Billionaire hedge-fund manager Tom Steyer will donate $20 million toward an initiative that would raise $1 billion annually from multi-state corporations for green building projects and the state budget, proponents said today.
That brings Steyer's contributions to $21.9 million so far in the campaign, one of the highest amounts ever by one individual for a California initiative effort. Steyer is an environmentalist who founded San Francisco-based Farallon Capital Management in 1986. Forbes magazine lists his net worth at $1.3 billion as of March.
Only one contributor in recent memory gave more to a statewide initiative: real estate heir and businessman Stephen Bing, who gave $48.6 million to Proposition 87 in 2006, according to state records. The failed effort would have raised taxes on oil production for alternative energy projects.
Steyer has formed a coalition of environmental groups that dubs itself the "Californians to Close the Out-of-State Corporate Tax Loophole." The committee filed signatures last week to put their initiative on the ballot.
The proposal would require all companies in California to calculate their corporate income tax based solely on their proportion of sales in the state. Under a tax law change pushed by Republicans as part of the 2009 budget compromise for temporary tax hikes, corporations won the ability to choose between the sales-based tax formula or a separate equation that also considers employees and property.
The latter formula is more beneficial to out-of-state firms who can lower their tax rate because they have relatively few employees or property in the state. California is one of only two states that allows companies to choose their tax formula.
Large business groups who oppose the measure say it would cost jobs in the state. But California-based biotech firms have lobbied for the change because they say they are at a competitive disadvantage compared to companies based elsewhere.
The proposal would raise an estimated $1 billion a year, according to the nonpartisan Legislative Analyst's Office. For the first five years, half of the money would go toward energy efficiency projects in buildings and the other half would help the state's general fund, including schools.
PHOTO: Tom Steyer, 2011. Courtesy of Tom Steyer