California’s Gamble: Trading in Rehabilitation for Incarceration

In 2014, California adopted Proposition 47, a law aimed at reducing incarceration rates and promoting rehabilitation in the community.[1]  Proposition 47 reclassified certain low-level drug offenses and property theft under $950 from felonies to misdemeanors.[2]  Significantly, felonies generally result in longer sentences in state prison, whereas misdemeanors result in shorter sentences in county jail, typically not exceeding one year.[3]  Proposition 47 reduced the sentences of over 200,000 people incarcerated in California state prisons,[4]  resulting in the state saving $816 million in total prison spending between fiscal years 2016-17 and 2024-25.[5]  

The $816 million has been allocated to three state agencies: the Board of State and Community Corrections (“BSCC”), the Department of Education, and the Victim Compensation and Government Claims Board.[6]  The BSCC has funded over twenty-six recidivism reduction programs in California aimed at rehabilitating formerly incarcerated people through mental health and drug treatment programs.[7]  These programs are required to report their results, and the outcomes thus far show significant success.[8]  Initially, the program reduced the recidivism rates of participants to twenty-three percent, compared to the state’s general recidivism rate of thirty-five percent.[9]  In the second round of funding, the recidivism rate of program recipients dropped to fifteen percent.[10]  Additionally, homelessness decreased by sixty percent for program participants.[11]  The state spends about $3,270 per program participant, which is significantly lower than the $133,000 the state spends per incarcerated person.[12] 

This reduction in incarceration rates did not correlate with an increase in violent crime; however, there was a nine percent uptick in larceny immediately after Proposition 47’s introduction in 2014.[13]  However, since 2014, larceny rates have fallen by seventeen percent, according to a 2022 survey.[14]  Despite this overall decrease, larceny has remained a particular issue to large retailers such as Target, Walmart, and Home Depot.[15]  In May 2023, Target said that stolen inventory would cost their company over $500 million.[16]  In the same year, Target closed nine locations in New York, Seattle, and San Francisco because of theft and organized crime.[17]  Most large retailers have expressed that their biggest concern is organized theft of large amounts of inventory at once.[18]  Thus, many large retailers pushed for a new tough-on-crime law to address this issue.[19] 

As a solution to large retailers’ concerns about larceny, California overwhelmingly passed Proposition 36 in 2024.  The new law undoes Proposition 47 by allowing for the imposition of felony charges for thefts under $950 when an individual has two or more prior theft or drug convictions.[20]  Those in favor of the law argue that it reduces theft and unburdens large retailers while also deterring repeat offenders with harsher penalties.[21]  However, opponents argue that it focuses on punitive measures to fix the larceny issue instead of rehabilitative efforts.[22]  Critics fear that although this law may help lower theft losses for large companies, like Target, it may also result in an increased incarceration rate, leading to a decrease in funding for rehabilitative programs.[23]  

Increasing prison sentences for non-violent crimes should be highly scrutinized,[24] especially considering the disastrous effects incarceration has on a person’s ability to access employment opportunities and support their family.[25]  A recent study found that incarceration decreases a man’s annual earnings by forty percent.[26]  Additionally, fifty-four percent of incarcerated people have minor children to support.[27]  Therefore, emphasizing punitive measures instead of targeting the root issues that cause drug use and theft—such as homelessness, mental health issues, and addiction —may limit the long-term effectiveness of this Proposition and may even exacerbate the root causes.[28]

The overall decrease in larceny in the last decade coupled with the success of Proposition 47’s rehabilitation program at curbing recidivism rates makes this new law questionable.[29]  Given that large retailers’ primary concern is organized retail crime (“ORC”),[30] laws that target those offenses directly should be used to minimize retail theft through the imposition of felony charges. This would be preferable to a law like Proposition 36, which introduces felony charges for minimal thefts under $950 for repeat offenders.[31]  To that end, large retailers should be satisfied by the recent introduction of Assembly Bill 2943, Assembly Bill 1802, and Assembly Bill 2943 in 2024, which specifically target ORC[32] —highly coordinated efforts by multiple individuals working within a larger criminal networks to commit large scale theft for resale purposes.[33]  Specifically, Assembly Bill 2943 made possession of stolen goods with the intent to resell a crime punishable as a misdemeanor or a felony.[34]  Additionally, the Governor of California, Gavin Newson, has distributed $267 million to California communities to help combat organized retail crime.[35]  This wave of legislation in 2024 and the response by the Governor[36] is sufficient to respond to large retailer’s complaints about theft considering the overall decline in larceny.[37]  California should repeal Proposition 36 because it penalizes low-level offenders and undermines rehabilitative efforts and instead rely upon the recently introduced, organized retail crime laws to address the large retailer’s theft concerns.

[1] Sam Levin, California Police Launch Stings and Arrests Under New Tough-on-Crime Measure, Tʜᴇ Gᴜᴀʀᴅɪᴀɴ (Jan. 8, 2025), https://www.theguardian.com/us-news/2025/jan/08/california-prop-36-shoplifting-drug-arrests [https://perma.cc/B9XL-VQG7].

