Sales Tax Increase Looms

Council Waits for Poll Results Before Acting

Thursday, March 21, 2013
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Whether Santa Barbara voters are allowed to choose to increase the sales tax charged within city limits by an additional half cent this November will depend largely on the results of a $25,000 poll that has yet to be commissioned. At stake in the equation is about $9 million in additional revenues City Hall would generate a year that could be used to restore some of the services cut the previous six years or to address a massive gap ​— ​ranging from $200 million to $400 million in size ​— ​in unfunded and deferred capital needs.

The issue is especially charged given that this year is an election year for the City Council with four of the council’s seven seats up for grabs. For the sales tax to be placed on the ballot, a minimum of five councilmembers would have to put it there, and it’s not clear if the votes exist. Mayor Helene Schneider, up for reelection with no evident challenger in sight, is a strong proponent of the tax hike, arguing the additional revenues are needed for a host of pressing issues ranging from street repairs to a new police station. “If we don’t start fixing some of these things now,” she said, referring to the deteriorating quality of the 400 miles of roads City Hall has to maintain, “it’s going to cost us a whole lot more down the road.”

In 2001, the road-quality index for city streets was 74 out of 100; last year, it dropped to 63. Five years ago, a council subcommittee identified a list of major projects that needed funding; high on the list was a new police department, a refurbished fire station on the Riviera, and a revamped Cabrillo Bathhouse. Schneider said the bathhouse could generate revenues if fixed up, but she added that the downstairs gym ​— ​which many don’t know exists ​— ​is in such bad repair that “you don’t want to go in there.”

Councilmember Frank Hotchkiss, an outspoken and to-the-point conservative, is the only one to unequivocally state he’ll vote against placing the matter before the voters regardless of what the survey says. Hotchkiss ​— ​up for reelection ​— ​said surveys can be made to say anything and brought up the Saturday Night Live skit in which it was satirically demonstrated that “leisure suits cause cancer.” Hotchkiss said he has no plan yet how he would generate the additional revenues that would be required to hire the additional police officers he believes are needed. “It’s more of a philosophical starting point,” he said. “I don’t want to see more taxes.”

The council’s two other conservatives ​— ​Dale Francisco and Randy Rowse ​— ​expressed skepticism about the fiscal prudence of such a sales-tax increase but stated they’d be open to placing the matter on the November ballot, depending on the poll results. “If the voters say they want to tax themselves, who am I to stand in their way?” said Francisco. Francisco elaborated that he’d need to see a strong showing by survey respondents ​— ​closer to two-thirds than just one-half ​— ​to vote in favor of placing the tax increase on the ballot.

Both Rowse and Francisco expressed concern that the council has not demonstrated an ability ​— ​in relatively good economic times ​— ​to withstand public-employee demands for pay increases. Both the police and fire unions have just started contract negotiations; the union representing most city workers begins contract talks in September. Neither Rowse nor Francisco is up for reelection in November, but four years ago, Francisco ran for mayor against Schneider. Asked if he was contemplating another mayoral bid, Francisco stated, “No comment.” Francisco didn’t deny that the city had pressing capital needs, but he said many California cities were in far worse condition. The problem, he said, was structural in nature and could not really be addressed until the state’s regulatory bureaucracy stopped squelching California entrepreneurs.

City Administrator Jim Armstrong noted that the shortfall for major capital projects was first identified five years ago but that it made little sense to contemplate a sales-tax increase in the midst of a severe recession. Since then, he noted, the state shut down all redevelopment agencies, which Armstrong estimated cost the City of Santa Barbara up to $55 million over the next three years. Throughout the recession, he said, councilmembers voted to trim 90 positions from the City Hall payroll, making structural changes that saved $8 million a year. With or without the sales-tax increase, Armstrong said, the city could provide the same level of services without forcing unpaid furloughs on its workers. But, like Schneider, he stated some improvements would get more expensive over time. Armstrong noted that last year, 79 percent of the sales-tax increases proposed throughout California were approved, even one in Santa Maria. Such measures need only a simple majority if the funds are not earmarked for specific purposes. If they are earmarked, a two-thirds supermajority is needed.

