Both Sides Gear Up for Sales Tax Battle : Prop. 172: Foes of half-cent levy say that despite rhetoric, law enforcement will not be the sole beneficiary. Supporters insist that measure’s defeat would mean deep cuts in services.

To Orange County Sheriff Brad Gates, the campaign for Proposition 172 boils down to one simple fact.

“People are fearful,” the veteran lawman says. “The people in this state are scared to death.”

For that reason, Gates believes, California voters on Nov. 2 will make permanent a half-cent sales tax that originally was enacted two years ago as a temporary measure to help the state through hard times.

But while the ballot measure is being sold as a way to bolster beleaguered local law enforcement programs, even supporters concede that the proposition would not prevent local governments from making further cuts in police, sheriff and fire department budgets. If Proposition 172 passes, the beneficiaries will include health and welfare programs as well as law enforcement.

That discrepancy between campaign rhetoric and reality has become the focal point of the measure’s opponents, who hope that a spotlight on the distortion will lead a skeptical electorate to reject the tax.

“This is nothing more than a general tax increase masquerading behind a law enforcement facade,” said former Assemblyman Tom McClintock, who now heads an anti-tax foundation that is helping to lead the opposition. “Local governments throughout the state are going to use this money for whatever they please.”

When voters decide the fate of Proposition 172, the stakes will be high, and not just for the taxpayers and those who benefit from government services.

Politically, Gov. Pete Wilson is rebounding from a two-year slump in part because voters were relieved that Wilson and state lawmakers were able to pass a budget on time in June for the first time in seven years.

If Proposition 172 fails, its defeat will open a gaping hole in local government budgets and force deep and probably unpopular program cuts that critics will be able to trace directly to the governor’s door.

The half-cent sales tax is meant to replace part of the nearly $2.6 billion in property tax money that the state, at Wilson’s insistence, shifted from local governments to help balance the state budget in June. By transferring the property tax money to schools, the state relieved itself of a significant portion of its obligation to public education.

The move transformed what had been a state budget crisis into a fiscal nightmare for cities and counties, which suddenly were sent scrambling to balance their own budgets.

To help relieve some of the pain, the state extended the half-cent tax, which originally was scheduled to expire on June 30, through the end of the year, and gave that money to local government. Voters on Nov. 2 will be asked whether they want to make the tax--and its estimated $1.5-billion annual revenues--permanent.

Currently, the basic sales tax rate statewide is 7.25 cents on the dollar, with the money raised by the tax distributed among state and local government agencies. Local governments also have the authority to seek voter approval for another 1.5 cents. The highest sales tax currently is in San Francisco, where consumers must pay 8.5 cents on every dollar of taxable purchases.

In Los Angeles County the sales tax is 8.25 cents on the dollar. In Orange County it is 7.75 cents.

If the voters reject Proposition 172, the rate will drop everywhere in the state by half a cent on Jan. 1.

Hoping to make the tax seem more attractive to voters, the Legislature named Proposition 172 the “Local Public Safety Protection and Improvement Act of 1993.”

The umbrella group for the measure’s supporters calls itself “Californians for Strong Law Enforcement.” Before the election, probable voters will be bombarded by mailings and advertisements touting this theme.

Backed by Wilson and the Democratic and Republican leaders in the Legislature, law enforcement, much of the business community and public employee labor unions, the Proposition 172 campaign probably will raise and spend more than $2 million.

The campaign plans to target voters most likely to cast their ballot by mail. Supporters will send two mailings to 700,000 people who have voted by absentee ballot in at least four of the past six elections. The remainder of their resources will go to radio and television ads in the final days of the campaign.

The message to voters will be a more civilized version of the fabled standby: your money or your life.

If the tax measure fails, supporters say, law enforcement budgets from San Diego to San Francisco will be devastated.

The cornerstone of the campaign is the argument that all of the sales tax money must go to law enforcement.

It is true that the money raised by the sales tax will be put in a special fund to be used only for local public safety services. But the proposed law does not require local governments to maintain current levels of spending on public safety.

This means that local governments could deposit the special sales tax money into their police department budget--as the law requires--and then immediately withdraw an identical amount of general fund dollars from the same account. Those funds could be spent on any program.

“It’s the Big Lie,” Ted Costa, an anti-tax advocate who opposes the measure, said of the claim that the money will be restricted to law enforcement.

Steve Swindeman, executive director of the California State Assn. of Counties and a supporter of the measure, confirmed that programs besides law enforcement will benefit from the sales tax.

“If this doesn’t pass, local governments will have $1.5 billion less to spend on law and safety--and other categories--that’s correct,” Swindeman said.

But Swindeman added that most local governments spend well over half of their discretionary revenue on public safety. If those agencies lose a big chunk of money, they cannot help but cut deeply into law enforcement services.

So far, organized opposition to the measure has been limited to a few conservative Republican lawmakers, former Assemblyman McClintock, and People’s Advocate, the group run by Costa that is descended from the late anti-tax crusader Paul Gann.

The organization that is named for Gann’s more famous partner--the late Howard Jarvis--also opposes the measure, as does the California Republican Party.

Joel Fox, president of the Howard Jarvis Taxpayers Foundation, said his group is opposed to Proposition 172 because the tax has a detrimental effect on the economy.

The cost of the half-cent sales tax averages about $43.50 per person in California.

“It seems illogical to me that the Legislature decided one way to stimulate business in California was to give business a sales tax break, yet they cannot make the logical jump that if they give consumers a sales tax break, that should be good for the economy too,” Fox said.

But Allan Zaremberg, lobbyist for the California Chamber of Commerce, which supports the tax, said keeping the state’s streets safe is as important to the business community as the burden of taxes or government regulation. The California Taxpayers Assn., which is supported by contributions from major businesses, also supports the measure.