Warning that police officers could be laid off without new revenues, the Los Angeles City Council voted Tuesday to put a half-percent sales tax increase on the March ballot.
The 11-4 vote, however, came with warnings that the tax hike could have a dramatic impact, hurting the local economy and pushing shoppers of large consumer goods to neighboring cities with lower sales tax rates.
Mayor Antonio Villaraigosa said Tuesday he will allow the tax measure to head to the ballot without his signature.
"I will not ask the people of Los Angeles to support higher taxes until the City Council makes progress on a set of new reforms that will make us more efficient, accountable and competitive," Villaraigosa said in a statement.
It was unclear if the mayor would campaign for the measure if the council adopts the assurances he's sought, which include a guarantee the money would be used for public safety and the privatization of the Los Angeles Zoo and the Convention Center.
If passed, the sales tax measure would bring in $215million, enough to cover nearly all of next year's projected shortfall of $216 million, officials said.
L.A.'s sales tax is currently 8.75 percent. When the statewide Proposition 30 sales tax increase takes effect on Jan. 1, the tax will be 9 percent. If the city proposal is approved in March, Los Angeles shoppers would pay 9.5 percent sales tax.
Former Mayor Richard Riordan, who is seeking to qualify a pension reform measure for the May ballot, said the tax increase would hurt efforts to improve the local economy and would put the city on the path to bankruptcy.
"What Los Angeles needs is more jobs, not more taxes," Riordan told the council. "More and more taxes will not be used properly to bail us out of our budget problems in the future. The sales tax is the most regressive tax there is and that's why the (Service Employees International Union) agrees with me that this tax is a bad idea."
Riordan warned it would drive consumers out of Los Angeles to purchase large- ticket items because of the sales tax savings. Automobile purchases would not be affected because the sales tax rate on cars is based on where the driver lives.
Council President Herb Wesson asked Riordan: "Why didn't you clean this up when you were mayor?"
But Wesson would not allow him to respond.
Also opposing the measure were Council members Eric Garcetti, Jan Perry, Dennis Zine and Mitch Englander. Garcetti and Perry are running for mayor next year, and Zine is running for city controller.
"I don't think we have done all we could to find savings, and that includes the Police Department," Zine said.
Perry said she also believes other savings are available and could be achieved by working more closely with city workers to cut costs.
Also, mayoral candidate Kevin James said he opposes the tax, calling it an example of the city's unfriendly attitude toward business.
The political committee of SEIU Local 721 came out against the proposal last week, saying it believes it would hurt working families. Also, the Valley Industry and Commerce Association opposes the tax proposal.
But Police Chief Charlie Beck said he doesn't see where his department can cut any more costs.
"We have been cutting $100million a year from our budget," Beck said. "There is nowhere else to go other than to lay off police officers."
Beck estimated he would have to fire 500 police officers for every $50 million cut from his budget.
"Ninety-seven percent of my budget is payroll," Beck said. "That's the only place I can get any savings."