Without five votes, the tax increase is dead well before it ever arrives. But even with the five votes, it remains unclear what community organization ​— ​or politician ​— ​would raise the funds to wage a credible campaign. Schneider would seem the obvious choice, but last year she unveiled a complicated package of ballot initiatives ​— ​including a sales-tax increase ​— ​that could not garner the political support needed for a host of reasons. While a simple sales-tax increase has less for opponents to lambaste, it would still face criticism from conservatives, who oppose any tax increase, and from liberals, who contend sales taxes unfairly burden the poor. Whether Schneider has the stomach for a repeat engagement has yet to be seen and would depend, in some measure, on whether she faced a serious mayoral challenge.


Independent Discussion Guidelines

So why is it that only the most regressive tax can be passed with a simple 50% majority? Answer: political reality.

Steve_Johnson (anonymous profile)
March 21, 2013 at 1:36 a.m. (Suggest removal)

Does this Tax and any other pressed into the State make any difference? Come the End of March, all that is left is the Financial Armageddon of America anyway. This is where our economy will fall to just below poverty and nearly 2/3's of America's workforce will see unemployment and poverty that will make the homeless of today (March 22, 2013) seem rich. Right after the Government kills nearly all of its contractor jobs and half of all their Government civilian jobs the Housing Market will default all loans and push the majority of American's onto the street. For many of us we heard from our Grandparents and great grandparents of the fall of 1930, when the Market crashed and people were literately jumping out of windows and off building roof tops to their deaths but watch out, were about to witness it all over again but this time 10 years is a best case scenario to this rounds crash and not the conservative scenario which would fall somewhere around 15 to 20 years before America would see prosperity again. So does it really mater that half a cent would make a difference?

dou4now (anonymous profile)
March 21, 2013 at 7:11 a.m. (Suggest removal)

Armstrong's states the same levels of service can be provided by the city without "forcing unpaid furloughs on its workers" - what a joke! These people are really insane; "forcing" city employees who are grossly overpaid and incompetent to work fewer hours at the same pay while increasing unemployment and the cost of living for residents by refusing to allow new development and new businesses and raising taxes and fees due to their negligence and violation of federal law, and then lying about their 13 years of ignoring input on their violation of federal law, ignoring federal law that protects the elderly and disabled, constant lies and propaganda, and support for criminal cops who cost residents hundreds of thousands in legal fees and fines. We really can't afford any of these people, and, unfortunately, it seems as though SB's long-term incestuous good old-boy policies have driven out all the competent people and filtered out anyone with the ethics necessary to run a Ponzi scheme. It's a great book on the destruction of the private sector by public sector employees whose only means of survival is as parasites. Lawsuits against SBPD haven't even been factored into economic projections, and the city's policy of following the example of the Catholic Church in refusing to acknowledge the molestations at St. Anthony's will undoubtedly parallel theirs in liability. SBPD forgers and perjurers and bankruptcy frauds, and worker's comp frauds and suborners of perjury by ministers and deadbeats with civil judgments against them at PR "Coffee with a Cop" meetings is actually a major step beyond the Catholic Church, which stopped a long way short of scheduling PR "Picnic with a Pedophile Priest" events.

14noscams (anonymous profile)
March 24, 2013 at 10:06 p.m. (Suggest removal)

Just quit voting for the spendthrift lefties. Get some people in office who think like the Governor of Kansas who dug the state out of a HUGE hole by cutting gov spending, reducing gov employment, eliminating unnecessary programs etc. BUT we need voters who are not looking for the gov to pay their way in order to accomplish this. Maybe impossible in a town where so many people depend on gov for income.

JohnLocke (anonymous profile)
March 25, 2013 at 9:48 p.m. (Suggest removal)

Sales tax increases are regressive and affect most those who have the least. Last year, Schneider's complex plan included a sales tax which would have aided our local public schools, so I was for it, and especially for the additional plan to oblige public employees to contribute more to their own public pensions. I can't support this tax plan since the police building and Cabrillo Bath house changes can wait.
Hotchkiss is a typical conservative in that he wants more cops on the street but has no plans or ideas about how to fund it.

DrDan (anonymous profile)
March 26, 2013 at 4:17 a.m. (Suggest removal)

More laws, more taxes, more cops. Ayn Rand's Atlas Shrugged prophecy coming to light.

billclausen (anonymous profile)
March 26, 2013 at 5:02 a.m. (Suggest removal)

If voters approve this, we can look forward to all sorts of new traffic calming projects as well. They may forgo filling potholes until the next proposed tax increase.

Botany (anonymous profile)
March 26, 2013 at 5:54 a.m. (Suggest removal)

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