Testy exchange over ‘millionaires tax’ to reduce homelessness exposes a rift among county supervisors

A majority bloc of the Los Angeles County Board of Supervisors has split over how best to fund a wide-ranging plan to reduce homelessness.

Mark Ridley-Thomas and Hilda Solis — both labor-backed Democrats who are typically political allies — got into a heated exchange during two hearings last week over a proposal that would enable the county to pursue a new income tax on millionaires to address what many see as the region’s growing crisis.

The county does not have the authority to raise income taxes and would need a change in state law to do it.

In a vote last week, Solis temporarily blocked the proposal seeking state approval that would pave the way for a ballot initiative and later introduced one of her own asking for the county to look into how to use existing money more effectively.

City and county officials released plans earlier this year to get people off the streets and have been mulling the idea of asking voters for a tax increase to pay for new housing and services.

The most recent count by the Los Angeles Homeless Services Authority found nearly 47,000 people on the streets and in shelters, a 5.7% increase from the year before, when the count showed a 12% increase from 2013.

County officials voted earlier this year to allocate $150 million for housing programs and other initiatives to reduce homelessness, but say nearly $500 million a year would be needed for such programs to make a significant dent in the problem. A state proposal that would raise $2 billion to build new housing for mentally ill homeless people statewide could defray much of the cost of construction, but would not pay for services.

Officials estimate that a “millionaires tax” similar to the existing statewide income tax on high earners that raises money for mental health services could raise $243 million a year for housing and services for the county’s homeless.

A recent poll commissioned by the county found that 76% of the likely voters polled were supportive of a millionaires tax — enough to meet the two-thirds majority required to impose a new tax.

The respondents were more receptive to the high-income tax than to other options presented, including increasing sales or property taxes or taxing marijuana sales to pay for homeless programs. The sales tax proposal, which had the next highest approval ratings, would require a four-fifths vote of the board to put it on the ballot, which means it could be blocked by the panel’s two Republicans.

Supervisors Ridley-Thomas and Sheila Kuehl want the county to start pushing for a budget trailer bill that would grant the county the authority to place a measure on the ballot in November. If the state granted the authority, supervisors would need to take a separate vote to place the measure before voters.

The two Republicans on the board, Michael D. Antonovich and Don Knabe, expressed skepticism about pursuing a tax increase.

Solis, in a surprise move, joined them. At Tuesday’s board meeting, in which the supervisors were slated to vote to begin lobbying the state, Solis said she had not been provided with a detailed breakdown of demographics of the people polled and had not received a breakdown of the results for each supervisorial district until Monday night.

She also contested the findings of the homeless count, saying she thought it had underestimated the problem in her east-county district and was concerned that the area would get less funding from a potential tax measure as a result.

Solis said afterward that she wanted the county to do its “due diligence,” including potentially commissioning another poll.

“If L.A. County moves forward,” she said, “it needs to be in an informed and concerted way.”

After a lengthy debate, the proposal was initially voted down and then rescheduled for this week. The supervisors will also discuss a separate proposal by Solis and Knabe to look at the nearly $1 billion a year the county spends on nonhousing-related programs for homeless adults — including emergency medical care, mental health services, welfare payments and incarceration — to see how money could be spent more effectively on the small population of chronically homeless people who account for the majority of the costs.

The budget bill will be adopted by June 15 and signed by June 31, giving county officials time to decide whether to place a measure on the ballot by the deadline of Aug. 9.

A number of other tax initiatives are likely to appear on the ballot in November, including tax measures for county parks and transportation projects and an extension of a statewide income tax increase passed in 2012.

Solis and Ridley-Thomas had another heated exchange at a budget hearing Wednesday, after Ridley-Thomas unsuccessfully proposed that the homeless tax item be scheduled for a set time at the next meeting, to prevent public speakers from having to wait around through the board’s other business. After the proposal was first denied by Solis, who is the board chair, and then voted down, Ridley-Thomas got up and walked over to Solis’ chair. The two had an inaudible exchange that ended with Solis asking, “Are you threatening me?”

A transcript of the meeting only recorded Ridley-Thomas saying, “All right, Hilda,” before Solis’ exclamation. Solis declined to comment on the exchange. Ridley-Thomas maintained he had not made any threat and said, “I don’t quite know what she was responding to.”

“This is a significant issue and it is an urgent issue,” he said. “I find the entire set of circumstances to be quite surprising … but I think it’s time for us to demonstrate to the public that we are very, very serious about it, because they are.”

Solis said Friday that she was still considering how she would vote on the proposal to seek state support for a millionaires tax. She said her separate proposal to look into existing funding was not intended to compete with it.

“I’m trying to be fiscally conservative here, with dollars we can control,” she said.

abby.sewell@latimes.com

Twitter: @sewella

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