NOVEMBER'S SPECIAL ELECTION PROPOSITIONS ARE DEFEATED

On November 8th, the Special Election ballot saw the voters turn down all eight statewide Propositions, regardless of source of support. The overall problem seems to be that the voters basically objected to the special election being held; that they were disappointed with the Governor's performance; and in many cases did not understand, nor care to, the detail of the propositions. A synopsis follows:

Propositions 73, Parental Notification on Abortion seem to have failed as foes heavily outspent the supporters, and stressed the danger to some girl teenagers living in troubled or abusive homes, having to get parental approval.

Proposition 74, Teacher Tenure, and Proposition 75, Public Employee's Union Dues requiring public employee unions to get annual written consent from their members to use any of their dues for political purposes, were opposed heavily by the money provided by the California Teachers Association (CTA). Proposition 75 was also opposed by all other public unions. The large amount of money available to buy negative publicity overwhelmed the supporters.

Proposition 76, School Funding and State Spending, which proposed an annual spending limit based on an average of recent growth, and granting the Governor new authority to unilaterally reduce state spending during certain fiscal situations fared the worst of the Governor's supported Propositions. 62 percent of the voters said no. This cornerstone of Governor Schwarzenegger's attempt to get California's ludicrous budget and over-spending cycle under control was also heavily opposed by the CTA, whose 300,000 membership spent $50 million to defeat Propositions 74, 75, and 76.

Proposition 77, Reapportionment would have changed the method of redistricting state political boundaries, presently accomplished by the Legislature and Governor after each national census, and put the task into the hands of three retired judges. The opposition attacked the Proposition as a Republican power grab, backed by the Governor, and out-spent the proponents $18 million to $15 million. Virtually all elected state and congressional politicians opposed the change. However, it appears our elected Legislative officials recognize that the people are displeased with their performance, and there is a chance that they will move to change the Constitution to have redistricting done by some type of commission.

Propositions 78 and 79, Prescription Drugs. These competing Propositions, 78 supported by the drug companies and 79 supported as a state operated program, were both defeated, notwithstanding that drug companies spent $80 million in support of Proposition 78. But the general consensus is that the drug companies are not unhappy about the loss, and that their true concern was that Proposition 79 might pass.

Proposition 80, Electric Service Providers and Regulations. The Proposition would have broaden the authority of the Public Utility Commission (PUC) to regulate electric service providers, and would provides monopoly control of electricity lost by the largest majority, 65.7% of the vote. Now both the Public Utilities Commission will come under pressure to compete the state's energy market.

THE STRANGE RETIREMENT OF CITY MANAGER BOB THOMAS

In early November, Reporter Terri Hardy of The Sacramento Bee reported that Sacramento City Manager Bob Thomas was being pressured to step down. Evidently there were power struggles and growing tensions between Thomas and Mayor Fargo, and some City Council members. Involved were personality clashes and the recent controversial appointment of Carol Shearly to head the City's Development Services Department. At first, Thomas reported he had received a tip he was to be fired, but Mayor Fargo, and City Council members Rob Fong and Robbie Waters met with Thomas to squelch the rumors. Hardy reported that during that discussion, Thomas told those Council members he would be offering a letter to the Council next week, making his retirement official. Later it was announced that Thomas's retirement date would be December 31st.

From that point on the "retirement" events, and costs to City taxpayers, escalated dramatically, and the rest of the story became strange. Hardy, on November 23rd reported, "The City Council that pressured Thomas to step down earlier this month quietly gave him an even nicer send-off Tuesday - a 10 percent pay raise and potentially a higher pension for life. The decision boosts Thomas' salary to $208,900 from $189,901. The Council made the increase retroactive to July 1, the beginning of its fiscal year." Retroactive 10 percent raises were also given to the City Attorney, Treasurer, and City Clerk. This was on top of an 8.3 percent raise for Thomas last October, and a 2 percent cost-of-living increase last June. The last raise was made in a Council meeting, without comment, as a consent item on the agenda. No input from the public, notwithstanding Thomas' 20.3 percent total in raises during the calendar year before retirement.

The next day, November 24th, the story became bizarre. The City had released the details of Thomas' retirement document. Terri Hardy wrote that, "With the Sacramento City Council pressuring him to step down, City Manager Bob Thomas agreed to take $80,000 if he retired on Dec. 31 - four months earlier than he had planned --" And here's where it gets weird. The document prohibits city officials or the city manager from making negative comments about one another and warns: "Any violation of this agreement by the city manager will result in forfeiture of all compensation received as a result of this agreement." This was a second salary boost in one week. But the clincher is the Bee November 29th Editorial, "Hush money", sub-headed "$80,000 to retire early and silently? Why?" It relates the story of Thomas' retirement and monetary gains. The Editorial ends with: "Don't look for Thomas or anyone in the city to say anything negative about that. Fortunately, Sacramento's citizens are not similarly prohibited from voicing their opinion of this outrageous going-away gift."

