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# Problem With Save Our Streets Tax: Who Can You Trust?
April 07 2014
Written by Paul Hatfield.
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***PERSPECTIVE:*** Council Members Buscaino and Englander are making the rounds pitching their latest version of Save Our Streets, this one calling for a half-cent bump in the sales tax for the next fifteen years.
The price tag has risen since their failed attempt last year. It has gone from $3 billion to $4.5 billion and includes around $600 million for sidewalk repairs.
It is worth noting that a [$1.5 billion street repair tax proposal by Tony Cardenas and Greig Smith in 2006 never made it to the ballot](http://www.highbeam.com/doc/1G1-149376611.html) due to a lukewarm reception by residents and competition from other bond measures on that year’s ballot.
Nothing much has changed since then. There are other measures on the horizon including a County half-cent sales tax boost for transportation projects (probably on the 2015 ballot). It will weigh heavily on the minds of the likely voters in 2014, making the required two-thirds share of the votes for approval of the SOS tax a tough sell.
If both SOS and the County increases were approved, our sales tax would jump to 10%. It would be worth buying your big-screen TV and computer system in adjacent Ventura and Orange Counties. If you have access to a van or pickup truck, it might pay to buy home furnishings at stores outside of Los Angeles County, especially if you live fairly close to the county lines.
Also looming in the future is a [15-cent-per-gallon fuel tax](http://articles.latimes.com/2014/feb/20/business/la-fi-carbon-tax-proposal-20140221) being pushed by State Senator Darrell Steinberg. It probably stands a zero chance of being approved in 2014, but do not rule it out in future years.
A few cents here; a few cents there, and before you know it, we will be paying an insidious penalty for making everyday purchases. We already do, but it will get worse.
Proponents of SOS whine that street maintenance has been hampered by a decline in gasoline tax revenue as a result of more fuel-efficient cars on the road. They point out that other sources from the federal government and county bonds will be declining.
I would be more sympathetic to their complaints, but street maintenance funding has been an issue since the 1950s. [This 1997 article from the Los Angeles Times ](http://articles.latimes.com/1997/oct/05/local/me-39593)is interesting reading. Our streets were already in dire straits back then.
You would think that a group of fifteen adults serving on the City Council would have by now arranged the spending priorities to address core needs instead of giving city employees a free ride on health care.
We are going through a process of what I refer to as [virtual bankruptcy](http://phinvv.wordpress.com/2012/05/13/what-happened-to-the-daylight/): services are cut rather than dealing with the structural deficit fed by overly generous and unsustainable employee compensation. Unless our elected officials are willing to come to grips with this problem, we should be reluctant to open our checkbooks.
Having said that, we must also be realistic.
We are in such a deep hole as far as reducing the street and sidewalk repair backlog, additional funding above and beyond offsets in the general fund will be needed to close the gap.
Whether the funding comes in the form of a bond or tax, we need to ask this very important question: are you willing to trust a government that has failed to manage its obligations for at least half a century with a $4.5 billion commitment over the next fifteen years?
It would be like Clark Griswold giving his [ne’re-do-well cousin Eddie a pile of money so he can reinvigorate his worm farm](http://www.moviewavs.com/php/sounds/?id=gog&media=WAVS&type=Movies&movie=National_Lampoons_Christmas_Vacation"e=youprettyset.txt&file=youprettyset.wav).
$4.5 billion is out of the question. In 15 or 20 years we could be right where we are today…considering yet another increase in sales tax to pay for neglect.
But what if we scale it back with some caveats?
Try this out for size: a bond or tax which would generate $500 million to be used over a three-year period. If the city could show a meaningful reduction in the repair backlog while maintaining the status quo with the rest of the streets, then we could consider an extension of the funding.
This plan would require locking down the condition of the streets at the beginning of the program and a re-evaluation after three years.
The [Micro Paver](http://bss.lacity.org/resurfacing/LAStreetSystem.html) technology used by the city would enable the city to measure the street conditions at roughly two periods in time (obviously, it would not be possible to evaluate all the streets at any one time).
This approach might even dovetail with a performance-based budgeting program under consideration by the city.
It would certainly be easier to sell than the “trust me” proposal by Englander and Buscaino … and their cousin Eddie.
***(Paul Hatfield is a CPA*** ***and former NC Valley Village board member and treasurer******. He blogs at Village to Village and contributes to CityWatch. He can be reached at: )***
**–cw**
**CityWatch**
**Vol 12 Issue 29**
**Pub: Apr 8, 2014**
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