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California Legislature wants to throw a lot of good money after bad

July 12, 2023

If throwing good money after bad is ever made an Olympic sport, California will bring home enough gold to pay off the deficit.

Four measures pending in the Legislature would enable tax increases for the purpose of spending more money on failed policies and mismanaged agencies. These bills should be stopped before they unleash burdensome new costs on Californians already struggling with the high cost of living.

Assembly Bill 1679 would allow Los Angeles County to further exceed the cap on local sales taxes, which state law limits to a combined total of 2% over the state’s 7.25% sales tax. Special state laws like this one have already enabled the cap to be exceeded, with the result that 47 cities in L.A. County now pay a sales tax rate of 10.25%.

AB 1679 would allow an additional half-percent increase in L.A. County’s sales tax to fund homelessness services and housing, replacing and expanding Measure H, the quarter-percent sales tax passed in 2017 and set to expire in 2027. AB 1679 has already passed the Assembly and will be heard today July 12 in the Senate Governance and Finance Committee.

Another bill that will be heard in the same committee today is Assembly Bill 1607. It would expand the power of the Los Angeles County Affordable Housing Solutions Agency to place tax increases on the ballot to fund homelessness programs. LACAHSA was created in 2022 by Senate Bill 679 and empowered to put tax increases on the ballot to fund renter protections, affordable housing preservation and new affordable housing production. It was specifically excluded from funding homelessness programs, but AB 1607 would remove that restriction.

If Assembly Bills 1679 and 1607 are enacted, voters in L.A. County could see more tax increases for homelessness programs on the 2024 ballot. Notably, courts have said special taxes need only a simple majority to pass, not the two-thirds required for special taxes under Proposition 13, if placed on the ballot by a citizens’ initiative.

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A direct effort to undercut the taxpayer protections in Proposition 13 is Assembly Constitutional Amendment 1, set for a hearing today in the Assembly Local Government committee. ACA 1 would change the state constitution to allow local tax increases for certain public housing programs and any kind of “infrastructure” to pass with just 55% of the vote instead of two-thirds. A recent amendment to ACA 1 would extend the power to place taxes on the ballot to “a regional transportation commission” and “an association of governments” as well a city, county or special district.

A fourth bill seeking higher revenue is Senate Bill 532, which would increase bridge tolls in the Bay Area by $1.50, a tax increase to bail out “transit operators” that are “experiencing a financial shortfall.”

Public transit agencies in California say they’re facing a “fiscal cliff” caused by a lack of ridership and the end of federal COVID relief funding. That’s not a good reason to raise the taxes of the very people who are finding these systems unusable and choosing not to ride them.

Instead of addressing the waste and failures of costly homelessness policies and mismanaged transit agencies, Sacramento is greasing the skids for more tax increases. This would be a good time to call your representatives. Look them up at findyourrep.legislature.ca.gov.

Orange County Register

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California Legislature wants to throw a lot of good money after bad

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