So what Joe Mosca did at last week's SCAG/CEHD meeting should come as no surprise. After all, turning his back on what this town wants, all the while claiming it is because he knows our needs better than we do, is now an established pattern. But would you believe that the issue being voted upon this time was the possible confiscation of our city property taxes for regional use, and that Joe actually cast a vote to keep this initiative going? Despite what this could mean for Sierra Madre? Follow along and we'll break it down for you.
SCAG is the regional planning authority that has been the source of much of the pressure on cities like ours to allow for unwanted high density development. Mostly in the form of muli-story mixed use condominiums. You only need to take a short trip to Pasadena or Monrovia to see what becomes of cities who've adhered to this scheme. There you will find blocks of unwanted complexes that are a glut on the market and will remain so for years to come. Sierra Madre has resisted this for years, and has maintained itself as an unscathed and independently run small town in one of the most densely populated counties in the United States. It is quite an accomplishment if you think about it.
SCAG, while claiming to be the place where local governments go to plan together for regional development, has actually become little more than the local enforcer for Sacramento's development policies. Joe, who supports and works hard for these policies, was assigned by powers that be in the regional governance world to something called the Community, Economic & Human Development Committee, or CEHD in acronym speak. And in 2012 it will be this CEHD that will hand down what are expected to be the largest Regional Housing Needs Assessment (RHNA) numbers the SCAG region has yet to see. Numbers which will determine what level of development the state can demand that we accommodate here in Sierra Madre. Sacramento's mandates under SB 375 are clear, and their factotums at SCAG are working hard to make them happen.
But apparently it is no longer only development planning that SB 375 has taken away from small cities like ours. Would you believe that Sacramento aligned regionalists are also working to take control over things like local property and sales taxes away from us as well? This is something that could mean we'd no longer be able to budget for the needs to the people of this city, and with their tax money, without first getting the approval of the state. And would you believe that Joe Mosca actually supports this?
The concept that has been created by regionalists such as the people at SCAG is called the "Fiscalization of Land Use." The description I will reproduce below is a finding of SCAG/CEHD's Fiscalization of Land Use Subcommittee. Here is how the matter is explained in their February 4 meeting handout:
While local governments in California are funded through a variety of revenue streams, the legal structure of the finance system restricts local governments' flexibility in allocating funds as well as their ability to raise additional revenue.
(In other words, these local governments in question have exhausted all of their possible resources through over-spending, and now they must find other ways to find more cash.)
The SCAG document continues:
One of the options for a city to raise revenue is by realizing an increase in "taxable sales" within its borders and a resulting increase in sales tax revenue returned to the city. This can create a strong incentive for local land use planning to favor retail development that increases taxable sales and sales tax revenue. Many locations in California have thus become "over-retailed" with more commercial space than local and regional markets can support.
So what is being described here are the actions of misguided city governments who, having spent themselves into a hole, turn to large scale commercial development in hopes of creating increased sales tax revenue at levels commensurate with their spending. One of the big pitches for our allowing for such development, the Downtown Specific Plan, came with the promise that sales tax collections would increase markedly.
So what do they see as being a way of relieving these cities of the consequences of their actions? Here is where the going gets a little murky.
The Fiscalization of Land Use Subcommittee developed goals to where the recommendations should:
- provide more balanced and stable revenue for cities and counties;
- provide more balanced incentives for land use planning and development; and
- reduce the extreme reliance and competition for sales tax revenue.
That last one is pretty good. Sounds like SCAG feels that anyone who fails to attract or succeed in a free enterprise system should be sheltered from the consequences of their failure. And how is that to be achieved?
Balanced incentives should also help local governments plan consistently with state mandates such as SB 375, RHNA and RTP. Staff has prepared two options for discussion and possible further review:
- Option 1 - a sales tax-for-property-tax swap; and
- Option 2 - sales tax revenue sharing.
In other words, pooling taxes from all the cities within the SCAG region, and then doling funding out to those cities in need of it the most. Such as the ones that spent all their traditional funding, allowed for runaway development in order to make up for it, and when that failed to achieve the desired results, sank into fiscal disaster. Think of this as a welfare system for failed city governments, paid for out of our seized property taxes.
Sierra Madre, which is funded mostly by property taxes (sales taxes being quite miniscule in this town), has remained not only solvent but is actually running healthy surpluses due to superior budgetary planning and spending control. And therefore we could hardly expect to get very much of that confiscated loot under such a system. Rather we would become one of the contributing cities in order to, as SCAG puts it, "provide more balanced and stable revenue for cities and counties." Our punishment for being successful, I suppose.
Now this proposed plan to remove the rights of cities to decide how to do budgets and spend their own taxes was met with impassioned opposition from some of the cities at this CEHD Committee meeting. Their hope being to kill this process outright. The representatives of several cities stood up and gave forceful speeches on what a terrible wrong this would be should it somehow go live. Something resulting in cities such as ours not only losing control over their finances, but also suffering the indignity of lesser burghs spending tax money raised in other, more provident, cities.
When the time came for a vote on this matter, there were two options available. The first was to completely kill this policy process and make sure that it never saw the light of day again. The other was to allow the study to continue, with the possibility of a full passage and implementation in the future.
The final vote was 19 to 6 in favor of the process continuing. And how did The Honorable Mr. Mosca, City Councilmember from the City of Sierra Madre, vote on this? He voted with the regionalists, and against those who favor cities remaining independent and in control of their own taxes and budgets.
Which also means that Joe also voted against the interests of the people who elected him.