Will Taxpayers Be Mugged by Sacramento?

TaxesGovernor Brown has just released his spending proposal for 2017-18 and taxpayers should not be blamed if they feel like they are walking down a dark alley in a high-crime neighborhood.

While the governor’s proposed budget has been described as austere, it still represents a spending boost of 5 percent, a rate of increase only slightly smaller than last year’s 6 percent. Because the state is in the process of rewarding its employees with generous pay increases and covering an expanding requirement to fund their pensions — pensions that are currently subsidized by six percent of the general fund budget — more spending does not represent an increase in the quantity or quality of services for average Californians.

The Brown budget contains no major program increases except for transportation. But the kicker is that this would be contingent on higher taxes on gasoline and car registration. So, while state workers will be kept snug and comfortable, if commuters want those pot holes repaired, they must pay extra.

However, the governor’s budget should not be regarded as anything more than a place holder, as the ability to fund it is threatened from all directions. The new administration in Washington, as well as a majority of both houses of Congress, have made it clear that Obamacare is on the verge of elimination. There can be little doubt that federal funding for California’s massive expansion of Medicaid is in jeopardy. Because, to paraphrase Ronald Reagan, a government program is the nearest thing to eternal life we’ll ever see on this earth, no one will be surprised when Sacramento looks to average taxpayers to make up the nearly $16 billion-dollar difference.

Then there is uncertain tax revenue. The extension of the nation’s highest income tax rates renders California highly vulnerable to economic fluctuations. Although growth had been tepid, we have experienced 90 months of economic expansion and financial experts warn us to be prepared for the next downturn.

As if these threats were not enough, Brown will have to contend with elements in his own party who believe in the axiom of former Senate leader, David Roberti, “When you’ve got it, spend it,” to which they would add the corollary, “If you don’t have it, spend it anyway.”

Chairman of the Assembly Budget Committee, Phil Ting, has already made it clear that he does not want to budget assuming the worst, that the Legislature must continue “investing in California,” a budgetary approach akin to Admiral David Farragut’s at the battle of Mobile Bay, “Damn the torpedoes, full speed ahead.” While Farragut was successful, is it appropriate to put California taxpayers at dire risk through imprudent spending?

In May, the governor will issue a revised budget, no doubt with major changes, in advance of the June 15 deadline for final passage. If revenue is down, taxpayers may be treated to the spectacle of a cage match between those committed to spending, backed by their special interest allies, and those who advocate a slightly more cautious approach.

In Sacramento, fiscal sanity is relative. Ironically, our eccentric governor who thinks nothing of lavishing nearly $100 billion on a bullet train, may be the dwindling middle class’s best hope to fend off major increases to their already staggering tax burden.

Jon Coupal is president of the Howard Jarvis Taxpayers Association — California’s largest grass-roots taxpayer organization dedicated to the protection of Proposition 13 and the advancement of taxpayers’ rights.

This article was originally published by HJTA.org

California Democrats Behaving Like Confederates

For fiscal conservatives and free market advocates, the national elections in 2008 and 2012 brought no small measure of disappointment. In its eight-year run, the Obama administration imposed a host of new taxes – including several as part of the failed “Affordable Care Act” – and, just as egregious, nearly doubling the national debt from $10 trillion to over $20 trillion.

Those who advocate for lower taxes, property rights and less burdensome regulation understood and begrudgingly accepted that “elections have consequences.” (As President Obama was known to brag.) So it is now with amusement – if not outright schadenfreude – we are watching progressives across the nation, and especially here in California, melt down in shock and disbelief.

Particularly frustrating for progressives is their growing realization that many of the policies and actions of the last eight years that they jammed down the throats of conservatives and center right citizens from “fly-over” country are now coming back to haunt them. For example, former Democrat Senator Harry Reid from Nevada changed longstanding Senate rules regarding how many votes it would take to stop the filibuster of a presidential appointee. Progressives imposed that rule to pack the United States Court of Appeal for District of Columbia Circuit, a powerful court because it reviews most legal challenges over federal regulations. The “Reid Rule” will now be used by the Trump administration to fill his cabinet quickly over the objections and efforts to obstruct by Democrats and, more importantly, to seat a replacement on the U.S. Supreme Court for the late Justice Antonin Scalia.

