Gov. Jerry Brown rallies support for tax increases: ‘Fixing our roads is basic’
As a young governor, Jerry Brown pilloried Proposition 13 as a “fraud” and a “rip off,” and aligned himself against what became the landmark 1978 measure by Howard Jarvis and Paul Gann to cut property taxes.
Brown, now a self-described apostle of common sense who is turning 79 on Friday, this time wants to raise taxes, pressing for a gas tax increase as the lynchpin of a 10-year, $52 billion program to fix rutted roads. The fourth-term Democrat says the spirit of the deceased anti-tax crusader still influences debate in Sacramento.
“I know your politics don’t fit in because the ghost of Howard Jarvis still haunts the halls of this Capitol,” Brown told lawmakers in testimony Monday. “He’s had quite an influence, that guy.”
The planned vote Thursday on Senate Bill 1 is testing the clout of the veteran politician, who time and again over six years has been able to exert his influence over lawmakers. Yet the risk of voting for a gas tax hike, which some view as a regressive levy on working-class constituents, is creating what Brown acknowledges is a politically perilous situation.
“I am not saying it’s pleasant. I am not saying the voters are going to give you accolades,” Brown said. “I am just telling you as a Californian, don’t sell the state short.”
As lawmakers prepare to consider the bill, here’s a look at what it does, the governor’s rationale and the political dynamics in the Legislature:
Q: How much would this cost?
Brown and Democratic legislative leaders estimate the measure will increase costs for the average motorist by about $10 a month.
The legislation would raise $52 billion over 10 years. It seeks to raise the base gasoline excise tax by 12 cents (raising $24.4 billion), create a transportation improvement fee based on the value of vehicles ($16.3 billion) and and raise diesel excise and sales taxes ($10.8 million). The state also is proposing to repay a $706 million transportation loan that goes back to the early 2000s.
Q: What would you get for your money?
Funds would be divided between repairing local streets and state highways, as well as other projects like local transit. Overall, some $30 billion would go to “fix-it-first” repairs to local roads and potholes, as well as highways and smoother pavement. It also would prioritize $4 billion in bridge and other repairs, $3 billion to improve trade corridors and $2.5 billion to reduce congestion on major commute corridors.
Q: Why is Brown only now getting around to fixing the state’s crumbling roads?
Brown has been admittedly restrained on the subject, with a few exceptions. He has discussed as part of the budget process the need to repair roads, and in his 2015 inaugural address he stressed the need for having the roads, highways and bridges in good enough shape to function properly. Brown said at the time that the state had accumulated $59 billion in needed upkeep and maintenance.
But raising taxes, as Brown says is necessary, is a tough sell. Last fall, the special legislative session on transportation funding ended without a deal.
Q: What’s Brown been doing to get a deal done, and who is on board?
Brown has hit the road in recent weeks, running what amounts to a campaign, including testifying in the Legislature, appearing at media events and issuing a long list of endorsements, including from the Allan Zaremberg, president and chief executive of the California Chamber of Commerce, generally no fan of tax hikes.
Zaremberg characterized the proposal as “a responsible investment.” “Asking Californians to pay more is not something the Chamber of Commerce does lightly, or frequently. But in this case, it is the most prudent course of action,” he said.
Brown also has support from the building trades, transportation advocates and local governments.
Q: How is the governor framing the debate?
Brown and others have repeatedly reminded the public that asking people who drive to help pay for road upkeep was a principle of Ronald Reagan. A user fee is fair and relates the cost to the benefit, Brown asserts. “When you go to the general fund (to pay for the work), you lose that feature.”
He argues the pay-as-you-go approach avoids saddling future generations with debt, and he’s likened the need for road fixes to a leaky roof. “If you don’t fix the leak,” he said at one of the events, “your furniture will be ruined.”
“You pay now, or pay later,” Brown said at another stop. “And pay a hell of a lot more.”
Brown went further, contending the growing tab is putting California on a path to experiencing something akin to the Greek government’s debt crisis. “You can wreck California. It is possible.”
Ultimately, though, “You can’t avoid the payment,” he said.
Q: Who’s against it?
Tom Scott, executive director of the National Federation of Independent Business in California, said it represents the largest gas tax increase in state history. Also opposed is the California Farm Bureau.
The Howard Jarvis Taxpayers Association, led by President Jon Coupal, says the state has plenty of money already that it can use to pay for road repairs.
Legislative Republicans are largely opposed to tax increases.
“How do we keep California affordable?” asked Assemblyman Vince Fong, R-Bakersfield. “Californians right now are paying one of the highest gas taxes in the country.”
Q: So, does the state really have the money?
That depends on how you look at it. Brown argues you would have to make major reductions to programs many in the Legislature would reject, like cutting funding for higher education, childcare or preschool. That doesn’t include the billions of federal dollars the state may have to replace if Medi-Cal is cut.
Even if Republicans agreed to make some of the cuts, Brown would be hard pressed to convince fellow Democrats to go along.
“I don’t think there’s any extra money in the general fund,” he said, adding, “To say the money is there is more like an ‘alternative fact.’”
To earn more support for the measure, advocates have included a constitutional amendment – subject to voter approval – that would protect the money from being diverted to other programs.
Q: What makes passage politically difficult?
Increasing taxes in California is no slam dunk, even with two-thirds Democratic majorities. Many of the Democrats being asked to approve the increase represent marginal districts where their vote could backfire when they come up for reelection, or when they run for their next political office. Multiple Republican lawmakers who agreed to raise taxes in the past have seen major damage done to their careers.
Q: What if the road repair issue doesn’t get solved and is left to the next governor?
Brown, who leaves office in less than two years, says he’s better positioned than those who might succeed him to lead the charge for the issue because he is not running for future political office.
“I have no future. I only have a past,” Brown said.
He said the candidates vying to replace him all envision themselves as running for president one day, and don’t want to push for taxes. The Bee surveyed three of the leading Democratic contenders – Treasurer John Chiang, Lt. Gov. Gavin Newsom and former Los Angeles Mayor Antonio Villaraigosa. Newsom and Villaraigosa said they strongly support Brown’s plan. Chiang said while he hasn’t reviewed all the details, he backs the concept.
Chiang said he’s open to new revenue streams to address California’s “underinvestment” in public infrastructure, but with several conditions, including pledging the money exclusively to transportation infrastructure, adding an online tool that allows the public to track spending and giving voters the chance later on to evaluate how much bang they are getting for their buck.
Villaraigosa, through a spokesman, said he wants to look at taxes all together, not one at a time, to create more stability, efficiency and fairness. But he said fixing roads and other infrastructure are very high priorities for him.
Newsom said he would be open to raising taxes to pay for the repairs, contending new money won’t just “appear.”