San Luis Obispo snubs rules, promotes sales tax increase

October 12, 2020

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.