Contra Costa Herald

News Of By and For The People of Contra Costa County, California

Public asked to participate in CalTrans test on DeSaulnier’s per mile “Road Charge” to replace gas tax

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Video screenshot source: Caltrans

Due to purchase and use of hybrid and electric vehicles

Receive up to $400 in gift cards for 6-month Pilot program beginning Aug. 2024

By Allen D. Payton

Caltrans has launched a test on the proposed per mile Road Charge to possibly replace the state’s current gas tax and invites the state’s drivers to participate. The Pilot program will last six months and participants can earn up to $400 in gift cards.

With the passage of Senate Bill 1077 introduced in 2014 by then-State Senator (now-Congressman) Mark DeSaulnier, California began investigating a long-term, sustainable transportation funding mechanism as a potential replacement to the gas tax, known as a “road charge” due to the advent of hybrid and electric vehicles. As of 2022, state officials estimate that there were about 1.1 million electric cars and 1.3 million hybrids on California roads.

Source: Caltrans

Taking direction from the Legislature, California completed the largest road charge research effort to date piloting more than 5,000 vehicles that reported in excess of 37 million miles over a nine-month duration. According to the program’s report, the statistics only serve to reinforce Californians’ desire for mobility, a safe and reliable transportation system, and an improved overall quality of life. Below please find the California State Transportation Agency’s release of the California Road Charge Pilot Program final report.

History of Transportation Funding

According to the Road Charge Pilot Program Summary Report, Nearly all of the 350 billion miles driven each year on California’s highways and roads are  powered by gasoline or diesel fueled vehicles. Historically, the taxes on those fuels provided the majority of the revenue required to maintain and operate our transportation network. As future consumption of gasoline and diesel fuel declines, due to increased fleet efficiency, California will be challenged to sustain its $2.5 trillion economy. Continuing to depend on a consumption-based transportation model, while at the same time adopting policies to increase vehicle fuel efficiency and promote the reduction of vehicle miles traveled, puts into question the long-term viability of the gas tax as a sustainable revenue model.

Source: Caltrans

Historically, transportation funding has been impacted by two main factors: inflation and vehicle fuel efficiency. Until this year, with the passage of the Road Repair and Accountability Act of 2017 (Senate Bill 1), the state gas tax had not been adjusted for inflation since 1994, which significantly reduced its purchasing power. Senate Bill 1 adjusted fuel rates for past inflation and includes future inflation adjustments: hence, solving the inflation issue and delaying the expected transportation funding shortage by a decade or more. However, the impact of improving vehicle fuel efficiency remains an issue, especially as new vehicles sold in the coming decades are expected to be much more fuel efficient.

The report claims, “Without Senate Bill 1’s inflation adjustments, the transportation funding shortfall would be quickly approaching. The new Senate Bill 1 revenues, as illustrated in Figure 1, stabilize the state’s short-term transportation infrastructure funding needs and provides time to explore alternatives to continued reliance on fuel taxes.”

Source: Caltrans

How Transportation Funding Works

Currently, it costs approximately $8.5 billion annually to maintain California’s roads.

  • Approximately 80% of highway and road repairs are funded by a tax on gasoline charged at the pump when you buy gas. The more gas you buy, the more you pay in gas taxes and the more you contribute to highway and road repairs.
  • On average, Californians pay about $300 a year in state gas taxes.
  • Various state fees also support transportation. Trucks pay weight fees and zero-emission vehicle owners pay $118 each year, and all vehicle owners pay a transportation improvement fee.
  • Some counties also charge a local sales tax to further invest in road and transit needs or have tolls on bridges or certain highways.
  • The public may also pass state bonds to invest in additional transportation needs.

What is Road Charge?

California relies on gas tax and other fuel tax revenues to fund its roadway maintenance and repairs. But as cars get more fuel efficient or use other energy sources, such as electricity and hydrogen, the gas tax will no longer fund the infrastructure California needs. California is researching a potential gas tax replacement that’s both sustainable and equitable: road charge. A road charge is a “user pays” system where all drivers pay to maintain the roads based on how much they drive, rather than how much gas they purchase. Under a road charge, all drivers share roadway maintenance and repair costs based on what they actually use. (https://dot.ca.gov/programs/road-charge)

  • California could replace the gas tax with a mileage-based user fee charged to drivers who use the roads. The more you drive, the more you pay for highway and road repairs. The less you drive, the less you pay.
  • Everyone would pay their fair share for road repairs based on how much they drive, not the kind of car they own.
  • California is working to develop a road charge program that is fair, transparent, and sustainable so that it meets our road maintenance needs now and in the future.