Another example of their being hoisted on their own petard was discussed recently by California political analyst Tony Quinn who noted that the federal courts struck down most of Arizona’s efforts to enforce border security. The U.S. Supreme Court noted that, in the area of immigration, federal laws pre-empt conflicting and even complimentary state laws. That throws into doubt any efforts by California and other left-leaning states to enforce any so-called “sanctuary” policies.

confederate-flagBut all this hasn’t stopped California’s top Democratic leadership from posturing (mostly for the cameras) about how they will “stand up” to the federal government to protect “California’s values,” whatever that means. Apparently, Gov. Brown and newly elected legislative leaders have mistaken Sutter’s Fort in Sacramento with Fort Sumter in South Carolina which heard the first shots fired in the Civil War. They need to be reminded that things didn’t work out so well for the Confederacy back then and if, by taking on the federal government, they think they will get a better outcome, they’re probably wrong.

The latest evidence that Democratic leadership has lost its moorings with reality is the hiring of Eric Holder, the disgraced and corrupt former U.S. Attorney General in order to “push back” against both the Trump Administration and the Republican controlled Congress. (Holder advocated for international criminal Mark Rich, and was admittedly running guns to Mexico as part of the “Fast and Furious” scandal).

The hiring of Holder is an insult to all California taxpayers. First, California has a multitude of lobbyists in Washington, D.C. (all at taxpayer expense) to represent the actual interests of the state. Second, the action was clearly a provocation intended to generate a response from Washington. But California should be careful what it wishes for. The Congress of the United States has the power of the purse and California would do well to work collaboratively with those upon whom they rely for billions of federal dollars.

Near the close of the Civil War, President Lincoln gave his famous second inaugural address in which he implored Americans to show “malice toward none, with charity for all.” Let us hope that the petulant, foolish posturing of California’s political leadership receive as much grace from the federal government in the coming years.

Jon Coupal is president of the Howard Jarvis Taxpayers Association — California’s largest grass-roots taxpayer organization dedicated to the protection of Proposition 13 and the advancement of taxpayers’ rights.

This piece was originally published by HJTA.org

Pay Hikes Result in a Happy New Year for State Workers

Money

In a recent column, I commented on how joyous the holiday season would be for members of the state Legislature and our constitutional officers who are seeing a 4 percent increase in their pay. California lawmakers were already the highest paid in the nation.

But as the song says, you ain’t seen nothing yet. In a state the U.S. Department of Labor rates as first in pay for state and local government workers, one of the largest public sector unions has negotiated a pay raise of up to 19 percent for many of its members. Union leaders claim that many of the jobs their members perform are in high demand and, without the increases, employees will be lured away to the private sector. Therefore, a 19 percent increase for “financial experts” currently making between $7,300 and $10,000 per month, is warranted. However, everyone has been invited to the party. Even janitors will be getting an extra 3 percent on top of the standard 4 percent that has been negotiated for all the represented workers.

Other unionized employees, now negotiating pay increases with the state, will likely see similar raises. And it is important to mention that most of these “public servants” are receiving health care and pension benefits that most in the private sector can only dream of.

In November, voters said yes to new taxes and to the continuation of the highest income tax rates in the nation. The expensive campaigns that put these measures over the top were funded primarily by public sector unions, so it is not hard to guess where the bulk of the tax revenue will be going. Instead of state government providing more and better services, most of the funds will go to paying for raises for government workers. And let’s not forget the need to fund nearly a trillion dollars in unfunded pension liabilities for which taxpayers will be picking up the tab.

This is not to lose sight of the fact that many public employees work hard and provide valuable service. Most citizens want to see these employees fairly compensated for good work.

However, because government holds a monopoly on most of the services it provides — there is no competition or alternative — much of the work actually provided is subpar. Anyone who must use government services cannot imagine that these across the board raises state employees are receiving are based on merit.

