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Ted Lieu, the VLF and the supermajority

by: Brian Leubitz

Tue Nov 20, 2012 at 12:19:31 PM PST

SB 746 Tanning Beds TED LIEU PC_April 28 2011_1054Senator backs down from car tax discussion

by Brian Leubitz

If you ever wonder about the gaping hole in our budget that we've been trying to close for the last decade or so, there is one part of that larger pie that is bigger than the rest. That is the Vehicle License Fee. Back when Arnold Schwarzenegger was running in the recall election, it was dubbed simply the "car tax."

And give him credit for this, when elected he did, in fact, slash the "car tax."  We were able to backfill with a few years of budgetary "smoke and mirrors" but the hole was stubborn. And when 2007-8's big recession hit, we were proverbial budgetary roadkill. The cuts just couldn't come fast enough to match the speed of declining revenue, given that we had already made cuts to cover the loss of the VLF revenue.

And so here we stand, with a brand new legislative supermajority sure to eventually show up. So, given the damage the VLF cut brought us, surely it would be at least open for discussion, right? Sen. Lieu thinks so, or at least he thought so a few days ago when he told the LA Daily News just that

The constitutional amendment would restore the 2 percent vehicle license fee slashed by Gov. Arnold Schwarzenegger after he won office partly on that pledge.

The 1.35 percent transportation system user fee increase would generate an estimated $3.5 billion to $4 billion annually for roads and public transit in yet-to-be-decided proportions, Lieu said. ... "It would be a test to see what the two-thirds (majority) Legislature means," Lieu told the editorial board of the Los Angeles News Group. "The best way for us to lose the supermajority is to overreach.

"I'm not saying it would be an easy sell," he added of the proposal. "I'm aware of the fact I may be attacked for it." (LA Daily News)

Now, the interesting part here is that the suggested increase would still go to the voters, because, apparently we are all in on the government by plebiscite thing. All this would do is to save somebody a few million dollars of getting the measure on the ballot. To be honest, the amount of money spent getting it on the ballot would pale in comparison to the amount required to pass it. So, yes, Democrats have a supermajority, but no, they won't be going so far as just passing additional revenues on their own.

Silly you, thinking we had a representative democracy, but even the vote was too much for some.

However, over the last few weeks California's political landscape has changed.  I have listened carefully to those who have contacted my office or me.  Additionally, more stakeholders weighed in on this important issue.  As a result, I will not be introducing the proposal.  Instead, I will work with transportation stakeholders and the public next year on alternative ways to mitigate the transportation infrastructure problem.  This problem is not going to go away and will only worsen when the final installment of depleted Proposition 1B funds are allocated next year.  I am open to any suggestions and if you have any, please feel free to contact me or my office. - Sen. Ted Lieu

So the good senator got some pressure, and as Dan Walters points out they are loathe to be seen as "over-reaching." The CW apparently comes down hard, and despite some solid advice from our very own Robert Cruickshank to move forward on progressive legislation, it looks like there is more work to be done here. Now, that being said, it looks like we may get some not inconsequential reform on the ballot in 2014, but the status quo is still quite strong.

Brian Leubitz :: Ted Lieu, the VLF and the supermajority
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Who else in addition? (0.00 / 0)
Who else in the legislature is looking to push for financial structural reform? Asm. Phil Ting of split-roll fame...?

No Brainer (0.00 / 0)
This does seem like a no brainer
The 'Car tax' cut was one of Arnold's biggest mistakes

Let's be careful, though
Don't start raising taxes will-nilly
The VLF and splitting the property tax rolls seem the most obvious

Let's not go on any spending binges, either

Any reforms that don;t cost too much money ??

Here is my idea. (0.00 / 0)
How about an incremental car tax based on the value of the car. ANy car under 5,000 in value would have the old tax value, 5000-10000 would tier up to 1 percent, 10000-16000 would be 1.25 percent or so, and anything over would be at 1.6 percent as an idea.

We want to fund services while not being as regressive.  

Structural change (0.00 / 0)
I like the overall idea of changing the structure of VLF but I'm thinking something more along the idea of a carbon tax.  Maybe we could figure out a way to determine pollution levels and gas mileage at smog check and base the VLF on that.  It would be progressive from an environmental standpoint but probably regressive from an economic standpoint.

[ Parent ]
We should refer to "restoring" the VLF, not "raising" it. (0.00 / 0)
The VLF increase that was used to bring down Governor Gray Davis was an automatic restoration written into a law signed by Pete Wilson. We need to frame this as "paying the same car tax our grandparents paid without complaint".

The VLF reduction was never intended to be anything more than a "good times" tax cut, destined to be revoked when other revenues came up short. The 'Pubs unfairly pinned it on Davis, who was too much a gentleman to pass the buck back to the legislature.

Mr. Lieu is wise to go slow on this issue. Political power extends beyond the steps of the legislature. The VLF restoration is opposed by auto dealers. Auto dealers are a major source of ad revenue for local newspapers. Local newspapers still have some influence in shaping public opinion.

The election barely behind us. Let's give the TeaPuppets a few more weeks to simmer down and adjust to the new realities, and start building some grassroots support for the VLF. If I recall correctly, there was little praise for it back in 2002 among young people and minorities... traditional Democratic voters.

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