Council only places sales tax measure on November ballot; Harper, Rocha, Tiscareno switch vote on landlord tax
By James Ott
After a divisive vote and previous 4-0 votes in favor of both, Antioch leaders chose to only place one of two emergency tax measures, proposed to raise money for more police and code enforcement, on a special election ballot this November, during the city council meeting on Tuesday, June 25.
Although all of the council members initially supported both a half-cent sales tax measure and an annual business tax measure on landlords in the city, the council shot down the landlord tax after fears that political pressure from the California Apartment Association might cause one or both measures to fail when the public eventually votes.
The landlord business license tax was initially brought forth by a citizens group, known as the Friday Morning Breakfast Club who said they wanted to fix a loophole that currently allows out of town owners of multiple single family homes freedom to rake in rental money like a business without paying a business license tax like every other Antioch business.
They filed papers to gather signatures for an initiative. But, the council then agreed to take on the measure. Following meetings between members of the council, citizens group, city staff and representatives of the California Apartment Association, a compromise was reached.
Instead of a flat $20 per month per rental unit in Antioch, as it was written the tax measure would have charged owners of 1 to 25 single family rentals $240 per year, per home. The tax amount gradually decreased the more rentals one owns, so owning 26 to 50 rentals would have cost $120 per unit per year, 51 to 150 would cost $75 per unit per year and 150 rentals or more would be charged $50 per unit per year.
At the June 11 council meeting, the vote was 4-0 in favor of the landlord tax, with Councilman Gary Agopian absent. But the emergency measure required a unanimous vote of the city council, so, they had to wait until the June 25th meeting to place it on the November ballot.
But by then, with the failed vote by the council, it was too late for the citizens group to gather the necessary signatures to put their measure on the November ballot.
Hans Ho, a member of the citizens group and the leader of the ballot measure effort was upset with the council’s vote.
“We have the Mayor making decisions based on the advice of his political consultant, instead of listening to the citizens of Antioch,” Ho said. “The Mayor told me Mary Jo Rossi, who ran his campaigns for council and mayor and is working on a fundraiser for Tiscareno, told him the landlord fee could hurt the sales tax measure.”
Another member of the citizens group, former Antioch Mayor Don Freitas said that the landlord tax would have been a permanent source of income for police, while the half-cent sales tax measure’s revenue would end after seven years if it is voted in by the public.
Theresa Karr, Executive Director of the California Apartment Association, (C.A.A.), said that while she and her organization support Antioch updating it’s nearly 50-year old tax code to tax landlords in the city, the proposed landlord business tax was unfair because it would charge the landlords, in the city, far more per year than most businesses would pay.
Freitas argued that the rental business is unique and brings in more people who all need city services so he said the extra cost is justified.
“The rental business brings in people that have a need of municipal services – it’s unlike other businesses in our city – it brings a burden,” said Freitas. “And so for 47 years everyone has paid [a business license tax] except them, – that’s what is inequitable.”
Karr said that the measure would unfairly single out a particular group of people and added that her organization was, “prepared to fight the measure” and had “already started a legal challenge.”
“If it had passed we definitely would have been prepared for a campaign to oppose it,” said Karr. “We probably would have done a grass roots campaign – once the tenants realized they could have the possibility of a rent increase they might vote no.”
The final council vote that downed the landlord tax measure was 2-3 after Council Members Monica Wilson and Gary Agopian voted for the landlord tax measure, while Mayor Wade Harper and Council Members Mary Rocha and Tony Tiscareno voted against it. Because the measure needed a unanimous vote to reach the ballot, even one dissenting vote would have stopped the measure in it’s tracks.
In addition to the opposition from the C.A.A., Mayor Harper said he felt the odds were already stacked against the landlord tax measure because the polling that the city did recently showed that it likely would not have received enough votes to become law.
“I really feel that the measure will not pass,” said Harper before submitting his dissenting vote. “I believe the landlord rental tax will fail and negatively impact the sales tax measure.”
He added that he felt the C.A.A. was “unbending” and did not try to work with the city and the citizens group hard enough to get a landlord tax that everyone could agree on.
Harper’s fear that opposition to the landlord tax might mean failure for the half-cent sales tax measure was echoed by Rocha who was a member of the city council in 2010 when a similar half-cent sales tax measure failed to garner enough public votes to pass.
“We’re facing a group of people [the C.A.A.] that could give us a problem with the half cent sales tax or a legal problem,” said Rocha. “We don’t need any opposition. We can’t take the chance to mess up again.”
Supporters like Agopian said that he felt there was enough public support for the landlord tax measure to pass and that the city should give both measures a chance because the money is sorely needed by Antioch.
Antioch City Manager Jim Jakel has repeatedly stated the city is in dire need of immediate income, especially if it is to hire police and code enforcement to combat a plague of crime and blight that has struck the city in recent years.
The two measures were originally proposed as a way to generate the $6.8 million dollars a year needed to fund the 126 sworn officers the city had prior to the recession. If it passes, the half-cent tax will only generate $4.2 to $4.7 million dollars, said Jakel, while the now defeated landlord tax could have generated at least an additional $2.5 million dollars a year if it had passed.
The Antioch City Council, the C.A.A. and the Friday Morning Breakfast Club have all stated their willingness to work together to give a future iteration of the landlord business tax a chance to appear on the November, 2014 ballot, where voters may decide the measure’s ultimate fate.
Publisher Allen Payton contributed to this story.