Proposed Tax Increase On Chevron – Letter to the El Segundo Herald by Ron Murray

Posted on January 5, 2012 by Mike

The following letter to the editor was published in the El Segundo Herald newspaper (HeraldPublications.com) on Thursday, January 5, 2012 in the Letters section on page 3. The El Segundo Herald has a strict 250-word limit, including the title.

Proposed Tax Increase On Chevron

The proposed tax increase is flawed. The tax proposed is on land ownership, not on the business. The County taxes property— land and improvements of which El Segundo receives a “slice”. Taxes should be uniform and consistent; so the tax should be applied to all unimproved land in the city—parking lots, unimproved commercial zoned property, empty storage lots, etc., not just on Chevron.

Most business in El Segundo pay a business tax based on commercial building footage plus number of employees/contractors. This formula is good as it is tied to services provided by the city to the business. Chevron’s production facilities are not inside buildings, so an adjustment of the formula is needed for them, however, the space taken for administration, production/processing, transport and storage of its product(s) should be known and could be a substitute for the square footage part of the formula. Under no circumstances should the tax be based on land ownership, much of which is not used for production.

The Dec. 22 Herald states the Measure could add $10 million to the city. That currently is about the total business license income for the whole city—is Chevron to carry one-half or more of the business tax burden?

Ron Murray

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Good Neighbors – Letter to the El Segundo Herald by Chris Powell

Posted on January 5, 2012 by Mike

The following letter to the editor was published in the El Segundo Herald newspaper (HeraldPublications.com) on Thursday, January 5, 2012 in the Letters section on page 2. The El Segundo Herald has a strict 250-word limit, including the title.

Good Neighbors

Many who work closely with the City on fiscal issues were surprised when a proposed tax increase on Chevron showed up on the Council’s agenda with no warning.

Considering the Council just balanced the city budget for the first time in ten years, a multimillion dollar tax increase is not something you’d expect to come up. What happened? Do they view Chevron as a convenient target because of its enormous investment in our community? Whatever the reason, this matter hasn’t been given sufficient thought.

Refiners are leaving the U.S. because of escalating costs. If this new tax causes Chevron to scale back its operations here, the City will lose revenue at the expense of other businesses and citizens alike. And the company couldn’t be faulted if this added cost forced them to reduce their substantial support of our schools and charities.

Chevron has always been willing to pay its fair share and to work with the City when the need for more revenue arises. Why the Council failed to constructively engage the company in such a discussion this time around is perplexing, and could cost our community not only revenue, but a very valuable long-term good neighbor relationship.

Local voters have rejected previous tax proposals that were rushed to the ballot, like the utility users tax, even when endorsed by our business community. If the City doesn’t take sufficient time to assess the impacts and present a solid case to voters, this latest tax scheme will deservedly meet the same fate.

Chris Powell

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Chevron Tax – Letter to the El Segundo Herald by Joe harding

Posted on January 5, 2012 by Mike

The following letter to the editor was published in the El Segundo Herald newspaper (HeraldPublications.com) on Thursday, January 5, 2012 in the Letters section on page 2. The El Segundo Herald has a strict 250-word limit, including the title.

Chevron Tax

It’s disappointing that a majority of the City Council feel compelled to raise taxes on El Segundo’s oldest business without taking the time to consider the consequences not only for Chevron but for other businesses here.

Why, in a last-minute agenda addition just five days before Christmas, would the Council vote to draft an initiative for millions in new taxes, with a deadline of January 13 to decide whether or not to place it on the ballot?

Between holiday downtime and the Mayor himself planning to be unavailable for the 12 days immediately preceding that vote, how can they possibly determine if this is in the best interests of El Segundo?

Also puzzling is the fact that some Council members were apparently in such a hurry to rush this multi-million tax onto the ballot that they failed to provide time to solicit and consider input from the city’s residents and business community, or to demand further analysis of the impacts of the proposed tax over and above the brief report presented by the City Manager.

A tax of this magnitude deserves extensive scrutiny and public discussion before taking a fast track to the ballot. If they’re willing to do this to one company, all our businesses and families are at risk of being the next target. The Council can and should reverse this reckless course at its January 13 meeting.

Joe Harding

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Are Chevron’s Taxes Too High? – Letter to the El Segundo Herald by Michael D. Robbins

Posted on January 5, 2012 by Mike

The following letter to the editor was published in the El Segundo Herald newspaper (HeraldPublications.com) on Thursday, January 5, 2012 in the Letters section on page 2. The El Segundo Herald has a strict 250-word limit, including the title.

Are Chevron’s Taxes Too High?

The City Manager’s Chevron Shakedown must stop, including efforts to extort large “gifts” of money under threat of a $10 million annual tax hike. The City will suffer long-term damage to its reputation as a good city to locate a business.

Doug Willmore used false premises to construct a deceptive one-sided analysis for the Chevron property, rather than a true cost-versus-benefits analysis. It is unfair and dishonest to compare tax revenues generated per acre by the Chevron refinery with that of other local businesses. Land use in other South Bay cities is mostly residential and not three-quarters commercial/industrial as in El Segundo.

In his one-sided analysis, Willmore ignored the cost for the City to provide and maintain infrastructure and services for residents and businesses that would otherwise exist on the massive Chevron refinery property.

If the refinery never existed, that land would be mostly residential and some commercial. Tax revenues would be much less, and the City would have to provide and maintain infrastructure and services for twice as many residents at great expense that Willmore failed to include in his seriously flawed and biased analysis.

Willmore excluded some Chevron tax revenues. And he increased the number of acres and reduced the calculated tax revenue per acre by failing to account for the area of all the public streets, alleys, parks, and schools that would otherwise exist on the Chevron property.

If an accurate analysis shows Chevron is paying excessive taxes, will the City Council reduce Chevron’s taxes and apologize?

Michael D. Robbins

Note: Although this letter to the editor is a short 250 words, it does a good job towards refuting the news media propaganda hatchet jobs against Chevron and Councilman Carl Jacobson by KCET SoCal Connected producer Karen Fochet (March 2, 2012 TV show, “Small Town Big Oil”) and L.A. Times writer Jeff Gottlieb. This letter pre-dated the KCET hatchet job by nearly two months.

(This note was not part of the letter.)

Here is some additional information separate from the above letter to the editor.

Fired City Manager Doug Willmore gave a PowerPoint slide presentation at the December 20, 2011 regular meeting of the El Segundo City Council. He claimed that Chevron was not paying enough taxes, was not paying it’s fair share of taxes, and that the other businesses in the City were paying higher taxes than Chevron and were subsidizing Chevron.

However, Slide 7 of Willmore’s presentation, titled “General Fund Revenues by Segment”, exposes Willmore’s biased and deceptive one-sided benefits-only analysis rather than a true and complete cost-versus-benefits analysis.

As you can see in the aerial photograph, no city infrastructure and services are provided within the outer boundary of the massive 951-acre Chevron property, but the rest of the business and residential areas in city are provided with large amounts of city infrastructure and services that cost the city a fortune in taxpayer money.

However, Doug Willmore omitted all information about what the city has paid over the years and continues to pay to provide and maintain city infrastructure and services within the massive Chevron oil refinery property (zero), the remaining business properties (very large), and the residential properties (even larger) in El Segundo.

The City does not pay to provide the many miles of streets, curbs, gutters, sidewalks, alleys, storm drains, water pipes, sewer pipes, parks, recreational facilities, trees, landscaping, street sweeping, residential trash collection, and police patrols that it pays to provide for the other business and residential areas in the city.

Why should Chevron be forced to pay for massive amounts of city infrastructure and services that it does not receive?

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