Public Comment

Saying No to the Berkeley Tax Measures

By Barbara Gilbert
Thursday September 11, 2008 - 09:53:00 AM

There are three local tax measures facing Berkeley voters: Measure GG, Fire Protection and Emergency Preparedness Tax; Measure FF, Library Bond; and Measure GG, the Gann Tax Renewals. The most objectionable is GG, for the reasons below, but there are also good reasons to say no to all three. 

Living in the North Berkeley hills and being of a certain age, I am as terrified of fire and inadequate emergency medical services as anyone. And my support for our essential city services—fire, police, emergency medical, library, and public works is so strong that I insist that they be funded first, from the city’s abundant discretionary moneys, and not be put in the political arena of special taxes levied on an already overtaxed local middle class homeowner population. 

Let’s be clear: A simple majority vote by our City Council would keep our fire stations open and manned, would fully fund fire and emergency medical services at an appropriate level, and would be a catalyst for management and program reform that “those in the know” know are absolutely necessary. It is unconscionable to threaten us with death and destruction if we don’t agree to pay more, when the power to fund these services, and fund them right now, lies with our elected Council! 

So I urge you to stand up for Berkeley and vote no, as you did in 2004, to paying extra for essential fire and emergency medical services. This special fire tax is unwise and unfair, fiscally unnecessary, and an impediment to the budgetary and management reform that is essential for long term sustainability. 


Unwise and unfair 

My candidate Obama, and the national Democratic party, have said that the last thing we need is to increase taxes on the middle class. Why are our elected representatives acting like Republicans by increasing the middle class tax burden and letting others off scot-free? Consider: 

Berkeley’s middle-income homeowners already bear the lion’s share of local taxation. And they are now facing shrinking home values, stagnant incomes, job uncertainty, and disappearing benefits. 

Berkeley real property taxes are at the top range in our high tax state, and are at the very top when one adds in our transfer tax, utility user tax, sales tax, sewer service fee, permit fees, and parking fines and fees. 

Our real property taxes are regressive, as they don’t account for income. California already has a steeply-progressive income tax to capture revenues from those who can and should pay more. The average Berkeley family income is only about $87,500 (includes two-income families), and the new owner of an average home ($750,000) has a real property tax bill of almost $11,000. 

Proposition 13 is not the problem. About 80 percent of Berkeley homes have turned over since Prop. 13 passed, and assessed values and local tax revenues have risen astronomically as a result. Those 20 percent of homeowners with the lowest assessed values are usually elderly retired persons on fixed incomes. The average Berkeley homeowner ($330,500 assessed value) already pays a substantial $5,500 annually. Commercial/industrial properties do not pay a commensurate share as they do not, at least openly, often change hands and face upward reassessment. 

Too many Berkeley participants—non-homeowners, the university, developers, large nonprofits—pay little or nothing for the services they use. So why is our city government going after the middle class homeowner for yet more money? 


Fiscally unnecessary and a deterrent to budgetary and management reform 

The city’s basic ad valorem tax revenue has doubled in the last eight years, permanently adding about $20 million annually, with regular $5-10 million additional annual increases likely. Real Property Transfer Tax revenue has ranged between $10-15 million annually. 

There is $141 million discretionary General Fund, growing by at least 5 percent annually. 

The city budget is up 60 percent over the last 10 years, almost double the 32 percent inflation rate 

Most of our existing special taxes already have generous annual inflators. The special library tax, due to manipulation of the annual inflator by council, is up more than 80 percent despite the actual 32 percent inflation rate. 

Budgetary reforms absolutely need to be implemented for long term fiscal sustainability and community survival, such as: 

• Controlling city employee costs, which are 80 percent of the budget. Average compensation is now about $159,000, and is due to go up 14 percent over three to four years. (Remember, the average Berkeley family income is $87,500, and this is with two earners considered, unlike city employees). Twenty-five percent of city employees are paid more than $100,000 in salary alone. We need to cut the number of city employees, at least by attrition. With a stable population of about 100,000, Berkeley’s staff has increased by more than 30 percent over the last 20 or so years. 

• Reconsidering and de-funding unjustifiable pet, pork barrel, and “earmark” projects loved by our City Council, especially in an election year. For example, $9 million is given annually to un-audited community agencies for duplicative, unproven, and often nonessential services, such as a gardening cooperative and an athletes for peace organization. 

• Cutting subsidies to developers, pursuing adequate reimbursement from UC for the approximately $15 million in free services it receives, limiting the use of expensive outside contractors, implementing an effective economic development program to expand the tax base, and, most important, putting nonessential services and projects before the voters instead of essential services.  


The city’s Fire Department needs to be better managed 

About $2 million of the proposed $3.6 million tax constitutes an overtime slush fund for a mismanaged Fire Department, and the other items, such as radio equipment, could and should be easily funded by the General Fund. Last year our firefighters accrued 37,000 overtime hours, almost $2 million was spent on overtime ($1.4 million over budget), and 12-15 vacancies, more than 10 percent of authorized staffing, were left unfilled. About 25 percent of firefighters were compensated more than $200,000. If these vacancies are filled and time off managed responsibly, we could cut overtime costs back to the budgeted $600,000 and have a better-staffed Fire Department.  

Most of the Fire Department calls—about 8,000—are for emergency medical services, yet we do not even have a trained Medical Dispatcher who could give immediate lifesaving emergency medical advice and dispatch paramedics and ambulance instead of the full Fire Department regalia of engine, truck, ambulance and the accompanying highly-paid crew. We also need to consider a dedicated independent paramedic/ambulance service that would use trained paramedic staff and state-of-the-art ambulance equipment at a far lower cost than the current regalia of highly-paid firefighters, firefighter-paramedics, engines, trucks, and ambulances. 

My candidate Obama has also said that we don’t need more of the same old politics. In my opinion, these unfair, unwise, unnecessary, and reform-averse special taxes are exactly that, the same old tired politics. In 2004, voters rejected similar taxes by wide margins, and should do so again, insisting that our city leaders immediately fund these services at the proper level.  


Barbara Gilbert is a long-time Berkeley homeowner and civic observer.