Thursday, July 9, 2015

Are You Ready for a 0% UUT? It Is Heading for the Ballot

What will Teresa Highsmith do?
While many people in Sierra Madre debate the wisdom of a 6% UUT rate versus a 12% UUT rate, there are those who have decided that they have had enough of this hair-splitting nonsense and don't see why they should have to pay any Sierra Madre utility taxes at all. Like zero percent utility taxes, with no questions asked. And no matter what City Hall might say about how such a thing could possibly trigger events resulting in the end of all times, they're going forward with it anyway.

I know The Tattler has been kind of wishy washy on this topic. We believe that City Hall is pretty damn lucky to still have that 6% UUT rate, and should be doing all it can to hang on to it. Advocating for the doubling of utility tax rates to 12% like such eminently befuddled folks like Gene Goss might not be as politically wise a move as they now believe. I mean, how badly do you want to piss off the voters of Sierra Madre? Next April isn't too far away, and people do have long memories for slights that involve the taking of even more of their money.

Only 149 valid signatures were required to qualify their effort as a ballot measure. The UUT dumpers took no chances and turned in 250 signatures. Which is a fairly large sampling of people. When asked to sign this petition to do away with utility taxes, not very many people refused. I am not sure City Hall gets that yet.

After all, very few of those 250 petition signing folks showed up at the Firehouse last month.

There were several comments posted on The Tattler yesterday about ending utility tax collection here. Obviously, and to use L.A. gang war argot, "It's on." I get the feeling that not only are these guys very serious about UUT busting, they plan to fight very hard for their ballot initiative as well. It could be quite an interesting time in old Sierra Madre.

Here is one of those comments:

Sounds real to me.

Here is a summary of that effort to repeal utility taxes in Sierra Madre, taken from the UUT repeal petition that was being passed around up until just this last weekend.

All of that said, there is a catch. I call it the Teresa Highsmith Factor. As you know, Teresa has sold her lawyerly heart to many different cities, and does for them what she does here. For better or worse. And it is in her role as the City Attorney of South Pasadena that Teresa constructed some rather large legal barriers to a similar resident driven utility tax banishing move.

Here is how we described that event on February 5th (link):

That was my prediction last February, and I am sticking to it. When Sierra Madre's City Council gets around to dealing with this petition for a measure to do away with utility taxes, they'll simply receive and file the matter. In other words, they will do nothing. All on the advice of City Attorney Highsmith.

That is pure legal bluff of course, but one that will be very expensive to call. That is, unless these Sierra Madre tax fighters have a pro bono lawyer willing to fight this abrogation of their democratic rights on legal principle. 

This move would also be something that could end up costing the taxpayers here a whole lot in legal fees. When it comes to preserving tax income for itself, no price is ever too high for City Hall to pay.

Speaking of UUT repeals

These initiatives are happening all over California these days. Here is a newspaper account from The Press Enterprise, which is straight out of Riverside County.

Residents want to ax utility tax - Riverside voters could see 2016 repeal measure for tax that’s charged in eight cities around county (link): If you’ve noticed a line item on your water or electric bill denoting a “utility user’s tax,” welcome to the club.

Nine Riverside County cities charge an extra percentage to utility customers and use the money to pay for basic city services. But residents in one of those cities – Riverside – are launching a campaign to get rid of that tax.

Residents and businesses already pay various state, federal and other fees and charges on their bills, so the utility user tax feels like “a sales tax on top of a sales tax,” said Ben Clymer Jr., who owns the Riverside location of Ben Clymer’s The Body Shop, an auto repair chain his parents founded. Clymer and other residents, backed by a Tea Party-funded taxpayer advocacy group, want to get a measure on the Riverside ballot that would repeal the city’s 6.5 percent utility user tax.

Riverside’s utility tax dates to 1970, before a public vote was required on new taxes. More recently, the charges have gotten mixed responses in other Inland cities.

San Jacinto voters have twice rejected a utility tax, proposed at 6.5 percent in November and then 5 percent this May. In Canyon Lake, a 3.95 percent tax was narrowly approved last fall. In cities that have utility user taxes, which in 2013 included 154 cities around the state, “It’s a very significant portion of general-purpose revenue,” said Michael Coleman, a municipal finance expert who advises the League of California Cities.

The tax can be charged on electric, gas, water, sewer, phone, cable or satellite TV, and trash collection services, but Coleman said gas, electric and phone service taxes are most common.

The last remaining ingredient for today's utility tax stew is this following question: What will John Harabedian and Gene Goss do?

Both seem to be on a Blues Brothers style "Mission From God" to raise taxes here in Sierra Madre. All so "The Platinum Dozen" on the SMPD can continue pulling down compensation numbers that run as high as $180,000 per year. Or twice what the average family in this town makes.

Will they counter with a ballot measure next April to raise utility tax rates here to 12%, which would be by far the highest of its kind in the State of California?

Stay tuned for more on the coming utility tax wars. This could get kinda wild.


  1. Mod. Marvelous article today. it's crystal clear that the city atty and city staff and a couple of the council are working against the bulk of the citizens just to make certain that a handful of premium pensions are preserved. I, for one, am so tired of working to support highly funded early retirement for public employees. I will work to defeat any increase in the UUT!

