports that business groups also plan to oppose SB 2 in state court by arguing that the fees companies will have to pay for health insurance are "essentially a tax that did not get the two-thirds vote in the Legislature required by the State Constitution" (Rapaport, Sacramento Bee, 12/2). The California Labor Federation, AFL-CIO said it is considering a legal challenge of the wording of the coalition's petition, saying it "misrepresent[ed] the fact that businesses with 20 to 49 employees will be exempt from the program until the state can afford to give them a tax credit to relieve at least some of their higher costs," according to the Los Angeles Times. Supporters of the law also said that signature gatherers misrepresented the purpose of their petitions (Jones, Los Angeles Times, 12/2). Nathan Ballard, a spokesperson for the federation, said, "They got this on the ballot under false pretenses. We got calls from people all over the state who said that signature gatherers said it was to provide more health care when it takes health care away" (San Francisco Chronicle, 12/2). He added, "It's going to be a tough battle, but we'll put together a coalition of doctors, health care advocates, community groups and business to protect this law" (Silber, Contra Costa Times, 12/2). Sara Lee, a spokesperson for the chamber of commerce, "denied that signature gatherers misled voters," according to the Chronicle (San Francisco Chronicle, 12/2). Senate President Pro Tem John Burton (D-San Francisco), who sponsored the legislation, said supporters of the law are preparing a legal challenge keep the measure off the ballot because the petitions circulated did not accurately reflect the law's provisions (Sevrens Lyons, San Jose Mercury News, 12/2).
Allan Zaremberg, president of the chamber of commerce, said, "Stopping this mandate and tax ... will be a major step toward restoring faith in California's economy and job climate" (AP/San Diego Union-Tribune, 12/2). He added that the coalition should have "enough signatures to qualify for the March ballot" (Los Angeles Times, 12/2). "Californians will now have an opportunity to overturn [this law], which would impose billions of dollars of new taxes on workers and employers," John Dunlap, president and CEO of the restaurant association, said (Sacramento Bee, 12/2). But Art Pulaski, executive secretary-treasurer of the California Labor Federation, AFL-CIO, called the referendum "an attempt to undo an important law that protects working families who will get health care from their employers" (Los Angeles Times, 12/2).
"The sooner the state abandons the illusion" that SB 2 will address the state's "health care crisis," the "sooner it can begin the effort to arrive at a realistic long-term solution," a Mercury News editorial states. "Mandating employers to provide health care for their employees makes as much sense as forcing businesses to provide other essentials, such as housing or three square meals a day," according to the editorial (San Jose Mercury News, 11/28).
Additional information on SB 2 is available online.