ANAHEIM : Mayor Is Challenged on Utility-Tax Stand

Throughout his successful election campaign, Mayor Tom Daly railed against the city’s utility tax and used it to verbally bludgeon its most outspoken proponent, then-Mayor Fred Hunter.

It’s now been six weeks since the two switched offices and now-Councilman Hunter has issued a challenge, telling Daly and newly elected Councilman Frank Feldhaus, who also opposed the tax during the campaign, that “it’s time to fish or cut bait.”

“In the last campaign I heard a lot of rhetoric about the utility-user tax, and I’ve yet to see the council do anything,” Hunter said at last week’s council meeting. “You people (Daly and Feldhaus) know that rescinding the utility-user tax would devastate the city, and I think we need to know . . . whether you’re going to do it or not. Quit playing games.”

Hunter, who did not return several calls for comment this week, then moved to place a discussion of the utility tax on the Jan. 5 council agenda, apparently to force Daly’s and Feldhaus’ hands.

Daly, who defeated Hunter 57% to 43% in the Nov. 3 mayoral race, said Wednesday that he would have no comment on Hunter’s challenge, saying that it is unclear to him what Hunter meant by his comments.

“I cannot spend my entire life responding to the inane comments of Fred Hunter,” Daly said. He said that while he continues to oppose the utility tax, he refused to say whether that meant he would support rescinding the tax.

“I’ve said I oppose the tax, and that is all I have said,” Daly said. “I’m not going to speculate about what is going to happen in the future.”

During an interview this week, City Manager James D. Ruth agreed with Hunter, saying that revoking the year-old tax would be catastrophic for the city’s budget. It has been cut by several million dollars over the past three years because of the recession and the resulting decline in sales and hotel tax revenue generated by the tourism industry. The utility tax, which raises about $8 million a year, adds 2% to the gas, water, electric and telephone bills of Anaheim businesses and residents. The average cost per resident is $3 a month.

“If the council opts to eliminate the utility-user tax, we’ve got significant problems,” Ruth said.

Feldhaus did not return several calls Wednesday.

The utility tax was imposed in September, 1991, after three months of sharp debate. Hunter, who was then mayor, and Councilman Bob D. Simpson originally pushed for a 4% tax in an attempt to head off $14 million in budget cuts. Then-Councilman Daly and Councilman Irv Pickler were opposed to the tax. Then-Councilman William D. Ehrle originally voted with Hunter and Simpson to impose the 4% tax, but two weeks later changed his mind and voted to rescind the tax.

The sides were deadlocked, and the city administration was threatening to cut $14 million from the city’s budget when Pickler agreed to vote with Hunter and Simpson and impose a compromise 2% tax that would expire in September, 1993, unless the council voted to extend it.

Many interpreted Daly’s campaign opposition to the tax as meaning that he would seek its repeal before its scheduled expiration.

“I never said that,” Daly said. “You’re trying to put words in my mouth.”