The Sacramento Bee
2100 Q Street
Sacramento, CA 95816

Re: Metro article "Appeals court upholds ban on Roseville's utility fee" Apr. 13th.

The Bee April 13th article, "Appeals court upholds ban on Roseville's utility fee", covering the Howard Jarvis Taxpayers Association's successful lawsuit against the City of Roseville for applying an illegal 4% in-lieu franchise fee against city services for water, sewer and garbage collection, resembles an action by the Sacramento County Taxpayers League and the Jarvis organization involving the City of Sacramento. The City had an 11% in-lieu franchise fee charged against the same services. In both cases it was recognized that the fee is actually an add-on tax, unrelated to cost-of-service requirements of Proposition 218. The difference, however, was that then City Manager Bill Edgar recognized the fee was illegal, and did as the Javis and the League asked, which was to put the fee before the voters as a tax, as required by law. He made the recommendation to the Sacramento City Council, which they wisely approved. The tax was presented to the voters as a revenue neutral action, which simply changed the name from fee to tax. The city voters approved. The 11% tax is called the Enterprise Fund/General Tax, which according to the City Budget brings in $11.7 million each year legally. Serious negotiation is oft-times wiser than starting a war.

Joe Sullivan
Executive Director

The Sacramento Bee
P.O. Box 15779
Sacramento, CA 95852

Re: Your Views "The majority vote" March 12, 2002

Pat Watters, in a letter, slammed the Howard Jarvis Taxpayers Association for opposing the 55% vote threshold for approving local school bond measures created by Proposition 39. In ignorance, he implied Jarvis people are greed-motivated and seek only to line the wallets of selfish people. If all property owners are selfish, greedy people, than the Jarvis organization is surely guilty of protecting them. Watters ignores that Proposition 39 exists only because billionaires Reed Hastings and John Doerr of Silicon Valley spent many millions of dollars to change a 121-year old Constitutional requirement that local general obligation bonds for schools be passed by a two-thirds majority of the vote. It permits all registered voters to vote on school bond tax increases, while only property owners pay the 30-year obligations. The U.S. Supreme Court, when considering exactly the same type issue, said, "in voting to issue bonds voters are committing, in part, the credit of infants and of generations yet unborn, and some restriction on such a commitment is not an unreasonable demand." I'll stand with the Supreme Court and Jarvis.

Joe Sullivan
Executive Director
Sacramento County Taxpayers League

Board of Directors
Sacramento Regional County Sanitation District
700 H Street
Sacramento, CA 95814

Subject: Alternative Sewer Impact Fee Structure

Dear Directors,

I appreciated the opportunity at the Board's meeting on February 13th to reiterate the Taxpayers League position of support for the staff recommendation that the "tiered infill" impact fee structure, using the 70% definition be adopted.

At that meeting it was obvious the "tiered" element of the proposed new Ordinance, and its cost impact on developers created great concern as expressed by the Building Industries Association's representative. Supervisor Niello, also expressed surprise that the League would not support the "postage stamp" approach to connection fees, i.e., a single connection fee for the entire system. As a result I promised the Board I would endeavor to relate the rationale and history behind establishing the original connection fee cost, and our related position.

I prepared the information as a position paper, enclosed, which I may use as an insert to the League's monthly Tax Fax such that I can explain the story to our all our members. And the position paper will be added to other studies that appear on our www.sactax.org website.

Respectfully,
Joe Sullivan
Executive Director

Encl: Regional Sewer System Change of Connection Fee from Flat to Tiered
cc: Bob Shanks - District Engineer - SRCSD

August 20, 2001

Board of Directors
Sacramento Regional County Sanitation District
700 H Street
Sacramento, CA 95814

Subject: Workshop on Regional Sewer Plant Treatment Capacity Buyback Program

Dear Directors,

I received an advanced copy of your staff's recommendation to your Board that you conduct a workshop regarding the Treatment Capacity Buy-Back Ordinance. The workshop will discussed during the Board Meeting on August 22nd.

The Sacramento County Taxpayers League recommended approval of the Treatment Capacity Buyback Program in 1999, and has been pleased with results of the program that evolved. The recovered plant treatment capacity enabled both the county and city of Sacramento to reduce some targeted connection fee costs that encouraged developments that might not otherwise have occurred. It is a measure of the Program's success. Another is being able to factor future capacity acquisitions into planning plant expansions, reducing investment capital needed to increase plant size.

We note that the staff is recommending that no further money be identified for capacity buy-back until 2004, which we believe to be an error. They state that the capacity "bank credits" should last over 7 years, and that an update of the master plan would unlikely place much value on this capacity. I suggest that the need, and application of "cut-rate" capacity be addressed every year, as was intended when the original Ordinance was approved.

