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Contributors
Jon Coupal- Columnist
Jon Coupal
is an attorney and president of the Howard Jarvis Taxpayers
Association -- California's largest taxpayer organization with
offices in Los Angeles and Sacramento. [go to website] [go
to Coupal index]
 Hi-Tech
Business Leaders' Hypocrisy
Stand on
two-thirds tax vote is revealing...
[Jon Coupal] 11/29/04
On important taxpayer issues, California's high-tech business
leaders are of two minds. And what they think has an impact on
the rest of the taxpaying public, especially homeowners.
Regrettably, two business groups which have declared virtual
war on ordinary taxpayers are the Silicon Valley Manufacturing
Group (SVMG) and the San Jose Silicon Valley Chamber of Commerce.
The latter is headed by Jim Cunneen, a former member of the State
Assembly. When Cunneen was in the Legislature, he impressed many
-- including us -- with his energy and earnestness.
While the entrepreneurial
spirit reflected by those on the cutting edge of the "dotcom" world
is to be applauded, it is difficult to understand why many
of these folks continue to push
a radical anti-taxpayer agenda. After all, it was Silicon Valley
dotcom millionaires and billionaires who funded much of the Proposition
39 campaign in 2000, which resulted in making it much easier
to increase property taxes for school bonds.
But we can't help
but notice that these Silicon Valley business leaders are very
picky about which tax increases they support.
They tend to back only those tax measures whose impact would
fall most heavily on others, and to oppose those that would increase
levies on themselves and their companies. (Not long ago, Silicon
Valley leaders were advocating a higher tax on homeowners here
in California on the same day their lobbyist in Washington was
advocating for an R & D tax credit for their industry).
We at the Howard Jarvis Taxpayers Association have known Jim
Cunneen since he first announced himself as a candidate for the
Legislature nearly a decade ago. We endorsed him because, among
other reasons, he agreed to support the two-thirds vote. And
for most of his legislative career, he recognized the importance
of this super-majority vote protection.
As chamber president,
Cunneen still understands that a two-thirds vote can effectively
prevent unreasonable taxation because he
was an outspoken opponent of Proposition 56. This public employee
union-backed measure was on the ballot last March and would have
undone Proposition 13's requirement that new state taxes require
a two-thirds vote. In a Mercury News opinion piece Cunneeen wrote, "The
two-thirds rule is a protection against tax increases run wild,
not an obstacle to raising needed revenues."
However, recent events show that Cunneen has acquiesced to his
associates who want to continue the effort to shift more and
more of the costs of education onto the backs of homeowners.
The chamber president
has joined Taxpayers for School Improvement, a recently formed
committee made up of some of the major backers
of Proposition 39. The goal of this new group is to do away with
the two-thirds vote required to increase property taxes for schools.
Using their successful Proposition 39 as a template, they plan
to field an initiative that would require only a 55% vote to
increase property taxes, known as "parcel" taxes. Unlike
bonds, the proceeds of which must be directed to capital improvements,
the revenue raised from parcel taxes can be used for anything,
including salary increases for administrators.
Parcel taxes place an equal tax on all parcels of property.
They are particularly odious because the result is that retirees
living in a bungalow, the new buyer of a tract home, the multimillionaire
president of a high tech company residing in a mansion, and a
major business corporation all pay exactly the same flat dollar
amount. (We suspect that a $400 dollar per year parcel tax would
be a greater financial burden to a retired couple than to Cisco).
Moreover, since in virtually all communities the majority of
parcels of property are residential, homeowners pay for most
of the tax. And of course, this is another instance where everyone
votes, regardless of their obligation to pay the tax. If parcel
taxes were to require only a 55% vote, we know from the experience
of Proposition 39, virtually all would pass, and the result would
be tens of billions in new taxes added to the burden of homeowners.
Regardless of what may be Jim Cunneen's best intentions, he
and his Silicon Valley colleagues can't have it both ways when
it comes to the two-thirds vote requirement. They showed a great
appreciation for the two-thirds vote when they would have been
the likely target of tax increases had Proposition 56 passed.
Now, however, they continue their efforts to weaken the two-thirds
vote protection at the local level, especially for taxes that
hit ordinary taxpayers the hardest.
If they are really so anxious to increase taxes, how about one
that falls most heavily on the high tech industry? We are sure
homeowners can come up with some ideas.CRO
copyright
2004 Howard Jarvis Taxpayers association
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