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02.17.10

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Governor's Gas Tax 'Flip' Is Trouble

By Bill Monning


IN JANUARY, as part of an effort to tackle the budget deficit, Gov. Schwarzenegger proposed eliminating California's 6 percent gasoline sales tax and replacing it with a 10.8 cents per gallon excise tax. While that might seem like good news for consumers, it comes at a high price. In the short run, drivers could see a slight drop in gas prices, but the excise tax would increase another 6 cents by 2020 and very likely show up at the pump. The governor's rationale for the gas tax flip is to redirect money designated for transportation (by Prop. 42 voters) and use it to fund other programs.

The governor's proposal, if implemented, will have a devastating impact on the Santa Cruz Metropolitan Transit District in the short term while undermining longer-term efforts to reduce CO2 emissions under A.B. 32. Under the governor's proposal, Santa Cruz Metro stands to lose $6.5 million annually in state and local funds, nearly 20 percent of its budget. According to Metro, the proposed cut will result in the reduction of bus service in Santa Cruz County from 39 fixed routes in full operation to four. ParaCruz, which shuttles people with disabilities to health appointments, would be cut from 37 to 10 vans, potentially jeopardizing lives. Metro staffing would be reduced from 375 employees to 80 and would result in the elimination of 24-hour service on many routes and a cessation of subsidized fares for UCSC and Cabrillo College students. Residents in rural areas like Bonny Doon or Live Oak could be stranded. When workers can't get to work, our economy suffers further.

Another consequence of the governor's plan is the prospective loss of union jobs. Santa Cruz Metro employees are represented by the United Transportation Union. When union jobs are lost, workers lose health benefits and without work need to rely on public benefit programs for health-care coverage for themselves and their families. Linked to these proposed cuts will be a devastating impact on the Metro's current commitment to upgrading its fleet to comply with A.B. 32's CO2 emission reduction objectives. It is ironic indeed that the "Green Governor" seeks to balance the budget by targeting public transportation, a proven tool in the fight against carbon emissions.Another adverse impact of the governor's plan will be a reduction of funding for public education under Prop. 98, which is based on sales tax revenues. The Legislative Analyst's Office has noted that the gas tax flip would reduce funding to public schools this year by around $800 million.

It is important to note that the governor's budget proposal is facing strong opposition from the state Legislature. Last week, as a member of the Assembly Budget Sub Committee 5 on Transportation and Information Technology, I expressed my concern about the impacts of transit funding cuts to jobs in Santa Cruz County. I asked Mr. Mark Monroe, an analyst with the Department of Finance, whether they had calculated the increased costs to the state from unemployment claims for the thousands of public transit employees who will lose their jobs statewide. The answer was "No." I encourage constituents to voice your concerns directly to the governor's office. He argues that there are no other options. I disagree. As Californians we have to articulate a vision of the state we want to live in and be prepared to consider all options, including revenue options, to reverse the decline of our state's most critical institutions.

Bill Monning is the assemblymember representing District 27, which includes parts of Santa Cruz, Santa Clara and Monterey counties.


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