Most States Pursuing Vehicle Miles Traveled Taxes

According to the Tax Foundation, most states are taking steps toward a vehicle miles traveled (VMT) tax. “Oregon was the first state to begin research into VMT taxes in 2001 and was the first to implement a program in 2015. Four states now have active programs for passenger vehicles and four other states have active programs targeting heavy commercial vehicles (Oregon has both), with pilot programs carried out in 16 states. Only Hawaii has a mandatory program, which requires EVs to participate by 2028 and all light vehicles by 2033.”

Video screenshot source: Caltrans

Calculator Compares Road Charge vs. State Fuel Tax Costs

The “Road Charge” vs. gas tax calculator for a sample cost comparison of paying the current gas tax of $0.579 per gallon as of July 1, 2023, versus a per mile road charge offers options of $0.02, $0.03 and $0.04. At two cents per mile the Total Monthly Road Charge would be less than the Total Monthly State Fuel Tax for a gas-powered vehicle. But at three cents per mile, the monthly cost of the Road Charge would be greater than the current fuel tax.

For a 2024 Chevrolet Equinox EV driven an average of 1,000 miles per month the Road Charge annual costs would be $240 at two cents, $360 at three cents and $480 at four cents per mile versus the current $118 annual fee. The calculator “Does not include any federal or local taxes” and shows, “Rates are hypothetical and would be set by the California Legislature.”

Video screenshot source: Caltrans

Participate in 2024 Road Charge Collection Pilot

The Road Charge policy idea is still being explored and developed. The public’s input and ideas can help inform what the best way might be to implement a program in California. Drivers are asked to participate in the 2024 Road Charge Collection Pilot and earn up to $400!

  • Receive up to $400* in gift cards
  • Participate for 6 months; Aug 2024 – Jan 2025
  • Pay road charges each month
  • Gas tax refunded end of pilot
  • Take 2 surveys to tell us about your pilot experience

*Complete all required activities throughout the Pilot and earn up to $400: $100 distributed in September 2024 and up to $300 will be distributed in February 2025.

To learn more and participate in the pilot program visit https://caroadcharge.com/engage/contact-us-pilot/, call (916) 619-6283 toll-free or email info@caroadcharge.com.

 

 

Contra Costa’s Measure X sales tax: Living Up to the Promise?

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Zoom discussion Feb. 16 sponsored by League of Women Voters, Contra Costa County Library, Contra Costa TV

Voters passed Measure X, a new countywide 20-year, half-cent sales tax to support health and human services for our neighbors and families, in November 2020. The ballot measure language stated that the intent of Measure X is “to keep Contra Costa’s regional hospital open and staffed; fund community health centers, emergency response; support crucial safety-net services; invest in early childhood services; protect vulnerable populations; and for other essential county services.” Learn whether it’s living up to what was promised to voters in a Zoom discussion on Thursday, February 16 at 4 p.m.

How is the Board of Supervisors providing accountability to the public about the impact of the tax monies? What did we learn from this first year of sales tax allocations? What does this mean for the future? A panel of experts will discuss what was funded by Measure X and what gaps remain:

  • John Gioia, Contra Costa County Supervisor
  • Marianna Moore, Chair of the Measure X Community Advisory Board
  • Kanwarpal Dhaliwal, Co-Director of RYSE, a non-profit for Richmond youth
  • Sara Gurdian, Contra Costa County Budget Justice Coalition

Shanelle Scales-Preston will moderate the panel discussion.

Decisions about the first year’s Measure X allocations, as analyzed by the Measure X Community Advisory Board, will be presented as well as the remaining gaps they identified. Other topics will include changes to the Advisory Board’s bylaws and any barriers encountered during the first year.

Register for the Zoom webinar with your email here.

REGISTER FOR THIS EVENT »

Information on how to access the Zoom webinar will be sent to your email address 24 hours before the program.

The Library will provide closed captioning for this event. The program will be recorded and posted on the following sites after the meeting:

LWVDV YouTube channel

Contra Costa County Library YouTube channel

Sponsors include the League of Women Voters of Diablo Valley, the League of Women Voters of West Contra Costa County, the Contra Costa County Library and Contra Costa TV.

Contact programs@lwvdv.org for more information.

MTC to seek legislature’s approval to place Bay Area Transportation tax measure on 2026 ballot

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Photo by MTC.

To generate at least $1 to $2 billion annually; priorities include transit, safer streets and roads, resilience

Commissioners considering a variety of tax options

By John Goodwin & Rebecca Long, Metropolitan Transportation Commission

The Metropolitan Transportation Commission (MTC) on Wednesday, Jan. 24, 2024 voted to pursue legislation in Sacramento this year that would enable Bay Area voters to consider a transportation revenue measure as early as November 2026.

The proposed measure aims to advance a climate-friendly Bay Area transportation system that is safe, accessible and convenient for all. This includes preserving and enhancing public transit service; making transit faster, safer and easier to use; repairing local streets and roads; and improving mobility and access for all people, including pedestrians, bicyclists and scooter and wheelchair users.

