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Home My WebLink About4.3 Opppose Prop 166 & 167~ ~ CI'I'Y OF DUBLYN AGENDA STATEMENT CITY COUNCIL MEETING DATE: September 28, 1992 SUBJECTa EXHIBIT3 ATTACHED: Opposition to Propositions 166 & 167 (Prepaxed by: Bo Barkes, Manaqement Assistant) io Resolution oppos~ng Pxoposition 166 2e Resolution opposinq Psoposition 167 RECOMMENDATION:~p Au horize the Mayor to sign the resolutions posing Eropositions 166 and 167 and send them to commit~ees opposinq these measures. FINAi~TTCIAL STA~EMENTs The Propositions could have a neqative effect on the local business and economic development DESCRIPTION: At the September 14, 1992 City Council Meeting, Staff was directed to develop resolutions in opposition to Propositions 166 and 167. These two measures are scheduled to be voted on in the November electione The League of California Cities has issued a position of °'No Support°' on the two issueso Proposition 166 This Proposition is being sponsored by the California Medical Association (CMA), the lobbying organization for medical doctors in California. The measure is being touted by its organizers as health care reform. Proposition 166 will mandate that employers must provide a health care package for all employees who work 17.5 hours per week or 70 hours per month by 1997. Employers must pay at least 75% of the premium for these employees and their dependents. The arguments against Proposition 166 are compelling. 1. Part-time and seasonal workers, the unemployed and those who are retired will not receive benefits. Those most in need will not be covereda 2. The initiative does nothing to control rising physician fees and other medical costs. Medical costs and insurance premiums will continue to increasee 3e This Proposition will force small businesses to pay for a system that is already ill. The measure will cost businesses billions of dollars each year. The high cost of doing business in California is already a deterrent for business to be in the State. Further burdens will only increase the number of businesses leaving the State or convince businesses not to come to California in the ~irst place. 4, Jobs will be lost due to these increasing burdens on businesses. 5. The commissions and boards which will oversee the implementation of the Proposition will be influenced by the same individuals who benefit from the Proposition, the physicians. Under the Proposition, part-time employees are classified as those working 17.5 hours per week or 70 hours per month. The measure would have its greatest impact on the Recreation Department, where a potential of 40 to 50 part-time employees work about 20 hours per week. The impact could potentially be significant as the City may be required to provide health benefits to the employees working at least 17s5 hours per week or 70 hours --------------------------------------------------------------------------- co~zES moa CITY CLERK y~~ ~°' FILE ~ ~ ~ ~ • ~ • a month. The Proposition could create a severe strain financially and administratively. Overall, the Proposition will not only have a major impact on the City's operations, it would also be detrimental on California's economy through the increased financial regulations placed on businesse Proposition 167 This Proposition includes more than a dozen tax increases and changes. Business and consumers will feel the impact of these tax increases on personal income, small business taxes, worker's compensation rates, insurance premiums and property. Specifically, the tax increases wouldo 1. Increase property taxes on business by reassessing properties at the change of ownership. 2a Increase Bank and Corporate income taxes by 1%. 3. Impose New Oil Severance Taxes of barrels of oil extracted in California. 4. Revoke the so called, "Sub-chapter S Status," tax credit on business. 5. Increase personal income taxes for those making more than $100,000 per year. 6. Increase Insurance Premium Taxeso 7, Allow Bank deposits and loans to be taxed. Tax reductions in this Proposition would: 1. Repeal the temporary State sales tax imposed last year from January 1, 1993 to January l, 1994.. 2. Reinstate the sales tax exemptions for snack food, bottled water, newspapers and magazines. 3. Extend renters credit to all income brackets. There is no guarantee that any additional tax revenue will remain in the cities or counties. The Proposition does not earmark the new funds for specific purposes, allowing the legislature to shift funds back to the S~ateo Small businesses already feel the pinch of numerous regulations in California and this increases the burdens on them. These types of tax increases are not conducive to generating local sales and business developmente The State°s independent legislative analyst states, "This measure would result in roughly a 20 percent increase in the total amount of income taxes paid by businesses in California, and a 10 percent to 20 percent increase in the amount of property taxes imposed on business activities or their investments in neca plant and equipment in California. Business may find, for example, that they would be more profitable operating in nearby states that have lower business taxes. To the extent that this occurs, this measure woulc~ reduce the future growtn in tax revenues.QO The Proposition is not in the best interests of the City of Dublin, as it will deter business and economic development. Recommendation Authorize the Mayor to sign the resolutions opposing Propositions 166 and 167 and direct Staff to forward them to committees opposing these measures. BB asPRP167,bo#2 • RESOLIITION NO. - 92 ~ A RESOLUTION OF THE CITY COIINCIL OF THE CITY OF DIIBY~IN OPPOSING PROPOSITION 166 WHEREAS, the current health care system is in need of reform; and WHEREAS, the sole sponsor of Proposition 166, the California Medical Association, has designed a health care reform which actually only benefits doctors; and WHERE~i~, the proposition does nothing to control the major problem of spiralling health care costs; and WHEREAB, small businesses will be forced to pay for a system that is already ill; and WHEREAS, the high cost of doing business in the State of California is already a deterrent for businesses to locate here; and WHEREA~, real reform to the health care system needs to be accomplished through other methods; and WHEREAB, Proposition 166 will be detrimental to and will hurt California's economyo NOW, THEREFORE, BE IT RESOLV D that the City Council of the City of Dublin opposes Proposition~ I~~ PASSED, APPROVED AND ADOPTED this 28th day of September, 1992. AYES: NOES: ABSENT: ABSTAINo ATTEST: Mayor City Clerk ~XNI~I~' ~ ~ i RESOLUTION NOe - 92 • A RESOLUTION OF THE CITY COIINCII~ OF THE CITY OF DIIBLIN OPPOSING PROPOSITION 167 WHEREAS, the current economic times have resulted in high unemployment and an uncertain future for working Californians; and WHEREAS, the State should be doing everything possible to encourage employers to stay in California, not giving them more reasons to eliminate jobs or leave; and WIiEREAB, Proposition 167 includes more than a dozen separate tax increases - including property taxes, personal income taxes, taxes on smal~ businesses and insurance premiums; and WgiEREAS, it would drive more businesses and jobs out of California potentially costing over 100,000 jobs; and WHEREAB, it would result in a host of unwanted consumer price increases, including insurance premiums, residential and office rents, gasoline prices, utility bills, banking costs; and WHEREAS, the initiative does not earmark these new funds which would therefore allow the State to divert the funds for their purposes; and WHEREAS, Proposition 167 would cause damage to California's economic livelihood. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Dublin opposes Proposition 167. PASSED, APPROVED AND ADOPTED this 28th day of September, 1992 AYESe NOESs ABSENT: ABSTAIN: ATTEST: Mayor City Clerk EXNIB~' ~