• Dec 25, 2008
California hasn't been able to borrow money for months, and according to the state's treasurer, it will run out of money in February or March if it doesn't pass a budget and get some income flowing. The majority Democratic legislature has sent Governor Schwarzenegger a budget that contains a suite of "revenue enhancements" that the Democrats call fees, not taxes. In addition to a jump in the state sales tax and personal income tax, there's also a provision to apply a per gallon gas "fee" of 39 cents.
The biggest problem with the proposed budget is the way in which it was passed, which relies on the definition of the word "tax". Democrats used a simple majority vote to pass the proposed budget, instead of the mandatory 2/3 majority needed to pass new taxes, because they say "it does not technically increase the amount of taxes on Californians." For instance, because the gas "fee" would be set aside for transportation projects only, it isn't a tax, it's a user fee, and so it doesn't require a 2/3 majority vote.

Call it what you want, Californians would be paying more money, so Republicans have vowed not to support what they call increased taxes. Citizen's groups have also promised to sue the state if Schwarzenegger signs the proposed budget as is. The other problem is that Schwarzenegger has already vowed to veto it, but not over the tax vs. fee issue. He said he'll let other people sort that out – what he really wants are bigger cuts in spending before he'll approve anything. The budget discussions resume on Friday as lawmakers work to have something done by year's end. Thanks for the tip, Fed!

[Source: Yahoo!]


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  • 63 Comments
      • 6 Years Ago
      I don't trust politicians with more money, they already proved they don't know how to budget themselves so why give them more money?

      Better yet lets have a hearing in Washington like the Big 3 and see how where their current budget went etc etc...
      • 6 Years Ago
      Typical tricks that the public falls for. San Jose had a similar "fee" that was due to expire. So when the latest ballots came around election time, they had the public vote yes to "lower taxes" - and because nobody reads anything anymore, it passed. Had the public read it, they would have not had to pay ANY more money come the end of the year.

      The Government essentially took a fee that was due to expire, repackaged it, and turned it into a tax that never expires - and was approved by the people.

      They'd do the same here - guaranteed.

      RTFM applies to everything people!
      • 6 Years Ago
      Why dont they only charge this "FEE" to people that drives a car with a MPG lower then 18...
      • 6 Years Ago
      You know, here in Tennessee, we sorta like hafta have a balanced budget. Every year. All the time. So, in economic down-turns, the government has to take the same hit as the small/medium/large businesses. Its in the State Constitution.

      So, maybe, they oughta, uhm, consider doing the same thing that every citizen has to do, namely, balance their budget. As a small business owner myself, I don't get to simply demand more money when my bills start exceeding my revenue. I have to have a long term working plan.

      California is currently feeling the results of decades of government over-expansion. And now that people aren't flocking to California anymore, they can't hide it in grossly distorted property taxation.

      Trust me, it will get worse for California before it gets better. But you would be better served by biting the bullet and cutting spending drastically now before the job flow from California rapidly increases.

      Truth is, sure we're happy to get Nissan's HQ from San Jose, but long term we'd rather not be North Carolina. There are enough liberal transplants moving here from the States they destroyed through their "progressive" policies now as it is (I use the quotes because Tennessee was the first State to adopt a health care plan for the uninsured while still maintaining its "lowest tax burden" status). But at least the Cali guys are cooler than the mouthy Yanks.
      • 6 Years Ago
      only $0.39? It should be a bit more like $1. Use that money to build the high speed rail and beef up the public transit. But don't tax the people living in rural areas and people who can't afford it. I'm sure the people why buy SUV's and gas guzzlers and people who are too ignorant to use public transit when one is available wont mind.
        • 6 Years Ago
        SF public transport is slow and expensive. It costs me 7 dollars each way to go to a place 9 miles from my house on the "ever praised" BART train system. Driving there would not be much difficulty at all if it was not for the 5 dollar bridge toll and the fact that it takes 45-90 minutes in traffic. Hell, the train alone takes minimum 25 minutes and 35+ in rush hour.

        the 9 miles which on a train should be rather quick, is not. The train tracks are extremely over congested and have not had any major expansion project done to fix the situation..ever. It has just been accepted as a design flaw.

        Same with the highway system and confusion that happens. I have spent 30 minutes in traffic several times at the toll plaza just waiting to pay the toll. Even "fast track" gets backed up from the horrible bottle necking. This was obviously considered an acceptable design flaw as are the many other problems that do not need to exist.

        So why do I want to pay more money, to use things that are not even made properly? the NYC Metro system is not near perfect, but at least its cheap. Constantly being improved though. Metro system in Chicago is always being repaired and in general expanded. Neither are perfect but are cheap.

        In Orlando Florida, traffic on I4 is terrible. Horrendous, not any fun at all. But there are toll roads that run around the city that cost about 4-6 dollars depending on the route taken and are nice roads and faster. So there, you pay more and get benefits for it. I just dont see that happening in California through their legislation.

        I HATE paying a lot of money for things that dont even work properly. If they were cheap you'd say "yeah oh well its how it goes". If Iam paying a considerable amount of money for poor services, then how about they be made good damnit?

        • 6 Years Ago
        Fatima, America simply isn't laid out in a way that would work for public transit outside of several major cities. There are too many people too spread out and transit destinations are also too many and too far apart for public transit to work effectively. You'll either need a ludicrous number of buses going to an equally unworkable number of stops (too frequent stops slowing transit) or you've got to sell people on getting off at one stop and then doing several miles of legwork to get to their destination.
        • 6 Years Ago
        I'm with you, Fatima. Make it an even $1... and do it now while the gas prices are low! A little pain now will make us that much more leaner and meaner in kicking the foreign oil dependence.

