UPDATE ON CITY UTILITY TAX
At the September 20th Taxpayers League Director's
meeting the issue of windfall tax increases, developed by rapidly escalating
utility costs, was, once again, discussed in detail. Covered were Utility
User Taxes (UUT) charged by the County (2.5%) and the Cities of Sacramento
(7.5%), Citrus Heights (2.5%), and Elk Grove (2.5%). It was noted that
the City of Sacramento's UUT was 5% higher than the County, and the other
two Cites that have a UUT. Also noted was that the League already has
a lawsuit filed against the County challenging the legality of its UUT,
which could be repealed, if not supported by the County voters.
The Board's decision was that the Sacramento
City Council should be offered the opportunity to voluntarily reduce its
7.5% UUT to 2.5% over a five year period. If the recommendation is ignored,
the League will put a Measure on the November 2002 ballot, which would
give city voters the opportunity to reduce the tax directly to 2.5%. The
Insert to this Tax Fax is the Taxpayers League letter sent to City Manger
Bob Thomas, and the City Council, covering the League's request.
REFUSE (GARBAGE) RATE INCREASE CANCELED
In July, the staff of the Waste Management
and Recycling Division of the County presented the Board of Supervisors
(BOS) a proposed residential rate increase of $2.40 per month for residential
garbage pickup and disposal. The rate increase was challenged by the League's
Executive Director. He related that the increase could be covered by use
of Tobacco Litigation Settlement Funds. The BOS deferred Staff's request
In August the staff presented an updated
version of needs. Once again the League opposed the rate increase, pointing
out that the $5 million to be gained from the increase was already in
hand. Waste Management had reported a profit of $3.4 million in last year's
finances, and the County's proposed Budget had over $2 million of undesignated
Tobacco Litigation Settlement Funds on hand. Combining the two would cover
the $5 million that would be paid by ratepayers if the rate increase were
approved. The BOS needing additional clarification regarding funds, voted
to continue the rate hearing until August 29th.
On August 29th, the staff asked the BOS
to continue the rate hearing until September, stating they were going
through a reevaluation of financial options. The BOS agreed, and set the
rate hearing for September 5th.
At the September 5th hearing staff told
the BOS that an increase in garbage collection fees was not needed. Set
aside was $2.2 million originally programmed for new garbage cans, and
found was $7.5 million in surplus funds. In addition, tobacco settlement
money will be used to buy new trucks, offsetting nearly $20 million in
future capital funds, part of which would have had to been collected from
residential ratepayers in the unincorporated county. Public Works Director
Warren Harada also told the Board that, based on this reassessment, they
could go two to three years without a rate increase. The revised Waste
Management fiscal plan was approved by the BOS.
The Association's Executive Director thanked
the BOS, and told the Board he would reexamine the League's 3-year ongoing
request that the $13.5 million of Waste Management's Enterprise Fund money,
illegally transferred to the County's General Fund after approval of Proposition
218, be returned using Tobacco Litigation Settlement Funds.
The plan to use up to $20 million of the
tobacco money to buy new trucks would seem to more than cover the League's
$13.5 million transfer request.
THE BONDS ARE COMING, THE BONDS ARE COMING!
We expect a rush of school bond issues,
probably on both the Primary and General Ballots during elections in 2002.
The fever to generate the bonds has been augmented by the success of Silicon
Valley billionaire's Proposition 39, which reduced the bond approval rate
from 66.6 to 55 percent of the votes cast. The dirty little secret of
this change is that repayment of the bonds falls on property owners only,
whereas all voters, property owners or not, will vote on the local bond
issues. Saying yes to bond Measures paid for by property owners is easy
for non-property owners, as it will not cost them a cent.
Already announced is that the Folsom Cordova
Unified School District Trustees will vote on a $53 million Measure for
the March Ballot, which will cost property owners $7.25 per month for
each $200,000 of assessed valuation. Los Rios Community College District
will probably also place a $265 million bond Measure to the voters next
March. That Measure will cost property owners $9.96 per month for each
$100,000 of assessed valuation.
At a recent joint press conference involving
Jonathan Coupal of the Howard Jarvis Taxpayers Association, Ted Costa
of the People's Advocate, Lew Uhler of the National Tax Limitation Committee,
and Joe Sullivan of the Sacramento Taxpayers Association, opposing Governor
Davis's approving increased spending by the State, Sullivan told the press
that organizations like the 40 year old Taxpayers League represent the
taxpayer's last line of defense. He used Chancellor Brice Harris crying
need for money for the Los Rios Community College District as an example.
Sullivan said that when the state does not fulfill its obligation to fund
higher education needs, in desperation community colleges turn to local
property owners for money. If successful, the state escapes it's obligation,
and lends to the Legislator's attitude of "let the locals fund it."
