Friday, August 24, 2018
IN MY OPINION (Column)
Tax Measure on the November Ballot Would Make Los Angeles Even Less Affordable
By TERESA CASAZZA
(The writer, a a certified public accountant, is president and chief executive officer of the California Taxpayers Association, a non-partisan, non-profit organization founded in 1926. It is the state’s largest and oldest organization representing taxpayers. Its website is at http://www.caltax.org.)
At a time when housing affordability has reached a crisis level in Los Angeles County, and businesses are struggling to stay open, the last thing we need is a new property tax that will add to the cost of living. But that is exactly what the Los Angeles County Board of Supervisors has proposed.
The new property tax would cost county taxpayers approximately $300 million per year, taken directly out of the local economy.
Here’s how it would work: In addition to the annual tax that is based on each property’s assessed value, and in addition to existing parcel taxes for schools, firefighting, libraries, parks, trauma care, etc., every property in the county would be subject to a new parcel tax to pay for stormwater and urban runoff cleanup.
The tax would be 2.5 cents per square foot of each property’s “impermeable area”—roofs, driveways, parking lots and other areas that don’t soak up rain. So, if you paved your backyard as a water-conservation measure during the drought, you now would pay more than neighbors who kept their water-guzzling lawns. If you own a small business with a large roof and a paved parking lot, you would be taxed more than your competitors with smaller roofs and street parking.
If you own a home and are not deemed a low-income senior, you would pay the tax every year. To make matters worse, you could end up paying higher federal income tax, too, because the new tax would not be deductible (the IRS prohibits taxpayers from deducting a parcel tax if it imposes a higher tax on some properties than others, as this one would).
Renters would pay indirectly, as landlords almost certainly would pass the cost on to tenants. If you shop in the county, you would pay more for everyday goods and services, as business owners typically increase prices to cover the cost of tax hikes.
There is an appeals process, but it is stacked against the taxpayers. Appeals would be limited to challenging a mathematical error in the calculation of liability, or a “significant discrepancy” over what is considered an impermeable area.
Another troublesome issue: the tax has no end date. Since the tax never would go back to voters for periodic renewal, the public wouldn’t be able to hold the county accountable. The bureaucracies that spend the money would have no motivation to be efficient, because they would know that the money would continue coming in every year, no matter what.
There is no question that Los Angeles County needs to do a better job of stopping polluted water from flowing into the ocean, but this flawed tax isn’t the solution. If county officials can’t find a way to use existing funds by reprioritizing spending and adopting internal efficiencies, they at least should go back to the drawing board and come up with a plan that won’t flood residents and the economy with never-ending taxes.
Copyright 2018, Metropolitan News Company