Gov. Jerry Brown seeks rewrite of tax initiative

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Bowing to pressure from liberal activists, Gov. Jerry Brown is negotiating an eleventh-hour compromise on a November tax initiative, according to multiple sources familiar with the talks.

A deal could be announced as early as today.

The deal would fuse elements of Brown’s current proposal and parts of a ‘millionaire’s tax’ backed by a coalition of liberal groups, including the California Federation of Teachers.

It would contain a smaller sales tax increase than the half-cent hike Brown originally proposed, but would require upper income earners to pay more than the 1- to 3- percentage-point income-tax increase Brown had called for.

For weeks, Brown tried in vain to convince backers of the Federation of Teachers measure to walk away from their initiative and back his. Brown has said multiple tax proposals on the same ballot would confuse or divide voters and doom all measures to failure. Another proposal backed by Pasadena attorney Molly Munger is moving forward but has less public support than the other measures, according to recent opinion polls.

In December, Brown unveiled what he called a balanced plan aimed at attracting Democratic and independent support and neutralizing opposition from business interests -– a five-year tax hike on sales as well as incomes of more than $250,000. Two of the state’s largest business organizations -– the California Chamber of Commerce and the California Business Roundtable -– came out against the Munger and Federation of Teachers initiatives over the last week but were notably mum on the governor’s plan.

But polls showed the governor’s plan would be a tough sell to voters. A recent Public Policy Institute of California poll showed the measure was supported by just 52% of likely voters, with 40% opposed.

The new challenge will be getting the revised initiative on the November ballot. A newly drafted measure must be submitted to the attorney general’s office for review and must gather more than 1 million petition signatures in the coming weeks.

Earlier this week, officials with Brown’s effort acknowledged that those signatures had to be submitted to election officials by early May to ensure those petitions can be counted and verified in time to qualify for the November ballot.

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-- Anthony York in Sacramento