As Senate leaders move closer to taking a floor vote next week on their version of the Republican tax reform measure, Los Angeles County leaders have directed their lobbyists in Washington, D.C. to oppose provisions of their proposal.
The Board of Supervisors agreed unanimously that the tax reform measures proposed by Republican House and Senate leaders would place a burden on Los Angeles County residents by increasing taxes on the middle class, cutting funding to social services, and hindering the county’s ability to continue to build affordable housing, according to the motion authored by Supervisors Mark Ridley-Thomas and Sheila Kuehl.
“While few can argue that the current tax code is anything short of byzantine, many of the provisions being considered by the Senate and House of Representatives would have a devastating impact on the ability of federal, state and local governments to provide vital services,” the supervisors wrote in their motion.
Their motion instructs their lobbyists to urge Congress to oppose tax reform provisions in the House and Senate proposals “which would have a negative impact on Los Angeles County and its 10 million residents.”
L.A. County’s five member Board of Supervisors oversees the largest local governmental body in the nation and a current fiscal budget of $30 billion.
Specific concerns include the elimination of the State and Local Tax (SALT) Deduction, which allows taxpayers the option to deduct real estate taxes as well as either income taxes or sales taxes paid to state and local governments.
Some news reports suggests Senate members may scrap eliminating the deduction, while others say those suggestions are untrue.
“Its elimination would result in double-taxation for California residents and would hinder local governments’ efforts to improve aging infrastructure and increase the supply of affordable housing,” Ridley-Thomas and Kuehl wrote in their motion.
The supervisors said what’s of more concern is that the Senate tax reform plan also proposes the repeal of the Affordable Care Act’s individual mandate.
“Further, many of the tools used by local governments to improve aging infrastructure and increase the supply of affordable housing, such as private activity bonds, tax-exempt bond financing, and low-income housing incentives, would be eliminated or curtailed under the House and Senate tax proposals,” the supervisors wrote in their motion.
Private activity bonds funded an estimated 20,000 housing units statewide in 2016, said Monique King-Viehland, acting executive director of the Community Development Commission and Housing Authority for Los Angeles County.
“The proposed reforms would have a devastating impact on housing and community development efforts in Los Angeles County and nationwide,” King-Viehland said during Tuesday’s board meeting.
As for county residents who already own a home of their own, the Senate bill would eliminate property tax deductions and the House bill would cap those deductions at $10,000 annually.
About 13 percent of county homeowners pay more than that in property taxes, according to Assistant Chief Executive Officer Manuel Rivas.
Republicans from both the House and Senate have said their versions of proposed reform simplifies the tax code for all and will encourage companies to hire more workers.
Three California Republican members of Congress voted against the measure earlier this month, including Rep. Dana Rohrabacher, R-Costa Mesa, Rep. Darrell Issa, R-Vista, and Rep. Tom McClintock, R-Elk Grove. The bill passed 227-205.
U.S Steve Knight, R-Palmdale, supported the bill, saying in a statement in September that the framework laid out simplifies “tax brackets for everyone so our workers see more money in their paychecks every month for them and their families to enjoy”
Now that the House has agreed on their version, the Senate will begin to discuss their version, possibly next Thursday, according to published reports.
Kuehl remained unconvinced that more people will be helped by the proposed reforms.
“This is the same old ‘Trickle Down Economics’ that has failed time and time again, except for the billionaires who already pay too little in taxes,” Kuehl said in a statement.
“Nothing trickles down,” Kuehl added. ” In fact, most people just get hosed.”