Historically, the Education Reserve Augmentation
Fund (ERAF) is the classic example. In the 1990's Gov. Wilson and the
Legislature took property taxes away from counties, cities, special districts,
and redevelopment agencies, and transferred the money to a special fund
to meet the state's needs to fund schools and community colleges. This
saved money in the state's General Fund. The process continues to this
day. Notwithstanding that when running for office Gov. Davis branded ERAF
as "larceny', and promised the voters he would give it back, he has fought
ending ERAF at every turn. And from these kinds of actions local school
bond Measures grow across the state.
UPDATE ON LAWSUIT AGAINST SACRAMENTO COUNTY
Sacramento County illegally passed its Utility
Tax, and increased its Transient Occupancy Tax (Hotel Tax) during the
1990s in violation of Proposition 62, which required the taxes to be put
before the voters for approval. These actions resulted in the Howard Jarvis
Taxpayers Association (HJTA) and the Sacramento Taxpayers Association
filing a lawsuit as plaintiffs against the County, asking that they put
the taxes before the voters as required by law. The County's answer to
the complaint was an admission that it had imposed the taxes, that Proposition
62 was constitutional, and that they did not submit the taxes to the voters
for approval. Their defense was that we exceeded the Statute of Limitations
(didn't file in time) and that the delay prejudiced the County.
At the time, two other cases came into play,
which involved similar defenses regarding the statute of limitations.
Oddly, the two came out with opposite decisions. The HJTA asked for a
California Supreme Court Review, and our case against the County was held
in abeyance, pending the outcome.
On June 4, 2001 the Supreme Court in a unanimous
decision stated that a three-year statute of limitations for legal challenges
begins to run, not when a tax was passed, but when the last illegal tax
was collected. The Supreme Court decision has been published, and at the
time The Sacramento Bee wrote that County Counsel Robert A. Ryan Jr. stated
that county officials will meet with the plaintiffs (HJTA and the Taxpayers
League) to discuss a resolution.
Notwithstanding County counsel's comment,
we haven't heard from them. Consequently, a letter was sent to the County
asking when the County intended to put the illegal taxes before the voters.
The County responded that, while it is true their defense regarding the
Statute of Limitations has been disapproved by the Supreme Court, the
County has a new defense. Its new defense is that Proposition 218 impliedly
supersedes Proposition 62 and grandfathers all pre-1995 unvoted taxes.
Since this issue is presented in a case pending in Monterey County, the
County of Sacramento wants to wait until a decision is rendered in the
Monterey case. It seems that the intent is, once again to delay resolution.
Remember this. Every time you pay any utility
bill that lists the County's utility tax as part of the total cost, the
County once again has violated the law. They have admitted it. And their
reaction is not to follow the law, but instead to continue to violate
it many times every month. It is time for accountability. Perhaps the
time has come to elect replacements for those charged with representing
us, with people whom, when they swear to uphold the State's Constitution
will obey its laws, rather than flaunt their violations.
WHY TWO-THIRDS VOTE FOR SPECIAL TAXES
[Excerpt from Howard Jarvis Taxpayers Assoc.
Over the years some taxpayers have suggested
that earmarked taxes should be encouraged so that everyone will know where
their money is spent. Unfortunately this is not how it works.
For example, in 1993 in a statewide special
election, voters approved Proposition 72, a half-cent sales tax to be
used for local public safety purposes. The result was that while the money
raised by the new tax went to public safety, many counties cut back on
the money they would otherwise have spent on public safety and diverted
it into other programs. Some counties saw no significant increase in spending
on public safety programs, but all taxpayers saw higher taxes.
This "money laundering" process, where citizens
are asked for more tax money for a purpose they support, but most if not
all funds formerly provided for that purpose are shifted to other less
popular projects, is a common practice in local government.
"It's a lot like a 'bait and switch' scam,"
Jonathan Coupal said. "Officials convince voters to approve a tax for
something like more police, and after they have the money, they take funds
that were formerly committed to law enforcement and spend them on some
other pet project. The two-thirds vote for these special taxes helps taxpayers
from becoming victims."
As a new member to the league, let me thank
you for your ongoing efforts to benefit the taxpayers of Sacramento. I
am a registered Libertarian and greatly appreciate the dedication to reign
in the obscene growth of government in our lives and taxpayer financing
of the same.
But I would like to ask that you make one
small correction to your sentiments in the most recent newsletter, taxpayers
without offspring do not benefit from the college plan you illustrated.
So to say that the "taxpayer" (which is a holistic term) is a winner is
not entirely correct. Only taxpayers with offspring are winners. And it
once again proves our tax system continues to 'target" groups of special
interests rather than provide across the board.