There are those who will justify the additional money as cost-of-living increases. But cost of living increases are based on inflation, which has been minimal due to the sluggish economy. Just ask Social Security recipients, who will receive an increase in their benefits of 0.3 percent (three-tenths of 1 percent) for the coming year. This translates to about a $4 monthly increase for the average retiree, or about $48 per year. Had the average recipient, who must get by on $1,355 each month, been granted a 4 percent increase (the minimum for so many state employees) their monthly checks would bump up almost $55, or $660 annually.

But we shouldn’t have to argue over how much government employees should be paid. Since union leadership worries that the private sector will hire valuable workers away unless they are paid more, why not let them go? In the private sector, they can join or establish companies that can bid on doing the work currently performed by government employees. Let them pay themselves whatever they want, but they will have to bid on doing the work they now perform on the taxpayers’ dime. Government will hire the lowest qualified bidder and if their service is topnotch, they will keep their contracts. If not, the governor and Legislature can move on and engage another bidder.

As the late New York Governor Mario Cuomo — a Democrat and father of the current New York Governor — stated several decades ago, “It is not a government’s obligation to provide services but to see that they are provided.”

Jon Coupal is president of the Howard Jarvis Taxpayers Association — California’s largest grass-roots taxpayer organization dedicated to the protection of Proposition 13 and the advancement of taxpayers’ rights.

This piece was originally published by HJTA.org

‘Public Servants’ or ‘Well-Paid Elite’?

MoneyOnce upon a time we called them “public servants.” Today, most taxpayers struggle to keep a straight face when this term is used to describe the well-paid, elite who govern us.

In a state where the median per capita income is just over $30,000, Gov. Brown, legislators and other state elected officials will celebrate the holidays with a 4 percent pay raise. The California Citizens Compensation Commission, whose members are appointed by the governor, decided the improved economy and healthy state budget justified the raise. California lawmakers, who were already the most generously paid in all 50 states, will now receive $104,115, earning them $14,774 more per year than the next highest. Of course, this does not count the additional $176 per day in “walking around money,” living expenses lawmakers receive for every day the Legislature is in session, amounting to an average of $34,000.

The governor, too, is now the highest paid at $190,100 — Pennsylvania’s governor is actually slated to make $723 more, but Gov. Tom Wolf does not accept the salary.

Do Californians pay their governor, the top executive of a state government responsible to nearly 40 million constituents, enough? The fact that there is never a shortage of candidates for this job is an indication that the pay is sufficient. So, the question arises, why do many government employees receive more than the governor?

At the local level, most cities have as their chief executive, a city manager. Of 479 cities – out a total of 482 – reporting to the state controller, 279 are paid more than the governor. Of these, 24 receive over $300,000 annually.

For some cities, paying their top administrator a high salary seems to be a matter of vanity. Council members, who approve generous compensation, will take the position that their city deserves a highly-paid manager, the same way some car buyers justify the purchase of a luxury vehicle. Just as the neighbors may be impressed by the new Mercedes, neighboring cities will be impressed with their city’s ability to overpay the help. This, of course, puts pressure on surrounding cities to keep up with the Joneses.

While some city hall insiders will argue that higher pay is justified by a larger population, there seems to be no actual correlation.

Escondido, California’s most generous city, has been compensating its manager $413,000 annually to serve a population of 151,000. In slightly larger Palmdale, the manager receives $138,000 to look after 160,000 residents. And then there is Garden Grove with a population of 177,000 where the city manager gets $89,000.

A few years ago, the city manager in Bell went to prison for illegally compensating himself $800,000 per year. However, although it may not be illegal, the city of Vernon stands out as a candidate for the most profligate in the state. Its top executive is paid more than $328,000. The city’s population is only 210, which means that each resident is responsible for over $1,560 to compensate the manager. (The rumor that Vernon’s top executive insists on being called “Your Majesty” could not be verified.) Another small city, Gustine in Merced County, with a population of 5,482 gets the award for most frugal. It pays its city manager $909 annually.

While there are other areas of government employee compensation that beg examination, the range of pay for city managers seems to be the most irrational.

Still, none of these local administrators is close to the state’s top salary of $3.35 million. But since the program generates the revenue to pay UCLA football coach Jim Mora, he is more likely to be criticized for his record more than his salary.

