The San Diego Regional Chamber of Commerce has not yet taken a formal position on Proposition D. The Chamber’s board of directors will review and likely take a position on the sales tax measure on Thursday, September 23.
We have been deliberate in reviewing Proposition D. Of course, the tax increase is not popular, but we were intrigued by the reforms, including the potential for savings with landfill operations, information technology services, and reducing retiree health costs. At the same time, there has been frustration that many of the reforms have not already been put in place.
Earlier this month, the Chamber’s Legislative and Small Business Advocacy Committee voted unanimously to oppose Proposition D.
As President and CEO of the Chamber, I will remain neutral until the Chamber’s board acts, but since the folks at VOSD asked, here is my advice for those hoping to persuade Chamber members on the measure:
Opponents: Focus on jobs and taxes. A tax increase during a recession takes money out of the hands of San Diego consumers and hurts private sector (read: small business) job creation. Also, draw attention to the framing of the measure that implies City Hall won’t do reforms unless you agree to pay higher taxes. Ask the question: Does this tax increase help increase private sector employment, solve the city’s structural deficit, or help improve the economy of San Diego during the current recession?
Proponents: Emphasize public safety and fiscal reform. Police and fire budgets will be cut. Highlight what is in store regarding service levels in public safety. Also, start putting reforms in place as soon as possible, and pledge (in a credible way) to fully implement all the listed reforms, and even more after November 2. Ask the question: Do you want to protect public safety service levels and initiate important fiscal reforms in City Hall?
The debate at the Chamber board meeting is likely to focus on the impacts of a sales tax increase on small businesses, the true savings to be gained from the listed reforms, and the resolve of city leaders to truly address the city’s structural deficit.
Proponents seem to say that, due to political realities, fiscal reforms at City Hall will only happen with a tax increase.
On the other hand, opponents seem to think that real fiscal reforms will only happen without a tax. City leaders have to be painted into a corner to make the tough decisions.
Many don’t see the trade-off between an increased sales tax and the listed reforms in Proposition D as a fair deal. To be sure, many will be directly affected by cuts in city services, but they are more acutely affected by the current economy.
Fundamentally, Proposition D comes down to trust and on that count, proponents have a long way to go.
Unfortunately, the fact that the majority of the city council was originally willing to raise taxes without any reforms was telling.
Also, just last week the city council moved forward on amending the Planned District Ordinance on downtown development. According to a recent study, the action will cost private sector jobs and reduce revenues to the city. Not a good sign.
In my opinion, Proposition D will probably fail at the ballot box. Voters are not likely to approve a sales tax increase, especially during this recession — no matter how nicely you wrap it up in reforms. Unemployment is high and the economy is struggling.
Now, regardless of the Chamber’s position, and regardless of the outcome of the election, the real question is, what do we do after election day to fix our city’s structural deficit?
We should get ready for ongoing contention at City Hall, be willing to accept further reductions in services, and be determined to support the mayor and others in City Hall pushing for needed substantive fiscal reforms.
Looking forward, it’s important to be prepared for the day after the election — when we will all have to work together to help fix our city.
Ruben Barrales is the president and CEO of the San Diego Regional Chamber of Commerce. He lives in Del Mar Heights.