Don't misunderstand me, its not that I'm
ungrateful for tax relief of any kind, but it is important to note to
correctly describe tax relief so that taxpayers are not disillusioned
into thinking that something greater is taking place than what is taking
place. In addition, it is noteworthy to continue to discuss the unequal
treatment of individuals and married taxpayers without children with respect
to the tax system. Evidence exists in many areas that demonstrate that
childless taxpayers pay a disproportional share of the taxes.
- Craig B. Kincaid
Your article on utility taxes reminded me
of the way city management conned the city council while I was on the
Garden Grove City Council for 18 1/2 years beginning in April 1980.
Prior to Prop. 13, city departments provided
budgets of what they would like to spend. If there was a shortfall, property
taxes were increased.
After Prop. 13 was passed, the city had
to tighten its belt. It was found that some departments could operate
with fewer employees, vehicles could last longer, less money was donated
to charitable organizations, etc.
One thing management didn't want to do was
eliminate the employee pay raises of about 14 percent per year so fees,
charges and assessments were innovated or increased.
The council was told that pay raises given
3 months into the year were only for 9 months of the year so they only
counted 3/4 of the raise. The same logic had raises given 6 months into
the year figured as half the raise and those given 9 months into the year
amounted to only 1/4 of the raise. Using this logic, we were told that
a 4 percent raise 3 months into the year, 4 percent at mid-year, and 6
percent 9 months into the year made the raise only 6 1/2 percent.
Later the city increased the A, B, C, D,
E employee pay steps to include steps F, G, and H, claiming it saved money
because the raises would only be merit raises. Later when I checked, I
found the extra pay steps were practically automatic.
The point is that when management of a local
government entity claims there is a shortfall of funds, such shortfall
usually depends on the method used in figuring the budget.
- Bob Dinsen
LETTERS TO THE ASSOCIATION
We seek "Letters to the League" from members
on present projects and issues on which we are working, and recommendations
on those we should look at. Letters may be edited and republished in any
format, primarily in the interest of available space. Send letters, faxes,
or e-mail to the Sacramento Taxpayers Association. Our e-mail is firstname.lastname@example.org,
our phone/fax number is (916) 331-5991, and our address is:
Sacramento Taxpayers Association
1832 Tribute Road, #210
Sacramento, CA 95815
Our Members constitute the League's strength
and Members provide coverage on many issues we try to resolve. We welcome
new members G. Ross Popkey and Paul Hrabal to our 40-year old tax fighting
Over 120 taxing agencies in Sacramento County
and its six Cities, handle billions of taxpayer's dollars yearly. The Association's constant surveillance of their activities has been our mission
for 40 years. We have been successful in rooting out many illegal uses
of taxpayer's money, and have defeated the last three attempts to raise
sales taxes in the city and county of Sacramento. The last alone kept
$90 million in the pockets of taxpayers over the last three years.
We receive no outside funding. Funds are
raised in the form of membership dues and donations to our defense fund.
We always search for new members to build our strength. In the next two
years the League will be part of, or in charge of, some of the most serious
battles we have ever been engaged in involving taxpayer's protection.
These fights will be local and statewide, joining with a lead taxpayer
organization sponsoring a statewide fight for all taxpaying property owners.
To win these endeavors we are asking all members to help by recruiting
new members, and contributing to our defense fund. If each member were
to recruit just one other, we could double our strength in one year. Please
call (916) 921-5991 if you have someone you believe would be interested
in becoming a Member of the Taxpayers League.
ONE MAN ALONE
After writing the President's Column, I reflected
on actions of individuals and the impact they have on others surrounding
them. In this vein I wish to bring to your attention the actions of a
single individual...someone dear to us all, who has served his nation
in time of war, but who now serves all of us in the Sacramento community
and members of the Sacramento Taxpayers Association in particular: our
own Joe Sullivan.
As you will read throughout this month's
Tax Fax, after literally years of hard-fought effort, the County of Sacramento
has acknowledged that it need not again raise monthly refuse rates, and
in discussion last month County staff actually admitted that according
to their own computations, no such raise will be needed for the next three
years. While this outcome constitutes yet another victory of the League,
I can assure you that "our" victory is in fact the result of the efforts
of one individual, working alone, to make his community better: our own
Joe Sullivan. Joe has achieved a truly worthy goal, for which we all owe
him a debt of thanks.
Now I know Joe will be embarrassed to read
this, and he - and perhaps you - may even wonder why I have linked his
efforts in my own mind to the incredible acts of individual heroism and
sacrifice we have witnessed over the last month. Again, any such heresy
is my own, and is utterly unintended. My goal, however imperfect, is to
ensure that as the months and years pass, and the raw emotion and vivid
memories of September 11th pass from us as well, we are forever reminded
that in each and every day of our lives, there exists an opportunity for
one individual, acting alone, to make a real difference. We pray God that
we are never tested as those heroic rescue personnel, those airline passengers,
and so many other families have been tested, but we must forever carry
the spark which saw them act so bravely and so well in the face of so
much more. But failing such a moment, may we not fail to do that of which
we are capable when the moment presents itself. In fighting for the Sacramento
Taxpayers Association, Joe Sullivan has done precisely that - and done
so in our name - and for that he again deserves our thanks.
