August 1, 2002

City, tax foes square off on ballot language

S.C. files suit to keep utility tax from voters

By DAN WHITE
Sentinel staff writer

SANTA CRUZ — A Superior Court judge is expected to decide this month whether tax foes fiddled with the facts while presenting arguments against a 7 percent utility tax.

City government filed suit last month, alleging that the language is misleading and should be stricken from the November ballot.

Tax foes, led by KSCO radio talk show host Steve Hartman, gathered enough signatures to put the tax on the November ballot.

"They say our utility tax is unjust and illegal," city attorney John Barisone said. "(But) the California Supreme Court and the state Court of Appeals hold it is legal. We have court decisions saying it is legal."

The utility tax generates an annual $8.4 million to the city’s roughly $45 million general fund. It provides money for police, fire, public works, city parks and other services. The city said it could not weather a 20 percent general fund cut without severe cuts to services including public safety.

Tax foe Alan Bailey, who filed the language along with Hartman, Mike Schmidt, Bob Lissner and Bob Thomas, argues the city is unjustly branding them as liars and using "scare tactics" to stop them.

Tax foes contend the city’s budget is rife with porky pet projects and that the utility tax hurts the poor, along with elderly residents on fixed incomes, while raising money spent without accountability.

The city is countering the group’s claim that many functions of numerous not-for-profit groups contracting with the city are redundant and that consolidation would save millions without harming services.

"We only provide $1.9 million to social services," Barisone said. "So saying ‘saving millions of dollars’ is false and misleading."

Hartman said the savings would be cumulative.

"We didn’t pinpoint that the city would save millions," Hartman said. "We just said, ‘millions would be saved.’"

Bailey, a semi-retired financial consultant, defended his group while acknowledging "none of us is qualified to call ourselves a lawyer. We’re just average everyday working people."

He said the state constitution, according to his group’s reading of it, requires cities that levy taxes must at least be granted authority to levy those taxes from the state government.

"We believe the utility tax was not legally sanctioned," Bailey said.

The tax foes argue the city has a legal obligation to preserve essential police, fire, public works and street maintenance services.

The city said this, too, is misleading.

"It’s false and misleading, to reassure that services (Santa Cruz residents) currently enjoy will continue unaffected by $8.4 million in losses," Barisone said.

Hartman said that while no law forces the city to provide adequate services, "we feel the higher authority is the California Constitution. ... ‘The protection of the public safety is the first responsibility of local government.’"

 

Contact Dan White at dwhite@santa-cruz.com.