Susanville’s financial stability, bolstered by a 1% sales tax increase from Measure P in 2022, is threatened by a controversial ballot proposition, the Taxpayer Protection and Government Accountability Act. The act, which aims to give voters more control over taxes, is under review by the California Supreme Court. The court’s decision could significantly impact local government revenues, including Susanville’s essential sales tax income.
The act requires voter approval for any new or increased taxes and fees introduced by state and local governments after January 1, 2022. It also has a retroactive provision nullifying taxes and fees imposed since this date unless ratified by voters within a year. Legal challenges focus on whether the act unconstitutionally revises the state constitution and if it impairs essential government functions. A decision is expected by June 27.
If the measure passes, Susanville’s 1% sales tax increase could be at risk, threatening over a million dollars in new revenue vital for public services. City Manager Dan Newton says the city is keeping a close watch.
Political analyst and CA Broadcaster Association President Joe Berry believes the proposed change is too extensive to be resolved in a single ballot measure. However, Berry doubts that the measure will be removed from the ballot before voters have a chance to decide, noting that even if the proposition passes, it could be nullified later, allowing decision-makers to avoid seeming politically motivated.
The state’s legislative analyst’s office estimates this measure would have major fiscal effects, resulting in “Lower annual state and local revenues, potentially substantially lower, depending on future actions of the Legislature, local governing bodies, voters, and the courts.”
The act’s fate will shape the future of tax imposition in California and determine the financial stability of cities, including Susanville.