The vote was approved unanimously by all members present. There are 21 commissioners with three non-voting members. Oakland Mayor Sheng Tao and San Jose Mayor Matt Mahan who are voting members were both absent during the vote.

State Sen. Scott Wiener of San Francisco earlier this month introduced what is known as a spot bill that will be used as the vehicle for authorizing placement of the proposed measure on a future ballot in each of the nine Bay Area counties. The first opportunity to amend Wiener’s Senate Bill 925 will be in mid-February.

While the Commission has not yet identified a revenue source for the proposed measure, MTC Chair and Napa County Supervisor Alfredo Pedroza noted that he and his colleagues are considering a wide range of options.

“Voters traditionally have supported transportation through bridge tolls or sales taxes. Bridge tolls are not an option in this case and we think it’s smart to look at more than a regional sales tax. We’re proposing a few options so we have enough flexibility and enough time to get it right.”

Tax Options & Projected Revenue

Legislators, and MTC staff and commissioners, will consider several options for generating revenue. These may include a sales tax, an income tax, a payroll tax, a square footage-based parcel tax, a Bay Area-specific vehicle registration surcharge with tiered rates based on the value of the vehicle or a regional vehicle-miles traveled charge (VMT) charge subject to prior adoption of a statewide road usage charge not sooner than 2030.

MTC staff recommend raising at least $1 billion to $2 billion per year for robust investments in safe streets and other capital improvements, to improve and expand transit service, and to help Bay Area transit agencies operate their services.

Goals of the Regional Transportation Measure

The revenue measure’s core goal is to advance a climate-friendly transportation system in the Bay Area that is safe, accessible and convenient for all. Focus areas include:

  1. Protect and enhance transit service. Ensure that current resources are maintained and used effectively; and enhance service frequency and areas served.
  2. Make transit faster, safer and easier to use. Create a seamless and convenient Bay Area transit system that attracts more riders by improving public safety on transit; implementing the Bay Area Transit Transformation Action Plan; and strengthening regional network management.
  3. Enhance mobility and access for all. Make it safer and more accessible for people of all ages and abilities to get to where they need to go. Preserve and improve mobility for all transportation system users, including people walking, biking and wheeling.

Proposed Expenditure Categories

  1. Transit transformation: sustain, expand and improve transit service for both current and future riders; accelerate customer-focused initiatives from the Bay Area Transit Transformation Action Plan and other service improvements that are high priorities for Bay Area voters and riders; and help fund the transition to zero-emission transit.
  2. Safe streets: transform local streets and roads to support safety, equity and climate goals, including through pothole repair, investments in bicycle/pedestrian infrastructure, safe routes to transit and other safety enhancements.
  3. Connectivity: fund mobility improvements that close gaps and relieve bottlenecks in the existing transportation network in a climate-neutral way.
  4. Climate resilience: fund planning, design and/or construction work that protects transportation infrastructure and nearby communities from rising sea levels, flooding, wildfires and extreme heat.

Transportation Measure Highlights

This measure reflects feedback from Commissioners, key legislative leaders and other stakeholders, including:

  • Improving transit coordination by strengthening MTC’s role as regional transit network manager;
  • A focus on Bay Area Transit Transformation Action Plan (TAP) action items and other customer facing policies that would benefit from a regional approach, such as ambassadors to assist riders and support a safe atmosphere;
  • Flexibility in the amount of revenue requested, as well as the way that funding could be generated;
  • Flexibility in spending priorities as the region’s needs evolve with time; and
  • The “North Star” vision statement, which includes greenhouse gas emission-reduction tools, such as:
    • A Transportation Demand Management mandate that encourages Bay Area employees to commute to work in ways other than driving to work alone; and
    • A limitation on how money could be spent on highway-widening projects.

Just as MTC commissioners have proposed a range of tax options, so too have they identified multiple expenditure categories.

“We recognize that we’ll be asking voters to take on a heavy lift,” acknowledged Pedroza. “The big lesson from COVID is the need to transform both our transit network and the way we pay to operate it. But we also need to transform our local streets and roads to fix potholes and make the roads safer for walking and biking. We need to improve connectivity and do it in a way that doesn’t encourage people to drive more. And we need to make our transportation infrastructure more resilient to rising sea levels, flooding, wildfires and extreme heat.”

Measure Vision Statement

The commissioners also adopted the following Vision Statement for the measure: “The Bay Area needs a world-class, reliable, affordable, efficient and connected transportation network that meets the needs of Bay Area residents, businesses and visitors while also helping combat the climate crisis; a public transit network that offers safe, clean, frequent, accessible, easy-to-navigate and reliable service, getting transit riders where they want and need to go safely, affordably, quickly and seamlessly; local roads are well maintained; and transit, biking, walking and wheeling are safe, convenient and competitive alternatives to driving; enhancing access to opportunity, lowering greenhouse gas emissions, strengthening the region’s economy and improving quality of life.”

