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Last updateMon, 25 May 2015 2pm

LOS ANGELES Wednesday, May 27th 2015 2:43

WAGE RAISE RAGE

  • WHO WE ARE-Nearly half of Los Angeles just gave itself a raise. Following a wave of state and local minimum-wage bills and initiatives, Los Angeles became one of the largest cities to dramatically raise its hourly base pay and join Seattle to hit the magic $15-an-hour demand pushed by labor and community groups nationwide. The City Council…
  • ​City Snookered by Westfield Billionaires

    Jack Humphreville
    LA WATCHDOG-In March of 2014, the Herb Wesson led City Council and Mayor Eric Garcetti approved a 25 year, $48 million giveaway to help the $28.5 billion Westfield Corporation finance its $250 million development, The Village at Westfield Topanga. (Photo) But this subsidy championed by Councilman Bob Blumenfield was hardly necessary as The Village…
  • Slick With Denial: ‘Self-Regulation’ and the Latest Oil Spill

    Judith Lewis Mernit
    HISTORY LESSONS IGNORED-On Wednesday, May 20, the day after a Santa Barbara County fire inspector discovered a stream of contaminated crude oil flowing onto a pristine segment of the Southern California coast, a group of researchers published a study linking the 2010 Deepwater Horizon oil spill to a mass die-off of bottlenose dolphins. The 46…
  • Scaremongering about the Patriot Act Sunset

    Jameel Jaffer
    FALSE CLAIMS EXPOSED-In a last-ditch effort to scare lawmakers into preserving unpopular and much-abused surveillance authorities, the Senate Republican leadership and some intelligence officials are warning that allowing Section 215 of the Patriot Act to sunset would compromise national security. (One particularly crass example from Senator…
  • Still the Land of the Free, and the Home of the Brave

    Ken Alpern
    ALPERN AT LARGE-It's been another year and another successful Flag Placement at the West Los Angeles National Cemetery. Crawling out of bed in the morning on a holiday weekend to show up bright and early for a show of American patriotism and respect to our veterans and fallen heroes, the region and nation saw yet again how the Boy Scouts, Girl…
  • Retaliation: VA Police Target Veterans

    Robert L. Rosebrock
    LOS ANGELES – Recently, I was interviewed by John Ismay, an Iraqi War Veteran who is the “Veterans and Military Issues Reporter” for Southern California Public Radio. We met at the Los Angeles VA to discuss the never-ending misappropriation of land at this largest VA in the nation, within our nation’s capital for homeless Veterans. We were…
  • City Controller’s Grandstanding DWP Audit is the Real Waste of Ratepayer Dollars

    Dennis Zine
    JUST THE FACTS-City Controller Ron Galperin’s Grandstanding DWP Audit results were finally released. Unfortunately, the conclusion and political spin that came afterwards from the controller was misleading. Here are the FACTS: The DWP’s Joint Training Institute and Joint Safety Institute are administered by DWP managers and representatives of the…
  • A Place Where ‘Special Interest’ is NOT a Dirty Word

    Denyse Selesnick
    MY TURN-We need to have a new word to differentiate the villainous “Special Interest” that everyone is always complaining about and the “Special Interest” that almost all of politicians and civic and social activists have adopted as a cause. It is impossible to have passion about multiple issues. I know I have mentioned this before, but it seems…
  • Alert! America’s Small Businesses are Being Screwed by Big Business

    Robert Reich
    THE ECONOMY-Can it be that America’s small businesses are finally waking up to the fact they’re being screwed by big businesses? For years, small-business groups such as the National Federation of Independent Businesses have lined up behind big businesses lobbies. (Photo: small businesses in Studio City) They’ve contributed to the same Republican…

 

  • Can Strawberries Help Fight Cancer?