I am aware that the industrial community is asking that the Ordinance July 31st decision date regarding application of funds for capacity Buy-Back be extended for 90 days to permit discussion of opportunities.

I strongly recommend that you keep the buy-back option open. Waiting until 2004 may deny the county and the involved cities the opportunity to act positively in attempts to encourage businesses and residential developers to locate in the county limits.

Respectfully,
Joe Sullivan
Executive Director

August 5, 2001

Sacramento County Board of Supervisors
700 H Street
Sacramento, CA 95814

Reference: County Waste Disposal Residential Refuse Rate Increase

Honorable Supervisors:

On July 24th, the staff of the Waste Management and Recycling Division of the County presented you its, "Refuse Enterprise Operation Statements" as of June 30, 2001, which identified a profit, thus far, of $3.4 million. We recognize the profit is not a result of "earned income", but rather resulted from a transfer of $5.4 million from Capital Outlay, loosely defined as money spent from the Capital Fund, which accumulates as replacement money for depreciated equipment and buildings. The transfer of capital money to the operations and maintenance budget, created the $3.4 million "profit".

During the presentation, many budget increases were displayed, including a table related specifically to ratepayers. Its bottom line indicated that an additional $2.9 million a year must be collected, which equates to a monthly raise of $1.57. As the rate increase being proposed is programmed for $2.40 per month, the need for the difference is in question. For the record, the Taxpayers League believes that imposition of fees in excess of cost of service is illegal, and bad public policy.

At the hearing I asked, as I have done over the last three years, for return of $13.5 million illegally transferred from the Waste Management Enterprise Fund to the county General Fund after passage of Proposition 218. I suggested the transfer could be made from Tobacco Litigation Settlement Funds, which are received by the county from the state with no strings attached. Transfer of $5 million of such money was requested last year in a coordinated letter from the Public Works Agency, the Office of Budget and Debt Management, and the County Executive to the Board of Supervisors during budget hearings for 2000-2001. It was to have been a one-time transfer "to fund the two year phase in of the needed rate increase as well as fund the budget gap that will occur during the four month implementation period before the new residential rate collection rates take effect." What actually happened was you used the $5 million as a down payment for a fleet of natural gas driven garbage trucks to help clean up the air, then raised the monthly residential rate by $3.65.

Now, the same conditions exist, except the County's proposed 2001-2002 budget has $15.9 million of Tobacco money apparently identified for trucks. The money is not on hand now, but may come soon as I understand you are negotiating a deal to discount all anticipated future money to be received under the Tobacco Settlement as a quick, up-front cash deal. As more than $200 million may be involved, I'm sure a measly $13.5 million can be set-aside for the Waste Management Division to enable them to avoid residential rate increases for the next 3 years.

Respectfully,
Joe Sullivan
Executive Director

cc: Richard Owing

June 7, 2001

Sacramento County Board of Supervisors
700 H Street
Sacramento, CA 95814

Reference: Return of $13.5 Million to Solid Waste Management Enterprise Fund

Honorable Supervisors,

On May 10th we sent a letter from the League asking your Board to add a Hearing Item under Timed Matters on the transfer of $13.5 million from the county's General Fund to the Waste Management Enterprise Fund as a budget item. We received no response. The intent of the request was to isolate the issue as a stand-alone single item, aimed at a vote to determine who among the Board of Supervisors wants to return the money, and who is opposed. A copy of the letter is enclosed, which points out that illegal transfers occurred after approval of Proposition 218. In addition to that letter, we included copies of League letters to you dated May 30, 2000, March 10, 2000, December 14, 1999, and July 26, 1999 which covered other times we formally informed you of our position with respect to the transfer. In addition, we included our papers on Sacramento County's Solid Waste Disposal Crisis, dated August 23,1999, and the analysis of the Business Plan for Refuse Enterprise Fund, dated July 10, 2000.

Coupled with the request for the line item vote, we are advising that the League opposes the projected $2.40 increase in the monthly garbage rate, on top of the $3.65 rate increase put in place last year. The money is needed, but had your Board acted as we requested last year, neither increase would be necessary.

Last year we believed the Board agreed with our transfer request, and was prepared to move some of the money from the General Fund to waste management. Belief was based on a coordinated letter from the Public Works Agency, the Office of Budget and Debt Management, and the County Executive to the Board of Supervisors on May 31,2000. The letter asked the Board to receive the Business Plan and conceptually approve its recommendations. The $3.65 rate increase was in the letter, as was this interesting statement: "Conceptually approve a one-time transfer from the General Fund to the Enterprise Fund of $5 million to fund the two year phase-in of the needed rate increase as well as fund the budget gap that will occur during the four month period before the new residential rate collection rates take effect." Anticipating a hearing, the May 30, 2000 letter was sent. We asked later, and were assured the $5 million transfer would be in the budget. As this amount equaled the yearly "take" of the old Asset Fee, we felt it could be used to offset the proposed rate increase, which would bring in about $5 million.