To learn more about the proposed tax measure click, here. To read the supporting documents considered by the Commissioners click, here.

MTC is the transportation planning, financing and coordinating agency for the nine-county San Francisco Bay Area.

Allen D. Payton contributed to this report.

 

California is not East Berlin. A wealth tax in the Golden State would expedite the exodus

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By Jon Coupal

Note: This column first appeared in The Press-Enterprise. Republished with permission.

Daily news reports on the great “California Exodus” are not just from conservative outlets. Left-leaning publications such as the Los Angeles Times and San Francisco Chronicle have recently reported on the outmigration of upper-income citizens who, even if not billionaires, still generate a lot of income tax revenue.

Earlier this month the California Legislature held a hearing on Assembly Bill 259 which would lay the foundation for the imposition of a wealth tax. The companion legislation to AB 259 is a proposed constitutional amendment that would, among other things, effectively sweep away Proposition 13’s limits on taxing property.

Fortunately, the idea that California would be the first in the nation to impose a highly unpopular wealth tax is so radical that the proposal was rejected by Democrats as well as Republicans on the Assembly Revenue and Taxation Committee. It didn’t take long for the Democrat chair of the committee to shuffle the bill to the “suspense” file where bad legislation goes to die.

Coincidentally, the wealth tax hearing occurred on the same day that Gov. Newsom released his proposed budget. Things got a little sparky during the presentation with Newsom pushing hard against the Legislative Analyst’s figure of a $68 billion deficit. Newsom contends that the deficit is “only” $38 billion. (But hey, what’s a $30 billion difference between friends).

Newsom saved his most animated criticism for those who highlight the state’s shortcomings, including the significant outmigration of California’s most productive citizens. He especially targeted the editorial page of the Wall Street Journal, which has never been reticent about commenting on the state’s well-deserved reputation for anti-business bias.

But to his credit, Newsom rejected the notion of a wealth tax – at least for now. For taxpayers, it matters little whether the governor’s stance is motivated by politics or a sincere policy position. Either way, we’ll take it.

The problems with the wealth tax proposal – even as half-baked as it is – are legion. But one issue should be especially troubling to anyone who believes both in fiscal restraint and basic constitutional freedoms. That is, could a wealth tax be applied to people who voluntarily leave the state for the specific purpose of avoiding California’s highest-in-the-nation income taxes? AB 259 contains a provision that applies the wealth tax to every “wealth-tax resident,” defined as someone who “is no longer a resident, and does not have the reasonable expectation to return to the state.”

The question here is not whether a resident of another state can be taxed when they have a “nexus” to California, for example income earned in California or owning property in the state. Rather, what about someone who no longer has any connection to California? The proposal to tax wealth on such people would likely be deemed to violate the U.S. Constitution’s Commerce Clause.

More fundamentally, an “exit tax” could be construed as an impairment to the right to travel. The U.S. Supreme Court affirmed in 1958 in Kent v. Dulles that citizens have a liberty interest in the right to travel: “[t]he right to travel is a part of the ‘liberty’ of which the citizen cannot be deprived without due process of law under the Fifth Amendment …”

Setting aside the practical and legal problems with this or any wealth tax proposal, a fundamental problem is the signal it sends to all productive California taxpayers as well as those in other states who might consider moving here.  California already has a horrible reputation for its treatment of taxpayers and businesses, why would we even consider another punishing tax?

The proponents of the wealth tax need to be reminded that, as much as they might want to prevent citizens from leaving, California is not East Berlin. The U.S. Constitution will not allow the state government to build a wall to keep citizens in, and then shoot tax bills at them when they try to escape.

Jon Coupal is president of the Howard Jarvis Taxpayers Association.

 

Want to serve on the Contra Costa Measure X sales tax Community Advisory Board?

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February 23 deadline to submit application

The Contra Costa County Board of Supervisors is seeking applicants for appointment to the Measure X sales tax Community Advisory Board. The Measure X Community Advisory Board (MXCAB) was established on February 2, 2021 following passage of the countywide sales tax measure providing general purpose revenue for County programs.

The Supervisors are seeking diverse representation from individuals with broad experience with programs that align with the Measure’s voter-approved purpose “to keep Contra Costa’s regional hospital open and staffed; fund community health centers, emergency response; support crucial safety-net services; invest in early childhood services; protect vulnerable populations; and for other essential county services.”

The main responsibilities of the Measure X Community Advisory Board are:

  • Providing input on the scope and methodology of the regular written assessment of community needs and priorities;
  • Using the assessment findings to develop general funding priorities to be recommended to the Board of Supervisors on Measure X net revenues available for allocation;
  • Receiving annual status reports on the implementation, milestones, impact, and outcomes of Measure X funded programs;

Appointments for seven (7) At-Large and five (5) At-Large Alternate seats will be considered at the Board of Supervisors Finance Committee, with public interviews scheduled March 4, 2024 at 9:30 a.m. To have your application considered at the March Finance Committee meeting, please submit an application online by February 23, 2024 at 5:00 p.m.

