The election is coming up fast, and one item on the ballot is making a lot of headlines—Prop 40. This proposition is asking voters to approve a first-of-its-kind wealth tax on billionaires. Most of that money would go to healthcare, but could this measure also help California’s schools? Well It depends on who you ask. Education reporter Taylor Barton has been digging into the issue, and shares what she found.
This conversation aired in the October 22, 2026 episode of Crosscurrents.
Conversation transcript:
Hana Baba: So why do educators care so much about Prop 40?
Taylor Barton: Even though this is only a one-time, 5% tax on billionaires, it could end up meaning a lot of money for California’s public education.
H: But I thought this tax was supposed to fund healthcare?
T: Yes! So the lion’s share – 90% – of the money would go to healthcare – the idea with that is to make up for state revenue lost to Trump’s “Big Beautiful Bill,” which has dramatically cut California’s healthcare budget.
H: But you’re saying some of it would go to education?
T: So 10% of this proposed wealth tax would go to education and food assistance.
H: Okay so a pretty small portion.
T: Right, it’s only 10%, but remember that’s 10% of a huge pot of money. The state estimates that Prop 40 would rake in tens of billions of dollars — billions with a B — if it passes.
H: So it sounds like that would be good for schools.
T: Some educators think so!
Schools are dealing with a lot of financial uncertainty between HR 1 and federal budget cuts. Look, SFUSD alone is facing $10M in federal cuts this fiscal year.
And in SF thousands of students rely on Medi-Cal and food benefits. That support is way less predictable now.
Now – It’s important to note that we don’t know how much of that 10% will go to schools vs. food programs. The measure’s text doesn’t specify, it’s up to policymakers.
But the United Educators of San Francisco, the biggest teachers union in the area, endorsed Prop 40. So did the statewide California Federation of Teachers. and the union that supports school service workers.
But Hana, this is where it got weird. Educators are not all aligned on this. In fact they seem to be kind of split.
H: Why is that weird?
T: They’re being pretty tight-lipped about it, a lot of my usual sources did not want to go on the record.
But the California Teachers Association, the largest teachers union in the state, is against Prop 40. They’re siding with other unions representing education admin workers and school boards.
H: They don’t think this is a good idea?
T: It’s more that they don’t think it’s the right way to fund education.
Most of the money for public schools and community colleges in California comes from this law that passed in the eighties – they call it the Prop 98 Guarantee. That law says that schools have to get about 40% of the state’s revenue every year.
And that’s been happening … Except in the last couple of years, the state has underpaid. In fact the CTA is suing the state for delaying those payouts.
So the educators who are against this NEW wealth tax, Prop 40, worry that this big, one-time big lump sum won’t be subject to Prop 98’s guarantee, and might come at a cost to that more stable, ongoing stream of funding for schools.
H: So how could Prop 40 hurt THAT funding?
T: Well, it’s not clear that it would. Prop 40 includes language that says the state can’t use this lump sum as an excuse to shortchange other regular funds for healthcare, education, or food assistance.
But this is why the CTA told me they wouldn’t comment on Prop 40 – they want to focus their energy on winning that lawsuit, and on passing Prop 3. I haven’t heard any educators oppose Prop 3.
H: Wait, what’s Prop 3 got to do with it?
T: It’s the other tax on the wealthy that voters will see on their ballots. A lot of people confuse Prop 3 with Prop 40 – but they’re super different.
Prop 3 is an ongoing tax on income, and it’s actually just to keep in place something that already exists. About half the money currently goes to public education. Whereas Prop 40 is a new, one-time tax on wealth.
H: What’s the difference?
T: Well, wealth goes beyond income. Let’s say you, Hana, are a tech mogul.
Most of your money is not actually cash or a salary. You also have stocks and bonds in tech companies. The value of those investments change depending on the market, but they are part of your total wealth.
H: And Prop 40 would tax me on all of it.
T: Almost all of it. Real estate and most retirement accounts don’t count. But other investments or big assets like fine art do. And when it’s time for you to pay up, they might have to liquidate those assets – sell your stocks, for example. And once those assets are liquid, they’re no longer growing.
H: So billionaires may not like that.
T: Right. And some opponents say: prop 40 might make billionaires leave California. And actually a few already have, like Google cofounders Sergey Brin and Larry Page.
H: But why would that matter for education?
T: Well remember that law I told you about from the 80s that guarantees money to schools every year? Theoretically, billionaires contribute to that through their income. Without them, the regular money that schools are already entitled to every year could shrink.
HANA: Would it shrink a lot?
T: Probably not. That’s the thing – lots of billionaires already find ways to avoid income taxes. Like Mark Zuckerberg famously has a $1 annual salary, even though he’s worth billions. By doing that, he also avoids paying into the ongoing education fund.
Some research has found that California billionaires only contributed a little over 2% of the total income tax revenue in the last few years. The rest is paid by average folks, and their wealth has not exploded the way today’s billionaires’ has in the last few years.
That’s why some educators have told me they support Prop 40, and why the measure was proposed to begin with – they just want the ultra-wealthy to pay their fair share.
H: Okay, you told us about Prop 40 and Prop 3. What else are you watching for in education this election?
T: The state’s top education job – Superintendent of Public Instruction – is also up for grabs, and that’s a pretty surprisingly partisan race. I highly recommend listeners check out kalw.org to learn more about that.
And there are also tons of school board seats changing this year up and down the state. In the Bay, we’re keeping an eye on Oakland and San Francisco Unified School Districts, plus San Francisco’s Community College Board. SFUSD’s Board of Ed especially is a super crowded race, so we’ll be watching to see who comes out ahead there.
HANA: You can hear more of Taylor’s coverage on education, plus our election briefings on all of this year’s ballot measures at KALW.org.