When budget time came, the $5 million for the Rate Stabilization Fund was gone. In its place appeared "Fund one-time transfer of $5 million to the Refuse Fund to finance replacement of vehicles with clean air vehicles." It was to be a down payment for a new fleet of natural gas powered garbage trucks to cost $30 million. We protested the change, and repeated the $13.5 million transfer request in all subsequent rate and budget hearings, to no avail. The $3.65 rate increase was approved.

In the May 10, 2001letter we identified the Tobacco Litigation Settlement Funds as the money that can be used to replace the rate money taken. So, again, we recommend you transfer $13.5 million from the county's General Fund to the Waste Management Enterprise Fund, in increments if necessary, and thereby make rate increases for the next two years unnecessary.

Respectfully,
Joe Sullivan
Executive Director

February 9, 2001

Letters Editor
Inside the City
3104 0 Street, #120
Sacramento, CA 95816

Subject: City Highlights Article "City Utility Tax Windfall", February 2001 Issue

The article "City Utility Tax Windfall" under the "City Highlights" column in the February 2001 issue of Inside the City contains an identification error as to the taxpayer organization protesting the increase in taxes the City of Sacramento receives as a result of utilities rate increases. The article references the "Sacramento County Taxpayers' Rights League." I am sure the complainant is Mark Whisler of the "Sacramento City Taxpayers' Rights League." There is only one "Taxpayers League" recognized throughout the county, the forty year old Sacramento County Taxpayers League, governed by a 23 member Board of Directors, composed of some of the most well known citizens in our county. The Taxpayers League's Directors have not yet taken a position with regard to the tax acceleration as a result of projected increases in utility and other service rates.

Mark Whisler, an excellent researcher and advocate, wants the City of Sacramento to reduce its 7.5 percent utility tax to 4 percent to compensate for the "windfall" in taxes it will receive as utility rates skyrocket. The Taxpayers League, on its part, will be examining that issue, and another disturbing one, the city's 10 percent tax charged against its own Public Works Department Enterprise Fund, collected as rates for water, sewer, and trash disposal services. That voter-approved tax replaced the "in-lieu franchise fee", which amounted to over $10 million per year, that was outlawed by Proposition 218's requirement that such rates cannot exceed the cost of providing the service. Notwithstanding voter approval, it is one of the most unusual taxes conceived, i.e., a tax on an Enterprise Fund.

It should be revisitied.

Joe Sullivan
Executive Director
Sacramento County Taxpayers League

February 6, 2001

The Sacramento Bee
Letters to the Editor
P.O. Box 15779
Sacramento, CA 95852

Re: Bee article "Mall, city talking of teamwork", Feb. 3, 2001

The Bee reported the Sacramento City Council is considering helping expand Arden Fair Mall and improving some of surrounding neighborhoods by declaring the combination a Redevelopment Zone. The intent is to upgrade the Mall to better compete with newer malls outside the city, and to do some work in the local neighborhoods to meet requirements of Redevelopment Law, as the Law requires that 20 percent of the Zone's funds must be used to create affordable housing for people of low or moderate incomes. Such combinations, usually contrived to subsidize a commercial enterprise, are often termed "Corporate Welfare".

Many taxpayers do not understand that Redevelopment Agencies are a state-authorized layer of government created by the California Legislature. They are an entirely separate government authority, with their own agenda, revenue, staff, and expanded powers enabling them to issue bonds and condemn public property. Designed to assist cities in cleaning up inner-city neighborhoods, they have developed into "Unknown Governments" created without a vote of the citizens affected They are governed by appointees of city councils, who often appoint themselves as the members. They can incur bonded indebtedness without voter approval, and unlike other levels of government, can use the power of eminent domain to benefit private interests. All a city has to do to create such an Agency is to declare some portion of the city as "blighted", which is relatively easy to do.

The danger is that once created, a Redevelopment Agency has the exclusive use of all increases in property tax revenues that are generated in its designated area. Such money is diverted away from the city General Fund, and property tax increases beyond the base year are no longer available to the police, schools, or public service requirements. For the Agency to begin receiving property taxes it must first incur debt, and the money received can only be used to pay off outstanding debt. Pay-as-you-go is not part of redevelopment law, or philosophy. Agencies project that ever-rising property tax increments will cover future debt service. But if an economic downturn occurs, and real estate values decline, the cities with Agencies may have to raid their General Funds to bail out the failing enterprises.

We suggest the city find a better means to help Arden, rather than put city taxpayers at risk.

Joe Sullivan
Executive Director
Sacramento County Taxpayers League