Additional Arguments Against Measure B – El Segundo’s 50 Percent TOT Tax Hike

Here are the Additional Arguments Against Measure B, El Segundo’s 50 Percent TOT Tax Hike from 8% to 12%, on the April 12, 2016 El Segundo General Municipal Election ballot.

These arguments are in addition to the Sample Ballot Argument Against Measure B and Rebuttal to the Argument in Favor of Measure B.

Seven Additional Arguments Against Measure B:

  1. Measure B Piles On Top of California’s New 50% Minimum Wage Hike from $10 to $15 Per Hour The California State Legislature just passed a bill, and Governor Jerry Brown signed it into law, to raise California’s minimum wage to $15.00 per hour. This will be damaging to El Segundo hotels, which employ many unskilled and often poorly educated workers whose labor is not worth $15.00 in a free competitive market. The Measure B TOT tax hike will pile on top of the minimum wage hike, artificially driving up room prices and further reducing room sales.
  2. Measure B has Nothing to Do With Safety and Everything to Do With the Police and Fire Unions Further Enriching Themselves at Taxpayer Expense The El Segundo Police Officers’ Association (ESPOA) and El Segundo Firefighters’ Association (ESFA) are the city’s police and firefighter unions. Their purpose for existing is to maximize their pay and pension increases, to continuously increase their pay and pensions, by raising our taxes and fees to pay for it, no matter how excessive and unsustainable.

    That is why the police and firefighter unions are bankrolling the Measure B campaign. They have already spent more than $36,000 dollars in this election, including Measure B and their support for three City Council candidates. This is a huge amount for small-town El Segundo. (For an unusual change, they are actually supporting the good City Council candidates this time, but for their own reasons.)

    None of the firefighters and only about one-fourth of the police live in town. Yet they want to keep raising our taxes and their pay and pensions. For every thousand dollars of campaign money they spend in El Segundo, they get back millions on an ongoing basis.

    For decades, the ESPOA and ESFA unions have involved themselves in our local city elections although most of them don’t live here. They bankrolled the Measure A campaign in our April 8, 2014 El Segundo city election, with $10,000 plus an additional $7,500 from two other City employee unions. Measure A was ELEVEN TAX HIKES in one ballot measure, on residents and businesses. It would have created new utility user taxes (UUTs) on residents for water, electricity, gas, and all forms of “communication services”, including landline and cellular telephone, Internet, cable TV, and satellite. It would have about doubled those existing taxes on businesses, and increased the hotel TOT tax and business license tax, and created a new parking tax.

  3. Measure B Undermines the City Council’s Negotiating Position in its Ongoing Labor Union Contract Negotiations –

    Measure B will weaken and undermine the City Council’s bargaining position in the ongoing labor contract negotiations with City’s police and other employee unions over pay raises and pension increases. The unions will claim most or all new tax revenue as theirs – to further increase thir pay and pensions. Only the El Segundo Firefighters’ Association (the firefighters’ union) has reached agreement and signed a labor contract with the City Council. The El Segundo Police Officers’ Association (ESPOA – the police union for officers and sergeants), El Segundo Police Managers’ Association (ESPMA – the police union for lieutenants and captains), City Employees Association, and other City unions are still in intense negotiations with the City Council.

  4. Measure B Will Increase El Segundo’s Funded and Unfunded Pension Liabilities –

    Most or all of the Measure B money will go to police and firefighter union and management pay and pension increases. The unions will claim the new tax money as their own. Every union pay raise increases the union member pensions, and also increases the management pay and pensions. This increases the funded and unfunded CalPERS pension liabilities. Vote NO on Measure B to stop this vicious cycle.

  5. Adjacent Manhattan Beach has only a 10% TOT Tax –

    Measure B will send El Segundo’s hotel customers to adjacent Manhattan Beach, which has only a 10% TOT tax and no current plans to increase it. Manhattan Beach has a nicer beach and a pier.

  6. Measure B is an Excessive Tax Hike –

    Measure B is excessive, and the City Council can come back with a less oppressive tax hike ballot measure in November. Representatives from the City of El Segundo met with the Hotel Operators in town. The hotel operators graciously agreed to a maximum TOT increase of 25%, from 8% to 10%, with at most an additional half-percent earmarked to promote tourism in El Segundo, based on the City’s representation that it needs the money. City Council members Marie Fellhauer and Dave Atkinson slapped the gracious hotel operators in the face by demanding a 50% TOT tax hike, from 8% to 12%.

    Longtime El Segundo resident Kip Haggerty wrote in his letter published in the April 7, 2016 El Segundo Herald:

    “To my dismay, I see the City Council has come back to us yet again with the immoral proposition of gouging hotel customers for the crime of not being us. The argument in favor is based on the bromide ‘every one else is doing it.’ Anything higher than the sales tax rate is just plain wrong and I hope we have the collective wisdom to vote it down again.”

  7. Business Travelers Will Substitute Tele-Video Conferencing for More Expensive Hotel Stays –

    Economics and common sense tell us that customers consume less, make substitutions or do without goods and services when prices increase. Even classified meetings among defense contractors can be conducted using tele-video converencing. I worked on a highly classified program for a local defense contractor where we avoided most travel expenses by investing in an NSA-approved encrypted tele-video conferencing system in a DOD-approved secure conference room, inside a DOD-approved Sensitive Compartmented Information Facility(SCIF).

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