If you drive a car, car, I’ll tax the street
If you try to sit, sit, I’ll tax your seat
If you get too cold, cold, I’ll tax the heat
If you take a walk, walk, I’ll tax your feet
Don’t ask me what I want it for
If you don’t want to pay some more
Cause I’m the taxman, yeah, I’m the taxman
And you’re working for no one but me (Taxman!)
— lyrics from the Beatles’ song “Taxman”
These are taxing times we live in.
If you doubt that Gov. Gavin Newsom said while he expects the projected state budget surplus for the coming fiscal year that was estimated by the legislative analyst’s office as $14.8 billion will be closer to $21.5 billion he’s pushing to tax your drinking water.
That’s right. Sacramento is experiencing a tsunami of unexpected tax revenue so the governor wants to increase taxes. Jerry Brown wasn’t kidding when he warned on his way out the door that his biggest concern going forward were the Democrats he left behind were going to go on a spending spree. In fairness to Newsom he has suggested some adult-like moves such as paying down unfunded pension liabilities with some of the surplus. That said instead of taking $500 million from the state already has coming in and putting it toward cleaning up drinking water in very specific locales in California he wants to impose a new tax.
Newsom hasn’t rolled out the details yet but if it reflects what the California Legislature tried to impose last year for the same purpose but came up short of the required two thirds vote due to lawmakers being skittish about imposing a new tax in an election year we will all be paying 95 cents a month in tax on our residential water bills. That would give the state another $110 million.
No one is debating there are clean drinking water issues in what Newsom referred to as “disadvantaged” parts of the South San Joaquin Valley and Mojave Desert. Thank ignorant or intentional dumping of chemicals — think PG&E, chromium-tainted wastewater and Hinkley that was slowly turned into a ghost town.
The question is why does everyone else in California who pays for their own community’s effort to assure safe drinking water have to be taxed for a local problem even more so if they themselves are “disadvantaged” And if the state deems we are “all Californians” then why not tap the massive surplus?
The argument that because voters rejected Proposition 3 in November — the $8.9 billion water bond that promised $500 million would be set aside for grants to local jurisdictions for clean drinking water projects — the state needs another funding source is ludicrous. There is a $14.8 billion surplus that Newsom expects to bloom into $21.5 billion. If it is such a pressing matter why not knock the budget surplus down to $21 billion? If you’ve been a California taxpayer for a while you’d know that would cramp the style of the state legislature that goes on spending binges for their pet causes and favored constituents whenever there is an extra dime on the table.
Then there is a question of fairness. Why should someone in Manteca pay for a local problem in the Mojave Desert caused by local business and development via a special tax when there is no direct tie in except that “we are all Californians”? The substantially higher treatment standard for wastewater for communities around the Delta imposed by the state was driven originally not by a concern about fish but by the quality of water going south to Los Angeles to keep treatment costs low for end users. No one in Los Angeles is paying a tax on their drinking water to help pay for cleaner wastewater treatment in Manteca.
Granted, cities all the time apply for and obtain state grants for water and wastewater treatment projects funded by state bond elections. But there has never been a special tax imposed statewide for local water or wastewater treatment.
And what about the “sin” of charging taxes for an essential need for life? Remember the outrage last year about the tampon tax? Democrats argued that you should not tax people for essential products. Then Gov. Brown vetoed the legislation to exempt feminine hygiene products from sales tax saying that if you take away tax revenue in mid-budget without replacing it with another source or cutting back expenses by as much as the state would lose from sales tax receipts on tampons it would be irresponsible governance. As the adult in Sacramento, Brown said the right time to suggest doing away the tampon tax — which he was not necessarily against doing so per se — is during the budget process. Democrats who slammed Brown for his position at the time did not bring up doing away with the tampon tax during the budget process. Surprise.
So, if tampons are essential, then what is drinking water — a luxury?
Such questions don’t matter for the folks in Sacramento who think everything is fair game to tax and that your money is better off in the government’s hands than in your pocket.
And if they are worried about low-income folks as they contend they are, why make someone living in South Stockton barely making ends meet on a limited income part with $11.40 more a year on water they need to drink, wash clothes, and flush their toilets while at the same time paying their share of producing clean drinking water in Stockton have to do it for someone who arguably might live in an area that might be better well off financially even if marginally so?
The proposed tax that is part of Newsom’s strategy to establish a “safe and affordable drinking water fund” is wedded with $25 million set aside for that purpose in his first budget as governor. Newsom obviously has no qualms tapping state general fund revenue for cleaning up contaminated water systems that he estimates impacts 1 million California residents. Why not go for $500 million instead of $25 million and get going on solutions now instead of waiting for enough money to accumulate from assessing a special tax?
Then there is the question that could whip up enough backlash to trigger another Proposition 13-style tax revolt: Given most Californians secure drinking water from municipalities or water agencies as opposed or private concerns how would taxing what are essentially government services play in Fresno?
No matter how you frame it, to the rank and file taxpayer treading water paycheck to paycheck taxing drinking water smacks of severe government tax overreach regardless of how the money is spent.
This column is the opinion of Dennis Wyatt, and does not necessarily represent the opinion of The Journal or Morris Newspaper Corp. of CA. He can be contacted at email@example.com or 209.249.3519.