Comments
LA WATCHDOG - Angelenos are being asked to vote on five tax proposals that will hit us up for over $600 million. We, however, have a limited understanding of the impact of these taxes on our wallets and the City budget because our elected elite who occupy City Hall and the County Hall of Administration and the campaign funding union bosses want to keep us in the dark, expecting that we will blindly approve these increases that will be used to fund even more raises for City employees.
In March, we received a ballot in the mail asking property owners to approve an increase in our Street Light Assessment. The $125 million request is almost three times the current assessment of $45 million. This is an extremely complicated assessment where the size of a property’s vote depends on the size of the parcel, the type of street light (ornamental, residential, pedestrian), property use (residential, retail, office, industrial, institutional, public, undeveloped utility), and other “special” benefits. There are also issues involving the votes by government owned properties which have not been disclosed.
The City has placed three propositions on the June primary ballot that will raise an estimated $80 million. Two of these involve the transient occupancy (hotel) tax while the third applies to unlicensed pot shops.
The first, Proposition TT, would increase the hotel tax from 14% to 16% through December 31, 2028, and 15% thereafter. Importantly, it will apply to out-of-towners who are here for the Olympics. It is expected to yield about $44 million a year through 2018 and $22 million thereafter.
The second, Proposition TC, would apply the hotel tax to the spread that online travel companies charge their customers and what these companies pay to the hotel operators. Expected annual revenue is $5 million.
The third, Proposition CB, would apply the City’s business taxes to unregistered pot shops and is anticipated to raise $30 million per year.
[Note: the City needs to do a better job of collecting taxes from registered dispensaries. The City is owed over $400 million in back taxes, interest, and penalties. Failure to pay these taxes does should be prosecuted as a felony.]
The County has also placed Measure ER on the ballot that would increase our sales tax by a half-cent to 10¼%. This measure is expected to raise $1 billion a year, of which $400 million (40%, our share of the population) would be paid for by residents of the City.
There has been no outreach by the City and County to educate us on this significant increase in our taxes. How will these new revenues be allocated? Will they be used efficiently? Will there be accountability? This failure is reason enough to vote NO on these five tax increases that total $1.2 billion.
[My Voter’s Guide will be published next week.]
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Proposition TT: Funding For City Services Through Modifications To The Transit Occupancy Tax.
Shall an ordinance be adopted to fund general City services, such as street/sidewalk repairs, 911 emergency response, fire protection, and parks, by: increasing the transient occupancy tax, currently 14% paid by hotel and lodging guests, to 16% through 2028 and then 15% thereafter; and requiring online and other travel companies to collect and remit the tax; generating approximately $22-44 million annually until ended by voters?
Proposition TC: "Applying Transient Occupancy Tax To Online Travel Companies"
Shall an ordinance be adopted to update the City’s transient occupancy tax, paid by hotel and lodging guests, to require online and other travel companies to collect and remit the tax (the current rate is 14%); generating approximately $5 million annually for general City services, such as street and sidewalk repairs, 911 emergency response, fire protection, and parks, until ended by the voters?
Proposition CB: Applying Cannabis Business Taxes To Unlicensed Cannabis Businesses"
Shall an ordinance be adopted to apply the City's existing cannabis business taxes to unlicensed cannabis businesses at current rates (10% on cannabis sales; 5% on medical cannabis sales; 2% on manufacturing, cultivation or other commercialization; 1% on transportation, testing or research); generating approximately $30-35 million annually for general City services, such as street/sidewalk repairs, 911 emergency response, fire protection, and parks, until ended by voters?
Measure ER: The Essential Services Restoration Act for Los Angeles County General Sales Tax Measure
Shall the measure to help our community address severe federal cuts enacted by the President and Congress; reduce the loss of essential services, including healthcare for County residents; reduce the risk of closing the County's four public hospitals and numerous clinics, and significant healthcare provider layoffs and other service cuts by enacting a 1/2 percent (0.5%) general sales tax for 5 years, generating approximately $1 billion annually, with independent audits, be adopted?
(Jack Humphreville writes the LA Watchdog column for CityWatch, where he covers city finances, utilities, and accountability at City Hall. He is President of the DWP Advocacy Committee, serves as the Budget and DWP representative for the Greater Wilshire Neighborhood Council, and is a longtime Neighborhood Council Budget Advocate. With a sharp focus on fiscal responsibility and transparency, Jack brings an informed and independent voice to Los Angeles civic affairs. He can be reached at lajack@gmail.com.)
