Steyer's Calif. Tax Referendum Passes

Nov 7 2012 | 1:46pm ET

Last night was a good one for Thomas Steyer, the retiring head of Farallon Capital Management.

A staunch supporter of the re-elected President Barack Obama, who addressed the Democratic National Convention this year, Steyer was no doubt pleased by Obama's unexpectedly easy win and Democratic gains in the House of Representatives and Senate. Then, Steyer's fellow Californians overwhelmingly approved a ballot initiative backed by the hedge fund billionaire.

Steyer's measure, which was winning 59.5% to 40.5% with about 60% of the vote in, would close a California tax loophole that Steyer says favors out-of-state companies. The measure will require corporations to base their tax on in-state sales only, rather than the earlier formula with allowed them to consider their property and workforce in the state.

The measure is expected to generate about $1 billion in new revenue every year for cash-strapped California, although Steyer, an ardent environmentalist and proponent of green initiatives, made sure half that money will go towards increasing energy efficiency and clean-energy job training. Another chunk is earmarked for schools.

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