San Luis Obispo snubs rules, promotes sales tax increase

October 12, 2020
T. Keith Gurnee

T. Keith Gurnee

OPINION by KEITH GURNEE

Come Nov. 3, San Luis Obispo voters are being asked to approve Measure G-20, SLO’s latest proposed sales tax hike that will replace the temporary 0.5 percent sales tax enacted in 2014 by tripling it with a permanent 1.5 percent sales tax increase.

This begs questions that demand answers:

  • Could the timing of this tax be any worse?
  • Should we reward the dubious performance of our city government by letting it dig even deeper into our pockets?
  • Can our downtown and local businesses survive these increases amidst the worst pandemic in 100 years, its resulting lockdowns, and the social unrest that has plagued our downtown businesses?

The answer is a resounding no!

Measure G-20’s advocates argue that the funds raised will be used only on certain projects when in fact it will go into the General Fund with no restrictions on its use, including increasing management salaries.

While Measure G of 2014 raised $7.8 million annually, Measure G-20 hopes to raise a whopping $21.6 million per year. Why the big jump? That’s easy: because the city has gotten hooked on the revenue and is grasping for even more.

With 11 of its top managers making more than California’s governor, with 25 other staffers making more than U.S. Senators, with its unfunded pension liability exceeding $175 million, and with interest accruing on that debt by $1.1 million monthly, it’s incumbent upon the city to practice greater fiscal responsibility.

G-20’s supporters say that 70 percent of the tax will be paid by tourists and visitors. Amid the coronavirus with so many sheltering in place and avoiding travel, and when our hotels and restaurants are restricted to a fraction of their capacity, that 70 percent number is pure fantasy. Just remember this: each and every resident of the city who spends money here will be paying a higher tax.

G-20’s supporters also say that SLO’s tax increase will be the same as many California cities. If it fails, we’ll have a lower tax rate than others, giving our local businesses and our tourist industry a competitive edge over other communities and generating more economic activity here.

And what about the city’s failed past promises to spend previous sales tax revenues on capital projects? Instead, they were spent mostly on general routine maintenance activities and operational expenses.

A detailed audit conducted from 2007-2014 on the original Measure Y tax increase revealed that less than 3 percent of the revenue was spent on true capital projects. Since passage of Measure G in 2014 that number has climbed to only 4 percent!

But what’s most disturbing is the city’s spending of your taxpayer funds to send out official-looking city mailers this past week advocating passage of Measure G-20 and generating public fears if it fails. This thinly-veiled political hit piece was a direct violation of the Fair Political Practices Commission (FPPC) rules and the Government Code prohibiting the use of public funds for political purposes.

Just two months ago, the FPPC imposed a $1.35 million fine against the County of Los Angeles for doing what SLO is doing right now. Perhaps the city doesn’t mind spending your tax money to pay such a fine.

Sales taxes are the most regressive form of taxation that hurts the middle-class, small businesses, and young families struggling to get by in these trying times. With the COVID-19 pandemic and its resultant lockdowns, business closures, and job losses, now is not the time to raise our taxes.

Vote NO on Measure G-20, and vote for those candidates for mayor and SLO City Council who will vote the same way.

T. Keith Gurnee is a former SLO City Councilmember.


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Jorge Estrada

I rest my case in support for the protection of proposition 13 as the need is obvious, government resolve is always in the form of new taxes and yes they are tax fiends. For this reason proposition 13 was greatly supported to force government to live within their means, as we do. The socialist are hell bent into undermining the relevance of this protection by the heavy handed spending tax dollars on social programs, leaving the benefit for all as well as infrastructure underfunded. We have evolved into a culture where many want a lifetime mommy and daddy to take care of them. Sadly they feel entitled too.


IDBOUND

.5 or 1.5 tax increase adds up most people are going to spend at least 1k to 1.5 each month on taxable items ,just about everything we do in everyday life is taxed including just flipping the light switch in our houses .

.5 to 1.5 adds up equates to $10.00 to $23.00 a month multiplied by 12 months is $120.00 to $276.00 more paid out by residents each year .

In some states sales tax rates are up to 9.5 and 10% those rates are in states where people from California are moving into and have voted for higher taxes ….They moved out of California to get away from high taxes ,then vote for them in their new state of residence .As an example Murray County Okalhoma sales tax rate is 9.5 % alot of California folks have moved their .

Citizens of SLO need to visit “” Transparent California “” website to see where their tax is being spent on current employees and money needed for pensions .They need to be sitting down when they see the wages SLO gov employees and retirees are receiving


TKG

Just received an email from somebody who read this piece who informed me that it omitted the concept “that DMV use taxes are based upon the local sales tax rate. Since automobile purchases are a high dollar item, the (sales tac) increase does have an impact on the local population, since use taxes are based on the location the person lives, and not where the car was purchased. It is not just the out-of-town people that are impacted.”