For further information, please call Emlyn Struthers, Deputy County Administrator, at (925) 655-2045 or Emlyn.Struthers@cao.cccounty.us.

Slay California’s Death Tax

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About 1.2 million signatures needed by February 5th to qualify the Repeal the Death Tax Act for November’s ballot

Download your petition below to help

By Katy Grimes

This article was first by the California Globe. Republished with permission.

Last week when Gov. Gavin Newsom was sharing his proposed 2024-2025 budget, he insisted that he was opposed to a proposed wealth tax. And sure enough, Assembly Bill 259 by Assemblyman Alex Lee (D-Palo Alto), which will impose an annual “worldwide net worth” tax of 1 percent on net worth above $50 million, rising to 1.5 percent on net worth over $1.0 billion, was killed in committee that afternoon.

However, the governor has been mum about another type of wealth tax – California’s sneaky Death Tax, which adds a new tax on property inherited by a family member, which was already was taxed over the years of ownership.

In 2020, Proposition 19 resurrected the Death Tax on families whose property is left to loved ones when they die, putting their homes, property and businesses at significant risk. While the initiative was cleverly disguised as a benefit for the elderly and disabled communities, Proposition 19 caused far more harm than good.

In May, Senator Kelly Seyarto (R-Murrieta) introduced Senate Constitutional Amendment 4, to restore taxpayers’ property rights by reversing the state’s “death tax” written into in Proposition 19. Deviously titled “the Property Tax Transfers, Exemptions, and Revenue for Wildfire Agencies and Counties Amendment,”

SCA 4 would have reversed one of the largest property tax increases in state history, a little-noticed provision of Proposition 19 that revoked the ability of families and parents to pass property to their children without any change to the property tax bill, according to the Howard Jarvis Taxpayers Association.

However, Democrats killed Seyarto’s SCA 4 in a legislative committee.

I remember when the Death Tax was first slayed.

“It was 1986 when the parent-child exclusion from reassessment was first added to the state constitution,” Susan Shelly recently wrote. “A growing number of Californians were angry to discover that state law treated death and inheritance as a “change of ownership” under Prop. 13, triggering reassessment to current market value just as if it was a sale. The legislature proposed a constitutional amendment that would allow parent-child transfers of a home and a limited amount of other property, such as a small business or a rental property, without reassessment.”

“The parent-child transfer protection passed by a unanimous vote in both houses of the legislature, and then was approved by 75% of voters statewide.”

Howard Jarvis Taxpayers Association elaborates on how Proposition 19 hurts taxpayers:

Proposition 19, had two main elements. The first was expanded “portability” of base-year property taxes. Homeowners who are 55 years of age or older, who are victims of a wildfire, or who are disabled may now move to a replacement home anywhere in the state, of any value, and take the base-year property tax assessment of the old home with them to a new home up to three times.

Now to the other part of Proposition 19. Previously under the state constitution, property transfers between parents and children, and sometimes grandparents and grandchildren, were excluded from reassessment. These family members could transfer a home of any value and up to $1 million of assessed value of other property, such as a small business property, a vacation cabin, or a rental property, without any increase in the property tax bill. This taxpayer protection was added to the state constitution in 1986 by Proposition 58 (parents and children) and in 1996 by Proposition 193 (grandparents and grandchildren) with overwhelming public support.

Proposition 58 was approved by more than 75% of California voters, and Proposition 193 was approved by nearly the same margin. Now, these taxpayer protections are gone.

Proposition 19 has replaced 58 and 193 with a very narrow exclusion for family transfers of property. Only a principal residence that the inheriting child occupies as his or her permanent primary residence is eligible for an exclusion from reassessment. Unless the new owner can move in within one year, the property is reassessed to market value. Business properties and rental properties lose the protection entirely.

So, what can be done?

Susan Shelly continues, “the Howard Jarvis Taxpayers Association, where I am on staff as VP of Communications, is collecting signatures to put an initiative on the ballot that would repeal the tax increase that was hidden in Prop. 19, without touching the other provisions in it. The official petition is available at RepealTheDeathTax.com and can be downloaded and printed on one sheet of ordinary letter-size paper. This enables instant distribution of the petition throughout the state. Theoretically, a million people could download the petition at the same time, fill it out and sign it, and have one other registered voter in the household also sign it.”

It’s easy. Click on RepealTheDeathTax.com and/or

Click here to DOWNLOAD the official petition RIGHT NOW

RepealTheDeathTax.com has more details HERE:

Read the Initiative here.

Please note: You must print and sign the petition with paper and ink. It’s not electronic.

Follow the easy instructions. And please note:

DEADLINE EXTENDED! Return signed petitions to HJTA postmarked by FEBRUARY 5

Download the official, legal petition to put the REPEAL THE DEATH TAX initiative on the November 2024 ballot.