The City is famous for extracting more than its share of City's taxpayers money, and giving it away in all sorts of nefarious ways. The Taxpayers League has been battling to end or reduce such City's extraction's and give-away's for over 44 years, and you can bet we're going to turn the rocks over to find out what's behind this travesty. As Sherlock Holmes said, "Come Watson, come! The game is afoot."

LOSS OF LEAGUE MEMBER RALPH MORRELL, A TRUE ADVOCATE

Member Ralph Morrell, at 87, passed on October 24th, removing from the political scene one of the best activists demanding honesty in state government. He formed the Northern California Coalition for Limited Government, composed of 22 County taxpayer organizations. Morrell's crusades were credited with ending vote switching and "ghost voting" by Legislators who were not in chambers when a vote was taken. He also was successful in imposing spending controls on the Legislatures "slush fund." Mr. Morrell was a retired Navy Warrant Officer whose exploits in the State Capitol was subject of a 2004 book, "California's Legislative Gadfly - A Story of One Man's Fight for Good Government." Robert L. Peterson, who wrote the book, said, "I don't think you'll see many like him anymore." And the Members of the League can testify that Peterson is correct in his assessment. He was an Advocate's Advocate.

LOSS OF A FOUNDER, AND A LONG-TIME MEMBER

With great sadness, we learned of Past President Galen Whitney's passing. Galen was one of our founders those long 44 years ago, who remained an active and interested Member until the end. We also lost Ivory J. Rodda, an active Member of the League since 1981. These men, whose combined tenure with the League was 68 years, will be greatly missed. Our prayers go out to their families.

INITIATIVE MEASURE FOR PRESENT SMUD CUSTOMERS

The Taxpayers League objects to the Sacramento Municipal Utility District's (SMUD) plan to annex part of Yolo County for electrical service to about 70,000 Pacific Gas & Electric (PG&E) customers from the standpoint that SMUD wants to submit the vote on annexation to potential Yolo County customers, but wants to exclude present Sacramento and Placer County customers from voting on the decision.

PG&E has launched an Initiative Measure to enact an Ordinance establishing the policy of SMUD to obtain the opinion of its current customers through an advisory vote on any proposal pertaining to an expansion of the SMUD boundaries. The Initiative is supported by Sacramento labor unions, homeowners associations, and taxpayer organizations, including the Taxpayers League. It will take about 35,000 signatures to qualify the Initiative.

The Initiative is the Insert in this Perspective. The League is asking its Members to use the Initiative document to obtain signatures of SMUD customers, in addition to the Member's signature. The documents should mailed to Robert Pence, whose address is on the Initiative, and the drop-dead date is January 11, 2006. And be sure to sign the bottom of the Initiative as the Circulator, even if it has only one signature on it.

UNION PUPPET MASTERS TIE SOME STRINGS AGAIN
By Joe Sullivan

Last month I related that the public, and Sacramento County Taxpayers League, is fed up watching dancing puppet elected official's strings being pulled by union puppet masters. Union influence on politicians throughout the state is a major problem. Their ability to buy access to, and support from, elected officials is demonstrated daily.

The examples I used were local. The Sacramento City Unified School District trustees vote for a "project stabilization agreement" requiring union workers contractors on school construction, wherein three trustees voting in favor were endorsed and financed in last November's election by the Sacramento Sierra Building and Construction Trades Council, the main organization supporting the plan, and the Service Employees International Union puppeteers who are jiggled the strings of the Sacramento City Council to regulate hospital facilities expansion, and be arbitrators of hospital billing, debt and nurse staffing. I remarked that unions find that putting decision-making puppets on boards is an easy way to win benefits.

On November 14th, in a Bee article “Teachers group already doing ’06 homework” I found a statewide example of the puppet dance. The article stated “ - - the CTA (California Teachers Association) wasted no time (after the November 8th Special Election) in calling a stream of 2006 statewide candidates to its downtown Sacramento office Thursday to help determine endorsements for the June primary. And when the well financed teachers’ association calls, politicians listen. Among those seen walking into the CTA building Thursday were: state Treasurer Phil Angelides, a Democratic gubernatorial candidate; state Controller Steve Westly, a Democratic gubernatorial candidate; state Attorney General Bill Lockyer, a Democratic treasurer candidate; and Los Angeles City Attorney Rocky Delgadillo, a Democratic attorney general candidate. The CTA on Tuesday successfully defeated an initiative that would have lengthened the time it takes for a teacher to get tenure and another one that would have changed the state’s guarantee for school funding. The group raised dues and spent more than $50 million attacking Gov. Arnold Schwarzenegger during the special election campaign. Two days after the election, it appeared that the union wasn’t begging for cash but rather looking for people to spend it on next year.”

What The Bee was actually describing is the flow of puppets going in to get their strings attached by the puppet masters.

