Proposition 41
Improving Transparency, Effectiveness, and Efficiency in California Government Act of 2026
What is it?
Prop 41 does two things. Before voters decide on a new special tax, the State Auditor must audit the programs the tax would fund. And new state taxes can no longer be exempt from the state spending limit, the cap voters approved in 1979.
Audits
Once backers of a special tax initiative (a tax earmarked for specific purposes) certify they have gathered 25% of the signatures required to qualify, the State Auditor must start an audit of every program the tax would fund. If the initiative qualifies, the audit's summary is printed in the state voter information guide. Special taxes passed on or after January 1, 2026 also get a repeat audit every four years.
Spending limit
Any state tax enacted or taking effect on or after January 1, 2026 cannot be exempt from the spending limit; the state cannot impose, collect, or enforce such a tax.
Conflicting measures
Prop 40, the one-time 5% tax on billionaire net worth on this same ballot, routes its revenue into a fund that does not count toward the spending limit, and Prop 41's conflicting-measures clause deems a same-ballot measure with such a tax to be in conflict. If both pass and Prop 41 gets more Yes votes, all of Prop 40's provisions become null and void. Neither measure names the other; a court would decide whether Prop 40 falls inside the clause.
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Fiscal impacts
Prop 41 does not raise or lower any tax on its own. The Legislative Analyst's Office estimated an unknown net fiscal effect. Audits of special taxes that fail or never qualify would cost the General Fund in the low millions of dollars per two-year election cycle, printing audit summaries could add a few hundred thousand dollars per qualified initiative, and any savings depend on whether programs adopt the Auditor's recommendations.
Why is this on the ballot?
Backers gathered voter signatures to qualify this initiative constitutional amendment for the November 3, 2026 ballot.
According to Article II, Section 8 of the California Constitution, amendments to the California Constitution may be introduced by collecting signatures (8% of the votes cast in the most recent Governor's race). The amendment must then be approved by voters with a simple majority of 50% + 1.
- Placed on ballot by: Voter signature petition.
- Sponsor: Building a Better California, funded mainly by Google co-founder Sergey Brin along with investors John Doerr and Michael Moritz, via its committee Californians for a More Transparent and Effective Government. Reform California and the California Chamber of Commerce also back the measure.
- Attorney General file number: 25-0040A1, amended language submitted January 12, 2026.