    Christian Cristiano
    WELLNESS-There have been a number of studies over the years that could show evidence of strawberries fighting off cancer. Tong Chen lead a study…
  • Study: The Best Way to Quit Smoking … Bet On It

    Francie Diep
    WELLNESS-Oftentimes, money speaks louder than words. Apparently, that aphorism applies to cigarettes too. A new study finds that money incentives…
  • Exercise Can Help Anxiety … Here’s How

    Christian Cristiano
    WELLNESS-Statistics show that over 3 million American adults suffer from anxiety and there is no evidence that number will be declining any time…




ICYMI-Amy Schumer shows Dave her vagina

Remembering Ann Meara: 1929-2015

The Star Spangled Banner … like you’ve never heard it before

 

 

 

 

  

 

 

 

LA’s $750 Million Time Bomb

LA WATCHDOG - On Monday, the California State Supreme Court, in a unanimous decision, ruled that a class action lawsuit challenging the validity of the City’s Telephone Users’ Tax (“TUT”) could proceed, overruling previous lower court decisions.

According to the City’s Official Statement, Los Angeles’ liability could be up to $750 million, the amount of the TUT collected between the time federal law changed and the effective date of Proposition S, the Communications Users Tax, that was approved by 66% of the voters in March 2008.

To put this in the proper perspective, $750 million equals 17% of this year’s General Fund.


In October 2006, Estuardo Ardon filed a class action lawsuit challenging the legality of LA’s TUT and seeking refunds for Angelenos of taxes illegally collected by the City over the previous two years, ever since the demise of the federal telephone excise tax.

However, in December 2006, Mayor Villaraigosa and the City objected, arguing that individuals must each file a government claim, putting the interests of the all knowing City ahead of those of ordinary, hard working Angelenos.  

While the resolution of this issue will take years, the City is benefiting from the new 9% Communications Users Tax that is levied on telephones, cell phones, and other communication services. This new tax replaced the 10% TUT, but included other methods of communication other than just plain old telephones.

But ironically, while revenues for the CUT increased to $288 million in the fiscal year ending June 30, 2009, this year’s anticipated collections are projected to be only $243 million, a decrease of $45 million, or 15%, from its peak in 2009.  

Underlying the lower CUT revenues is a decline in the use of plain old telephones and increased competition in the wireless market, resulting in significantly lower prices.

But this $750 million liability is a big league problem that is not going to go away.  Rather, it will continue to fester and grow because of monstrous legal fees and interest expense on the outstanding balance.  And when payment is due, it will become a major crisis.  

While the Mayor will no doubt pontificate about the “devastating” impact of this potential judgment on the City and its ability to provide core services such as public safety, and throw many barbs at the plaintiff’s evil supporters, City Hall needs to address this issue NOW rather than its usual response of “kicking the can down the road.”

To fund this $750 million liability, the City will probably issue yet another Judgment Obligation Bond, much like it did in June 2010 when it raised $51 million to fund its past sins on the backs of tomorrow’s citizens.  

But this new Judgment Obligation Bond will be the mother of all judgment obligation bonds, costing Angelenos over $1 BILLION when you factor in the interest payments and legal fees. The annual hit to the General Fund will be over $100 million.

Ouch.  

And thanks, Antonio. We will enjoy paying off this debt long after you have departed City Hall.

Note: Friends of the plaintiff included a diverse group: The Utility Reform Network (San Francisco), the Utility Consumers’ Action Network (San Diego), the Tax Foundation, the Consumer Federation of California, Consumer Action, and the Howard Jarvis Taxpayers Association.

(Jack Humphreville writes LA Watchdog for CityWatch He is the President of the DWP Advocacy Committee and the Ratepayer Advocate for the Greater Wilshire Neighborhood Council. Humphreville is the publisher of the Recycler -- www.recycler.com. He can be reached at:     lajack@gmail.com )  –cw

Tags: California, State Supreme Court, Telephone Users Tax, liability, Los Angeles liability, Proposition S, Communications Users Tax, time bomb





CityWatch
Vol 9 Issue 60
Pub: July 29, 2011

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