Businesses Seek to Force a Vote on RTD Tax for Metro Rail Leg

In a potential setback to the proposed second phase of the Metro Rail subway, a coalition of business owners on Monday said it had collected enough signatures to force the RTD to hold an election on a controversial tax that could raise $627 million for the project.

Members of the coalition, known as COMET--Committee Opposed to Metro Rail Tax--said the tax would unfairly place much of the burden for funding the subway on businesses lining the 13.3-mile route of the Metro Rail extension between McArthur Park and North Hollywood.

“We’re not deliberately setting out to undermine its construction or delay its construction,” said Andrew Miliotis, a spokesman for COMET. But the group, which includes businesses from Mid-Wilshire and Hollywood, had no choice but to oppose the tax, he said.

If the tax proposal is defeated, it would force the RTD to “go back to the drawing board” and reassess the $2.8-billion funding package assembled for the subway extension scheduled to open in 1998, said Andrea Greene, an RTD spokeswoman.

Under state law, the RTD must hold an election if landowners holding a total of 25% of the assessed value of the property in the district ask for a vote. Monday was the deadline to submit petitions for elections.

Greene said it could take weeks to certify the petitions for each district. If the petitions qualify, the RTD must hold an election within 90 days.

The taxes would be raised through five assessment districts--Hollywood, Mid-Wilshire, Vermont, Universal City and North Hollywood--that the RTD board voted to create this month. Starting in 2000, commercial property owners in the districts would pay between 33 cents and 55 cents per square foot annually for 19 years.

Miliotis said his company, which owns a 400,000-square-foot office building, would pay $2.5 million in taxes over 19 years.

The taxes would allow the RTD to issue $75 million in bonds and raise $627 million to finance and pay off the bonds.

Miliotis said COMET members were confident they had collected enough signatures for an election in the Mid-Wilshire district but were not sure they had prevailed in the Hollywood district.

Among those signing petitions was Larry Spungin, vice president of MCA, the largest property owner in Universal City. Ironically, Spungin was a member of an RTD task force that helped set up guidelines for taxation within the assessment districts.

Business owners from the North Hollywood and Universal City districts also submitted petitions but Vermont district businesses missed the Monday deadline.

The elections are not conducted on a one person, one vote principle. Owners receive one vote for each $1,000 of assessed value.