Update, Wednesday morning: In a huge embarrassment for City Council President Herb Wesson and the City Hall establishment, voters resoundingly rejected the citywide sales tax hike, 55.17 percent to 44.82 percent. See details on next page. With additional reporting by Jill Stewart. Update, 12:40 PM: Bad news for Council President Herb Wesson and the Mayor, as Proposition A trailing by eight points. Update, 11:10 PM: Prop A now losing by only 6 points.
Votes are slowly being counted by the City Clerks office, and Proposition A, the proposed sales tax hike, is losing narrowly by about eight points. Things are not looking good for City Council President Herb Wesson, who forced the tax hike onto the ballot after scant public input or discussion, as well as Mayor Antonio Villaraigosa and LAPD Chief Charlie Beck, who are also backing the measure. Prop A would raise the sales tax in Los Angeles from 9 percent to 9.5 percent, making it among the highest in state, along with Culver City and Santa Monica. It's supposed to raise $211 million a year in order to close an estimated $216 million budget gap. But critics say the tax will do nothing but postpone the inevitable - dealing with the city's ever-growing public employee health care and retirement liabilities.
The city had at first intended to raise fees for property sales, but after intense lobbying from the real estate industry, Wesson switched things up at the last minute and rammed the sales tax hike on the ballot. The Yes on A campaign has been heavily funded by the real estate, construction and billboard industries, as well as many public employee unions.
The No on A campaign was basically just Jack Humphreville posting on facebook.
A reporter we know spotted Wesson at the Mike Bonin victory party and asked him, "how can you justify a new tax given your large salary and large city council staffs?"
Said the pint-sized Wesson: "We do a lot of work on the council. We have a lot of constituents."
The reporter countered: "What about giving subsidies to large corporations like AEG and Eli Broad?"
Wesson replied: "I don't think that has anything to do with it."
Glad he cleared that up!
Update: Wesson's striking loss Tuesday night, after likely voters told pollsters they were nearly evenly divided but slightly leaning toward approving the sales tax hike, was reminiscent of Wesson's torpedoing in Sacramento of a new cigarette tax -- because Wesson wanted far more money.
In that major misreading of the tea leaves, then-Assembly Speaker Wesson, who is not viewed as a California Speaker who left a mark, wiped out a more modest tax plan for his far more radical own idea, and nothing was achieved.
Similarly here, Wesson stunned L.A. political leaders who had worked out a plan to bring in less money to City Hall, but still patch the deficit, by hiking the city's real estate transfer fee, which would have socked it to people involved in land, building and home transactions.
Many economists say the sales tax hits the poor far harder that any other economic group.