Assembly GOP members break no-tax pledge

April 17, 2013

By John Hrabe

The Assembly Republican Caucus, though small in number, has retained limited power in Sacramento by maintaining a united caucus on one issue: taxes.

Not anymore. A multi-billion-dollar tax extension quickly working its way through the California Legislature has Republican legislators embracing every side of the issue: yes, no and maybe so.

Even as Republican ranks have sunk to super-minority status, Assembly GOP leader Connie Conway of Tulare has been unable to maintain unity even on her party’s signature issue.

Assembly Bill 8, co-authored by Assembly Members Henry Perea, D-Fresno, and Nancy Skinner, D-Berkeley, would extend the sunset date on more than $2 billion in taxes and fees. The additional revenue would fund alternative fuel and vehicle programs. Last week, the bill cleared the Assembly Transportation Committee on a 10-3 vote, with Assemblyman Katcho Achadjian, R-San Luis Obispo, in support and abstentions from Assemblymen Eric Linder, R-Corona, and Jim Patterson, R-Fresno.

“If Republicans can’t agree with the grassroots movement on tax hikes, what do they stand for at all?” Jon Coupal, president of the Howard Jarvis Taxpayers Association, asked CalWatchdog.com. “With several Republicans supporting AB 8, a multi-billion-dollar tax increase, the Republican brand may have been tarnished.”

Tax extensions

The bill would extend until January 1, 2024:

* An $8 increase in the smog abatement fee;

* A $0.75 fee increase on tire sales;

* A $3 additional fee on the annual vehicle registration fee;

* A $2 surcharge for local air districts on vehicle registrations;

* A $5 increase of the fee for special identification plates for construction equipment, farm trailers, cotton trailers, logging vehicles and cemetery equipment;

* A $10 and $20 increase for vessel registration.

The total bill to taxpayers, as calculated by the Howard Jarvis Taxpayers Association: $2.3 billion.

Linder, who along with Achadjian signed the Taxpayer Protection Pledge, which promises a signer’s vote against any and all efforts to increase taxes, said that there are valid arguments on both sides of the multi-billion tax increase.

“Both sides made valid arguments and raised important questions that remain unanswered,” said Linder. “This issue is too important to be rushed through and it is good that the process is still ongoing. The Legislature still has more work to do.”

A bill analysis by the Assembly Transportation Committee, which Linder oversees as vice-chairman, makes clear that the bill is considered a tax increase under Proposition 26 and is subject to a two-thirds vote.  “Because this bill extends the additional fees on vehicle and boat registrations and a portion of the tire fee, and because these fees are deemed taxes under Proposition 26, this bill requires a two-thirds vote,” the policy committee analysis states.

Why GOP tax support?

So why are some Republicans supporting or abstaining on a multi-billion-dollar tax increase?

The additional revenue would be spent on programs for the construction of hydrogen fueling stations and the Carl Moyer Memorial Air Quality Standards Attainment Program, which provides taxpayer-funded grants for businesses to buy new eco-friendly engines and equipment. It also postpones new regulations by the Air Resources Board, a move which is praised by businesses and criticized by environmental groups like the Sierra Cub.

“Any time there is the talk of taxes and regulations and fees, it always gives me heartache,” Achadjian said during the committee hearing. “Coming from a county that’s rich with agriculture, fishing industry, truckers going in and out, they have all benefited from these taxes. This is one time that I can attest that hard-earned monies in taxes have served its purpose.”

Achadjian, who has received campaign contributions from the California Trucking Association, made a point to recognize how the tax extension would help truckers. He said, “With the new regulations that are going to hit the trucking industry… those are the folks who employ people, those are the folks who keep the economy going, so in honor of their efforts, I am going to support the bill.”

If the Sierra Club and Howard Jarvis Taxpayers Association sound like the political odd couple, they’re matched by members of the Transportation Committee. Joining Republican Assemblymen Dan Logue of Lake Wildwood and Mike Morrell of Rancho Cucamonga in opposing the bill was Assemblyman Tom Ammiano, D-San Francisco. He believes the legislation transfers costs from corporations to taxpayers.

“Although this bill does extend some incentives for clean air programs, it can have some adverse effects that go beyond that,” Ammiano told CalWatchdog.com. “In rolling back ARB’s legitimate regulations, it weakens that important state agency. In addition, it transfers costs of some of these programs from corporations to the taxpayers.”

Coupal lamented the end of a unified Republican opposition to tax increases. “Although HJTA is a non-partisan organization with a third of its members Democrats, it has traditionally been Republicans in the Legislature that have provided the bulwark against tax increases.  No more,” he said.

The Assembly Natural Resources will consider AB 8 on April 29. The bill is supported by a long list of industry groups, including the Alliance of Automobile Manufacturers, Association of Global Automakers, California Farm Bureau Federation, California Trucking Association, California Manufacturers & Technology Association and Western States Petroleum Association as well as by environmental organizations, such as the California Air Resources Board and Environmental Defense Fund.