LA tax hike plan set for March ballot *

cityhall2.jpgToday's City Council vote came despite Service Employees International, one of the city's largest public employee unions, coming out late last week against the proposal, which would raise the sales tax in L.A. to 9.5 percent. Union officials say a higher sales tax is regressive, meaning that poor people would pay disproportionately more than rich people. We'll see how actively the union campaign against the plan. This is really about city officials wanting a quick way of bringing down L.A.'s huge budget deficit without being forced to institute some pretty drastic changes in the employee pension system. That's why some city officials were surprised at the union decision. Only four council members voted against putting the measure on the March ballot: Dennis Zine, Eric Garcetti, Jan Perry, and Mitch Englender (both Garcetti and Perry are running for mayor.) By the way, Mayor Villaraigosa does not plan to veto the proposal, KNX is reporting. Earlier, the mayor said he wouldn't support the tax hike unless it was accompanies by other budget actions, such as the privatization of the Convention Center.

* Update: Villarigosa's statement below.

Mayor Antonio Villaraigosa announced today that he will return without signature a City Council election ordinance to place a half-cent sales tax increase on the March 5, 2013 ballot:

"I will not ask the people of Los Angeles to support higher taxes until the City Council makes progress on a set of new reforms that will make us more efficient, accountable and competitive. We must tie new revenue to new reforms.

"Since the recession began, the City of Los Angeles has reduced the General Fund workforce by 5,000 positions, increased employee contributions to pensions and retiree health care, and enacted a pension reform plan that raises the retirement age for new employees from 55 to 65. We have made progress in putting our fiscal house in order, but there is still more work to be done.

"I have proposed a series of measures that will reduce the size of our workforce, embrace new public-private partnerships, and streamline city services. Council President Wesson has indicated a desire to move forward on this reform agenda.

"Now is the time to make the tough choices to reduce our long-term structural deficit. I will be directing the CAO to prepare a budget by January based on present realities, not the hope of new revenue. We will continue to make the hard calls to protect public safety while balancing our budget."

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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
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