La Jolla Realtors Mount Revolt Over New Business Tax : Advertising: The $200,000 collected by City Hall to promote commerce is unfair and poorly spent, real estate agents claim.

La Jolla realtors are calling it taxation without representation and the biggest scam to hit town since the illegal doings of convicted financier J. David Dominelli.

They’re talking about a tax on downtown businesses in the wealthy seaside neighborhood--money collected as part of a Business Improvement District (BID) created last year by the San Diego City Council to raise money to improve the climate of La Jolla business. The realtors claim that the $200,000 being collected annually is instead being used to advertise La Jolla as a retail mecca--advertising that merely attracts foot traffic and does them little good.

Anyway, many realtors claim they do their own advertising--often nationwide--and say they are being forced to pay more than their fair share to foot the bill for local efforts.

Recently, La Jolla realtors formed STOPBID, a group they say is working to expose the inequities of the current BID taxing system.

“This whole thing was ramrodded through in the first place,” said Joe Graham, a local broker and past president of the La Jolla Real Estate Brokers Assn. “It’s the biggest scam since J. David. The way they’re spending the money is a crime.”

The BID unfairly charges realtors a “medium retail” rate of $250 to $300 a year, depending on their location, Graham says. He and others claim they should instead be included with other professional services such as attorneys and escrow companies, which pay a “low retail” assessment of $35.

Also, banks and hotels have been left free of any charge , although some of those businesses benefit most for the advertising done with the BID dollars, he says.

Many La Jolla realtors also say they were not contacted to attend a public hearing before the City Council before the new tax district was approved.

Now some say they are considering hiring a lawyer to file an injunction against the business group that started the district, in an effort to get the attention of the City Council.

The Business Improvement District in La Jolla was the brainchild of Promote La Jolla, a cadre of local businessmen. Executive director Dave Ish says the taxes are completely legal and the advertising benefits all La Jolla businessmen.

“New customers come to town and that benefits local businesses,” he said. “And, if they do well enough, maybe they’ll make enough profit to buy another house in La Jolla, and that could have a rippling effect with the realtors.”

Ish said realtors and all other businessmen in the new tax district were notified of the public hearing. “We sent notices out to everyone,” he said. “Maybe people don’t read their mail.”

Realtors fear that individuals instead of business will be taxed next. But what piques realtors most is the money being spent to operate a trolley-like bus between La Jolla and downtown San Diego.

Barbara Anderson, president of the Real Estate Broker’s Assn., said that, for most realtors, any money spent on the “trolley” is money down the drain.

“The average house in La Jolla is selling at something less than $1 million,” she said. “People who are going to spend that kind of money aren’t going to take the trolley here in the first place.”