Complete instructions are included in the pdf file.

Get your petition in the mail ASAP – before February 5th.

Katy Grimes, the Editor in Chief of the California Globe, is a long-time Investigative Journalist covering the California State Capitol, and the co-author of California’s War Against Donald Trump: Who Wins? Who Loses?

 

CA State Controller complains about inability to tax largest portion from L.A. Dodgers pitcher’s contract

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L.A. Dodgers’ pitcher Shohei Ohtani. Source: L.A. Dodgers Instagram

Wants Congress to approve caps on deferred compensation

SACRAMENTO — State Controller Malia M. Cohen released the following statement following last month’s announcement that the L.A. Dodgers signed a 10-year, $700 million contract with pitcher Shohei Ohtani. The contract is structured so that Ohtani will receive $2 million per year and defer the balance approximately 10 years, when he could potentially return to Japan and escape payment of California state income taxes on the deferred amount:

“The current tax system allows for unlimited deferrals for those fortunate enough to be in the highest tax brackets, creating a significant imbalance in the tax structure.” said Cohen. “The absence of reasonable caps on deferral for the wealthiest individuals exacerbates income inequality and hinders the fair distribution of taxes. I would urge Congress to take immediate and decisive action to rectify this imbalance.”

“Introducing limits on deductions and exemptions for high-income earners promotes social responsibility and contributes to a tax system that is just and beneficial for all. This action would not only create a more equitable tax system, but also generate additional revenue that can be directed towards addressing pressing important social issues and fostering economic stability,” Cohen stated.

About Controller Cohen

As the chief fiscal officer of California, Controller Cohen is responsible for accountability and disbursement of the state’s financial resources. The Controller has independent auditing authority over government agencies that spend state funds. She is a member of numerous financing authorities, and fiscal and financial oversight entities including the Franchise Tax Board. She also serves on the boards for the nation’s two largest public pension funds. Follow the Controller on X at @CAController and on Facebook.

Opinion: Will California’s budget woes impact tax reform?

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By Jon Coupal, President, Howard Jarvis Taxpayers Association

The Taxpayer Protection and Government Accountability Act (TPA) is a proposed constitutional amendment which has already qualified for the November 2024 ballot. It is sponsored by taxpayer and business organizations to restore key provisions of Proposition 13 and other pro-taxpayer laws that give voters more control over when and how new tax revenue is raised.

Although TPA, unlike previous tax reform measures, doesn’t reduce or eliminate any state or local tax, it does impose both enhanced voter approval requirements for fee and tax increases as well as robust accountability and transparency provisions.

For obvious reasons, tax-and-spend interests hate TPA and have launched a multi-front assault hoping to either defeat it or keep it off the ballot entirely.

The motivation for these schemes is that politicians and their enablers are fully aware that TPA is highly likely to pass if it stays on the ballot. Californians are sick and tired of having the nation’s highest tax rates jammed down their throats, especially when these heavy tax burdens are not accompanied by higher levels of public services; in fact, the opposite is true, as evidenced by California’s high cost of living, crime, homelessness, hostile business climate, and other ills.

But now, there may be another reason why anti-taxpayer interests are waging this war on TPA. A recent report by the California Legislative Analyst’s office threw a bucket of cold water on progressives’ plans to continue to increase taxes with virtually no restraint. The LAO now estimates “2022-23 revenues to be $26 billion below Budget Act projections. Historical experience suggests this weakness is likely to carry into this fiscal year and next. Overall, our updated revenue outlook anticipates collections to come in $58 billion below Budget Act projections across 2022-23 to 2024-25.” (Note that in less than a week after this news, the LAO upped the shortfall from $58 billion to $68 billion).

If there is any saving grace to the current financial situation it is that California still has substantial budget reserves. That, plus some creative accounting, can probably blunt the negative impacts of a severe drop in revenues – at least for a while.

Nonetheless, if California’s tax revenue spigot is curtailed any significant amount, will the enemies of the Taxpayer Protection Act argue that this provides another justification for removing all restraints on raising taxes?

Economic growth in Texas and Florida is outpacing that in California, due in part to a top marginal income tax rate of zero. What is happening in other smaller states is less well known. The smart move would be to follow the lead of other states which are aggressively pursuing pro-growth strategies which in turn lead to more tax revenue.

Take Iowa for example. Defying critics who claimed that tax reductions would crush the state budget, Iowa’s Governor Kim Reynolds slashed top marginal tax rates, previously some of the highest in the nation. Not only did revenues not crash, but they shot up by huge percentage points. According to a report in Center Square, “Iowa led the ‘tax-cutting wave’ in 2022, with the most comprehensive and aggressive tax reform in the United States. This will gradually replace the nine-bracket, progressive income tax with a flat tax, bringing the top rate, which was close to 9 percent, down to a flat 3.9 percent by 2026.”