        Once we get past this economic crisis, and oil prices increase again, the government can decrease the fee correspondingly to smooth out these absurd gas price fluctuations and give our industry a chance to plan & forecast.

        In the meantime, having money to fix all the busted roads can't hurt in terms of reducing wear and tear on our vehicles and nerves.

        Echelon Bob
        • 6 Years Ago
        PMiddle has the right idea. The gas "user fee" is supposed to encourage us to use... what alternative, exactly? BART, which has all of twenty-odd stops on its entire service area (and costs more than driving)? Buses, which aren't cheap either (after factoring in transfer fees on the horrendously poorly-planned lines)? Cabs, which cost an arm and a leg since, unlike NYC, no one rides them here except airport commuters and tourists?

        California's legislators need to recognize two things: one, that the state infrastructure--which they and their predecessors helped to create--is entirely designed around the automobile as the default unit of transportation, and two, that the homes and workplaces of the people that keep this state's economy running--largely immigrants and agricultural wage-earners--are well outside the reach of urban public transportation projects like BART.

        A better "user fee" would be a tax on new vehicles based on their mileage. It's ridiculous to not provide public transportation options to the low-income laborers responsible for your state's commerce, and then tax them for buying 15 MPG vans that are legitimately used to transport large numbers of people, and are practically necessary just to get to work.
        • 6 Years Ago
        I live in the San Fernando Valley, HUGE suburb right north of Los Angeles. And although I agree that we should use a much larger percentage of revenues for the high speed train, and better public transportation, to say that a $1 tax per gallon on gasoline is the way to do it is just incorrect.

        See, America's, and more specifically, California's transportation problem (epidemic) is a catch 22. People don't want to use the public transportation (metro) system because it is too unreliable and dirty, and the public transportation system is unreliable and dirty because no one wants to use it. Trust me, I hated the wastefulness of driving 2 miles (3-5 minutes) to school when there was a metro bus that took that route every day. But sometimes, the bus would just not come, or be 30-45 minutes late, or, worst of all, be 20 minutes EARLY.

        But there is hope, LA's new (2 years I think) Orange line connecting the southern San Fernando Valley with the Red line, which goes into Los Angeles and connects to the other lines has been an overwhelming success. I'm pretty sure it has already become profitable, and it has far surpassed expectations. I think (hope) this was an awakening to LA, and California that, when implemented correctly, that a public transportation system can be highly effective.
      • 6 Years Ago
      WHAT!? That is not a good thing... That'll help stimulate the economy for realz.
        • 6 Years Ago
        Kattleox, I'm pretty sure that this $0.39 "fee" is on top of any gas taxes that Ca has.
      • 6 Years Ago
      I am willing to pay this if everyone else has to also. But I don't really think that passing a new tax as a "user fee" to get around the state Constitution is the right way to do things. So it probably should be removed.
      • 6 Years Ago
      The timing's bad, but it shouldn't surprise anyone - the state is so out of money because the economic downturn has reduced tax revenues. The 'best' time to raise taxes may be during the good times, but that isn't when the state desperately needs to do it.

      I'm fine with more gas taxes, but I'm in full agreement with our governor - the state needs to make spending cuts as well. Ever since the "war on crime" became a big deal, state spending has gone up tremendously (albeit for more reasons than just that). It's out of hand.
      • 6 Years Ago
      california passed a prop question that would have stopped any spending on all ILLEAGALS, and saved them billions per year. But cal's supreme court said ,"no you cant do that", What the liberals the liberals deserve...
      • 6 Years Ago
      Forget the gas tax issue and look at the big picture.

      Point 1: The economy is in a mess.
      Point 2: The first phase of the mess was caused by the mortgage debacle.
      Point 3: People are out of work, i.e. no money.
      Point 4: Decreased tax revenues from faltering businesses.
      Point 5: Depressed real estate market causing decreased property tax revenue.
      Point 6: What California is experiencing, so too will the rest of the US.
      Point 7: If California falls, the rest of the US won't be too far behind.

      Any questions? And what are you going to do to help?
        • 6 Years Ago
        What economy, what does the US actually make anymore?
        This started way back under Carter.
        The 'credit crisis' is caused by derivatives.

        Property tax is illegal.
        You owe no man money to retain ownership of something that you already own.
        What an asinine idea.

        Time for revolution 1.5, if need be.
        • 6 Years Ago
        We are so screwed. The people responsible for this mess should be given the death penalty.
      • 6 Years Ago
      No public transit system is "cheap". All systems in the US are supported by taxes to the tune of 35 to 85 percent. That money comes from the 98 percent of citizens who never use transit. No public transit system has made anything close to a profit in over 60 years.
      And regarding the California fee of $.39 a gallon replaces the current tax of about $.32 a gallon and it will go to the general fund versus transportation
      • 6 Years Ago
      I think this is a good tax. Mainly because people would be more wise and spend their money in fuel efficient cars. I do think this is a good idea in the long run. I am college student, I barely have money for college and living, but I do see that this is a good fee. People in America are really good at adapting, they are not good in think ahead. So a tax that raises gas prices would create and incentive to buy fuel efficient cars.
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