California Approves Proposition 3 School Tax as 3M Sets $7.35B Accord

Long-term public finance for California classrooms and national groundwater remediation liabilities reached major milestones this week, as state voters permanently extended a high-earner income tax for public education and chemical manufacturer 3M announced a multi-billion-dollar settlement resolving per- and polyfluoroalkyl substances claims.

California Voters Pass Proposition 3 to Make High-Income School Tax Permanent

California voters approved Proposition 3 by a margin of 59% to 41%, converting a temporary income tax on high-income residents into a permanent revenue source for public education and state services, according to CalMatters via Mountain View Voice. Originally approved by voters in 2012, renewed in 2016, and previously scheduled to expire in 2031, the levy generates between $5 billion and $15 billion—5,000 million to 15,000 million dollars—annually, representing up to 15% of total revenue for California public schools.

The measure maintains a 12.3% income tax rate on individuals earning more than $371,000 per year and couples earning more than $743,000. Revenue collected under the tax flows into the Proposition 98 school funding formula, which guarantees that 40% of state general fund revenue goes to public education; of that allocation, 89% is directed to K-12 schools and 11% goes to community colleges, with any surplus deposited into a reserve fund.

The California Teachers Association invested nearly $60 million in advertising and mobilized members to visit more than 200,000 households across the state. Union president David Goldberg called the measure vital for protecting school funding and teaching positions, while Debra Schade, president of the California School Boards Association and a Solana Beach school board member, said voters reaffirmed the importance of sustained investment in public education. Opponents had argued that making the post-recession tax permanent risked prompting wealthy residents—including roughly 200 taxpayers who also faced a proposed one-time 5% wealth tax under Proposition 40—to relocate to lower-tax states despite a decade of declining student enrollment. CalMatters distributes its reporting across more than 130 media partners statewide.

3M Agrees to Pay Up to $7.35 Billion Over 9 Years in PFAS Groundwater Settlement

St. Paul, Minnesota-based manufacturer 3M announced Tuesday that it will pay up to $7.35 billion over 9 years to settle lawsuits brought by as many as 120,000 people alleging harm from groundwater contaminated by per- and polyfluoroalkyl substances, or PFAS, used in firefighting foam and consumer products near military bases and airports, KCBS Radio and the Associated Press reported.

Under the agreement, which does not include an admission of liability, 3M will begin payouts with $50 million this year followed by annual payments exceeding $1 billion each year from 2028 to 2033. 3M Chairman William Brown described the accord as a milestone that reduces litigation uncertainty, while attorney Fred Thompson of the Motley Rice law firm said the settlement provides needed relief for claimants facing medical expenses after nearly a decade of litigation.

The company previously agreed to a $450 million natural resource settlement with New Jersey and a separate accord exceeding $10 billion with U.S. public drinking water systems, while DuPont de Nemours Inc. and spinoffs Chemours Co. and Corteva Inc. previously reached PFAS settlements totaling more than $1 billion. Although the Environmental Protection Agency enforces PFAS limits and testing rules for public water utilities, private wells are not covered, and an industrial wastewater study has remained under review at the White House Office of Management and Budget for 2 years.