sections of text, not to exceed three paragraphs, to be quoted without written permission, provided that full attribution is given to the source and the above copyright notice is included. Foreword The passage of Proposition 13 on June 6, 1978, signaled a dramatic change in California politics as voters placed a cap on the amount of taxes they were willing to pay. Perhaps no other initiative in the past 20 years has been subject to greater scrutiny or provoked more controversy. The policy issues involved, including the question of equity, the fiscal relationship between state and local governments, and the level and quality of government services, are large and important concerns that need to be analyzed with an objective and independent eye. They are exactly the kinds of issues that the Public Policy Institute of California was founded to study. In this report, Michael Shires, John Ellwood, and Mary Sprague answer one of the most prominent questions in the policy debate: How much do we pay to our state and local governments in California an
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