☆ HJTA’s Susan Shelley: Prop 5 helps local governments trick voters into generational debt (part 4)
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Prop 5 opens the door to more gov't borrowing by reducing the voter threshold to 55% for local bonds. This further incentivizes governments to mislead voters on ballot labels and “informational” mailings. In part 4 of this Opp Now exclusive Q&A, Howard Jarvis Taxpayer Ass’n’s Susan Shelley points to tax hike trickery now in play, from school bonds—which already only need 55% approval—to the widely abused Upland exemption. Overtaxed Californians are grumbling, but Prop 5 can override their opposition, says Shelley.
Opportunity Now: We talked about how the Prop 5 ballot label under-informs voters. Can voters expect similar kinds of deceptions from the local measures that Prop 5 will usher in?
Susan Shelley: Look at school bonds, which can already be passed with 55%. In the LAUSD district, they have a $9 billion school bond. Instead of writing on the ballot label that it costs $25.04 per $100,000 of assessed property value, they decided to express it in pennies, as 2.504 cents per $100 of value.
Now, there was a state law, which I believe was authored by Steve Glazer, that said they had to express these numbers more meaningfully per $100,000 value, so voters could see how much it really is and not pretend it's just pennies. But apparently, that applies to the tax statement, but not the ballot label.
So LAUSD is putting it on the ballot as pennies instead of dollars, or tens of dollars. That’s an example of the kind of thing they can do: poll-tested tricks to conceal the full cost.
ON: And what’s the full cost?
SS: These bonds are based on the value of your property. It's charged to you as a dollar amount per $100,000 of assessed value of your property. The higher the value of your property, the higher these bond tax increases will be.
It’s very expensive.
When you multiply that dollar amount out by 30 years, you're paying thousands of dollars for each of these, over the life of the bond. Not pennies. Not a “latte a week,” as they sometimes try to tell you.
ON: What other kinds of deception are you concerned about?
SS: So, state and local governments can not only write the ballot title and summary and the voter guide, but they also can put out informational mail, commercials, and other messaging to convince people how wonderful the bond is going to be.
As long as it passes the test of “informational,” even if it looks exactly like a campaign mailer, they can essentially use your tax money for campaign mail.
They can be very tricky.
ON: And we’re not just talking about Prop 5, but deception that can potentially occur on each of the local bond measures?
SS: Yes, and with approval lowered to 55%, there are going to be a lot of tax increases, one after another, and people will lose their homes. Some, within a couple of years.
ON: When talking with opponents to RM4, I kept hearing that the regional agency didn’t seem to take into account the human cost of so much borrowing.
SS: You know, electricity bills, water bills, and insurance costs are going up. Inflation has raised grocery prices. Everything is more expensive.
Raising property taxes over and over again will devastate people. There is no ability-to-pay component in property taxes. If you can't pay it, there's no break for you, even if you’re low-income. There's nothing like that. If you can't pay your property taxes, the county will sell your house for you.
ON: After Prop 5, would the two-thirds requirement be preserved for any kind of tax?
SS: Well, special taxes would still need a two-thirds vote. So local taxes for a specific purpose would still need the approval of 66.7% of voters.
But the Upland exception is seeing really wide abuse.
ON: Those are the tax increases that can get on the ballot and only require 50% approval, right?
SS: Yes, the courts have shown tremendous deference to those citizens’ initiatives that help raise taxes. But on the Taxpayer Protection and Government Accountability Act, which would have closed the Upland loophole, the state Supreme Court showed no deference at all to the citizens’ initiative. All the deference went to the government; and the Taxpayer Protection Act was removed from the November ballot.
ON: What kind of abuse are you seeing?
SS: Proposition C in San Diego was a tax increase for the convention center, and the campaign was run by someone on the board of the convention center. This so-called citizens’ initiative was connected to the government entity that was going to get the money.
In Los Angeles, we have Measure A on the ballot, which is doubling the existing sales tax increase for homelessness programs. It’s a citizens’ initiative, but it is so enmeshed with the government that the Board of Supervisors had to lobby in Sacramento and sponsor a bill to make this exempt from the cap on local sales taxes.
ON: Aren’t voters going to get tired of so many tax hikes?
SS: I think so. I'm hearing more and more that people are just “no” on everything. People are really pressured financially, and you see that in every poll. They’re very worried about the future if this continues. And one thing about Prop 5 is that it will make this continue. It will make these tax increases easier after every election.
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