The wild budget rumpus is about to begin in earnest. Senate President pro Tem Darrell Steinberg’s bill to give counties and school districts broader power to push for new taxes is headed to the Senate floor for a vote. SB 653 was among dozens of bills taken off the suspense file and passed Thursday by the Senate Appropriations Committee.

Steinberg’s bill, which he’s dubbed “Let the people decide,” would allow counties, K-12 and community college school districts, and county offices of education to place measures on the ballot to fund schools through a variety of tax hikes including:

• Property taxes
• Personal income taxes
• Business activities taxes
• Vehicle license fees
• Excise taxes on a range of items “including but not limited to a local oil severance tax, a local alcohol tax, a local cigarette and tobacco tax, a local soda tax, and a local medical marijuana tax,” according to a fact sheet from the senator’s office.

Steinberg has been quite clear about his reasons for introducing the bill. “I put forward this bill for a substantive reason and for a tactical reason,” reported San Francisco Chronicle editor John Diaz last weekend.

The tactical, of course, is leverage with the Republicans if they continue their path of resistance against letting voters decide whether to extend some tax increases in order to close the remaining $10 billion budget gap. Although he didn’t come right out and say it’s a bargaining chip, Steinberg spokesman Mark Hedlund noted that Republicans are calling for pension reform, a spending cap, and some regulatory reform. With the budget deadline of June 15^th within sight, “there’s going to be a lot of moving parts over the next three weeks,” said Hedlund. “There is a lot of compromise and a lot of negotiating and a lot of give and take involved in the budgetary process, so it’s just hammering out the details.”

The substantive reason is the one raising alarm with businesses. The California Chamber of Commerce lists SB 653 on its annual job killer list. “No business will have any certainty or be able to plan on what its tax liability will be in the future,” wrote Chamber President and CEO Allan Zaremberg on the Chamber’s website. “The type of tax imposed under this bill would be limited only by the imaginations of a local government and the special interests. It’s a real barrier to job creation and investment in California.”

In a letter to Steinberg, endorsed by 40 trade and advocacy groups, the California Taxpayers Association warns that changing the tax structure by taking power away from the state and giving it to local jurisdictions would create a bureaucratic mess, place the state’s long-term economic growth in jeopardy, and create an inequitable tax structure.

As Torey Van Oot reported in a recent Sacramento Bee CapitolAlert column, opponents have begun an ad campaign against the bill and promise to ramp it up if necessary. Steinberg called the arguments “scare tactics.”  Spokesman Hedlund said that while they admit that SB 653 “may not be the most perfect alternative, it would allow county residents or people who live in school districts options to provide adequate funding for public education or public safety or other vital services that are going to be harmed by an all-cuts budget. The pro Tem’s feeling is that he wouldn’t be a good leader if he didn’t explore other options.”

One issue that opponents haven’t seized on is whether SB 653 faces a run-in with the 1970s Serrano v. Priest rulings. In three rulings during the decade, the State Supreme Court found the existing school financing system unconstitutional because it violated the Equal Protection Clause of the State Constitution. Ironically, that inequitable funding system was based on local property taxes; Serrano transferred education financing to the state. By giving local jurisdictions more tax authority to fund schools, SB 653 could inadvertently return schools to the days when school quality was dependent on the wealth of the community.