SACRAMENTO — California voters will decide on Proposition 40 in November, a measure proposing a one-time tax on the state's billionaires, after negotiations between SEIU-United Healthcare Workers West President Dave Regan and Gov. Gavin Newsom's office collapsed.
Two sources familiar with the June talks told the Los Angeles Times that Regan asked for union contracts with two hospitals in San Diego and Fresno, along with a clinic in Imperial County — demands aimed at expanding his union's footprint.
Regan denied making such demands, calling the allegations "categorically false." "We are trying to solve a problem," he said, arguing the union's goal is to prevent a "catastrophe" in California's healthcare system.
Regan designed the measure to raise $100 billion. He says the money would protect low-income patients, workers and hospitals from federal healthcare cuts. The RAND Corporation projects California will lose $100 billion in Medicaid funding under President Trump's One Big Beautiful Bill Act.
The approach tracks Regan's record. Elected to five consecutive terms since 2011, he has launched ballot initiatives at state and local levels — moves that have often served as leverage for union expansion or to thwart political opponents.
Francisco Silva, president of the California Primary Care Assn. criticized the tactic. "It's no secret in Sacramento that the ballot initiative has been used this way by UHW as a weapon," Silva said, adding that the union has been "very vocal about it."
Opponents say the strategy works like this: Regan's union advances an initiative that would burden employers, forcing them to the table. The union then seeks contracts or concessions. If employers refuse, the initiative goes to the ballot.
Proposition 40 has split California Democrats. The executive board of Service Employees International Union California voted to remain neutral, while the California State Council of Laborers and United Domestic Workers oppose it.
Regan dismissed talk of a party rift after the California Democratic Party endorsed the measure. "This endorsement puts to rest the idea that California Democrats are not united by the billionaire tax — they are," he said.
Opponents also warn the tax could ultimately shrink state revenue. The measure targets roughly 200 billionaires in California.
