San Jose Mercury News

Santa Clara County supervisors push sales tax measure for November ballot

By Tracy Seipel

June 26, 2012

The race to get voters to raise their sales taxes on Nov. 6 got more crowded Tuesday after the Santa Clara County Board of Supervisors agreed to consider a 1/8-cent increase that would pay to beef up everything from county law enforcement to hospital emergency room services.

County residents already are bracing for a sales tax hike this Sunday, when a BART tax that voters passed in 2008 finally goes into effect, pushing the county's current 8.25 percent sales tax to 8.375 -- the fourth highest county sales tax rate in the state.

Another 1/8 cent sales tax would send that to 8.5 percent, tying it for third -- and that doesn't even include Gov. Jerry Brown's proposed ¼ cent sales tax measure or one by the city of San Jose, which is mulling a ¼ to ½ cent sales tax to place on the same fall ballot.

John Roeder, president of the Silicon Valley Taxpayer's Association, said enough is enough.

"Sales taxes are too high already, and the county has a number of ways to cut down on its costs before it needs to start collecting more taxes from people,'' said Roeder, pointing to massive employee pension and health care costs that are eating up the county's budget.

"In nearly any department you can name, there is room for efficiency," said Roeder.

But county officials say at least 10 consecutive years of budget cuts has resulted in the loss of $2 billion to county services over that same time period. And further state and federal funding cuts are expected.

Moreover, they say, county employees have agreed to $75 million in pay and benefits reductions to stave off more cuts.

"So it's not as if we aren't making an effort to be more efficient," said Sylvia Gallegos, deputy county executive. "But we know there are important community services that we would like the voters to be able to vote on."

In a 4-1 vote, with only Supervisor Mike Wasserman opposed, the supervisors on Tuesday agreed that a sales tax is the answer to their budget woes. Wasserman said he was against the proposed tax hike because local and state taxes are already very high, and he doesn't favor increasing the tax burden in the county because it could drive residents and businesses out of the area. He also noted that a number of other tax measures could be on the same ballot.

Supervisors and county officials worry that a decision expected Thursday by the U.S. Supreme Court on the Obama administration's health care reform law, which is already being implemented by the county, could strain the county's finances.

"It's unclear what the state and federal government are going to do and particularly what the Supreme Court is going to do regarding services that are critical for our community," County Executive Jeff Smith told the board.

County voters, he said, "want to assure their current level of services -- or even increase services," and this is an opportunity for the voters to do that.

The measure would share a ballot with Gov. Brown's state sales and income tax proposals. The San Jose City Council will decide in early August whether to place on the ballot a new quarter or half cent sales tax measure.

And that's only the sales taxes. Still to come may be other taxes: The Santa Clara Valley Water District in July will decide whether to place a ballot measure that would extend its existing $54 parcel tax, set to expire in 2016.

Three school districts also are placing parcel tax or bond measures on the ballot, with several others deciding on similar measures in the coming weeks.

If the county's proposed 1/8 cent sales tax is passed by a simple majority of voters, it would raise an additional $498.5 million for 10 years, at which time the tax would end.

County leaders say the tax would be used to bolster costs for law enforcement and public safety; trauma and emergency room services; health care coverage for low-income children; economic development and job creation; housing for the homeless and helping students stay in school.

Representatives from some local nonprofit groups say their private polling shows that voters would support a 1/8 cent sales tax increase because they understand the importance of county services and the need to reinforce their funding.

"Not everyone is convinced that the state will work out its budget issues, and we want to make sure our county does not get dragged down with the state's budget,'' said Kathleen King, executive director of the Santa Clara Family Health Foundation.

"We need our county to look out for itself, and the best way to do that is a tax that will only take care of us locally, where it can only be used locally,'' she said.

The Board of Supervisors is expected to make a final decision on the sales tax ballot measure at its Aug. 7 meeting, during which they also could ask for any minor changes to the ballot language.

[Graphic: "How sales taxes could stack up"]


Contact Tracy Seipel at 408-275-0140.

This article is also posted at the web site of the San Jose Mercury News, here.

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