Other states have provided California with a roadmap for economic growth and healthy budgets by cutting taxes and pursuing other pro-freedom policies. However, the political realities in this one-party state – governed by hardcore progressives – render the odds of politicians even looking at the roadmap extremely slight.

That being said, if the Governor and the Legislature won’t do what’s necessary to prevent a budget disaster, the least they can do is get out of the way of those who have offered the Taxpayer Protection Act to the voters so that ordinary citizens can do what politicians won’t: impose fiscal discipline on a fiscally reckless state.

This column originally appeared in the Orange County Register. Republished with permission.

Serve on Contra Costa’s Measure X sales tax Community Fiscal Oversight Committee

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The Contra Costa County Board of Supervisors is seeking individuals interested in serving on the Measure X Community Fiscal Oversight Committee. Measure X is the countywide half-cent sales tax that passed by voters in Nov. 2020 “to keep Contra Costa’s regional hospital open and staffed; fund community health centers; provide timely fire and emergency response; support crucial safety-net services; invest in early childhood services; protect vulnerable populations; and for other essential county services, shall the Contra Costa County measure levying a ½ cent sales tax, exempting food sales, providing an estimated $81,000,000 annually for 20 years that the State cannot take, requiring fiscal accountability, with funds benefiting County residents.”

The committee was established by the Board of Supervisors on May 16, 2023 to advise the Board of Supervisors on financial audits of Measure X tax funds. There are currently five vacancies on the committee.

The Committee has the following duties:

  1. Review, on an annual fiscal year basis, the expenditure of tax revenue generated by Measure X, to ensure it conforms to (i) the stated intent of the ballot measure, and (ii) the Board’s direction for specific allocations.
  2. Oversee an annual audit of expenditures of tax revenue generated by Measure X.
  3. Prepare an annual report of expenditures of tax revenue generated by Measure X.

Requirements:

  • Civic-minded
  • Interested in volunteering for public service
  • Experience with auditing principles and financial management best practices

If you have the skills and experience required, we want to hear from you!

How do I apply?

Submit an application online here: https://www.contracosta.ca.gov/6408/Boards-and-Commissions-Database

For more information, contact Adam Nguyen at 925-655-2048 or Adam.Nguyen@cao.cccounty.us.

 

State taxpayers association warns of two tax impacting bills in CA legislature

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Urges voters, taxpayers to call the Capitol to protect Prop 13, see committee members phone numbers below

ACA 1 would make it easier to raise local special taxes by removing the Prop. 13 taxpayer protection of the two-thirds vote of the electorate required to pass

ACA 13 was just introduced last week as a devious attempt to stop the Taxpayer Protection and Government Accountability Act from passing when it’s on the ballot in Nov. 2024.

By Jon Coupal

Prior to the successful passage of Proposition 13 in 1978, Howard Jarvis tried several times to bring property tax relief to beleaguered California homeowners. While coming close, it wasn’t until 1978 when voters overwhelmingly passed Proposition 13 over the opposition of virtually every political institution and newspaper in California.

As they say, timing is everything. What changed the political dynamic so abruptly in 1978 was the fact that thousands of California homeowners were being taxed out of their homes. That also explains why, to this day, Proposition 13 retains its popularity even as the state has become more “progressive.”

Last week there were two competing press events over Assembly Constitutional Amendment 1 (ACA 1), a proposal that would erase part of Proposition 13. As the head of the Howard Jarvis Taxpayers Association, I was joined at a news conference on the Capitol’s west steps on Wednesday by several legislators who have unequivocally expressed their continued support for Proposition 13 and opposition to ACA 1. Also present were several representatives of other taxpayer groups as well as business organizations suffering under California’s excessive tax burdens.

ACA 1 is a direct attack on Proposition 13 because it would cut the vote threshold needed to pass local special taxes, dropping it from the current two-thirds vote required by Proposition 13 to only 55%. That change would make it easier for local governments to raise taxes.

Since Proposition 13 was enacted in 1978, voters have continued to support the important two-thirds vote protection. That support was reaffirmed with the passage of pro-taxpayer initiatives in 1986, 1996 and 2010.

Many people may not know that the two-thirds vote requirement did not originate in 1978. It has been in the California Constitution since 1879! For more than a century, local property owners have been protected against excessive bond debt by the requirement that local bonds – repaid only by property owners – need a two-thirds vote of the local electorate.

ACA 1 repeals the two-thirds vote protection for tax increases to support “infrastructure,” a term so expansive that local governments would be able to raise taxes for almost any purpose with a vote of just 55% of the electorate. This is a hatchet that chops away at the taxpayer protections in Proposition 13.

