Renters’ Credit, Revived by Gotch, Passes Senate
The Senate on Wednesday approved a bill by Assemblyman Mike Gotch (D-San Diego) to restore a renters’ tax credit he helped kill just two months ago.
On a 22-6 vote, senators approved the measure restoring the refundable renters’ income tax credit of $60 for single persons and $120 for married couples no matter what their income--a move that would cost the state about $135 million a year.
Gotch said the measure has become an “issue of equity,” since state law continues to grant an estimated $2.5 billion in tax breaks in homeowner exemptions.
But the bill, which must now go to the Assembly for concurrence, faces a likely veto by Gov. Pete Wilson. And that prospect, said Gotch’s potential Republican challenger, makes the bill a political exercise designed to placate voters in the mid-San Diego city district.
“The whole thing looks like a sham,” said Jeff Martson, who lost the 78th Assembly seat to Gotch in a close race last year. Marston said he’s mulling over a campaign to oust Gotch in 1992.
The issue of the renters’ credit is a politically sensitive one for Gotch. An estimated 55% of the residents in his district are renters in Pacific Beach, Hillcrest, areas around Balboa Park, parts of Mission Beach and sections of East San Diego.
With that in mind, Gotch took a strong public stand earlier this year against any reductions in the renters’ credit as proposed by Wilson to help close a monumental $14.3-billion budget deficit. In at least one adamant floor speech, he said he would not vote for anything that balanced the budget on the “backs of renters.”
But, under political pressure from Wilson and Assembly colleagues, Gotch changed his position and voted for a credit reduction as part of a trade-off for raising income taxes on the rich.
His vote during a dramatic late-night session July 16 provided the margin to spring that deal out of the Assembly and complete the last part of a $55.7-billion spending plan. The current budget allows the full credit only for renters of lowest income, phasing it out altogether for singles earning more than $20,500 and married couples earning more than $41,000.
Days later, Gotch introduced his bill to restore the credit and eventually had it amended into a measure that was before a Senate committee.
Asked Wednesday if he did so out of political concern, Gotch said, “I don’t know. I knew that, when I found myself in the position of casting a critical vote on the budget, I wasn’t going to allow this issue to die. This became my method of coming back to address this kind of equity.
“I don’t know what the political consequences are.”
Sen. Lucy Killea (D-San Diego), former 78th Assemblywoman, acknowledged that the bill would help Gotch politically. But she added that Gotch “made a commitment (to renters) he felt he had to live up to . . . and that’s what he’s doing.”
However, gubernatorial spokesman Bill Livingstone said Wednesday that Wilson will probably veto the Gotch measure. “He’s not going to support that because we don’t have the money,” Livingstone said.
Given that likelihood, Martson said, the Gotch bill becomes a “political situation” designed to enhance the assemblyman’s standing with his constituents. When Wilson vetoes the bill, he said, Gotch can say he fought for the renters’ credit he helped to eliminate.
“I find it incredible that he goes on and on about how he would not support the elimination of the renters’ credit and then he caves in on it,” Marston said about the July budget vote. “And then he turns around to introduce (legislation) to reinstate it because of the outcry.”
Gotch dismissed the criticism as a “strident plea from a sidelines candidate.”