Tax-sharing bill to build stronger metro areas

By Jim Wasserman The Associated Press
Thursday November 29, 2001

SACRAMENTO — A coalition attacking suburban sprawl and urban disinvestment rallied Wednesday around a bill aiming to curb both by making cities share sales taxes. 

Borrowing an idea from Minneapolis-St. Paul, Assemblyman Darrell Steinberg, D-Sacramento, proposes a pilot program for cities in his metropolitan area of 1.5 million. Cities and suburbs in Minneapolis-St. Paul share property taxes to create financial balance throughout the region. 

“We have a unique opportunity here in the Sacramento region to show the state the way,” Steinberg said. 

Sharing sales taxes, Steinberg and his supporters said, will bring more money to older neighborhoods and strengthen entire metro areas. 

“Right now it’s every jurisdiction for itself,” Steinberg told representatives of 75 interest groups rallying at the Capitol. 

But newer suburban cities remain wary of a cash grab. 

“This bill literally creates winners and losers in the region,” said Al Johnson, city manager in Roseville, a city of 85,000 east of Sacramento. 

Steinberg’s bill received accolades among numerous interest groups last year for promoting cooperative regional visions for growth. But the bill languished in the Capitol as Sacramento and its suburbs bickered over how to share the region’s sales tax income. 

Wednesday, the lawmaker promised a fresh offensive when legislators return in January. About 80 supporters vowed to get it passed. 

The bill would distribute more of the sales tax based on population in the region and less on where the sale actually happened. 

“We’re anxious to see this as a tool for slowing down urban sprawl, which has been fueled by sales tax generation,” said Vicki Lee, chair of the Sierra Club’s Mother Lode chapter. 

Steinberg said the bill, AB680, aims to stop cities from battling one another for new car lots, shopping malls and other sources of sales taxes. Many cities depend heavily on sales taxes to pay for fire trucks, police officers and parks. 

Critics say the system favors growing new cities at the expense of older ones. 

“We’re tired of watching the wealth move to suburban exclusive neighborhoods ... while residents in our urban neighborhoods and their neighborhood institutions become increasingly poor and desperate,” said Rachel Iskow, director of the Sacramento Mutual Housing Association.