Chula Vista to Cash In on Telecom Revolution? Prop H to Decide

Chula Vista residents will have to pick their poison when they go to the polls November 2. Proposition H, a utility users’ tax, is posited by the mayor and city manager as a vital source of income needed to prevent cutbacks in police and fire protection and other city services. Opponents of the proposition say it is another attempt on the part of the City to impose a new tax on residents.

Proposition H proposes to widen the scope of telecommunications services that are taxable. According to the city attorney’s analysis of the ordinance, the language from a 1970s telephone users’ tax would be modernized to include “Private network communications (T-1 line), cell phones, voice-over-internet telephone services (VoIP), 800 and 900 services, pre-paid calling card services and pager services.” The taxation would also be broadened to cover interstate and international services. Money from this increase would go directly into Chula Vista’s general fund.

Jill Galvez is vice president of Fast Blue Communications and one of the authors of the Proposition H rebuttal. In a recent interview, Galvez replied “yes” when asked if this ordinance would have an immediate effect on some users. (For example, a person who has his or her phone bill bundled with other services from Cox Communications would be taxed more for interstate and international calls.)

Galvez also argues that the passage of Prop H would be a deterrent to new businesses that might be looking to establish themselves in Chula Vista. According to Galvez, “The cost for telecom services in Chula Vista is already higher than anywhere else in the county.”

Galvez feels the greatest injustice is that Chula Vista already taxes a number of telecommunication providers even though the muncipal code excludes "charges for services paid by users of mobile and marine telephone service." According to Galvez, "Wireless subscribers have been paying this unauthorized tax for years."

The San Diego County Taxpayers Association opposes Proposition H because the additional tax revenue is not tied to reform and because the ballot language does not communicate that Prop H means a tax increase. The ballot proposal begins, “Shall the ordinance to modernize the City’s l978 Telephone User’s Tax (renamed the Telecommunications Users’ Tax), with no rate increase…”

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The San Diego County Taxpayers Association analysis also has found that if H passes,the city will gain only $265,000 in annual revenue while putting up to 4 million dollars of revenue in jeopardy. It appears that the city of Chula Vista is taking a gamble that is the equivalent of drawing to an inside straight!

I doubt Prop H passes...not in this economy.

Time to cut those $200K gov employee com packages.

Woodchuck, I noted in the San Diego County Taxypayer's analysis that some cities had proposed an ordinance that broadened the scope but reduced the tax. In those cities the ordinance passed :-)

surfpuppy, you're such a cynic, again, and I think you're right. I doubt it can pass in this climate of fear. I know pensions are a popular target, but all of us need to start thinking about generating money...and chula vista needs to generate something other than development in my opinion because it proves unsustainable.

Susan, CV, this county, this state has generated tons and tons of tax money, taxes have been rising and rising, yet there is still not enough to pay the bills, and even less in this depression. We have a $20 BILLION deficit this year, we had a $30 BILLION deficit last year and we are projected to have a $30 BILLION deficit NEXT year. The state has produced an on time balanced budget just 4 times in the last 28 years.

But gov employees have seen their overall comp rise far faster than inflation, in some cases - like law enforcement- nearly doubling during the last 10 year time span.

Generating money is not going to help when spending is so far out of control. CV has the highest paid public safety in this county-they should start with those making the most, and those are the ff's and the cops in CV. CUT and CAP their pay, make them pay MORE towards their gold plated, Cadillac pensions, and do not let anyone who is taking $$$ be allowed to negotiate the collective bargaining contracts with these monopoly puiblic unions.

Working families cannot even put food on the table today. The CA U-6 unemployment rate is at 22%. This depression is likely to last another 2-4 years IMO. We need to start cutting comp for gov employees, b/c 80% of taxes go to employee comp.

Just my two cents.

surfpuppy, I appreciate the long and thoughtful reply. I'm thinking of a long and thoughtful response ;-)

Please respond when you can.

The fact is those doing the best($$$) are the ones who should be taking cuts first, and should be taking the biggest cuts. Those include the public safety employees whose compensation is in the $200K neighborhood (and these are not professional positions).

They make the most, and they are the ones most able to, and should, take hits to their comp.

I have said before in other posts-to balance the budget you need to progressively cut compensation, everyone making over $100K should take X pay cut (say 25%), and as you drop down the income ladder you lower the % cut, until you hit a floor-say $50K.

That includes all the elected officials-EVERYONE!


Another GREAT story, about what's happening to BIG MONEY in South Bay!

I hope the voters all read and then heed your warnings about how they have (and still are) being U$ED by those elected to serve the Public.

The wireless portion of the tax amounts to about $1 per person per month. CV does not have enough sources of income and has done a good job of cutting. It is a reasonable fee although it probably won't pass. After November, we will need to cut positions even though we have among the fewest staff per resident in the county.

surfpuppy, I've been out of town on a stayclosebutaway vacation and the internet has been spotty.When I said generate, I didn't mean taxes as most people who are lucky enough to have a job...generate the taxes that make our world go round.

Don't know if you're still around but have been thinking more of questions than answers.

For example, if each person got $50,000 and the average household is a single parent...would a person be able to buy a home, a car, an education for his or her child, and isn't that part of what drives our economy?

Traditionally we have rewarded financially education and experience...should those be off the table?

So much is said about spending, but oddly we don't include military spending in our discussion.

I hear what you are saying about the $200k pensions. I have read some of the unbelievable ones in SD. And all people should pay into their pensions. Anyway, dialogue is good. Susan

What is the relationship between me calling a friend in Kentucky on my cell and the city of Chula Vista being able to tax me for it? Does the city in Kentucky get a share? What am I missing here? Maybe I'm wrong but I thought fire fighers and police officers and city services were part of property taxes?

