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LAist Guide to the Primary: Proposition S

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We all know that in five days Californians go to the polls to decide the fate of this state, this country and the world. That gross overstatement seems fitting given the coverage and verbage some are using to describe the upcoming Primary.

But, hey, what might have gotten lost in the shuffle of debate talk, Indian gaming commercials and Obama vs. Hillary rhetoric is a city ordinance that could affect everyone with a cell phone. So...everyone.

Today's focus is Proposition S, an L.A. City measure that is stirring up passionate debate on both sides from those who call it vital to maintaining city services to those who maintain the measure is bad for you, the average Jo(e).

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If you need to brush up on your Shakespeare, take a look at our past reviews of Propositions 91, 92, 93 and 94-97.

Cell phone user, by dogseat via Flickr

First tell me what it is

  • Prop. S is officially called, "Reduction of Tax Rate and Modernization of Communications Users Tax."
  • S is one of ten local jurisdictional measures around Southern California on the Feb 5 Primary ballot. Inglewood, for example, is considering a ban on fireworks and Redondo is considering bond to pay for schools and parks.
  • The official language of our city's ordinance is here, but in plain English, it's a Communications Users Tax ordinance that would lessen the existing tax rate on new media (cell phone and T1) users from 10% to 9% while updating that new structure to include "modern communications technologies," like cell phones and T1 lines that were previously not included.
  • Specifically, S would tax cellphone users (including text messaging but not Internet use). S would continue the exemption low-income, seniors and the disabled already receive with the money to fund general municipal service, such as 911, police, fire protection, street maintenance, parks and libraries.

Who likes it and why?

  • City Hall, the police and fire chief, Mayor V and former Mayor Riordan and some business groups all sing its praises. They love S because the thought is that the measure will flush some money back to the agencies that badly need the funds, like:
    • Crime investigation units
    • Domestic abuse response teams
    • Gang prevention
    • Traffic control
    • Emergency ambulance service
    • Police officer hiring and training
    • Firefighter hiring and training
    • Replacement of outdated firefighting equipment
    • Upgrading emergency communications systems and training. [Prop S Facts]

  • Supporters contend that S "closes a loophole," because people who use T1's for the phone do not currently pay a tax on the line. Thus it is only fair that the cheap asses who have been milking the county dry pay up. But, don't worry, Prop S Yessers say:
    Once Proposition S is adopted by the voters, the City Council cannot increase the tax without voter approval. [Prop S Facts]

  • The LA Times also liked the measure enough to endorse it last week, calling it:
    a prudent measure that would protect Los Angeles' 40-year-old telephone tax while simultaneously reducing it and applying it more fairly to new technologies. By rejecting the measure, voters would simply be punishing themselves by de-funding their government services. [LA Times]

How much does the city stand to lose from the loss of potential taxes if it is not approved?

  • The Yes on S folks claim that $270 million could be lost.

What is the opposition saying?

  • Wait just a minute, No on S peeps say, why the hell is the City Council trying to pass a measure to reduce taxes when they are free to do that at any time? Point taken: you only need to float a resolution to raise taxes, not reduce them.
  • The money won't actually go to safety organizations, they say:
    Nothing in Prop S requires City Hall to spend the money on hiring more police or fire fighters. Rather, Prop S is a general tax, which means Villaraigosa and the City Council can squander your money on anything they want. Why trust them with even more money? [No on Prop S]

  • No on S peeps say that the measure would actually tax Internet use, citing the exact language of the bill. However, that claim contravenes a federal law that prohibits a tax on Internet use and Los Angeles could not easily get around that. Nor do they want to.
  • It's not good for consumers, some say. "Proposition S is an anti-consumer, regressive tax," Mayor Sam said. Prop. S would impose a 9% tax for land lines, cell phones and wireless services, but would leave the tax rate for telemarketers at 5% and reduce to 0% the cell, internet and wireless service tax for the LA Times, Hoy and other local news radio stations.
  • Zuma Dogg ain't a fan either. But it's best for him to tell you why:

That's what they think. What about you?

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Photo of Mayor Antonio Villaraigosa by Dave Bullock via Flickr; "Cell phone" by frogmuseum2 via Flickr.

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