SEPTEMBER 11TH - A DAUGHTER'S QUESTION
AND A FATHER'S ANSWER
(My daughter Patricia (Lulu) Wheeler manages
the office, and her husband Jeff manages a shift in the City of Alexandria,
Virginia Sewer Plant - Her e-mail was sent Tuesday, September 11, 2001
- Joe Sullivan)
Oh my God poppa. How do you describe the
horrific scene I saw today. My God daddy, explain to me how there can
be so much hatred in a group of people that they need to cause so much
destruction? I've wept all day. I was sitting at work when I heard the
first report of the Trade Center, then the second…then I felt our building
shake from the explosion at the Pentagon. I ran to the window and could
see the huge clouds of black billowing smoke as the radio announced that
the Pentagon had been hit. People were walking around in disbelief, as
if in a daze. I started to weep. At that point the Directors told all
non-essential personnel to leave…which meant that Jeff and I stayed because
we are considered essential. The building emptied as I began to set up
a command post. I gathered a list of all personnel still on the site and
locations of all of them. I manned the radio base station and no one made
a move around the plant without giving me their location first, We were
then informed that we might have to stay all night because the next shift
could not make it in due to all the road closures and traffic jams. I
made sure that I had enough provisions for everyone overnight and had
all the first aid kits brought to my office just in case. I guess people
really don't think about what might be the next target…but we have been
well informed that what would go next would be the utilities…no power,
no water and no way to purify it. I sat at my desk as I watched military
helicopters circle overhead. We had security guards at both gates and
the Alexandria police sealed off the roads armed with shotguns. We could
see and hear the fighter jets as they circled DC…My God daddy, this was
the closest I've ever been to a war and I'm afraid it's not over yet…
Jeff and I are fine…a little worn out and
I think still walking in the same fog as everyone else. We got home at
9:00 after going in at 6:30…and you know what daddy…we'll be right back
there in the morning…trying to protect what has become so very dear to
- I love you daddy… Lulu
Wednesday, September 12, 2001 11:06 AM
Lulu. History seems a poor teacher. Human's
memories, or perhaps lack of knowledge, result in not recognizing that
wars, and the horror yesterday is an open declaration of war that until
now has been a limited guerrilla action, have been with us since time
immemorial. They start for many reasons, conquests to gain access to raw
materials (Japan in WW II), subjugation of peoples to increase national
power (Germany WW I and WW II), national interests (American Civil War),
and Religious Wars (Irish Catholics against Protestants, Muslims against
Jews, and some African Tribal Wars, among others). But of all, religious
wars are the worst because they are not battles of military might, but
rather battles between those with different faiths, deeply imbedded from
childhood in almost all humans. Religious wars don't end because one nation,
or a group of nations, conquers others who surrender, and are disarmed.
Religious wars don't end because you cannot conquer one's faith. Even
though you may conquer and control one's actions, the faith remains. The
history of the Jews is a classic demonstration of the strength of faith,
along with the martyred Christians. And that's what yesterday's terror
may have been about. There is no doubt that yesterday's military action
was a well-coordinated and extremely successful Islamic attack. The fact
that it was not done by men in uniform does not mean that it was not contrived
as a military objective. I believe it will be proven that Osama bin Laden
was at the root of this attack, aided by one or more of the Islamic nations.
His personal hatred of the US, along with his conviction that all Jews
and Christians are infidels, has made his efforts a Jihad, a holy war.
We, in the US have been insulated from the
horrors of war within the boundaries of our nation since the end of the
Civil War in 1865. But in virtually every other nation in the world, the
sort of destruction we witnessed yesterday is in many cases almost daily
fare. Look at Northern Ireland, Israel, the Sudan, many parts of Africa,
Mexico, and parts of the dissolved Soviet Union. The world shrinks every
day, and we can no longer think in terms of two oceans, and semi-safe
borders as safeguards from the rest of the world. Our association with
our allies, and particularly Israel, mark us as an enemy by many Islamic
nations in the world. We are at war. A new type war that we must learn
to fight. And it's going to be very difficult as the enemy is almost invisible.
I don't know what God has in mind for the
world, but I think bin Laden and his allies have misjudged the American
people. My birthday, December 7th, has made me a student of the attack
on Pearl Harbor. And I remember the quote of Japanese Admiral Isoroku
Yamamoto, the planner and leader of the attack. He said: "I fear we have
only awakened a sleeping giant, and his reaction will be terrible." Yesterday's
attack has awakened that giant again and united the people of the US.
God help the perpetrators when we find out for sure who is responsible.
I Love you,