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Democratic Bill Would Let Locals Tax Themselves

| May 5, 2011
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More government services in the Bay Area? Fewer in the Inland Empire? You’d be forgiven if you think that’s a rehash of last week’s debate over budget cuts targeted at GOP communities.

But it could also be the shape of things to come under Senate President pro Tem Darrell Steinberg’s bill to give locals more power to tax themselves… presumably if Sacramento lawmakers will not.

Given the Senate’s Democratic majority, it’s not surprising the bill moved forward. The bigger question, though, is what impact it might have on the budget stalemate.

In fact, much of this morning’s debate over SB 653 seemed to be more about state than local budgeting. Steinberg’s bill is both simple and clever: local governments — a county, city, even a school district — would be able to impose a number of taxes which are now the exclusive province of the state, as long as the voters approve.

The taxes under the bill that could be raised on the local level: income taxes, vehicle license fees (the infamous “car tax”), oil severance taxes, alcohol or other excise taxes, and cigarette taxes.

“The whole point of the bill,” said Steinberg in his presentation today, “is in the absence of adequate state funding, to give communities a choice.”

SB 653 is — philosophically, at least — similar to the idea of imposing spending cuts…specifically on GOP districts. This bill shifts the focus of that fight from punishing communities via cuts to rewarding them with more tax options through local elections.

As suggested at the outset, think for a moment how similar SB 653 is — philosophically, at least — to the hotly debated idea floated last week of imposing spending cuts, under a ‘no new revenue’ budget, specifically on GOP legislative districts. Steinberg’s bill simply shifts the focus of that fight from punishing communities, via state-mandated cuts, to rewarding them by giving more tax options via local elections.

(And Steinberg made a special point that those taxes would still be subject to a two-thirds vote of locals, a hurdle that’s historically been quite high.)

Opponents argued both the policy and the politics against the bill. Gina Rodriquez of the California Taxpayers Association. “We need to get the state’s house in order,” she said, “not support the creation of potentially more than 1,000 new taxing jurisdictions.” Critics also lamented the economic impact of additional taxes, should they be approved by voters.

And then there’s the matter of this year’s budget. The bill would do nothing to change the actual implementation or solution of the state’s current fiscal crisis, but it could — if passed and ultimately signed by Governor Jerry Brown — shift future debates over government services and dollars away from Sacramento. And it’s reasonable to assume that Republican-heavy regions of the state might suffer under that system.

“You have postulated here a whole plethora of taxes,” said Sen. Bob Huff (R-Diamond Bar) in this morning’s hearing. “It seems as a part of the scare tactics” of the budget debate, he said.

Whether the bill actually makes it to Governor Brown’s desk is, for now, beside the point. Whether it resets the 2011 budget jigsaw puzzle in such a way that the pieces fit together more easily… that’s the one to watch.

John Myers is KQED’s Sacramento Bureau Chief. Follow him on the Capital Notes blog or on Twitter.

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About the Author ()

John Myers is senior editor of KQED's new California Politics & Government Desk. He has covered California politics for most of the past two decades, serving previously as Sacramento bureau chief for KQED News and most recently as political editor for KXTV News10 (ABC) in Sacramento. In 2014, he was named one of the nation's top statehouse reporters by The Washington Post. Follow him on Twitter @johnmyers. Reach John Myers at jmyers@kqed.org.

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