[2] Grecia Resendez, Proposition 47 Delivers Nearly $1 Billion to California Communities, Cᴛʀ. ᴏɴ Jᴜᴠᴇɴɪʟᴇ & Cʀɪᴍ. Jᴜsᴛ. (Sept. 12, 2024), https://www.cjcj.org/reports-publications/report/proposition-47-delivers-nearly-1-billion-to-california-communities [https://perma.cc/FS9J-QQ4W].

[3] America’s Massive Misdemeanor System  Deepens Inequality, Eᴏ̨ᴜᴀʟ Jᴜsᴛɪᴄᴇ Iɴɪᴛɪᴀᴛɪᴠᴇ (Jan. 1, 2019),

https://eji.org/news/americas-massive-misdemeanor-system-deepens-inequality/ [https://perma.cc/M95E-MEAK].

[4] Brett Kelman, Nearly 200,000 Erased by Prop 47, but some former felons don’t know, Dᴇsᴇʀᴛ Sᴜɴ (Dec. 14, 2016), https://www.desertsun.com/story/news/crime_courts/2016/12/14/prop-47-felony-convictions-erased/94636060/ [https://perma.cc/P77Y-QF3K].

[5] Levin, supra note 1; Resendez, supra note 2.

[6] Resendez, supra note 2.

[7] Id.

[8] Id.

[9] Id.

[10] Id.

[11] Id.

[12] Id.

[13] Mia Bird, Magnus Loftrom, Brandom Martin, Steven Raphael & Viet Nguyyen, The Impact of Proposition 47 on Crime and Recidivism, Pᴜʙ. Pᴏʟ’ʏ Iɴsᴛ. ᴏғ Cᴀʟ. (2018); Scott Graves, Shoplifting in California Below is Below Pre-Pandemic Levels, Cᴀʟ. Bᴜᴅɢᴇᴛ & Pᴏʟ’ʏ Cᴛʀ. (2024), https://calbudgetcenter.org/resources/shoplifting-in-california-is-below-pre-pandemic-levels/ [https://perma.cc/QVM2-DWZE].

[14] Graves, supra note 13.  

[15] Levin, supra note 1.

[16] Alina Selyukh, Retailers howled about theft last year. Why not now?, NPR (Mar. 11, 2024 12:30 PM), https://www.npr.org/2024/03/11/1236075589/retail-theft-crime-target-stores [https://perma.cc/9ENK-D9TY].

[17] Id.

[18] Id.

[19] Levin, supra note 1.

[20] California General Election November 5, 2024, Vᴏᴛᴇʀ Gᴜɪᴅᴇ (Nov. 5, 2025), https://voterguide.sos.ca.gov [https://perma.cc/GG2A-SKJ6]; Levin, supra note 1.

[21] Id.

[22] Id.

[23] Resendez, supra note 2.

[24] Don Stemen, The Prison Paradox: More Incarceration Will Not Make Us Safer, Vᴇʀᴀ Iɴsᴛɪᴛᴜᴛᴇ (2017).

[25] Bʀᴜᴄᴇ Wᴇsᴛᴇʀɴ & Bᴇᴄᴋʏ Pᴇᴛᴛɪᴛ, Cᴏʟʟᴀᴛᴇʀᴀʟ Cᴏsᴛs: Iɴᴄᴀʀᴄᴇʀᴀᴛɪᴏɴ’s Eғғᴇᴄᴛ ᴏɴ Eᴄᴏɴᴏᴍɪᴄ Mᴏʙɪʟɪᴛʏ, 3 (Ellen Wert, 2010). 

[26] Id. at 4.

[27] Id.

[28] Stemen, supra note 24. 

[29] Graves, supra note 13; Resendez, supra note 2.

[30] Selyukh, supra note 16.

[31] What is organized retail crime?, Tʜᴏᴍᴀs Rᴇᴜᴛᴇʀs (July 12, 2024), https://legal.thomsonreuters.com/blog/what-is-organized-retail-crime/ [https://perma.cc/XP9A-9P5R].

[32] New in 2025: Cracking down on retail theft and property crime, Gᴏᴠᴇʀɴᴏʀ Gᴀᴠɪɴ Nᴇᴡsᴏɴ (Dec. 30, 2024), https://www.gov.ca.gov/2024/12/30/new-in-2025-cracking-down-on-retail-theft-and-property-crime/#:~:text=and%20Cargo%20theft-,AB%202943.,knew%20the%20goods%20were%20stolen. [https://perma.cc/L2D8-B24N].

[33] What is organized retail crime?, supra note 31.

[34] New in 2025: Cracking down on retail theft and property crime, supra note 32.

[35] Governor Newson signs landmark legislative package cracking down on retail crime and property theft, Gᴏᴠᴇʀɴᴏʀ Gᴀᴠɪɴ Nᴇᴡsᴏɴ (Aug. 16, 2024), https://www.gov.ca.gov/2024/08/16/governor-newsom-signs-landmark-legislative-package-cracking-down-on-retail-crime-and-property-theft/ [https://perma.cc/WWA8-TQUS].

[36] New in 2025: Cracking down on retail theft and property crime, supra note 32; Governor Newson signs landmark legislative package cracking down on retail crime and property theft, supra note 35.

[37] Graves, supra note 13.