Agoura Hills to Vote Whether to Pull the Plug on Utility Tax

Prompted by a California Supreme Court ruling that restricts the power of local governments to impose special taxes, voters here on Tuesday will determine the fate of a controversial utility tax enacted in 1994.

The Agoura Hills City Council passed the tax on gas, electricity and phone service without a public vote two years ago. Then, as now, city officials said the levy--4% of monthly utility bills for residents, 3 1/2% for business--was necessary to close a $1-million annual budget gap created when the state diverted local sales-tax revenues during the statewide recession of the early 1990s.

But local opponents, led by Agoura Hills resident Barbara Murphy, say the city doesn’t need the money because it can balance its budget by cutting spending.

The decision to hold a special election has also been a source of controversy. Tuesday’s vote will cost $25,000, nearly double the expense of holding it during November’s general election, said Agoura Hills City Manager Dave Adams.

Adams said the city cannot wait until November because of the need to plan for the fiscal year, which begins July 1. The utility tax accounts for nearly 25% of the city budget and has generated $2.4 million in revenues since it was enacted, he said.

So far this year, the city has collected but not spent about $900,000 in utility taxes, he said.

The city ballot measure was prompted by the state Supreme Court’s decision in the fall upholding a 1986 ballot measure requiring voter approval of specific taxes. Some cities in California ignored the measure, prompting a legal challenge that resulted in the ruling.

The city vote on the utility tax comes as the Los Angeles Community College District board faced a storm of protest for approving a $12 annual assessment on tens of thousands of county homeowners. The state Supreme Court ruling does not apply to the new educational assessment.

“You can’t argue with the [Agoura Hills] election,” said Kris Vosburgh, executive director of the Howard Jarvis Taxpayers Assn. The goal of measures such as 1978’s landmark Proposition 13, he said, is not to punish cities, “but force them to give people a say in their own taxation.”

Agoura Hills officials said they are prepared to delay projects such as road and sidewalk repairs should voters revoke the utility tax.

The Citizens Budget Advisory Committee has also recommended a list of job cuts and potentially cost-saving changes in the way the city employs private contractors, Adams said. But Murphy disputes the city’s efforts.

“They didn’t have to make cuts because they came and took our money,” she said. “Everywhere you look people are asking for our money,” she said, citing bond measures for police, the community colleges and, most recently, parks and recreation programs.

Adams, who has followed other municipal votes on special taxes in California, said that two of the six proposals this year have been approved.

Election day polls in Agoura Hills will be open Tuesday from 7 a.m. to 8 p.m.