The state ballot measures the business community should watch in the 2020 election

Our mission to help you navigate the new normal is fueled by subscribers. To enjoy unlimited access to our journalism, subscribe today. It’s not just politicians who will be on the ballot in November’s upcoming election. Across the country, state and local governments are giving Americans a chance to vote on […]

Our mission to help you navigate the new normal is fueled by subscribers. To enjoy unlimited access to our journalism, subscribe today.

It’s not just politicians who will be on the ballot in November’s upcoming election. Across the country, state and local governments are giving Americans a chance to vote on hundreds of ballot measures—propositions, initiatives, and referendums that give citizens an opportunity to directly approve or reject laws that are being proposed in their communities.

Ballot measures can relate to a wide array of issues, from taxes and election rules to criminal justice policy and the legal status of certain substances and activities. Whatever the matter at hand, they’re one of the few avenues for what’s called direct or pure democracy in the United States—a way for Americans to have a direct say in the laws that govern their land, rather than relying on elected representatives to craft and enact them instead.

Of course, that’s not to say ballot measures are devoid of the special interest–fueled maneuvering that so characterizes our political process. To the contrary, they’re often a means by which interest groups across the spectrum manage to float policies that they would like to see adopted—with those groups often pouring millions of dollars into campaigning for, or against, their adoption. Just ask voters in California, where 12 statewide propositions are on the ballot this November; those measures have commanded more than $700 million in combined campaign contributions, resulting in an onslaught of advertising on TV, radio, online, and virtually anywhere else Californians care to look.

In the end, it’s up to the voters to carefully consider each question on the ballot, weigh up the pros and cons, and cast their vote (or not, if they so choose) as they see fit. In the meantime, here’s a look at some of the most notable, consequential—and, indeed, expensive—statewide ballot measures across the country in this fall’s election.

Proposition 22 (California)

Prop 22 has been inescapable for Californians this election season, and for good reason: Gig economy giants like Uber, Lyft, and DoorDash have driven most of the roughly $200 million in contributions supporting the measure—making it the most expensive ballot initiative in California history, and by far the most expensive in the country this year. (Opponents have poured $19 million into beating Prop 22, taking total funding to more than $218 million to date).

Why have those companies spent so much on making Prop 22 a reality? Because the measure is very much a product of their efforts to work around California state labor laws that require them to offer certain employment benefits—including overtime pay, health care coverage, and unemployment insurance—to their fleet of drivers. Prop 22 would exempt app-based transportation and delivery companies from having to do so, by instead allowing them to designate their drivers as “independent contractors”—an arrangement that supporters claim would give those employees added flexibility, while relieving employers of the burdensome costs associated with the state’s employment laws.

Despite the overwhelming financial advantage offered by the measure’s proponents, polls indicate that it’s a close race for Prop 22, which will need a majority of more than 50{429fc2506e610357e12b2a5665db82631200a2e00b3a1d8839077d76f18e2e8b} of the vote to pass. The most recent poll conducted by the University of California at Berkeley’s Institute of Governmental Studies depicts a 46{429fc2506e610357e12b2a5665db82631200a2e00b3a1d8839077d76f18e2e8b} to 42{429fc2506e610357e12b2a5665db82631200a2e00b3a1d8839077d76f18e2e8b} advantage for “Yes” on Prop 22, with 12{429fc2506e610357e12b2a5665db82631200a2e00b3a1d8839077d76f18e2e8b} of respondents undecided.

Marijuana legalization measures (recreational: Arizona, Montana, New Jersey, South Dakota; medical: Mississippi, South Dakota)

The recreational use of marijuana is now legal in 11 states plus the District of Columbia, while medical marijuana is permitted in 33 states plus D.C. Five states may potentially join their ranks this fall, should voters vote in favor of legalization.

Arizona, which legalized medical marijuana in 2010, could pass recreational use via Proposition 207. It is the second time in four years that voters in the state are considering a recreational cannabis measure, after a previous measure was defeated in 2016.

After passing medical marijuana in 2004, Montana voters will decide this fall on I-190, a ballot initiative that would legalize recreational use in the state. And New Jersey could become the first mid-Atlantic state to legalize recreational cannabis via Public Question 1; the state legalized medical use, albeit for a limited number of medical conditions, in 2010.

Elsewhere, voters in South Dakota will consider separate ballot measures that would legalize both recreational and medicinal cannabis use, while those in Mississippi will vote on a proposal to permit medical use in the state.