  2. I'm usually for a reasonable amount of taxation so long as I think the money is being used wisely. But when varous police officers in Sierra Madre are making over $180,000 per year and so many of them are getting tens of thousands of dollars in overtime every year to pad their salaries, then no one can convince me that our tax money is being used wisely. Rather than try to micromanage the inefficiency, waste and bloat that is found at every City Hall, its far easier to just reduce their revenues and force them into operating as efficiently as so many companies have to do in the private sector in order to survive. One look at those police salaries, benefits and pensions telll me that Sierra Made has a long ways to go before they should confiscated any more of my hard-earned tax dollars.

    1. I agree.
      But as long as Elaine is in charge ,the last thing she will cut significantly is pensions and benefits.
      If she did make those cuts she would loose all support from City employees. They know she is a devious,incompetent petty-politician. But they support her for the Gravy Train she has created.
      Shame on the weak/politicized members of this and previous Councils for enabling this mess.

  3. I agree with 6:21AM. One thing to remember, since we are doing our share to reduce water, our bills have gone done. That means less revenue. Look for a water hike soon.

  4. 12% UUT, Goose? Really?

  5. The argument has always been that part of what makes Sierra Madre Sierra Madre is that we have our own police and fire departments. well, the real truth is that Sierra Madre has had its own public safety departments in name only, not in fact, for the last several years. Most of the police officers are actually LAPD working part time here in town and the fire fighters are newbies that come to Sierra Madre( but do not live here) for a couple of years for training and experience and then move on. We no longer have the dedicated in town folks serving. So it really doesn't matter if we have a contract with the Sheriff/LAPD or County Fire. Sierra Madre has been using itinerant public safety for years, it just has not admitted it yet.

  6. UUT taxes - its all over but the crying! TEAPAC & Howard Jarvis office are here to represent the people. If city hall fails to put the initiative on the April 2016 ballot, TEAPAC is prepared to deal with city hall. The residents own this town, not city hall.

    1. WE may own it ,but Elaine controls it and the town's money.

    2. TEAPAC 7:41, really? If you tell people that, you'll lose the votes of people who think that Tea Partiers are right wing nutcases.

    3. It's a pretty big asylum. Plenty of room for everyone.

  7. There are 4 groups in town on this one.
    1) the Goss 12% tax 'em until the scream crowd.
    2) the 8% UUT people. They see this as a compromise.
    3) the 6% UUT supporters. Their claim is this is what people voted for twice in 2012 and 2014.
    4) the 0% UUT supporters, who have institutional support from TeaPac.

    It is going to be very interesting indeed!

  8. Mod... Remember... It was just A short time ago that city hall was crying broke and begged the residents of Sierra madre for a little TEMPOARY tax help called UUT. These taxes were ALWAYS voted / Ordered to ONLY be spent on as a supplement for fire and police salaries. City Council and City Hall disobeyed the tax payers wishes and chose to spent those dollars any way they chose, such as salaries - pensions - $50,000 dollar cadallic health care benifit packages.....
    City hall has knowingly - been violating the law by misappropriation of residents UUT Tax dollars. The time has come that these Temlorary UUT dollars have come to an end! City hall posts on its web site that city has has $18 Million Dollars In the General Fund & in its Investment Account... The DA's office should be All over this and City Hall staffs heads should spin

    1. There was a little notice on the bottom of the ballot that says only a certain amount will go to police and fire. The rest goes to the general fund.

    2. Remember Jim McRae ? We fired him for 'misappropriations' that were trivial compared to what is now routine 'management'.
      I would rather have Jim back than continue with Elaine.

    3. Judith, all of it goes into the general fund. The police, fire and paramedics are paid out of the general fund, and all of the monies that come in as a UUT does not cover all of the safety expenses, therefore all of the UUT money goes to pay the expenses of those departments.
      Somehow or another, some have perpetrated the notion that the city is not spending all of the UUT on the safety, but that is not true.

      If you want to have a City of Sierra Madre you have to pay for it. I can't see any other source of money to run the city. Don't say they have to cut. That is no longer an option. Either we have a city government or we don't. The County would be only too glad to take us over.

    4. Of course, paying SMPD upwards of $180,000 in yearly compensation might have something to do with it. But if we cut their pay we'd be incorporated into LA County? Is that how the BS goes?

    5. don't forget that the entire UUT was based on a false premise and we were purposely given misinformation by the Councilmen Buchanan and Mosca and the City Manager - used a busted water pipe to claim we were on the verge of a city manager and it was to cover up bond mismanagement and use the tax to secure matching funds so he could build a new 7 million dollar library

      its been a lie since day one

      I'll vote NO every time and if I have the opportunity to vote 0% I will.

    6. Salaries. Benefits. Pensions.

  9. 7.56 these are your opinions only! FACT ...City hall put two UUT taxes on the ballot which were both defeated 2) city hall never offered to Repeal the UUT Taxes as previously promised by city hall as a Temporary tax.

  10. There is no such thing as a temporary tax increase. Just like there is no such thing as a pig with wings that can fly.

  11. Good explanation.. City hall appears to think they are the pig with wings which can fly.

  12. 8.44 I believe you will be found wrong. The residents will vote to Repeal that Tempory tax increase once called the UUT !

  13. The solution to Sierra Madre's financial problems is GemCoin. They are backed by amber mines.

  14. The reason the City kept the revenue from the UUT in the General Fund was because then the vote to win was 50% plus one and not 2/3 required for the tax increase. Not to mention too, that with the revenues going to the General Fund it is so much easier to "massage" the expense/income trail.