Jon Coupal is president of the Howard Jarvis Taxpayers Association — California’s largest grass-roots taxpayer organization dedicated to the protection of Proposition 13 and the advancement of taxpayers’ rights.

This piece was originally published by the HJTA.org

Legislature Tries to Dodge Prop. 54 Transparency Requirements

TransparencyThe voters speak, the legislature interprets — and sometimes the translation is not faithful to the original meaning. We saw that last week with resolutions and rules changes that seem to fly in the face of the newly passed Proposition 54 demanding a waiting period before any measure is passed and last session with Senate Bill 1107, which ignores the clear language contained in 1988’s Proposition 73. Now there is a lawsuit on the senate bill charging the new law is out of bounds and a violation of Prop. 73. Perhaps a legal challenge will follow on the Proposition 54 issue.

SB1107 set up public financing of campaigns claiming that the bill was furthering the purposes of the political reform initiative, Proposition 73, passed by voters nearly thirty years ago. One major problem with the reasoning — Prop. 73 banned public financing. How can you further the purposes of a law when a bill takes the law in the exact opposite direction?

The Howard Jarvis Taxpayers Association teamed with former state senator and judge, Quentin Kopp, a co-author of Proposition 73, to file suit against SB1107. In a release, HJTA president Jon Coupal said, “California voters decided to prohibit taxpayer dollars from being used as political slush funds.  If politicians want to change that, they have to take the issue back to the voters.”

I signed the ballot argument on behalf of Proposition 73. At the time SB1107 was being considered I wrote in this space that the bill was a back door way to avoid the voters wishes on public financing. Only a vote of the people can change the dictates of Prop. 73.

I expect the courts to see the law the same way. That could lead to a test on the newly passed Proposition 54.

Prop. 54 requires that bills be in print for three days before a final vote can be taken. The idea is that due deliberation occur before legislators pass judgment. Yet, when the legislature was sworn in last week, resolutions were immediately passed calling on Congress to pass comprehensive immigration reform and calling on the president-elect not to seek deportation of undocumented immigrants. In addition, the legislature set a rule that a bill passed in its original house did not have to submit to the three day rule under a theory that the bill would come back to that house with amendments from the second house.

The legislative majority made a rhetorical defense of their action on the resolutions justifying the procedure by declaring that Prop 54 only covered bills not resolutions or constitutional amendments.

One wonders if the voters made that distinction when voting on the ballot measure.

The proponent of Proposition 54, Charles Munger Jr., told Capitol Public Radio, “It is unfortunate that they would choose to pass their own rules and a resolution without giving their members and the public 72 hours to think about it.”

Perhaps Munger will go to court or wait to see how the Jarvis/Kopp lawsuit plays out.

One odd feature dealing with these two measures is that the Common Cause organization supported both Proposition 54 and SB1107. In fact, Common Cause sent out an email fundraising appeal preparing for a legal defense on SB1107. So here they support the legislature’s interpretation of the law. Will they be so willing to take the same course on Proposition 54?

The goal of the lawsuit is simple: When it comes to the initiative process the people’s verdict is final unless the voters themselves choose to change it.

This piece was originally published by Fox and Hounds Daily

What would California be like as an independent nation?

calexitCalifornia breaking off into the ocean as a result of the “Big One” is science fiction fantasy to Hollywood, credible urban legend to citizens of Los Angeles and San Francisco and, perhaps, the secret hope of many Americans residing on the other side of the Sierras. However, backers of a just filed initiative, “Calexit: The California Independence Plebiscite of 2019,” want a different sort of California breakaway. They envision the state as a “free, sovereign and independent country.” Although the effort began several years ago, secessionists have been bolstered by those suffering Trump Derangement Syndrome – a condition where “alt-left” adherents lose their minds over the thought of a Trump presidency.

A spokesman for the movement cites California’s different culture, different set of priorities and different plans for the future as a justification for breaking away from the rest of the country.

While efforts to establish California as a separate country may be a farfetched idea – the issue of state secession was settled in the small town of Appomattox, Virginia when General Lee surrendered to General Grant, 1865 – it is an interesting mental exercise. What would California be like as an independent nation? Who would govern and what would be the impact on taxpayers? And if California could establish independence, would the break-up end there? Drive anywhere in the Sierra foothills or north of Sacramento and “State of Jefferson” signs are ubiquitous.

