Proposition 2: Increases State's Rainy Day Fund. Legislative Constitutional Amendment.
Statewide — all of California
General election · Tuesday, November 3, 2026
- Placed on the ballot by the Legislature as ACA 20 (Chapter 130, Statutes of 2026). Final legislative votes: Senate 29 ayes, 2 noes; Assembly 59 ayes, 8 noes.[1][4]
The question on the ballot
INCREASES STATE'S RAINY DAY FUND. LEGISLATIVE CONSTITUTIONAL AMENDMENT. Increases California's Rainy Day Fund, approved by voters in 2014, to provide funding for education, health care, public safety, and other essential services during economic downturns. Doubles the budget reserve cap from 10% to 20% of General Fund revenues, requiring savings until Fund's balance equals 20% of General Fund. Requires additional savings in years when tax revenues are high. Increases budget reserves available for education, state debts, and pension obligations.[1]
Currently the state must deposit into the rainy day fund (Budget Stabilization Account) until it reaches 10 percent of General Fund taxes. The measure raises that to 20 percent, requires larger deposits when investment-gains revenue is very high, extends the required extra debt payments from 2030 to 2040 and expands what they can be used for (including payments to schools and community colleges and repaying certain borrowing). Deposits into the rainy day fund, and into a separate surge-revenue account (up to 10 percent of General Fund taxes per year), would not count toward the state appropriations limit until withdrawn. Fiscal impact per the Legislative Analyst: state budget reserves would be higher, and the state might make more debt payments.[1][2]
A YES vote means
Rules for building state budget reserves and paying down extra state debts would change. As a result, state budget reserves would be higher. The state also would be required to make extra debt payments for longer.
A NO vote means
Rules for building state budget reserves and paying down extra state debts would not change.
The law today
The Constitution requires the state to deposit 0.75 percent of General Fund tax revenue in the rainy day fund (Budget Stabilization Account) each year, plus more when investment-gains revenue is higher than normal; deposits stop being required once the fund reaches 10 percent of General Fund taxes, and the money otherwise deposited must go to infrastructure. The state must also make extra debt payments toward pension and retiree health debts equal to the initial deposits, but that requirement ends in 2030. Rainy day fund deposits and other reserves count toward the state appropriations limit. The state has about $20 billion in other reserves.[2]
Official fiscal estimate
Legislative Analyst: budget reserves would be higher, making it somewhat easier to balance the budget when revenues decline, and the state might make more debt payments because extra payments would run through 2040. The analysis gives no dollar estimate.[2]
Arguments made for
- Official argument in favor, signed by Darrell Roberts (California Professional Firefighters), Assemblymember Jesse Gabriel and Maria S. Salinas (Los Angeles Area Chamber of Commerce): Proposition 2 will "DOUBLE THE STATE'S RESERVE REQUIREMENT—from 10 to 20 percent of General Fund revenues—so California has a real cushion, not a token one, when the next downturn hits."[3]
- Same argument: "California's own nonpartisan Legislative Analyst's Office has recommended that the state should be saving significantly more than current rules require. Proposition 2 follows that advice."[3]
Arguments made against
- Official argument against, signed by Assemblymember David Tangipa, Senator Steven Choi and Carl DeMaio (Reform California): "Prop. 2 allows the politicians to gut the voter-imposed spending limit," and it "creates loopholes and accounting gimmicks so politicians can eliminate any chance of you getting your tax rebate."[3]
- Same argument: "Sacramento doesn't need a new tool to save money. It needs the discipline to follow the rules already in place and stop spending money it doesn't have."[3]
On record in support
- Gov. Gavin Newsom (named as a supporter in the official argument in favor and listed in CalMatters' voter guide).[3][6]
- California Professional Firefighters (Darrell Roberts), Assemblymember Jesse Gabriel (Assembly Budget Committee Chair) and the Los Angeles Area Chamber of Commerce (Maria S. Salinas), signers of the official argument in favor.[3]
- California State Board of Education (President Dr. Linda Darling-Hammond), California Hospital Association (Carmela Coyle) and California Primary Care Association (Francisco J. Silva), signers of the rebuttal to the argument against.[3]
- California Democratic Party and legislative Democrats (listed in CalMatters' voter guide).[6]
On record in opposition
Campaign money
No committees supporting or opposing Proposition 2 identified as of 10/06/2026. Source: Secretary of State ballot measure contribution totals.[5]
Research notes & limits
Question text, summary, fiscal impact, yes/no wording and arguments are from the Official Voter Information Guide. The Legislative Analyst's analysis describes the effect on the state appropriations limit; the official argument against characterizes it differently, and both are attributed as the authors' opinions (the guide notes arguments are not checked for accuracy).
Sources · 6
Researched 2026-10-19. Green citations are official government records.
- 1.Proposition 2: Official Title and Summary · California Secretary of State, Official Voter Information Guide (Nov. 3, 2026) · 2026-10-05 Official record
- 2.Proposition 2: Analysis by the Legislative Analyst · California Legislative Analyst's Office, via Official Voter Information Guide · 2026-10-05 Official record
- 3.Proposition 2: Arguments and Rebuttals · California Secretary of State, Official Voter Information Guide · 2026-10-05 Official record
- 4.Proposition 2: Summary and What Your Vote Means · California Secretary of State, Official Voter Information Guide · 2026-10-05 Official record
- 5.2026 Ballot Measure Contribution Totals: Proposition 2 (through 10/06/2026) · California Secretary of State · 2026-10-19 Official record
- 6.CalMatters 2026 Voter Guide: Proposition 2 (endorsements) · CalMatters · 2026-10-19 News report