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Despite opposition, LB mayor insists Measure M not a tax

The June 5 ballot measure is necessary to fund major services, city officials say, but some locals disagree

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On March 7, the Long Beach City Council unanimously voted to place Measure M, which is a utility-revenue transfer charter amendment, on the ballot for voters to decide on, according to ballotpedia.com.

Measure M will be the only measure on the June 5 ballot, excluding the 5th and 7th districts– along with the measure, those two districts have to decide run-off elections, respectively.

A “yes” vote on Measure M would authorize the City to transfer revenue from water, sewer and gas utilities to the general fund with a cap of 12 percent of each utility’s annual gross revenue. A “no” vote would be against the aforementioned revenue transfers, according to ballotpedia.com.

Proponents, such as Mayor Robert Garcia, said Measure M will help Long Beach maintain police, fire and other key services like street-repair, park and senior programs and more.

In a phone interview with the Signal Tribune Wednesday, Garcia said the measure would allow the City to use surplus revenue from gas and water utilities to cover the cost of vital services as it has been doing for 60 years.

He claims it is not a tax increase and that it maintains key 9-1-1 emergency services. Opponents say city officials have put this measure on the ballot because of “their reckless spending and mismanagement of taxpayers’ money.”

Gerrie Schipske, current attorney and a former Long Beach councilmember, said that she is opposed to Measure M during a phone interview with the Signal Tribune Tuesday.

“It goes against their very own language,” she said. “They passed a resolution putting this on the ballot. In the resolution in March, they refer to it constantly as a tax. They, in fact, indicate that this is a general tax. This is why it has to be put before the voters, yet now they are putting out materials saying that it’s not a tax. It is a tax.”

Schipske sent an email to the city attorney stating that city officials were posting misleading information about the measure on social media.

“The mayor and some members of the city council are tweeting, texting and sending email newsletters in which they tell the readers that, ‘Measure M is not a tax measure,’” the letter reads. “Those of us who have written the ‘arguments in opposition’ to Measure M request that you immediately instruct the mayor, city council and senior staff to stop misleading the voters. The State constitution, as amended with Proposition 26, clearly defines a ‘tax’ to include ‘any levy, charge or extraction of any kind imposed by a local government.’”

Richard Anthony, a city deputy attorney, spoke with the Signal Tribune during a phone interview on Tuesday about the alleged misleading claims.

He said that the language used in the social-media posts perhaps meant that the measure is not a tax in the way that the public generally thinks of a tax.

“It is not a percentage of, for instance, a ratepayer’s bill,” he said, “which is normally what a tax would be based on.”

Anthony said that some individuals have registered complaints with the City concerning the mayor’s tweet about the measure.

“It’s not clearly wrong to say it’s not a tax,” he said, “but I can see why some people might claim that it is misleading. That is within their rights to do that.”

On Twitter, Garcia’s tweet reads, “[…] Measure M is not a tax increase. It’s a City Charter amendment to authorize the transfer of surplus utility revenues to support services for Long Beach residents such as paramedics, fire, parks, police and library services.”

Schipske told the Signal Tribune that if newsletters and social-media posts about the amendment mentioned that Measure M is a tax, based off of Proposition 218, then fewer people would vote for it.

Garcia said during Wednesday’s interview that the measure will not raise rates from what they’ve “historically been.”

In an email blast earlier this month, the mayor stated that the City’s combined water and sewer rates in 2017 were on average $15 per month lower than Los Angeles, San Francisco, San Diego, Oakland, San Jose, Sacramento and Golden State Water.

“Gas utility rates for residential customers in 2016 and 2017 were on average $0.54 per month lower than those of the Southern California Gas Company,” the email reads.

Long Beach resident Diana Lejins is opposed to the measure and was a plaintiff in a lawsuit filed against the City in 2016. The lawsuit claimed officials illegally increased rates while assessing millions of dollars in pipeline permit fees to its own water department.

Lejins spoke about the lawsuit with the Signal Tribune during a phone interview Wednesday evening.

“The lawsuit basically said, ‘What you’re doing is illegal,’” she said.

Lejins claims the City is issuing Measure M to make legal what was ruled illegal in the lawsuit she was involved in. She also mentioned that the City has many sources of tax revenues, however, there is never enough money.

“It’s like no matter what you do, the government tries to suck more blood out of you, and then the taxpayers try to fight it with their propositions,” Lejins said.
An impartial analysis from the city attorney’s office states that on July 9, 2015, the lawsuit was filed against the City, alleging that certain revenue transfers from the gas utility to the General Fund accounts were ‘general taxes,’ therefore requiring voter approval under Proposition 26.

On Sept. 30, 2016, another lawsuit was filed against the City alleging certain revenue transfers from the water and sewer utilities to the General Fund were also ‘general taxes’ requiring voter approval under Proposition 218.

