June 2, 2006

National City Spotlight:

Much More Than the Cost of a Cup of Coffee

By Ted Godshalk

This commentary has been brewing for some time. Over a cup of coffee at the Chicano Perk, it finally flows, like the traffic that is flowing north out of town on National City Boulevard. Lately, the story percolating in National City has been a blend of scandals for the Mayor and very tight municipal finances. With a $6 million deficit, the official line is that expenditures must be cut by 20%. A re-warmed sales tax proposal is on the ballot for Tuesday, and this leaves a very bitter taste.

Raising taxes in National City is not new, but it is tiresome, annoying, and insulting. Voters were first presented a property tax measure in 2004 to build a new fire and police station in El Toyon Park. Voters turned the tax increase down; there was no compelling reason for the proposal, other than for politicians to garner the support of the public safety employees. Interestingly, there was no mention of the city’s budget problems at that time.

Then just eight months ago, a sales tax increase was put on the ballot. In this attempt, even with much warning of service reductions if it failed, the voters once again rejected increased taxes. Last year’s budget was met by clearing all of the smaller miscellaneous accounts, reducing hours at the library, and freezing hiring. The problem was not going to go away, and intelligence, determination, creativity, and honesty were necessary to solve it. In other words, it required leadership. None was forthcoming, and instead the sales tax was put on the ballot again.

This year’s sales tax is not very different from last year’s, and the reasons so many people are against Proposition D are almost as varied as the types of coffee at the java joint. Some owners of property are still steaming over the Eminent Domain battle fought out over the last three years. Others simply don’t trust Nick Inzunza and they have concerns with the City Council for following his lead. So, why the lack of trust?

The council’s refusal to include affordable housing in new developments, their catering to high-rise developers over the concerns of community members, the stealth increase of the sewer rates for homeowners, the installation of an ineffective police review commission, the close call with consideration of Indian gambling in the city, the lack of ethics and campaign reform, the empty promise of an aquatic center and an arts center, and their bloated Redevelopment monster running amok, all have something to do with it.

Additionally, there are five significant issues involved with this sales tax proposal. First, it is regressive. It affects the poorest the most. But wait. In a recent debate, Councilman Ron Morrison claimed that a sales tax is not regressive. National City has many low income residents, and they will pay the increased sales tax on everyday consumables like diapers, paper goods, school uniforms, restaurant food, auto parts, and just about everything else except groceries and medicine. This tax will weigh heavily on the poor and also on the middle class residents of National City.

Second, have you heard the Mile of Cars is neutral on the issue? Perhaps they fear the tax will hurt sales. The car dealers know that the city needs them more than ever, but they also know that car buyers who live in National City will have to pay the extra sales tax on any car purchased regardless of where they shop— in town, in Chula Vista, everywhere. Save National City doesn’t speak of this. Regressive? Yes. Unequal? Yes, again.

Third, when local businessman and Chicano activist Herman Baca debated Morrison on the sales tax, his opening remarks included a serious warning. Baca said, “Be careful what you wish for. Why will anyone shop here?” Baca continued, “The real question is: Will National City residents shop here when they can go to Chula Vista and pay less?” Herman Baca and others recognize that small businesses will be competing at a disadvantage when they have to increase their prices. He foresees a shopper’s boycott of National City and a resulting decrease in income to the city if the sales tax passes.

Fourth, when Morrison claims that the city must make a larger payment to the California retirement fund called PERS, he fails to mention that the reason the city’s payment has gone up from less than $1 million in 2003 to almost $3.5 million in 2005 (and upward from there) is that the Mayor and City Council approved employee contracts with large pension increases in early 2002, just before our last election for Mayor. This pension deal will continue to hurt the city financially, with or without a sales tax increase.

Fifth, the redevelopment agency has forced our city government into a scheme of debt that is akin to an addiction. National City, like many other cities in California, has racked up a huge debt by selling bonds and must now use property tax income to pay them off. What have they done with the money? In addition, with a high turnover at the agency, it now looks like most of the schemers have flown the coop and left the rest with their very expensive mess. Redevelopment is starving the general fund of much needed property tax. The City Council and Mayor should scale back the redevelopment area immediately, recover the property taxes, and pay policemen and firefighters and library staff. But now they ask us for more money?

There is still more black goo at the bottom of this pot. In the face of the Proposition D proponents’ claim that one third to one half of the sales tax generated will come from people who live inside the city limits, I must ask: Is it right that the residents of National City pay a $3 million to $4.5 million annual surcharge just to live here? Can we afford this tax and this lack of leadership?

Ted Godshalk can be reached at paradisecreek@mac.com

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