If California were an independent country, the precedent would be set for further fracturing, with other regions, where dissatisfaction with the established order is intense, seeking to break away.

Today, California’s political direction is dictated by the upper income elites living in coastal enclaves and Hollywood. Here, the Starbucks generation is consumed with issues like climate change and bathroom access and they are not shy about telling others how to live. This explains why Sacramento seems to be constantly making war on those not part of the coastal, protected class. But travel just 25 miles from the coast and you’ll find a different world. Here, people are concerned about finding a job or keeping the job they have.

After speaking to a group of politically active Californians a few years ago, pollster Scott Rasmussen responded to a question about the size of government saying, the average person does not walk down the street thinking about limited government, they are thinking about how they are going to support their families.

Outside of Malibu, Santa Barbara and the Bay Area, most people are still searching for the answer to the question of how to feed, shelter and clothe their families. If given the option of breaking away from the Prius driving, chardonnay sipping, kale chip nibbling elite, they would likely vote yes.

California will not become an independent nation, but the divide between the coastal and inland areas is real and we are about to experience another clash of these cultures played out on the Sacramento stage.

A special session on transportation, called by Gov. Brown last year, has just concluded without lawmakers imposing new taxes. But when the new Legislature convenes, one with even more pro-tax members elected in November, the top priority will be a significant increase in the gas tax and other auto-related charges. Once again, inland residents who need their cars for work will find themselves pitted against the “Let them drive Teslas” coastal elite.

If the price of fuel heads even higher than it is now, we are bound to see a multitude of working class Californians filling their tanks one last time as they leave the state for a foreign land called America.

Jon Coupal is president of the Howard Jarvis Taxpayers Association — California’s largest grass-roots taxpayer organization dedicated to the protection of Proposition 13 and the advancement of taxpayers’ rights.

This piece was originally published by HJTA.org

Local Governments Rigging Elections — Again

Voting boothWith all the state and local taxes on the November ballot, one would think that government at all levels in California was starved for revenue. But even a cursory review of the Golden State’s “tax machine” reveals that the tax burden is already too heavy for many to bear. California has the highest income rate in America (likely to be extended for another 12 years) and the highest state sales tax rate. And despite Prop. 13, our per capita property tax collections ranks no lower than 14th in the nation.

In the June primary, voters already passed 29 out of 40 local tax increases. But those taxes register as barely a blip compared to the earthquake confronting voters in less than three weeks. According to the California Taxpayers Association, there are 228 local tax measures representing a cumulative tax increase of more than $3 billion per year, along with 193 bonds (more than $30 billion’s worth) that would dramatically increase annual property taxes.

After the June primary, this column observed that the high rate of passage reflected not so much a love for higher taxes as it did the fact that the tax raisers have become experts at gaming the system to pass tax and bond measures. Highly paid political consultants tell local officials not to publicize tax elections to the entire community, but to target only their supporters. This means running stealth elections, communicating (in the case of school bonds) with only administrators and construction firms who are always more than willing to finance political campaigns and, of course, public employee unions who never met a tax they didn’t like.

The strategies that the pro-taxers employ to extract money from an unsuspecting citizenry are endless. For example, many school boards, cities and counties do all they can to time elections so that potential opponents have inadequate time to mobilize. The ultimate goal is to prevent an opposition argument from even appearing in the ballot pamphlet. On countless occasions, taxpayer advocates have been blindsided by proposed tax increases because they were only afforded a few precious days to submit an argument. And when it is too late, there are few legal remedies.

The ultimate insult to taxpayers, of course, is when local governments use public dollars to engage in political advocacy to influence an election. In theory, it is illegal for officials to use public resources (including public funds) to urge a vote for or against a political issue. But, in practice, it happens all the time. Two weeks ago, both the Howard Jarvis Taxpayers Association and the Central Coast Taxpayers Association filed a complaint with the Fair Political Practices Commission alleging campaign reporting violations of the Political Reform Act by the County of San Luis Obispo, the San Luis Obispo Council of Governments (SLOCOG) and the Yes on Measure J Committee, a group pushing a local transportation tax. These government entities have spent nearly a quarter of a million taxpayer dollars on promotional materials and government employee and contractor compensation supporting Measure J.

