California · November 3, 2026 · Legislative Constitutional Amendment

Proposition 2: Increases State's Rainy Day Fund.

Amends the constitution to increase the Budget Stabilization Account (the state's rainy day fund) cap from 10% to 20% of estimated general fund tax proceeds and exclude deposits into the account from the Gann Limit (state spending limit).

The official ballot language

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.

• 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. Summary of Legislative Analyst's Estimate of Net State and Local Government Fiscal Impact: • State budget reserves would be higher.

Source: California Secretary of State

What your vote does

A YES vote

A "yes" vote supports increasing the Budget Stabilization Account cap from 10% to 20% of estimated General Fund proceeds of taxes, counting capital gains revenue above 10% at 150% in deposit calculations, extending debt-repayment requirements through 2039-40, and excluding reserve deposits from the Gann Limit while counting withdrawals against it.

A NO vote

A "no" vote opposes this amendment to change rules governing the state's rainy day fund, extra debt repayment, and fiscal state of emergencies.

Source: Ballotpedia

What's actually in it — provision by provision

Propositions bundle things together. Here is every operative provision, separately:

Raises the Budget Stabilization Account (rainy day fund) cap from 10% to 20% of estimated general fund tax proceeds, setting aside more revenue as reserves.
Basis: Ballotpedia: raises BSA cap from 10% to 20% of estimated general fund proceeds of taxes.
Excludes deposits into the rainy day fund from the Gann Limit (the state spending limit), starting in fiscal year 2027-28.
Basis: Ballotpedia: excludes BSA deposits from the Gann Limit starting FY 2027-28.

Arguments, both sides

In favor

“Boosting the Rainy Day Fund will continue to provide a needed reserve for future years and protect programs that working families need.”
— Senate President pro Tempore Monique Limón (D-21), via Ballotpedia [source]

Against

“We don't have a rainy day fund in California. All this does is create a bigger slush fund for money to be used the following years instead of returning the money to the taxpayer.”
— State Assemblymember Joe Patterson (R-5), via Ballotpedia [source]

Endorsements

Supporting

Gov. Gavin Newsom (D)
Senate President pro Tempore Monique Limón (D-21)
State Sen. Melissa Hurtado (D)
State Sen. John Laird (D)
Assemblymember Jesse Gabriel (D)
Assembly Speaker Robert Rivas (D)
Assemblymember Avelino Valencia (D)
Xavier Becerra
League of Women Voters of California
CA Professional Firefighters
LA Chamber of Commerce

Opposing

State Assemblymember Joe Patterson (R-5)
Reform California

Source: Ballotpedia

Polling

Public Policy Institute of California (PPIC) Statewide Survey · September 4-10, 2026

Yes 60% · No 39%

1,103 likely voters; margin of error ±3.8%

Source

Fiscal impact

State budget reserves would be higher. (Ballotpedia.)

How does Proposition 2 line up with your values?

Take the 13-question AlignAlgo Vote questionnaire and get a scored breakdown of this measure — provision by provision.

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