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To Tax or Not to Tax?

The City of Oakland has four tax measures on the ballot and how you vote likely hinges on whether you think the city has a spending problem or a revenue problem.

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Are Oakland's problems caused primarily by the loss of nearly $100 million in annual revenues since the economy tanked, or by unaffordable public employee compensation and benefits, particularly pensions? To a certain degree, how you answer that question may dictate how you vote on Oakland's four tax measures next Tuesday.

Of course, you may conclude that Oakland has both a spending and a revenue problem, when deciding on how to vote on the four measures, which combined could add more than $80 million in revenues each year for the city. They are Measure V, which would raise taxes on medical cannabis and could generate more than $1 million annually; Measure W, a tax on telephone lines that would bring in about $8 million; Measure X, a $360 annual parcel tax that would raise about $54 million; and Measure BB, which would change the language of an existing tax, Measure Y, so that the city can start collecting $20 million in revenues again.

The most controversial and least likely to succeed is Measure X. The city council, led by President Jane Brunner, put the huge parcel tax on the ballot at the request of the Oakland police union, which is worried about losing another 120 cops to layoffs in January. Police officers have agreed to start paying 9 percent into their pensions — like all other city employees — if the measure passes. However, the union has all but abandoned the tax measure in recent weeks after it became clear that it had virtually no chance of winning the necessary two-thirds vote.

Councilman Larry Reid, who along with Brunner, was one of the earliest supporters of Measure X, said he believes it will lose, but yet is still backing it. He's worried that without the additional revenue, the layoff of 120 cops will be inevitable, and that the city will lose the ground it's gained in recent years, fighting crime. Homicides, for example, are down 40 percent this year compared to Mayor Ron Dellums' first year in office. "I lose sleep at night worrying about this stuff," said Reid, whose East Oakland district includes some of the city's most violent neighborhoods. "The thought of losing 122 cops — that's pretty scary."

But Reid's longtime friend, Councilman Ignacio De La Fuente, is perhaps the most vocal opponent of Measure X. De La Fuente says the Oakland Police Officers Association (OPOA) should have agreed this past summer to pay into their pensions before demanding that the parcel tax be placed on the ballot. "The reality is the unions, especially the OPOA, are not paying their fair share," said De La Fuente, a longtime union rep who has been perhaps the most outspoken critic of unsustainable public-employee salaries and benefits in recent years. De La Fuente opposes all of the tax measures except the cannabis tax. "More taxes are not the answer," he added. "We've been doing it for decades, and it hasn't worked. If you give the city more money, it'll just find a way to spend it."

Measure BB, the so-called "Measure Y fix" is generating less heat than the big parcel tax, but it still faces a tough battle because it also requires a two-thirds-super-majority to win. The measure would eliminate the requirement in Measure Y that the city allocate funds for 739 cops before it can collect the annual parcel tax.

The city had to suspend Measure Y this summer when the Oakland police force fell below 739 cops after the council voted to lay off eighty officers. If voters approve Measure BB, those eighty cops likely will not be rehired, but it probably will result in fewer layoffs in January. It also would allow the police department to reassign officers back to community policing duties. They were pulled out of those spots in July when Measure Y was suspended. Measure BB also would reinstate funding for the fire department and violence prevention programs.

Still, Measure BB has created a rift among public safety activists in the city. Don Link, a North Oakland activist, supports Measure BB because he's a strong believer in community policing and the citywide development of Neighborhood Crime Prevention Councils (NCPCs) — groups of neighbors who band together and help fight crime, block to block. They've proven successful throughout Oakland in recent years. "If we don't nurture these NCPCs, which have taken years to develop," Link said, "it's going to take a long time to get them back."

But Charlie Pine, a public-safety activist in East Oakland, opposes Measure BB because he believes the city council can't be trusted to allocate the funds wisely. He notes the numerous questions around how Measure Y funds were spent over the years. "If this were going to be used for community policing officers, that would be one thing," Pine said, "but the council just withdraws money from the general fund whenever they get parcel tax revenue."

Measure W, the telephone tax, is the least controversial and has a better chance of passing than either Measure X or Measure BB. It has much less opposition, and it only requires a simple majority to win. It would establish a $1.99 tax on telephone lines, including cell phones. Revenues generated by the tax would go into the city's general fund and are not earmarked for any specific program. However, most of the money will go to the police and fire departments because they make up more than 65 percent of the general fund budget.

Planning Commissioner Doug Boxer, a backer of the measure, believes that residents will vote for it because the tax isn't overbearing and it won't apply to low-income residents. The revenues it generates also likely will mean fewer cop layoffs. "I think the city needs to look to voters to ensure that we have an adequate number of police officers," he said, "and one of the ways to do that is a reasonable increase in telephone lines."

But David Mix, a vocal critic of the city's spending habits over the years, says the council shouldn't be asking voters to tax themselves again until it fixes the burgeoning public-employee pension problem. "I'm not against the telephone tax per se," he said. "But it's just more taxes upon taxes upon taxes. The city needs to wake up and work within the budget it has."

Finally, there's very little opposition to Measure V, the cannabis tax. It would raise the business tax rate on medical marijuana dispensaries from 1.8 percent to 5 percent. It also would establish a 5 percent business tax rate on the four large medical cannabis farms slated to open in the city next year. And it would institute a 10 percent tax on businesses that open up and sell pot for recreational use if California voters approve Proposition 19.

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