The perfect storm is gathering on the horizon for another California tax revolt.
There’s a booming economy that is benefitting the upper middle class disproportionately more than the working class and much of the middle class.
Housing costs are skyrocketing.
Tax burdens are rising as is government spending that from many people’s perception is getting farther and farther from basic necessities.
Meanwhile elected leaders give lip service to tax and spending reform in a bid to placate voters and then go about spending like there is no tomorrow.
It was the stage that was set in 1978 when voters — who were warned the sky would fall down if they capped annual property tax increases at 2 percent — voted overwhelmingly for Proposition 13.
This time around the gas tax increase is shaping up as Proposition 13 version 2.0. Should it qualify for the November 2018 ballot it could turn Sacramento upside down just like the original tax revolt did 40 years prior.
And just like with Proposition 13 the political establishment has been playing shenanigans well in advance off the gas tax repeal getting enough signatures to qualify for the ballot.
Attorney General Xavier Becerra did his best slick legal take in trying to mangle the title of the gas tax repeal initiative by assigning it the following verbiage: “Eliminates recently enacted road repair and transportation funds by repealing revenues dedicated for those purposes.”
It fails to mention words such as “taxes” or “fees” but instead uses the euphemism “revenue” to muddy the waters.
Sacramento County Superior Court Judge Timothy Frawley saw the ruse for what it was when backers of the gas tax repeal initiative sued over the wording. The judge rejected the Attorney General’s muddying of the waters and rewrote the measure’s title.
Goading taxpayers isn’t a wise move as the California Legislature discovered in 1978.
Of course if the measure qualifies we will see and hear a full-scale press warning how passage will send the state’s transportation and highways into a deep tailspin just like Californians were warned in 1978 that passing Proposition 13 would lay waste to our cities and schools.
The old Chicken Little routine backfired in historic proportions.
It’s not that voters don’t see the need for major road improvements or that they think there is a free lunch. Instead they are frustrated not just over decades of questionable expenditures and “revenue enhancements”, but about state government being out of control. Remember the Great Recession that started in 2006? Schools, local government, and the private sector all saw workforce cutbacks and reduced wages but not the state. There were no layoffs to right size for the economic realities. True there were pay freezes but compensation was not reduced nor did the hiring stop. California had zombie bureaucrats feeding off taxpayers struggling to survive.
When Gov. Brown vetoed a measure mid-budget year not to wipeout the tax on tampons because it did not include a corresponding cut elsewhere or an increase in taxes to plug the state revenue loss it would create, party hacks in his own party decried the governor as being anti-woman. No attempt at being fiscally responsible goes unpunished in Sacramento.
Left without restrictions government can be mighty liberal with money they tax other people to obtain.
Prior to 1978 school districts — as well as cities and counties — would add up all of their anticipated expense for an upcoming fiscal year and then tally up the various sources of revenue they had. They would subtract the revenue from projected expenses. The difference, or shortfall, was the amount of money they needed from property taxes. They would then increase the property tax rate based on that shortfall.
What typically happened were cities — with elected council members under constant pressure from citizens they’d come across at the barber shop, in the grocery store, or at their kids’ ball game — were under more pressure to keep spending down than in schools.
School boards for the most part deferred to the administration that was driven, in part, from state pressures and rules for what schools needed to have in place. The end result was school boards as a whole were more liberal with increasing the property tax rate.
It is the state agenda driven by special interest groups far from California’s barbershops, supermarkets and youth soccer fields that is fueling the current taxpayer frustrations.
The political elite rationalize taxpayers aka voters won’t support the repeal of the gas tax increase because it would end up hurting them. But that is where they are wrong. Proposition 13 proved that.
Pushing the state toward the abyss is an array of hidden taxes such as greenhouse gas fees collapsed into the price of services and goods such as gasoline as well as the pending federal tax reform that may cost many Californians the ability to offset the cost of high states taxes by eliminating federal deductions.
Timing, as they say, is everything.
The planets are aligning as they were 40 years ago next June.
And the repeal of the gas tax would spark a raging inferno just as Proposition 13 did to force a rethinking of government.