GREAT CATCH! If iI had just waited until the sales tax increase was approved, I would have had to pay an additional $525 in sales taxes on a moderately priced new car we bought here earlier this year. Darn!


localman

Keith, I’m afraid I have bad news. If you want a functioning city, or even just a paved road in front of your house, you’re gonna need to either pay more than your Prop 13 capped $1,500 a year in property tax or pay some more sales tax.


isoslo

Got some bad news for ya localman, anytime the government increases taxes everything the citizens buy gets more expensive. The city does not want this revenue to give us a better community, they want the money to give themselves a better living.


localman

Yes, they spend 80% of the budget on stuff that doesn’t help the community like…police, fire, utilities, public works, and parks. You could just look at the budget. It’s all there.


https://www.slocity.org/Home/ShowDocument?id=23630


TKG

And how about running $70,000,000 worth of bike paths through single family neighborhoods while wiping out on-street parking like the city wants to do? Or spending $160,000 plus consultant expenses on Heidi’s Diversity Committee when homelessness is a far greater problem in SLO than diversity is? Or how about more $ for salary increases for already over-compensated staff? Localman must be someone who seems to rely on government funding.


localman

Keith, again, sorry to break this to you, I know this self-sufficiency myth is important to you, but if you drive on the highway or use water in California, you rely on government funding. And that funding isn’t coming from your $1,500 in annual property taxes.


Also, I’m sorry, for the parking, very sad. Paid parking right? Otherwise the government would be paying for that street space, which would be government funding, which is bad.


kayaknut

Try 80% on salaries, benefits and pensions. That should be the place to start looking as ways to reduce costs.


WhatNext

You obviously have no idea how much people pay in property tax.


localman

You obviously have no idea how much people pay in property tax.


Here’s just one. $1.1M house paying $1,500 in property taxes.


https://www.zillow.com/homedetails/570-Pacific-St-San-Luis-Obispo-CA-93401/15386009_zpid/


kayaknut

You seem to have confused today’s house value with the price paid for a house when last purchased. The tax rate is based on the purchase price not today’s value, which is exactly what Prop13 was meant to protect. Trust that if the house you listed were to sell today at $1,000,000 plus the property taxes paid on it would be much higher than $1,500.


localman

I understand how this works. You seem to have confused how California does property taxes with how property taxes are supposed to work.


womanwhohasbeenthere

Prop. 13 was passed to keep people from being taxed out of their homes. If your neighbors own a house worth $1.1 M but pay $1500 a year in taxes, I am sure they bought it a long time ago , when wages were also considerably lower, and chose to stay there rather than move to a more expensive place.


Government is not short of money, it is simply mismanaged.


Government employees used to get middle class wages and job security as a trade-off for higher salaries. Now they get very high wages and pensions out of reach of all but millionaires in the private sector. One former city manager of SLO pulls in over $180,000 a year in pension. Katie Lichtig, the last one, gets $5,000 a month for life from SLO taxpayers for the years she was here – on top of pensions from the other cities where she worked.

Measure G-20 will just go to pay these outrageous pensions. There is NO accountability, NO effective oversight, and NO END IN SIGHT because it is a permanent tax. VOTE NO.


kayaknut

Actually I’m not confused, but you seem to think a person who bought a house back in 1920 and still lives in it and that now it is valued at $1,000,000 plus should be paying more taxes without any justification as to why. Again that is one of the reasons Prop 13 was passed.


localman

That person now has $1M in assets. They are effectively a millionaire. That’s the justification.


horse_soldier

Ridiculous. $1M in assets DOES NOT necessarily indicate the homeowner is flush with cash. Quite possibly they are retired, on a fixed income and in this state barely making ends meet. When the home sells the tax basis will change, the state will get theirs then.


shelworth

how about a 20% pay cut for every person employed by, or retired from San Luis Obispo? That might help a bit with the money problems and not hurt people who are struggling to pay their rent right now.


Rambunctious

I guess our government thinks they can shut us all down until we are on the verge of going broke and when it gets to hurting the coffers they can just raise our taxes….sorry that’s not how it works….we are all tapped out….deal with it….or open back up….you know you will on November 5th anyway…..


shishkabob141

Any tax into the general fund is a NO-GO!


slocorruptionhater

I agree, NO on G-20. The additional revenues will be used to replace funding that would otherwise go to capital projects to fund bloated management salaries instead. The City needs to drastically reduce its payroll first and foremost. The PD/FD “overtime” sham need to be eliminated. Don’t get me going on the unfunded pension liability issue. SLO is being run into the ground. So, first order of business is to limit additional revenue from new taxes, and to instead make the City be fiscally responsible.


Jon Tatro

Well written Keith and factually supported. Vote no on G20 and vote to replace the socialist running the city of SLO.