ACA 1 proponents are aware of Prop. 13’s enduring popularity, so not once in their over one-hour press event did they mention Proposition 13 by name. Instead, they talked about “protecting democracy,” “local control,” and taking on “right-wing interests.” (Are Californians “right wing” for wanting to keep their home instead of being taxed out of it?) Nor did the supporters of ACA 1 provide any specific example of exactly what lowering the two-thirds vote would purchase, other than to claim that it was essential to address California’s dual crises of housing and homelessness.

Opponents of ACA 1 have noted that making it easier to raise taxes makes no sense in one of the highest taxed states in America. No other state comes close to California’s 13.3% top marginal income tax rate, and we also have the highest state sales tax in America as well as the highest gas tax, not to mention gas prices. And even with Prop. 13, we rank 14th out of 50 states in per capita property tax collections. Californians pay enough.

This is a critical time. As of this writing, ACA 1 has cleared one legislative committee and may be heard by the full Assembly as early as this week. However, its main proponent, Assemblymember Cecilia Aguiar-Curry, admitted at her press conference that she didn’t quite have the votes yet. For that reason, the time is now for all defenders of Proposition 13 and advocates for limited taxation to contact their Assembly representatives and let them know that a vote for ACA 1 is a vote against Proposition 13.

This issue is so important to the Howard Jarvis Taxpayers Association that we will withhold our endorsement from any current legislator who fails to vote no on ACA 1.

Committee Hearings this Week, Taxpayers Urged to Call the Capitol

Your immediate help is needed to fight against two proposed constitutional amendments moving fast through the state Assembly. Both of these measures are attacks on PROPOSITION 13. We’re asking all HJTA members and supporters to please call the members of two committees that will be hearing these bills on Wednesday. Please call as soon as possible! Here’s all the information:

NO on ACA 1 – Hearing date: Wednesday, 8/23, Assembly Appropriations Committee

ACA 1 is a direct attack on Proposition 13 that would remove the taxpayer protection of the two-thirds vote of the electorate required to pass local special taxes. If this measure is enacted, local taxes and bonds for “infrastructure” (nearly everything) and public housing projects would pass with just 55% of the vote instead of 66.67%. This makes it easier to raise taxes, and your taxes could go up after every election.
Please call the members of the Assembly Appropriations Committee and urge a NO vote on ACA 1:

Chris Holden (Chair) – (916) 319-2041
Megan Dahle (Vice Chair) – (916) 319-2001
Isaac Bryan – (916) 319-2055
Lisa Calderon – (916) 319-2056
Wendy Carrillo – (916) 319-2052
Diane Dixon – (916) 319-2072 (Please thank Assemblywoman Dixon for opposing ACA 1)
Mike Fong – (916) 319-2049
Gregg Hart – (916) 319-2037
Josh Lowenthal – (916) 319-2069
Devon Mathis – (916) 319-2033 (Please thank Assemblyman Mathis for opposing ACA 1)
Diane Papan – (916) 319-2021
Gail Pellerin – (916) 319-2028
Kate A. Sanchez – (916) 319-2071
Esmeralda Soria – (916) 319-2027
Akilah Weber, M.D. – (916) 319-2079
Lori Wilson – (916) 319-2011 – Represents portions of Eastern Contra Costa County

NO on ACA13 – Hearing date: Wednesday, 8/23, Assembly Elections Committee

ACA 13 was just introduced last week as a devious attempt to stop the Taxpayer Protection and Government Accountability Act from passing when it’s on the ballot in November 2024. The Taxpayer Protection and Government Accountability Act is our initiative constitutional amendment that will restore the Proposition 13 protections that have been eroded by the courts.

Some of the measure’s key provisions include:

  • Require all new taxes passed by the Legislature to be approved by voters
  • Restore two-thirds voter approval for all new local special tax increases
  • Clearly define what is a tax or fee
  • Require truthful descriptions of new tax proposals
  • Hold politicians accountable by requiring them to clearly identify how revenue will be spent before any tax or fee is enacted

But ACA 13 would create special rules that make it harder to pass citizen initiatives like this one. If ACA 13 is enacted, the Taxpayer Protection and Government Accountability Act would require a two-thirds vote to pass, instead of the simple majority vote that has been required for all other constitutional amendments since 1849!

Please call the members of the Assembly Elections Committee and urge a NO vote on ACA 13:

Gail Pellerin (Chair) – (916) 319-2028
Tom Lackey (Vice Chair) – (916) 319-2034
Steve Bennett – (916) 319-2038
Bill Essayli – (916) 319-2063
Alex Lee – (916) 319-2024
Evan Low – (916) 319-2026
Blanca Rubio – (916) 319-2048

Please also call your own state representatives and urge them to vote NO on ACA 1 and NO on ACA 13. You can look up their names and contact information at findyourrep.legislature.ca.gov.

Thank you for your help in this critical fight to protect Proposition 13. We greatly appreciate you!
Jon Coupal is president of the Howard Jarvis Taxpayers Association.