Proposition 40 would impose a one‑time 5% wealth tax on California billionaires to raise an estimated $100 billion, largely to shore up Medi‑Cal against federal Medicaid cuts that could remove about $30 billion a year from the state. Internal SEIU disputes and recently publicized allegations against SEIU‑UHW president Dave Regan have surfaced shortly before the election, risking to distract supporters and undermine the measure’s prospects. While the allegations warrant fair investigation, advocates warn the timing may be intended to derail the only near‑term fix to prevent a Medicaid collapse affecting nearly 15 million Californians.
Union Infighting Shouldn’t Derail California’s Billionaire Tax to Save Medi‑Cal
Sen. Bernie Sanders speaks during the campaign kickoff for the California Billionaire Tax Act at The Wiltern in Los Angeles, on February 18, 2026. (Patrick T. Fallon / AFP via Getty Images)
California may have a narrow opportunity to blunt a looming Medicaid catastrophe: Proposition 40, a one‑time 5% wealth tax on billionaires designed to raise roughly $100 billion — most of it for health care — and to help cover an estimated $30 billion annual shortfall in the state’s Medi‑Cal program caused by federal cuts. But internal union disputes and last‑minute allegations against SEIU‑UHW president Dave Regan risk diverting attention and energy away from the ballot measure at a critical moment.
What Prop 40 Would Do
Prop 40 proposes a one‑time 5% levy on the wealth of billionaires in California, an amount proponents say would largely offset the funding gap created by recent federal legislation (H.R. 1) that is projected to reduce Medicaid funding by roughly $1 trillion nationwide over a decade. Backers argue the tax would protect coverage for nearly 15 million Californians enrolled in Medi‑Cal and stabilize health services that face abrupt eligibility and funding changes in the coming months.
The Union Dispute And Allegations
SEIU California has taken a neutral stance on Prop 40 even though the initiative was placed on the ballot by an affiliated union, SEIU United Healthcare Workers West (SEIU‑UHW). Investigations commissioned by SEIU California and the international SEIU found several accusations against SEIU‑UHW president Dave Regan to be credible, including claims of intimidation and misconduct tied to union governance disputes. Regan and SEIU‑UHW dispute parts of those findings and say the report was leaked to a newspaper owned by billionaire Patrick Soon‑Shiong.
The most serious allegation, raised by a former staffer, concerns an incident from 2009. Regan has called the allegations "complete fabrications." Both supporters of Regan and critics say the timing of these disclosures — weeks before the election — raises questions about political motivations and the potential to influence voter turnout on Prop 40.
Political Context And Timing
Governor Gavin Newsom opposes Prop 40, a stance observers link to his broader political ambitions. The California Democratic Party has endorsed the measure, exposing fractures between party leaders and some labor bodies. Labor leaders are divided: some condemn the alleged behavior and call for accountability, while others emphasize that the immediate priority must be protecting Medi‑Cal from deep federal cuts.
Lorena Gonzalez, president of the California Labor Federation: "Ultimately members decide whether a leader is appropriate — and right now we must keep our eyes on the fact that Medi‑Cal is being cut and the billionaire tax is the only near‑term fix on the ballot."
Why This Matters
H.R. 1 is expected to introduce new eligibility requirements on October 1 and January 1 and shrink federal Medicaid funding over the next decade, placing enormous strain on state budgets and health systems. Advocates say Prop 40 is the only immediate statewide mechanism on the ballot to preserve coverage for millions of Californians and to prevent clinic closures, overwhelmed emergency departments, and growing numbers of untreated patients.
What Should Happen Next
Accusations of harassment and intimidation must be investigated thoroughly and fairly. At the same time, the timing of these revelations should not distract from the urgent policy question: how to prevent a Medicaid collapse in California. Labor organizations, union leaders, and voters face a choice between pausing to resolve intra‑union conflicts or prioritizing a ballot measure that could avert immediate harm to millions of residents.
Bottom line: The allegations deserve scrutiny, but the public interest in preserving Medi‑Cal coverage for nearly 15 million Californians argues for keeping the focus on Prop 40 and acting expeditiously to protect healthcare access.
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