As the November election draws near, the complaints about government interference in elections have ramped up dramatically. In Sacramento, the Sacramento City Unified School District used “robocalls” to contact thousands of parents with “important information” about the benefits of a parcel tax as well as statewide Proposition 55. According to theSacramento Bee, the district sent the scripted messages recorded by five district trustees through its automated telephone message distribution system, explaining how the two tax measures would raise money for school programs and services that otherwise could be slashed. (This despite the fact that education spending in California has exploded since 2010).

Such communications are neither information nor balanced. They are always one-sided puff pieces designed solely to extract yes votes from uninformed voters.

California voters need to be alert to the lies, distortions and illegal expenditures of taxpayer dollars when considering any request for higher taxes. Yes, government services require public dollars. But before voting yes on any tax increase, ask yourself why is it that other states have markedly better public services without the high price tag.

Jon Coupal is president of the Howard Jarvis Taxpayers Association — California’s largest grass-roots taxpayer organization dedicated to the protection of Proposition 13 and the advancement of taxpayers’ rights.

This piece was originally published by HJTA.org

How To Ensure You’re Not Over-Charged on Property Taxes

property taxAs any reader of this column knows, voters will be confronted come election day with billions and billions of new tax hikes and bond measures (which, of course, result in their own tax hikes). But let’s not forget that there is another reason for taxpayer to experience a heightened sense of anxiety over the next few weeks.

For many the real scare this time of year is not the monsters at our doors on Halloween but the property tax bill in the mail box. But, while the “tax and spend” lobby increases its influence in Sacramento, homeowners have still been able to count on Proposition 13 for some degree of protection. Because Proposition 13 limits increases in a property’s assessed value to two percent annually, most property owners have a good idea what their tax bill will be even before opening the envelope. But homeowners still need to examine carefully their property tax bill because mistakes can happen.

Taxpayers should understand the various charges and make certain that they are not being assessed for more than they are legally obligated to pay. The best way to check a tax bill is to have your previous year’s bill handy for reference.

Checking the bill is especially important for those who bought their homes a few years ago at the height of the market. If your home value is actually lower than the assessed value shown on the tax bill, you should consider applying for a reduction in taxes. (Sometimes called a “Prop. 8 reduction”).

For most California counties, the property tax bill will show three categories of charges. They are the General Tax Levy, Voted Indebtedness and Direct Assessments.

General Tax Levy

The General Tax Levy is what most people think of when talking about property taxes. It is based on the assessed value of land, improvements and fixtures. This charge usually makes up the largest part of the tax bill and it is the amount that is limited by Proposition 13.

Proposition 13 passed overwhelmingly by voters in 1978 and it established a statewide uniform tax rate of one percent of assessed value at the time of purchase and limited annual increases in assessed value to no more than two percent. From a practical standpoint, this means that once the base year value of your property is established the General Tax Levy cannot be increased more than two percent each year. This allows all property owners to predict their property tax bills into the future and budget accordingly.

The best way to check to make sure that your current General Levy of Assessment is correct is to compare it with the previous year’s bill. The increase should be no more than two percent unless there have been improvements to the property like adding a room to a house or if you previously received a Prop. 8 “reduction in value.” This bears repeating: Because the real estate market in many parts of California is recovering many homeowners who previously received a temporary reduction in “taxable value” from their assessment may now see an increase in their tax bill more than two percent from last year. But in no case will the taxable value be more than the initial Prop. 13 base year plus two percent annually from the date of purchase. Although that may seem unfair, keep in mind that while the reduction was only temporary, the savings you received when your property was worth less are permanent.

If in doubt about the current value of your property, check sales of comparable homes in your neighborhood. If homes like yours are selling for less than the valuation on your latest bill contact your county assessor and ask that the value and resulting tax be adjusted to reflect true current value.

