In typical political double-speak, the City of Los Angeles has put a measure on the ballot titled, “”Reduction of Tax Rate and Modernization of Communications Users Tax”, as Los Angeles City Measure Proposition “S”.
I don’t know how it is going to modernize communications but I can tell you for sure it is anything but a “Reduction of Tax Rate”. While the City has been collecting a 10% tax on cellular phone service service, the courts have declared the tax invalid because, in violation of Prop. 218, the City did not get voter approval for the imposition of the tax. The City is appealing that decision, but in case they lose, which they probably will, they have decided to bring out Proposition S. If you vote NO for Proposition S, and the City loses in the courts, there will be NO tax on electronic communications.
Prop S does reduce the tax rate from the invalid 10% rate to a 9% rate. But actually, if the city loses its appeal the rate will be 0%. Prop S also imposes the tax on a host of new electronic communications that were not included before, such as using the internet, DSL, VOIP, PCS and other electronic services.
The tax is estimated to raise approximately $270 Million for the city of Los Angeles. The City is disingenuously claiming that without the tax it won’t be able to hire new police, or, run the city. The City of Los Angeles has a budget of $6.7 Billion. The tax would produce another 4% of revenue for the City.
My thoughts are that they can certainly find $270 Million to cut in the budget.
City Controller Laura Chick recently stated, “we shouldn’t think of asking taxpayers for more money until we get our house in order.”
City Hall squanders your money on wasteful programs (e.g., sphincter-control classes for civil servants), gives away millions in “pork” for special interests (e.g., millions in subsidies for downtown developers), and fails to guard against embezzlement (e.g., over $1 million from the housing agency). (For more examples of waste, look at the “Spreadsheet of Shame.”)
The special election itself is an example of waste: instead of putting Prop S on the ballot during the general elections in November 2004, 2006 or 2008, City Hall spent $5.1 million to add it to the presidential primary in February 2008.
Further, nothing in Prop S requires City Hall to spend the money on hiring more police. Rather, Prop S is a general tax, which means Villaraigosa and the City Council can squander your money on anything they want. Why trust them with even more money?
VOTE NO ON PROPOSITION S