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City Of L.A. Next In Line To Ask Voters To Raise Sales Tax

Paresh Dave |
November 13, 2012 | 12:08 p.m. PST

Executive Director

Council President Herb Wesson has quickly steered the sales tax measure through L.A. City Hall. (Edward Headington/Flickr)
Council President Herb Wesson has quickly steered the sales tax measure through L.A. City Hall. (Edward Headington/Flickr)
The L.A. City Council gave preliminary approval Tuesday to letting voters decide in March whether or not increase the sales tax in the city of Los Angeles by a half-cent to 9.5 percent.

Council President Herb Wesson said a sales tax increase would give city leaders time to engage in "forward-thinking" rather than focusing on just how to keep the budget balanced.

"We've done many things to show we're serious about putting this city on the right economic path," Wesson said. "But I don't believe we can solely cut ourselves out of this problem. We need time to sit down and breathe. That's what the sales tax would do for us."

Experts hired by the city said the decrease in consumer spending in the city as a result of a sales tax hike would be "quite minimal." City budget officials had planned for months to propose an increase on the tax on home sales. That plan met resistance from real estate agents, who instead said a general sales tax increase was more likely to be approved by city voters.

"I don't think this will cause a lot of harm for the residents of the City of Los Angeles," councilman Paul Koretz said.

L.A. Police Chief Charlie Beck has said failure to pass the measure would lead to the firing of cops. City councilmembers said increased sales tax revenues would benefit everything from police officers to city tree-cutters.

The city's current sales tax is 8.75 percent, but it will increase to 9 percent on Jan. 1 because of the passage of Proposition 30 last week. More than two-thirds of city voters supported a measure last week to increase the county sales tax to pay for transportation projects, but county voters as a whole rejected Measure J.

Just four of 14 councilmembers rejected on Tuesday putting the sales tax measure on the ballot: Mitch Englander, Dennis Zine, Jan Perry and Eric Garcetti. Both Perry and Garcetti are running for mayor during that same March election. Perry is trying to gain support from the business community. She said a sales tax increase would drive businesses out of the city.

Mayor Antonio Villaraigosa has said he would support the measure if it's balanced with cost-cutting measures. The mayor has the power to veto the measure from being placed on the ballot, though the council could override his decision.

Wesson put off specifics of reforms on Tuesday. He said the sales tax hike was needed to help re-invent the city to ensure it could do more with less in the long term.

"If we're successful, there are other tough things we're going to have to do," he said.

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