Voted Indebtedness

Voted Indebtedness charges reflect the repayment cost of bonds approved by the voters. Local general obligation bonds for libraries, parks, police and fire facilities and other capital improvements are repaid exclusively by property owners. Because a minority of the population is required to pay the entire amount, the California Constitution of 1879 established the two-thirds vote for approval of these bonds. This assures a strong community consensus before obligating property owners to repay debt for 20 or 30 years.

Until the year 2000 local school bonds also required a two-thirds vote but the passage of Proposition 39 lowered the vote to 55 percent. (Of course this did very little to improve schools as was promised). Because the 55 percent requirement guarantees that most school bonds will pass regardless of merit many homeowners are seeing a significant increase in the Voted Indebtedness column on their tax bills.

In some counties, parcel taxes may appear under this second category of property exactions even though parcel taxes are rarely used to repay debt. Parcel taxes are taxes on property ownership but are not imposed as a percentage of taxable value. Although there is no upper limit to amount of parcel taxes you have to pay  (HJTA is working to change that) the good news is that under Proposition 13 they still require a two-thirds vote.

Direct Assessments

The third type of levy one finds on the typical property tax bill is for direct assessments for services related to property such as street lighting, regional sanitation, flood control, etc. Because of Proposition 218 — the Right to Vote on Taxes Act placed on the ballot by the Howard Jarvis Taxpayers Association in 1996 — property owners must be given a meaningful say in approving new assessments. Before an assessment can be imposed or increased property owners must be informed in writing and be given the opportunity to cast a protest vote on the new assessment or assessment increase.

For more information regarding your property tax bill go to HJTA.org and click on Frequently Asked Questions then scroll down to “About Property Tax Assessments”. If you have a question about your property tax bill you can contact your county assessor, county tax collector or, in many instances, the phone number of the levying agency for each levy that is reflected on your bill. It’s your money and you have a right to be certain that your bill is correct.

Jon Coupal is president of the Howard Jarvis Taxpayers Association — California’s largest grass-roots taxpayer organization dedicated to the protection of Proposition 13 and the advancement of taxpayers’ rights.

Originally published by HJTA.org

Proposition 13 Is Safe — For Another Few Weeks

prop 13The Legislature is in adjournment, and with lawmakers at home campaigning for re-election, they are unable to engage in their favorite pastime of undermining Proposition 13 and its protections for California taxpayers.

However, this time out is only a brief respite from the Sacramento politicians’ inexorable pursuit of taxpayers’ wallets, the ferocity of which matches the dedication and intensity of a bear going after honey.

This December, after the election, lawmakers will reconvene to kick off the next two-year legislative session. During the just completed session, with great effort, taxpayer advocates were able to blunt a number of major efforts to modify or undermine Proposition 13, and, as surely as Angelina and Brad will be appearing on the covers of the supermarket tabloids, these attacks on taxpayers will begin anew when the Legislature is back in session.

Bills will be introduced to make it easier to raise taxes on property owners as well as to cut the Proposition 13 protections for commercial property, including small businesses. There may even be an effort to place a surcharge on all categories of property, an idea that was put forward by authors of an initiative that nearly collected enough signatures for placement on this year’s November ballot.

Accompanying the legislative fusillade will come the usual arguments that local government, or schools, or infrastructure, or the homeless, or the elderly, or (fill in the blank with the program or cause of your choice), or all of the preceding, need more money.

Government at all levels has become a militant special interest and its Prime Directive is to increase revenue – to take in more taxpayer dollars that is – and more is never enough.

The dirty little secret behind why government has changed from a service entity, dedicated to meeting the needs of its constituents, to a rapacious overlord, is that since being granted virtually unfettered collective bargaining rights in 1977, California’s state and local government workers have become the highest compensated public employees in all 50 states. With the high pay comes high union dues, collected by the employing entity and turned over to the government employee union leadership. These millions of dollars can then be used as a massive war chest to elect a pro-union majority in the Legislature and on the governing bodies of most local governments. And since these elected officials’ political futures are dependent on the goodwill of their union sponsors, there are almost no limits on what they will be willing to do to extract more money from taxpayers to be shoveled into ever increasing pay, benefits and pensions for government workers. (Government employee pension debt is several hundred billion dollars).