BEGINNING A MOVE TO CHANGE THE CITY CHARTER?
By Joe Sullivan

In last month’s Perspective I also described the history of Sacramento City’s change of its Mayoral position from part-time to full-time, relating that in 2002 former Mayors Phil Isenberg and Ann Rudin succeeded putting Measure S on the November ballot to make the Mayor's position a full time job. However, Measure S did not expand Mayoral duties, nor change the 1921 City Charter, which established a strong City Manager - weak City Mayor relationship..

The pressed effort by the Council and Mayor to get rid of City Manager Bob Thomas may be the beginning of a move to strengthen the level of the Mayor’s and the Council Member’s controls of City affairs. Further, as related in the history, there is also a desire by some of the Council to make their jobs full-time. To accomplish both, the City Charter has to be changed. And I’ll bet a dollar against a dime we will see such a move, and soon.

UNFAIR TAXATION OF HEALTH CARE SERVICES AND PRESCRIPTION DRUGS

The California State Board of Equalization (BOE) may be opening the door to taxation of “cosmetic” medical procedures, and taxing some types of medications, which are now tax exempt. Treatments that have both “cosmetic” and therapeutic benefits are at the most risk. In April, the BOE started with Botox, which is recognized by the FDA as a medicine, and is widely used in therapeutic treatments, including those that help keep children with cerebral palsy walking , and allow stroke patients to use their hands.

Decisions by the BOE, like the one on Botox, may lead to other such taxes on medical procedures, and services, as state legislators and regulators are constantly looking for new revenue. The Botox decision also sets a dangerous precedent, putting Legislators and state agency bureaucrats in the business of playing medical professionals. Be prepared for an adverse position challenging this tax imposition, as it can only result in increased medical costs.

WHO REALLY CARRIES THE TAX LOAD IN THE U.S.?

An interesting article on who pays taxes, and how much, was put together by the non-partisan Tax Foundation blowing away much of the hype about President Bushes tax reduction and who benefited. The hue-and-cry was that it favored the rich, yet the their report indicates that, “Despite the charges of critics, President Bush’s tax cuts further reduced the tax burden of low- and middle-income taxpayers, and shifted the tax burden onto wealthy taxpayers.” For example this year 44 million taxpayers will file, but will not have to pay any income taxes (because growing deductions and credits that have effectively removed them from the tax base).” “20 percent of taxpayers – people making more than $68,000 a year – will pay 82 percent of all federal income tax revenue.”

LETTERS TO THE LEAGUE

We seek “Letters to the League” from Members concerning projects and issues on which we are working, along with recommendations on those we should look at. Letters may be edited and republished in any format, primarily in the interest of available space. Send letters, faxes, or e-mail to the Sacramento County Taxpayers League. Our e-mail is sactaxleague@prodigy.net; our telephone number is (916) 921-5991. Our fax number is (916) 567-1279. And our address is:
Sacramento County Taxpayers League
1804 Tribute Road, Suite 207
Sacramento, CA 95815.

EXECUTIVE DIRECTOR'S MESSAGE

CALIFORNIA ECONOMIC UPDATE - November, 2005
For the first time since March 2001, all major industry sectors posted year-over-year gains.From September 2004 to September 2005, employment rose by 58,600 in Construction; 41,100 in Professional and Business Services; 36,200 in Leisure and Hospitality; 21,600 in Educational and Health Services; 21,100 in Trade, Transportation and Utilities; 17,600 in Government; 14,700 in Financial Activities; 7,300 in Information; 5,300 in Other Services; 2,700 in Manufacturing; and 100 in Natural Resources and Mining.

The state's unemployment rate—estimated from a different survey—was 5.1 percent in September, down from an unrevised 5.2 percent in August. In September 2004, California's unemployment rate was 6.1 percent. Hurricane-related employment disruptions bumped up the national unemployment rate 0.2 percentage point to 5.1 percent in September. This is the first time since April 1990 that California's unemployment rate was not greater than the nation's. Aside from hurricane effects, the state's unemployment situation has been improving at a faster pace than the nation's for the last two years.

California homebuilding came back strongly in September after slowing noticeably in August. Residential building permits were issued at a seasonally adjusted annual rate of 267,000 units in September, beating the August performance by more than 30 percent. Residential building permit issuances averaged 219,000 units during the first nine months of 2005, a 3.6 percent improvement on the same months of 2004.

The value of nonresidential building permits issued also improved in September and was up 12.5 percent from a year earlier. For the first nine months of 2005 as a whole, nonresidential construction increased 12.1 percent from the same months of 2004.

California home prices dipped in September, as they typically do at this time of year. The median price of existing single-family homes sold in September was $543,980, a 4.4 percent drop from August. This is still 17.3 percent above the median price of $463,630 a year ago.

The pace of home sales quickened in September to 650,780 units on a seasonally adjusted annual rate basis. Home sales were fairly stable during the first nine months of 2005, averaging 641,000 units.

Bruce Lee

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