Redistributing Sales Tax Could Harm Services

When a city resident calls 911, the salary of the responding officer is most likely paid, in part, with local sales taxes. “Share the Sales Tax Wealth” (editorial, June 19) blasted opposition by the League of California Cities to AB 680, a bill in the state Legislature that mandates a pilot program for redistributing the growth in the local 1% sales tax. The editorial seems to suggest that cities should trust the state government to solve the problem.

Over the last 25 years the local sales tax has actually declined from 11% to 10% of total city revenue. Moreover, city per capita sales tax revenue (adjusted for inflation) declined from $146 in 1977-78 to $130 in 2000-01. In contrast, state sales tax revenue grew in the same period from $593 to $705.

The state’s habit in recent years of using billions of local property tax funds to balance the state budget has made funding local services even harder. Cities could safely consider redistributing the growth of the local sales tax if the state is willing to constitutionally protect the revenue that funds police and other local services and to return the billions of dollars in property taxes it is still taking from local governments to balance its budget. Changing the rules in the absence of these steps is likely to put vital local services further at risk.

Chris McKenzie

Executive Director

League of California Cities

Sacramento