The City prevailed at the trial court in the gas-utility revenue case, however, that ruling is being appealed, according to the analysis.

On Nov. 8, 2017, the City settled the water and sewer utility revenue case.

Garcia said that the reason why the City is turning to voters to approve the measure is that the law has changed, and now it is asking officials to host a vote to commit transfers that the City had already been doing for a long time.

“What this does is that it keeps what we’ve been doing for 60 years ongoing, and so it also doesn’t raise utility rates from what they’ve historically been,” Garcia said. “It’s a simple measure that just keeps things the way they are, but we have to go to voters to affirm that.”

The impartial analysis also states that the General Fund pays for general City services such as police, fire and paramedic response, street repair, parks, libraries and senior programs.

City Charter Sections 1407 and 1501 currently authorize the city council or Board of Water Commissioners to transfer revenue from City utility funds to the General Fund if the revenue is not necessary to pay for a utility’s capital improvements, debt service, maintenance, personnel, reserves and other costs, according to the analysis.

Under this authority, the City has, for many years, approved annual transfers of surplus water, sewer and gas utility revenue to the General Fund as part of the budget process.

For the 2016-17 fiscal year, these transfers amounted to approximately $21,000,000 in General Fund revenue, which paid for general City services.

If approved by a majority of Long Beach voters, Measure M would amend Sections 1407 and 1501 of the city charter.

The amendments would reauthorize and affirm the City’s practice of revenue transfers from the water, sewer and gas utilities to the General Fund, as approved by the city council and Board of Water Commissioners, subject to a cap of 12 percent of each utility’s annual gross revenues, as shown by audited financial reports.

Measure M would clarify that all proceeds from utility-revenue transfers to the General Fund shall be used to maintain local General Fund services.

The amendment would also affirm that the city council or Board of Water Commissioners, whichever is applicable, may approve water, sewer and gas rates in an amount sufficient to recover the costs of operating each utility, including city-council- or board-approved utility-revenue transfers to the General Fund.

If Measure M does not pass, utility-revenue transfers to the General Fund and utility rates may be reduced, according to the analysis. In that case, the city council may be required, as part of the budgeting process, to consider eliminating or reducing general City services that the transfers fund.

“Obviously, there are some folks that’ll be against everything, and that’s OK,” Garcia said. “We are proud to have the support from our police officers, our firefighters, many of the members of the city council and teachers. Most of the institutions and organizations in the city are all supporting Measure M.”

Schipske said that if Measure M passes, the amendment would continue to be closely monitored to see if it complies with Proposition 218.

[Ed. note: Lejins is an occasional contributing photographer for the Signal Tribune.]

3 Comments

3 Responses to “Despite opposition, LB mayor insists Measure M not a tax”

  1. a. meylor on May 31st, 2018 3:30 pm

    If there is extra in the Water, sewer revenue fund, then we have been overcharged. Return those credits to us the bill/tax payers.

    Balance the budget correctly and not taking from tax payers.

    NO MORE TAXES!!! Don’t spend more than already paid.

    Too much waste.

  2. Dianna Marsh on June 2nd, 2018 2:50 pm

    The city of Long Beach (Mayor Garcia, et al) was “caught” with their “hand in the cookie jar”. I don’t care if this has been a practice for 60 years, IT’S NOT LEGAL and needs to stop. If I was caught doing something illegal, whether I had been doing it for years, I would be tried and sentenced! Mayor Garcia continues to play on the “emotions” of the people, as always when requesting a raise in any tax, with Measure M. This city needs to WAKE UP! Richard Anthony talks out of the side of his mouth like any good politician when he states “It’s not clearly wrong to say it’s not a tax”, the measure is not a tax in the way that the public generally thinks of a tax. Call it what it is, A TAX! If the good people of this city can’t see through the smoke screen we are all in trouble. The working class is being taxed beyond control, claims it’s for our city services like Police Officers and yet crime in our neighborhoods has increased dramatically. They have re-classified most of these crimes that affect OUR daily lives and pocketbooks so most are not reported as statistical data on crime. I would like to see an audit of exactly where all these monies/taxes are going. What exactly is our great leaders spending OUR hard earned money on?? If money is required for these important city services why are they spending it on unsightly green bollards, unnecessary round abouts (only in the more affluent areas of course). We need an audit of where all the monies are being spent, just like they did in the city of Bell. We all have to BUDGET, who’s budgeting the city??

  3. Lagrand on June 5th, 2018 7:49 am

    I suppose it’s not possible to calculate how this transfer has affected utility rates, which would be highly germane to the discussion. That said, it seems highly regressive in that we all need these utilities and they can be prohibitively expensive during periods of extreme heat and cold, especially for those on fixed incomes and the working poor. In addition, the City of Long Beach charges fees on late utility payments, compounding the burden on the poor.

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Despite opposition, LB mayor insists Measure M not a tax