Reply to #7 & #11

Both great posts!

I'm with SP, those making the biggest bucks should see "adjustments" much larger than any of those new folks at the other end of the pay scale.

Just having a jobs is a luxury these days!

You're right Founder, people are lucky to have a job--and that is why I began this article with pick your poison. If people are laid off then there are fewer people who are able to contribute to the general economy, as well as reduced services. It's worrisome. I have lived in Chula Vista all my life and remember what the city was like when Rohr Aircraft employed so many, and people had a decent wage, health care, the prospect of buying a house and educating their children....

  • CV's Preparation H -

Reply to #13 It must have been quite the scene

I bet that old CV was the hot place to Be!

Now that old Leaders are sucking up the money the times in Chula Vista are not so funny

I hope the voters this time study the issues much more and if they do they'll kick the Greedy Leaders out the door.

Folks that really do care about the neighborhood where they live Only want the best for everyone there and know how to give

If the voters voted in some new Leaders to "shrink" their ills They would not need any "Preparation H" to deal with their bills

Reply #15

Still no "given" name posted from CC as yet (Have early memory issues?)... Why your double standard of posting others but not your own?

Your post is the stuff of a personal email to Susan, instead of a poor attempt at redirecting the discussion about "Prep. H" (sic) to the CV of yesteryear, before it's Leaders started sucking up all the available Public Money...

The folks of Chula Vista deserve the best Leadership possible; and it looks from this and many other of Susan's stories that they have not been giving the election process their full attention. Maybe now that they cannot use the "I never knew how bad it was" excuse; things will be different this November!

Vote Yes on Prop H. Save City Services

here, let me fix this;

"Vote Yes on Prop H. Save Cadillac Gold Plated PENSIONS for under worked City Employees who already have salaries over $100K, cannot be fired, and retire at age 50"

Fixed :)

Reply #17 Pancho (I like your nose in your image!)

Prop H is just more PORK that voters cannot afford!

It is nothing different than Voting NO for Prop D (for DEBT) in San Diego.

Both Chula Vista and San Diego need to go bankrupt and re-negotiate their contracts with their Big Unions; that will "fix" what is wrong with our City fiscal problems; giving the same folks that got us into hot water another little bit of money will only encourage them to ask again and again, just like the spoiled Leaders they are, who also are also going to be sucking up HUGE pensions...

Reply #18 How about these slogans:

Vote No on H, it's the responsible thing to do! or NO on H = YES for CV or NO on H & NO to Greed or NO on H will make our Leaders WORK

@Founder & @Surfpuppy: What if I told you that everybody is already paying this UUT tax and a small amount of companies are still collecting the "fees," but the fees identified as local fees and then they choose to not even give that money to the city due to their interpretation of the law.

If you don't like paying taxes, I can understand. But these are fees already paid to companies and they keep them!

and @Founder: thanks for the compliment on my pic.

If you don't like paying taxes, I can understand. But these are fees already paid to companies and they keep them!

100% FALSE, If the extension is not exteneded (and it won't be) the tax ceases and NO ONE, NO COMPANY can collect it.

But if they do collect it after H fails, contact me Pancho-we will go after the scammers in court.

Here is a better idea, cut the multi million dollar, "retire as multi millionaires at age 50" pensions and lower the salary for the cities employees-that woulf go 100 times further than H would or could ever hope to.

The fact that Chula Vista is preparing to vote on this utility user tax AND it has a potential to have adverse economic impacts on the residential taxpayers of Chula Vista IS of interest to credit rating agencies evaluating factors to determine how Chula Vista debt should be rated.

The possibility that voters might turn this one down is DEFINITELY a rating factor as to the willingness of residents to raise funds for paying off municipal debt.

When I squint, I can see a hand writing something on the wall...

@surfpuppy619: here we go again. Where is your proof retiring as a millionaire from municipal work in Chula Vista? You have none. This is not Bell, CA. When those agencies continue to collect their fees, they'll just change the names. Enough said.

The possibility that voters might turn this one down is DEFINITELY a rating factor as to the willingness of residents to raise funds for paying off municipal debt.

You need to replace "municipla debt" with "pension debt and retiree healthcare costs"

RE municipal v. pension debt:

Pension debt and retiree healthcare costs are definitely in the mix, and so are many other things. Municipalities float bonds for all sorts of reasons, especially when they need money to do things that simply isn't available through the tax base but on a stretched-out mortgage-like schedule. And why not? The rating agencies get their cut, as do the brokers, the underwriters, and all the rest of the people who otherwise wouldn't get a cent on the bond transactions that didn't happen if city needful things were funded just by collecting local tax revenues...

Cities can't print money like the Fed, but they can darn sure issue some more bonds and pretend like they can!

Reply #27 Are you too sleepy to smell the PORK in CV!

This election I urge all the voters to get informed and then vote for what's best for CV not some Wealthy Developers and their Board friends...

I expect to see lots more "NEW" bloggers suddenly very pro CV and urging everyone to keep the status quo because that's what is best for the few; it fits in with the other stories like this one: http://www.sandiegoreader.com/news/20...

Reply #26 The City of SD and our same Leaders sitting in as The Redevelopment Agency sure are racking up the debt and trying their hardest to get as much money "committed" as possible; all the while crying poor to the voters that the same Council wants to shoulder a Sales Tax increase...

Our Leaders are now clueless, urging all of us to save a drop of water while they squander the bucks, because saving a buck is 20 Million times more important! http://www.sandiegoreader.com/weblogs...

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