Thanksgiving falls on Nov. 24 this year, but for politicians in Los Angeles, turkey day isTuesday, Nov. 8.
That’s when they will attempt to carve up taxpayers with at least four proposed tax increases – a sales tax hike and three measures that would increase property taxes.
It’s no coincidence that these tax-hike proposals are all on the ballot this year. Political experts believe tax increases have a better chance of passing in presidential elections, when turnout is higher.
So California politicians have been studying the polls and the calendar, and they’ve all reached the same conclusion — it’s fine weather for soaking taxpayers.
This comes on top of the Los Angeles Department of Water and Power’s five-year rate hikes, recently approved by Mayor Eric Garcetti and the L.A. City Council, which will fund a “city transfer” of hundreds of millions of ratepayer dollars to the city treasury every year.
If you think that’s sneaky, wait until you see the surprises in the latest proposed tax increases.
The Los Angeles Metropolitan Transportation Authority wants a permanent sales tax increase of one-half of one percent, plus a permanent extension of the 30-year Measure R sales tax passed in 2008. If voters say yes, Metro will have upwards of $120 billion to plan and build transit projects that are described in a detailed countywide plan.
But, surprise! The detailed plan can be completely changed at any time with a two-thirds vote of Metro’s board of directors. Nothing is guaranteed except a permanent tax increase.
And there’s another surprise. Under state law, this “traffic improvement plan,” as Metro has named it, will trigger super-streamlined approval for massive blocks of apartments within one-half mile of planned “major transit stops.” Transit-oriented developments don’t require studies of the projects’ impact on traffic speed or neighborhood parking. Instead of reducing traffic, we’re guaranteed to get high-density development that jams the streets decades before the transit is ever built.
Another proposed tax increase that’s full of surprises is a Los Angeles city bond to pay for housing for the homeless.
If the voters say yes, the city will be authorized to borrow $1.2 billion dollars and then pay it back by adding a new tax to property tax bills.
The city’s legal experts say the bond money couldn’t be used to pay for supportive services like mental health and substance abuse treatment, but only to buy land and build housing. The city would be allowed to use its powers of eminent domain to acquire land throughout Los Angeles, and then the land could be leased at a low cost to the developers who win the contracts to build homeless housing.
The surprise that awaits is that the federal courts still won’t allow Los Angeles to forcibly clear homeless encampments or prevent people from sleeping on the sidewalks. It’s likely that nothing will change on the streets except the property tax bills.
Property owners would pay between $4.50 and $17.50 per year for every $100,000 of assessed value–for 28 years–to repay the debt from the $1.2 billion homeless housing bond.
As if that’s not enough, the Los Angeles Community College District wants voter approval of a $3.3 billion facilities bond, paid for by another new property tax.
And Los Angeles County wants voters to pay for parks with a parcel tax of one-and-a-half cent for every square foot of buildings on a property. That works out to $22.50 per year for a 1,500-square-foot house.
The parks tax would also affect businesses. Large commercial properties, like warehouses and retailers, would be hit with sharp tax increases, which they’ll pass through to their customers as higher prices or absorb as damage to the bottom line. Either way, it’s one more reason not to locate a job-creating business in Los Angeles.
Politicians could prioritize the current budgets, but instead they spend money on their favorite people and projects and then insist on tax increases for whatever the voters think is important.
“I’ve seen seven polls in a row where people say that homelessness is their No. 1 concern,” Mayor Garcetti said recently.
There’s one bit of good news. Because of Proposition 13 – the iconic tax-revolt initiative that voters passed in 1978 – all these proposed tax hikes require the approval of two-thirds of the voters in order to become law.
When the real turkey day arrives this fall, a lot of taxpayers may be giving thanks for Prop 13.