March 8 L.A. Ballot Measures | News | Los Angeles | Los Angeles News and Events | LA Weekly
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March 8 L.A. Ballot Measures 

New city taxes and modest reform of pensions and campaign finance

Thursday, Mar 3 2011
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Los Angeles voters face 10 ballot measures in the March 8 election. Little money is being spent to support or oppose them, so voters will have to rely mostly on the sample ballot language — not glossy mailers and robocalls — in deciding how to vote.

But in many cases, the dry language of the sample ballot sheds less light than the behind-the-scenes story of how each measure found its way to voters. Herewith, the story behind four key measures:

Measure G: Police and fire pensions

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In retrospect, the aughts may appear to have been a Gilded Age for public pensions. In the late 1990s and early 2000s, governments got into a bidding war for good cops, firefighters and prison guards. In L.A., Mayor Richard Riordan pushed a 2001 ballot measure to boost pensions for public safety workers from 70 percent of final salary to 90 percent.

The market collapse and recession have made those pension deals seem unsustainable. In three years, a third of L.A.'s general fund will go to pensions. There are almost as many retired cops and firefighters as working ones. Those under the pre-Riordan plan get a modest average pension of $45,000 annually. Those in the new plan average $83,000.

It is generally agreed that it's time to retrench, before things get any worse.

In L.A., that means going to the voters. The city — led by City Administrative Officer Miguel Santana — proposed eliminating the 90 percent benefit for new hires and returning to the old level of 70 percent, while boosting employees' contributions to their retirement health costs from zero to 2 percent of their paychecks.

The police and fire unions made a counteroffer: Keep the 90 percent pension, but backload it, so that the deal is less generous to younger retirees and more so to older ones. An actuary found that the union's version saved the city more money.

That's now on the ballot as Measure G. (The unions agreed not to fight it.) If it passes, the average cost to the city for each new employee, per year, for pensions plus retiree health care will drop from $15,000 to $12,000, while the employee's average annual contribution will rise from $6,100 to $7,500. Over 10 years, the city expects to save $152 million.

That does nothing to help the current $350 million deficit, which is largely caused by an increase in the city's required contributions to the pension fund.

"Measure G is not the panacea for next year," Santana says. "But it puts the city on the right path so in the future we're not in the position we are today."

A more aggressive approach would have been to cap benefits at, say, $125,000 per year. That would preserve pensions for middle-class employees while curtailing the six-figure pensions that provoke outrage. Though lower-rung employees might be persuaded to support that, the police and fire commanders would fight it hard. It was never considered.

Measure H: Clean money

This measure illustrates how difficult it can be to do something small and good. It would ban contributions by city contractors and bidders while bolstering the city's public financing system.

Any time politicians are asked to change the system that got them elected, it can be an uphill slog. And though they're relatively incremental, these changes were hard-fought.

Since the early 1990s, the city has had a fund to provide matching contributions to city candidates. The idea is to level the playing field for underfunded challengers and reduce the corrosive power of fundraising.

The city is required to contribute $3 million per year to the fund, but it has been capped at $12 million. Measure H would lift the cap, allowing the fund to build up enough cash for the 2013 election — when an open mayor's race and council term limits will create a record demand for matching funds.

Getting it on the ballot required building a coalition of the council's liberal idealists — such as Eric Garcetti, Jose Huizar and Paul Koretz — with those more focused on the bottom line.

Council members less enamored of public financing — like Janice Hahn and Tony Cardenas — worried that the fund would take money from essential city services in tough times. So supporters added an ability to borrow from the fund during fiscal emergencies.

Even with that modification, the four most pro-business council members — Greig Smith, Dennis Zine, Bernard Parks and Jan Perry — voted no.

Although he voted against the measure, Parks said he agrees that "a person should not be able to give a contribution while they are competing for a contract." It's worth noting that several city contractors, including airport concessionaires Hudson News and Soto & Sanchez, have contributed to his re-election campaign.

Most of the credit for the measure goes to Garcetti and the California Clean Money Campaign, which kept up the pressure to get Measure H on the ballot.

"This is a modest step," says Trent Lange, president of the clean-money group. "It's not going to solve everything, but it does get rid of one of the most corruptive contribution sources."

Measure L: Libraries

Please see our Feb. 24 story, "L.A.'s Library Measure L: There's lots of hidden fat to fuel the 73 shuttered libraries."

Measure M: Marijuana tax

Janice Hahn floated several ideas for new taxes, including a tax on medical marijuana. Some marijuana advocates have supported taxes as a way of legitimizing the sale of medical pot.

But that's not the case here. This plan comes as the city is trying to shut down hundreds of dispensaries, and the dispensaries now feel like they're fighting a two-front war.

"While one hand taketh away, the other hand also taketh," says Kris Hermes, spokesman for Americans for Safe Access.

The opposition to Measure M includes both marijuana supporters such as ASA and prohibitionists like DA Steve Cooley. The supporters are mostly city employee unions, who hope to benefit if the city brings in an extra $10 million annually.

Marijuana advocates have vowed to sue, claiming that any tax on pharmaceuticals would be illegal.

Measure O: Oil tax

Another of Hahn's revenue-raising ideas was to tax oil extraction. But by the time the council voted to put it on the ballot, she had changed her mind.

Hahn said she had heard from "various business groups" who suggested that "this might be the wrong climate to put this on the ballot."

She further warned that the oil companies would mount a massive campaign to defeat the measure, and asked her colleagues to kill the idea.

But it was too late. Her mistake was letting the idea loose around a bunch of former state legislators. A third of the 15 council members served in Sacramento, where Democrats have been trying to enact a statewide oil extraction tax for years.

They ran with Hahn's idea, voting 12-to-1 to place it on the March 8 ballot. Hahn was the lone dissenter.

"When I want you with me, you're against me," she said ruefully. "When I want you against me, you're with me."

The measure would impose a $1.44-per-barrel tax on oil drilling in L.A. That's more than most surrounding cities, but equal to Culver City. It would raise $4 million per year. Oil drillers have warned that if the price of oil falls, it could kill jobs by making it uneconomical to drill in L.A.

As for the "massive campaign" to defeat the measure, so far the California Independent Petroleum PAC has kicked in a relatively modest $50,000 to "No on Prop. O."

Dennis Romero contributed to this story.

Reach the writer at gmaddaus@laweekly.com

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