Nancy Pyle wrote an op-ed for the Mercury News this week, and in it the San Jose councilmember suggests the always-popular proposal of raising taxes.
Her reasons are as follows: The city has an out-of-date business tax model; San Jose collects a million dollars less in property taxes than it did before the subprime mortgage crisis; and population has grown by about 45,000 since that time, which, Pyle noted, is like tacking on an extra Gilroy—and who really wants another Gilroy?
“We can fix this problem,” Pyle writes. “For example, a city-sponsored half-percent sales tax increase would raise about $72 million a year. San Jose would keep 100 percent of this money, enabling us to provide our residents the services they need.
“It is important that we act now, for the June ballot. We know that there will be multiple tax measures on the November ballot, and it is unclear at this time how or if any of them will help the city. We need to do everything we can to avoid the confusion created by a ballot containing multiple tax measures.”
Pyle has consistently beaten the drum about increasing San Jose’s revenues with taxes. And now that pension reform is set for a ballot measure in June, increasing the sales tax might become more seriously discussed by the council in the coming months.
But that isn’t to say the city and unions have stopped focusing on pension reform and ballot measures.
Some interesting letters were exchanged this week between the city’s deputy director of employee relations, Gina Donnelly, and union leaders. In a letter to AFSCME’s Yolanda Cruz and LaVerne Washington on Dec. 12, Donnelly writes:
“It is important to recognize that time is of the essence and the mediation process cannot be open ended. Consistent with the completion of impasse resolution procedures, the
City Council approved the terms of the ballot measure on December 6th. Absent any agreement to the contrary, the measure (in its current form) is now scheduled to be placed on the June 3, 2012 ballot and, consistent with its “sunshine” requirements, the Council will be unable to introduce changes in the measure after February 21, 2012. Therefore, any further mediation or other procedures must be completed no later than mid February, 2012, to ensure that any agreed-upon changes to the measure can be made before ballots are printed.”
On Wednesday, a statement from Mayor Chuck Reed stressed the need for pension reform through a ballot measure after a
report was released Joe Nation of the Stanford Institute for Economic Policy Research (SIEPR). The report’s analysis of the pension crisis is grim.
“... [T]he probability of San Jose’s systems fully meeting obligations is only 12 percent,” Nation writes. “In fact, the likelihood is 33 percent that the systems (federated employees and public safety) will fall short by a combined $10 billion in the next 16 years.”