COMMENTARY | COLUMNISTS | JERRY SANDERS

Voters have a chance to overturn city tax on jobs

The Jobs Coalition officially launched its campaign Dec. 27 to overturn the San Diego City Council’s decision to raise taxes on some businesses by as much as 750 percent. We now have less than a month — until Jan. 23 — to collect 34,000 valid signatures.

Your help is critical to ensure that this referendum is successful, ultimately forcing the council either to rescind its ill-conceived decision to hurt the economy or let the voters decide if they want this tax on jobs.

The Jobs Coalition represents more than 50 regional businesses and organizations, including the San Diego Chamber, EDC, BIA, NAIOP, BOMA and Realtors, who have come together to overturn what the City Council calls a “linkage fee.” We call it what it is: a jobs-killing tax.

It’s a jobs tax because businesses of all kinds — both large and small, as well as nonprofits, hospitals and private educational institutions — will now face an additional 375 to 750 percent tax on all new business development, expansion and some remodeling.

At a time when our local economy remains sluggish and unemployment stubbornly high, this jobs tax could easily push us back into a recession. It will certainly cause some businesses to scale back or eliminate expansion plans, which will reduce job growth we desperately need.

Other companies could take their business — and local jobs — elsewhere and many more simply won’t consider moving to San Diego. At a time when our economy remains fragile, we cannot afford to put jobs at risk and put ourselves at a significant competitive disadvantage.

To make matters worse, this jobs killer is also a zombie tax because it will continue to automatically increase year after year without any review or approval by elected officials or voters.

The city created this fee for subsidized housing in 1990. At that time, the business community asked for other sources of revenue to augment this fee. The council agreed, but those sources were never approved. In 1996 the fee was cut in half in an effort to spur jobs creation. It should be noted that the unemployment rate at that time was lower than it is today.

An increase to the fee was defeated in 2011, with the business community arguing that the council should find a more sustainable, stable and significant source of revenue that would not harm the economy and jobs.

Before the council's action late last year, members of our coalition put forward more than 20 alternative funding recommendations and policy reforms that would achieve this goal. Unfortunately, none of these was seriously considered. Instead, the council majority preferred, on a 5-4 vote, this astronomical tax increase on jobs creation.

Proponents of this jobs tax claim that this massive tax increase will pay for subsidized "workforce housing.” Unfortunately, while the hit to businesses and jobs is severe, the impact on San Diego’s subsidized housing is minimal. In fact, the most optimistic projections show this tax increase could generate 100 units a year, but there are more than 45,000 families waiting for subsidized housing.

Additionally, the money is supposed to go to what proponents claim is the "nexus" to jobs creation, that being "workforce housing." Unfortunately, that's not where the money is going. In fact, last year, 63 percent of the funding went to homeless housing, in clear conflict with the stated purpose. It is time to find a real and sustainable answer for subsidized affordable housing rather than attempting to fix it with a Band-Aid that offers no long-term solution and will harm our economy.

When bad politicians surface, the public has the right of recall, as we saw last year. When bad policies arise that jeopardize our economy and our jobs, it is similarly the responsibility of San Diegans to stand up and fight. In the case of the jobs tax, the Jobs Coalition, business leaders and members of the community have come together to stand up against this ill-conceived policy to highlight its long-term negative effects on our communities and ultimately to let the voters themselves decide through the referendum process.

On behalf of the Chamber’s nearly 3,000 businesses and 400,000 jobs, and the other coalition members dedicated to economic development, business expansion and job creation, I urge you and your friends, family and co-workers to sign our petition to ensure that San Diego remains competitive and economically viable.

Petition gatherers will be stationed outside grocery stores and shopping malls around the city of San Diego over the next few weeks. If you're a registered voter in the city of San Diego, you can sign the referendum and send a strong message to the council that it should be focused on jobs and the economy.

Join us now as we work to save San Diego’s future.

For more information, go to www.stopthejobstax.org

Sanders is president & CEO of the San Diego Regional Chamber of Commerce.

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