Literally, the only protections that average folks have from a total mugging by state and local governments are Proposition 13 and Proposition 218, the Right to Vote on Taxes Act. These popular propositions put limits on how much can be extracted from taxpayers by capping annual increases in property taxes, requiring a two-thirds vote of the Legislature to raise state taxes and guaranteeing the right of voters to have the final say on local tax increases.

It is easy to see why these taxpayer protections are despised by the grasping political class and their government employee union allies. This is also why taxpayers will have to work hard to preserve them.

Jon Coupal is president of the Howard Jarvis Taxpayers Association — California’s largest grass-roots taxpayer organization dedicated to the protection of Proposition 13 and the advancement of taxpayers’ rights.

This piece was originally published by HJTA.org

Taxpayers to Pay Even More as Usual Legislative Allies Vote for Tax Hikes

tax signAs the final day of the legislative session dawned last week, taxpayers were cautiously optimistic. After all, we had already stopped the most direct threats to Proposition 13. Those included Senate Constitutional Amendment 5, which would have weakened the rules regarding how some properties are valued for tax purposes and Assembly Constitutional Amendment 8, lowering the two thirds vote at the local level for taxes and bonds. Another success was notched by derailing an eleventh hour effort to make it much easier to raise property fees by broadly redefining sewer service to include storm water runoff programs. While seemingly arcane, this would have exposed California homeowners to billions of dollars in new property levies without direct approval.

As for more debt, taxpayers should be pleased that two multi-billion dollar bond packages, on parks and affordable housing, failed to clear the Legislature.

Now for the bad news. On the last day of session, our tax-and-spend legislature hit California consumers with a new tax on car batteries by passing AB 2153. This $1 tax on consumers will be paid at the point of sale, as will a $1 tax on manufacturers to be passed onto consumers. After 2022, the $1 tax on manufacturers is added to the consumer total increasing it to $2, and the tax is made permanent. While the revenue generated purports to deal with legitimate environmental issues regarding battery recycling facilities, thanks to AB 2153 receiving a two-thirds vote, the money can simply go into the General Fund and be used for any purpose.

Under the category of illegal as well as foolish, the Legislature authorized local municipalities to spend public money for political campaigns. Beyond the obvious argument that taxpayers should not be forced to finance campaigns with which they might disagree, Senate Bill 1107 is also in direct violation of the Political Reform Act which expressly prohibits such financing. To avoid costly litigation over the validity of SB 1107, Governor Brown could do taxpayers a favor by vetoing this bill.

Speaking of illegal, Assembly Bill 1889 seeks to spend hundreds of millions of taxpayer dollars on California’s showcase boondoggle, the High Speed Rail project. The legal problem is that access to the bond proceeds is conditioned on several requirements, including partial funding from federal and private sources, speed requirements and no public subsidies for operating expenses, none of which the High Speed Rail Authority can possibly meet. Again, in the absence of Governor Brown’s veto, litigation over sale of the bonds is a certainty.

From the perspective of fiscal sanity, it is a shame that every two year legislative session in California is an exercise in trying to prevent damage to taxpayers and the economy. Rarely is there anything remotely worthwhile in the hundreds of bills passed by our esteemed political leadership: No pension reform, no education reform, no civil justice reform or tax reform. While other states run clean, effective and efficient governments, the California Legislature resembles a three ring circus more times than not.

Unfortunately, it is not getting better. In the session that just ended, even some of our allies (or so we thought) cast horrible votes in favor of tax increases. As bad as things are, this November’s election could spell disaster for California’s beleaguered taxpayers. Tax hikes at the state level require a two-thirds vote of each house and we now know that a legislator’s proclivity to raise taxes does not necessarily depend on party affiliation. For taxpayer advocates, this is going to make our job of defending ordinary citizens in the Capitol much, much harder.

Jon Coupal is president of the Howard Jarvis Taxpayers Association — California’s largest grass-roots taxpayer organization dedicated to the protection of Proposition 13 and the advancement of taxpayers’ rights.

This piece was originally published by the Howard Jarvis Taxpayers Association.