All of these marijuana ballot measures would see the states in question impose sizable taxes on the sale and distribution of cannabis in their jurisdiction—a potential boon for those states’ coffers, at a time when many budgets are strained owing to the economic impact of COVID-19.

Graduated income tax amendment (Illinois)

There’s only one statewide measure on the ballot in Illinois this fall—but it’s a major one that could potentially overhaul the state’s tax code.

The Illinois Allow for Graduated Income Tax Amendment would repeal a 50-year-old constitutional requirement that the state impose a flat personal income tax rate (currently 4.95{429fc2506e610357e12b2a5665db82631200a2e00b3a1d8839077d76f18e2e8b} in Illinois), regardless of income. The measure, which is supported by Democratic Gov. J.B. Pritzker, would allow the state to enact legislation imposing a graduated income tax rate consisting of six tax brackets determined by income, similar to how federal income taxes are collected.

Support for and opposition against the ballot measure is heavily partisan, with Illinois Democrats mostly in favor and Republicans overwhelmingly against. That’s translated to donors opening up their pocketbooks in the hope of enacting or defeating the measure: More than $110 million has been contributed to the campaigns in favor and against the Graduated Income Tax Amendment, making it by far the most expensive ballot measure outside of California’s. While supporters have thus far outraised the opposition by around $10 million, opponents have had the help of Citadel hedge funder Ken Griffin, who has poured nearly $47 million of his own money into defeating the amendment.

“Right to Repair Law” Vehicle Data Access Requirement Initiative (Massachusetts)

This is a wonky one, but it essentially shapes up as a battle between independent automobile service providers in Massachusetts and major car manufacturers like General Motors, Toyota, and Ford.

Question 1, as it’s known, would require car manufacturers who sell vehicles with telematics systems—which electronically collect data about the vehicle’s functions—to equip those systems with a standardized open data platform. That would enable car owners and independent repair facilities to access the car’s mechanical data and electronically diagnose and repair any issues, rather than restricting that data to carmakers and their dealerships.

More than $50 million has been poured into both sides of the initiative—with the opposition, a coalition including the aforementioned automakers, narrowly outraising proponents who include Advance Auto Parts, O’Reilly Auto Parts, and AutoZone. The supporting Right to Repair Coalition claims the measure is about ensuring consumers have the right to take their vehicles to independent mechanics rather than having to rely on costlier dealerships, while the opposition Coalition for Safe and Secure Data is positioning the matter as a data privacy issue.

Proposition 23 (California)

Right next to Prop 22 on Californians’ ballots is Prop 23, also known as the Dialysis Clinic Requirements Initiative. The ballot measure would require kidney dialysis clinics in state to always have a licensed physician on-site during operation, report data on dialysis-related infections to regulators, obtain consent from the state before closing a clinic, and also prevent them from denying or discriminating against patients based on their source of payment or health care coverage.

Of the nearly $115 million in total contributions raised to date, the overwhelming majority (more than $105 million) has flowed to the opposition, with a huge chunk of that funding coming from dialysis care providers DaVita and Fresenius. Meanwhile, the proposition is very much backed by the powerful SEIU-UHW health care labor union, which two years ago proposed a separate California ballot initiative targeting dialysis clinics that was heavily defeated.

While Prop 23 promises added oversight of dialysis clinics and has garnered the support of the state’s Democratic Party, opponents claim the measure is unnecessary and would result in added red tape that would raise heath care costs and make it harder for tens of thousands of dialysis patients to get the care they need. SEIU-UHW has also been criticized for deploying the state’s ballot measure system to advance its own union organizing goals.

Minimum wage initiative (Florida)

If it passes, Florida Amendment 2 would see the Sunshine State incrementally increase its minimum wage—presently set at $8.56 an hour—to $15 an hour by 2026. The state’s minimum wage would first be raised to $10 an hour in September 2021 and gradually tick upward by $1 per year for the following five years.

Amendment 2 has drawn nearly $6 million in campaign contributions to date, with the vast majority ($5.3 million) raised in support of the measure—thanks in large part to the $4.2 million donated by Florida attorney John Morgan and his law firm. Opponents include numerous business and industry groups, including the Florida Home Builders Association and the Florida Restaurant and Lodging Association.

More from Fortune’s special report on what business needs from the 2020 election:

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BP shares now yield 8{429fc2506e610357e12b2a5665db82631200a2e00b3a1d8839077d76f18e2e8b}! Are they too cheap to ignore?

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