One of the Reason California is such a bad State for business and families are our tax polices.  They are regressive and punitive—with much of the tax money winding up in special interests hands and slush funds.

Board of Equalization Member George Runner understands that.

“Cut from the same cloth as previous taxpayer-funded ballot-box boondoggles like high-speed rail, the stem-cell research initiative and First 5, Prop. 29 is a $735 million annual tax increase that creates a brand new bureaucracy overseen by unelected political appointees who have unchecked authority to spend billions of taxpayer dollars.

At a time when Democrats are threatening more devastating cuts to education and public safety if voters refuse to approve Governor Brown’s tax measure in November, Prop. 29 raises nearly $1 billion in taxes a year, yet fails to do anything to solve our massive budget deficit or require that Sacramento control its wasteful spending habits.”

Are you willing to give one billion dollars per year to an unelected bureaucracy, answerable to no one?  That is the definition of a slush fund.  Prop. 29 should be called ”The Tobacco tax Slush Fund for Special Interests.”

 

Prop 29: Another Grab for Dollars with No Accountability to Taxpayers

By George Runner, member Board of Equalization, 5/3/12  www.georgerunner.com

April 17 was the deadline of another tax filing season, but it was just the start of the Democrats’ 2012 tax initiative season. In fact, in just a month, voters must take a stand against and defeat the first round of this year’s tax hike measures: Proposition 29.

Prop. 29, like many other tax increases in recent years, seeks to target an unpopular activity, smoking, and increase taxes to combat something of universal concern, in this case cancer research.

Cut from the same cloth as previous taxpayer-funded ballot-box boondoggles like high-speed rail, the stem-cell research initiative and First 5, Prop. 29 is a $735 million annual tax increase that creates a brand new bureaucracy overseen by unelected political appointees who have unchecked authority to spend billions of taxpayer dollars.

At a time when Democrats are threatening more devastating cuts to education and public safety if voters refuse to approve Governor Brown’s tax measure in November, Prop. 29 raises nearly $1 billion in taxes a year, yet fails to do anything to solve our massive budget deficit or require that Sacramento control its wasteful spending habits.

What advocates for tax increase on specific products like tobacco fail to understand is that tax policy has consequences.  At the Board of Equalization, we oversee the collection and implementation of tobacco and other taxes.  Every time we increase taxes on products like this we encourage the black market.  We’ve seen first-hand the loss of revenue and harm it causes to legitimate business owners.

Investigations into those evading the tobacco taxes are expensive and ultimately reduce any income to the state from those tax increases.  Much like every other type of tax increase, it often has the opposite effect.  Just a few years ago, tobacco-tax hike author Rob Reiner argued against increasing the tax further, estimating major losses to other pet projects.

Adding insult to injury is the fact that, unlike previous initiatives, nothing in Prop. 29 requires that funds be spent in California or even in the United States. Despite our double-digit unemployment rate and more than 2 million Californians currently out of work, the measure actually allows our tax dollars – and, with them, our jobs – to be shipped out of state. Shouldn’t we be keeping tax dollars here in California to create California jobs?

Written by former Senate President Don Perata, Prop. 29 was drafted to specifically circumvent Proposition 98 education protections.  Despite the 20,000 teachers who’ve been issued pink slips in California, Prop. 29 actually cheats schools out of more than $300 million.

But it’s not just education that gets short shrift, Prop. 29 was so poorly written as to put taxpayers at risk for the same kinds of conflicts of interest, waste and mismanagement that have plagued previous agencies and commissions created at the ballot box.

Like the stem cell research and high-speed rail initiatives, Prop. 29 contains no real accountability or oversight provisions. The nine-member commission Prop. 29 creates can spend $110 million a year on real estate and equipment. That’s in addition to the $15 million a year it can spend on administration and overhead for things like consultants, conventions and travel.

Prop. 29 does not contain critical taxpayer protections vital to any measure of this immense magnitude. In fact, the only report required on the commission’s activities is written by the commission itself, no external audits provided. That’s a lot like the fox guarding the hen house. These are not hypothetical scenarios –

Prop. 29 specifically lacks the kind of accountability and audit provisions that were called for in the wake of mismanagement and conflicts-of-interest at other commissions, such as the high-speed rail authority, the First 5 Commission or the stem cell agency.

Just in the past few months we’ve seen the horrendous waste at the high-speed rail authority.  Yet this proposal makes the same mistakes in terms of lack of accountability and creates an organization destined for inefficiency.

What’s worse, not only did Prop. 29 drafters choose to ignore these valuable lessons, they went a step further and locked in these fatal flaws for 15 years. Not even the governor or Legislature has the authority to amend Prop. 29, even in cases of waste, fraud or abuse.

Every one of us has had our lives affected by cancer in some way, devastating our friends and loved ones.  We all support doing what we can to find new, innovative treatments and cures. To accomplish that we must be deliberative and logical in our approach, not create a huge government bureaucracy as an emotional response to painful issue.  It is foolish to waste billions of dollars, derails job recovery in our state and leaves no one accountable.

Elected in November 2010, George Runner represents more than 9 million Californians as a member of the State Board of Equalization. For more information, visit www.georgerunner.com.

Previous Post

Next Post

 (6 comments so far)
Got something to say? Post a comment.

 
By posting you agree to our Terms of Use and Privacy Policy
   

John

Prop 29 will save the world, “and just might lead us to a cure”. We already have the cure, -Cannabis. If Cannabis were legalized, Cancer rates would plummet, because then, nobody would smoke tobacco. The tobacco companies don’t want that anymore than “big pharma” does though, so in the mean time everyone will continue to die and suffer.

May 29, 2012 at 7:04 am

Thumb up 0 Thumb down 0

Reply

CA with a clue

Ridiculous comments – clearly PR firm written sound bites; another self dealing board with no oversight . . . probably written by people who will give themselves a job using the money

May 6, 2012 at 7:29 am

Thumb up 0 Thumb down 0

Reply

Linda Shaner

I am voting Yes on Prop 29…research paid for by this tax will help the very people paying the tax..smokers..Supporting this Proposition will save lives, keep kids from smoking and help in finding a cure..read the facts, fan the smoke from your eyes and vote Yes on Prop 29!!

May 3, 2012 at 6:49 am

Thumb up 0 Thumb down 2

Reply

Evelia Castillo-Rodriguez

VOTE YES on Prop 29!! I know I am! Just remembering my friend that lost the battle to throat cancer, 2 years ago!! When the doctor finally diagnosed him, he was already stage 3. I do believe second hand smoke does kill, he had never smoked in his life! Prop 29 saves lives, will keep our kids from smoking and fund cancer research, which may find the cure!

May 3, 2012 at 1:49 am

Thumb up 0 Thumb down 2

Reply

neyriddle

Mr. Runner, you said “Every one of us has had our lives affected by cancer in some way, devastating our friends and loved ones. We all support doing what we can to find new, innovative treatments and cures.” Your words, my words are the same, that’s why I’m voting YES on 29! If you prefer another option go to asccan,org and donate! One way or another we have to win this war on cancer.

May 2, 2012 at 10:35 pm

Thumb up 0 Thumb down 2

Reply

LorI Bremner

It makes perfect sense to me to fund cancer research with a tax on tobacco. Smokers are the most likely consumers of the future treatments that could be discovered. I’m voting yes on Prop 29 because it will save lives, keep kids from smoking and just might lead us to a cure.

May 2, 2012 at 10:28 pm

Thumb up 1 Thumb down 2

Reply