California unions and billionaires don’t often find themselves on the same side of a political fight.

But a bitter battle over a November billionaire tax has splintered some of the state’s many labor unions to create a broad coalition of strange bedfellows who rarely join hands but are now collaborating to kill it.

A raft of prominent unions, Republicans, business groups, and anti-tax advocates are united in opposing the initiative, as is Gov. Gavin Newsom, whose office has been negotiating with stakeholders to achieve a last-minute deal to pull the measure from the ballot. 

The labor groups opposed to the measure include some of Sacramento’s most influential political players, including the California Teachers Association and other organizations representing law enforcement, carpenters, and builders. They’ve joined forces with pro-housing advocates and medical organizations like the California Primary Care Association, California Medical Association, and Planned Parenthood Affiliates of California in their opposition. 

The labor opposition is all the more remarkable since the tax measure has been conceived and sponsored by SEIU-United Healthcare Workers West.

Jason Elliott, Newsom’s former deputy chief of staff, is “astounded” at the breadth of groups opposed to it.

“The proponents ought to hope that negotiations are successful because they have given birth to one of the most unpopular measures I’ve seen in years,” Elliott said. “The coalition that has formed to defeat this poorly crafted measure is a coalition that rarely, if ever, comes together in California politics.”

The California Secretary of State’s Office announced Wednesday that the sponsors had collected enough signatures to put the tax before voters in November. If passed, it would impose a one-time 5% tax on billionaires’ net worth to raise an estimated $100 billion to offset health care funding cuts under President Donald Trump’s Big Beautiful Bill. 

“We’re one step closer to saving the hospitals and emergency rooms that we all rely on,” Debru Carthan, spokesperson for the Billionaire Tax Now Coalition, said in a Thursday statement. “David won the second round against Goliath, but healthcare workers and our allies won’t quit until we protect patients from the looming California healthcare collapse manufactured by Trump and Congress.”

• Labor groups split on Billionaire Tax

Those opposed to the measure almost unanimously agree that more funding is needed to save much-needed services. But they are skeptical that the tax is the best way to plug the budget gap. They have criticized it as a Band-Aid solution to a long-term funding crisis, and are anxious that it could drive out some of the state’s wealthiest residents (opens in new tab), whose fortunes the California budget leans heavily on. 

The California Teachers Association said in a June 7 statement (opens in new tab) that the tax “will not provide the sustainable and long-lasting funding that our schools and communities deserve.” California YIMBY leaders also called the tax “poorly designed (opens in new tab)” and said it would harm housing production by “discouraging investment in California.” 

Some of the state’s most notable billionaires, including Google co-founder Sergey Brin, Ripple’s Chris Larsen, venture capitalist (and chairman of The Standard) Michael Moritz, and Stripe CEO Patrick Collison, have already promised to spend heavily to try to kill the initiative. 

Some of the interest groups who are opposed to the tax have also announced plans to form their own well-funded campaign to block its passage (opens in new tab). The committee is sponsored by the California Medical Association and California Primary Care Association, which have each given $100,000 to the committee, and the California School Boards Association.

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Sacramento-based Democratic consultant Andrew Acosta said the overwhelming opposition demonstrates how “UHW poked multiple bears.”

“Why would they be excited about an initiative that doesn’t really help them at all? It’s a big pot of money, and they all have needs,” he said. 

Newsom reportedly (opens in new tab) promised donors he would convince SEIU-UHW President Dave Regan to pull the measure before a June 25 deadline. But several people with knowledge of the negotiations said they are not going well. 

Talks between the groups have repeatedly come together, only to fall apart. Barring some “massive pivot” one person said, the measure is likely to stay on the ballot. 

The coalition backing the tax sent a letter (opens in new tab) to Newsom Thursday afternoon proposing a “2% version” of the initiative as a compromise, which the group said would help backfill two years’ worth of funding cuts. 

“A massive healthcare crisis and collapse is coming for California,” the group wrote in its letter. “The current budget plans being discussed in Sacramento ask working Californians to bear the burden. Taxes on consumers. Cuts to healthcare programs. Increased costs for patients who can least afford them. And yet, as those proposals take shape, one group remains entirely untouched: the wealthiest billionaires on earth, many of whom call California home. That is not a balanced solution. It’s a choice, and we believe it’s the wrong one.” 

The revised proposal has so far failed to sway Newsom.

“The Governor has been clear that he is strongly opposed to a California-only wealth tax,” spokesperson Tara Gallegos said in a statement. “The Governor supports making the wealthiest Americans pay their fair share, but this poorly designed state-only measure will defund teachers, schools, clinics, and public safety.”

Public sentiment about the measure appears to be evenly split, though a well funded, union-backed campaign to defeat the tax could change that. A Public Policy Institute poll (opens in new tab) last month found 54% of likely voters supported the initiative, while a June poll sponsored by its opponents found support at 41%.

Regan notoriously uses state ballot measures as leverage to notch wins for his union, and is unlikely to back down without some financial concession from the state. History also shows Regan isn’t afraid of losing: of the dozens of measures he has filed in the last 17 years, only two have won (opens in new tab), according to a Politico analysis. 

Regan’s reputation in Sacramento, depending on whom you ask, is either that of a fearless leader willing to take on powerful interests to benefit his members, or someone whose only winning — or failing — strategy is to bully his way into a deal. 

“Dave Regan is the great coalition builder. Anything he touches, there is a great coalition opposed to him,” said Brandon Castillo, a strategist whose client list includes healthcare organizations that have fought Regan at the ballot box in years past. 

“Obviously this is a flawed measure. And there’s just not a lot of trust in the proponent,” Castillo said. “What does it take to satisfy what he wants? And can they get there?”

It’s a long road to November, and Newsom has outsized leverage in the sheer number of groups opposing the measure.

“It’s sometimes hard to get labor and business to agree that today is Thursday, let alone a consequential statewide ballot measure,” Elliot added. “But that’s precisely what has happened here.”