Reed Hastings, co-CEO of Netflix, participates in the Milken Institute Global Conference on October 18, 2021, in Beverly Hills, California. Hastings donated $1 million to oppose Proposition 30 in California.
AFP via Getty Images
In January, venture capitalist Ron Conway donated $50,000 to support Proposition 30, a climate change ballot measure that would raise his taxes. The Silicon Valley veteran is a prominent Democratic donor and has publicly opined on the importance of tech leaders giving back to California. Proceeds from the 1.75% tax increase on income of more than $2 million would go to a state fund for wildfire prevention and electric vehicle programs.
Now, as Californians prepare to vote on Prop. 30 on November 8, Conway has changed his mind.
“Ron contributed very early to Prop. 30 before it had even qualified for the ballot. He is now opposed to Prop. 30 because he believes strongly we can combat our climate crisis and reduce emissions without raising income taxes and hurting California’s economy,” Tony Winnicker, a spokesperson for Conway, tells Forbes.
Conway has company in opposing Prop. 30. In recent months, a group of at least nine tech and venture capitalist billionaires have contributed to the campaign against the measure, albeit in relatively small amounts, according to state filings. Two billionaire partners at VC firm Sequoia Capital—Michael Moritz and Doug Leone (along with Doug’s wife, Patricia)—put in $1 million and $100,000, respectively. Netflix co-CEO Reed Hastings donated $1 million last month. Oakland A’s owner John Fisher and his two brothers, Robert and William, all of who are billionaire heirs to the Gap fortune, donated $1.8 million collectively. Zynga cofounder Mark Pincus contributed about $500,000, private equity billionaire Bruce Karsh $475,000 and Mimi Haas, the billionaire widow of former Levi Strauss CEO Peter Haas, $100,000. None of Prop. 30’s billionaire donors have responded to a request for comment from Forbes. The No on 30 campaign also did not immediately respond to a similar request.
Despite the billionaire donations, Prop. 30’s opponents have contributed significantly less than the measure’s supporters. According to data through the end of September, Yes on 30 has raised $47 million—nearly all of it from one company: Lyft—while No on 30 has raised $14.8 million.
“Wealthy donors are a part of the Democratic constituency in California, and that gives them some leverage over some in the party,” says Eric Schickler, a professor of political science at the University of California at Berkeley.
Mark Heising, who is married to the daughter of hedge fund billionaire Jim Simons, made two $500,000 donations to the No on 30 campaign, one in August and another in September, according to state filings. Heising cofounded the Heising-Simons Foundation in 2007, which gave away $24 million in climate-related grants last year and says on its website that one of its core missions is to “make energy clean, affordable, safe and reliable for all.” The foundation did not respond to a request for comment from Forbes about whether Heising’s opposition to Prop. 30 is at odds with its climate philanthropy.
Supporters paint Prop. 30 as a no-brainer tax on millionaires necessary to help California transition away from gas cars, an existential and urgent task given that transportation is the largest source of carbon emissions in the state. Last year, California Gov. Gavin Newsom signed the most ambitious electric vehicle law in the country, mandating that all new vehicles sold in the state be electric by 2035. California aims to reduce emissions and become carbon-neutral by 2045.
If passed, Prop. 30 would raise between $3.5 billion and $5 billion annually, according to a legislative analysis of the measure, providing a long-term funding mechanism for the state’s ambitious electric vehicle initiatives. The majority of that revenue, 80%, would be used for electric vehicle subsidies and the installation of new charging stations around the state. Half of that funding is required to go to low-income communities. The remaining 20% raised by the proposed new tax would go to wildfire prevention programs.
“I really think it’s outrageous that these greedy billionaires are funding a deceptive opposition campaign because they’re not willing to pay their fair share to deliver this benefit of clean air to the whole state,” says Bill Magavern, the policy director of the Coalition for Clean Air, a prominent backer of Prop. 30.
A modest tax increase on high-income residents might sound like a slam dunk for California Democrats—but Prop. 30 has a surprising adversary: Newsom. In an ad released last month, Newsom argues that Prop. 30 “is being advertised as a climate initiative, but in reality it was devised by a single corporation to funnel state income taxes to benefit their company.” The official No on 30 campaign’s website directly asks voters to “stop the Lyft tax grab.”
Since California will also require ride-hailing companies to make 90% of their fleets electric by 2030, Lyft may benefit from Prop. 30 subsidies and the expanded charging network. The text of the ballot measure puts the California Air Resources Board in charge of administering electric vehicle incentive programs, which are available to everyone in California, including Lyft drivers. Lyft has spent $45.4 million to get Prop. 30 passed. Uber, meanwhile, has not made any donations for or against the proposition and has stayed silent about it.
Lyft cofounder and CEO Logan Green rejects the notion that Lyft will get special treatment under Prop. 30, making the point in a blog post that “not a single dollar of Proposition 30 is earmarked for Lyft or the Ridesharing industry as a whole.”
“I’m fortunate enough to be impacted by this tax and happy to pay it to help turn back the clock on this existential threat,” Green wrote last month. Forbes estimates that Logan has a fortune of at least $100 million.
Opponents have other arguments, too. California already has the highest income tax rate in the country, and an even further increase would deepen the state’s dependence on the wealthy, who could just move to other states with a lower tax burden. The California Teachers Association is opposed because the group thinks income tax revenue should go to schools and other priorities rather than electric vehicle programs.
Despite billionaire support, convincing voters to reject Prop. 30 may be an uphill battle. A poll from the Berkeley Institute for Governmental Studies released in late September found that 49% of likely voters support Prop. 30, while 37% oppose it. The poll also found that 15% of likely voters are undecided.
There are still three weeks left until the election, and the University of California at Berkeley’s Schickler says it’s not unusual for propositions that start out with a plurality of support to eventually lose steam.
“The No side is within striking distance,” he says. “So it really depends on if a sharp enough signal goes out to lead more Democrats to side with Newsom. That’s certainly possible.”