Good news for city out of Sacramento |

Good news for city out of Sacramento

Susan Wood, Tribune staff writer

If the California budget revision from Gov. Gray Davis survives the Legislature, South Lake Tahoe may keep an estimated $1 million in revenues it would have lost in vehicle license fees from his last proposal.

VLF fees would go up about $130 for the average registered car owner. The plan also calls for raising taxes on cigarettes, the wealthiest wage earners and consumer goods.

On Wednesday Davis said he has reconsidered what to do with vehicle license fees. He does not want to touch the money that for years has been pledged to cities and counties.

The 2003-04 projection has now climbed to a record $38 billion, causing shockwaves of alarm from cities like South Lake Tahoe — which faces a budget deficit in the coming months.

“While this sounds better than January, until it’s signed in ink we don’t know what we can expect,” City Manager Dave Jinkens said. “It’s a moving target for us now, but we’re going to have to evaluate it.”

Jinkens was also encouraged the state opted to pick up funds for police officer training. He was less enthusiastic about a half-cent increase in the state sales tax from 7.25 percent because the city wants to raise the rates in the city — thereby creating an additional source of local revenue.

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City leaders are concerned their tax increase measure will have less chance of passing because registered voters will be less apt to take on another tax hike.

At the same time, Jinkens sympathized with Davis and wondered how he could do it any other way.

“No one wants to see taxes go up, but how are you going to solve a $40 billion budget deficit?” he asked.

Jinkens is counting on a solid economic plan from the state, along with cooperation that falls outside partisan bickering.

“There’s got to be a compromise,” he said.

This meeting of the minds could take a leap of faith and good will.

Tahoe’s two Republican state lawmakers soundly objected to the proposal — mainly over the hefty level of tax increases.

“I don’t see any Republicans supporting it,” said Bill Bird, spokesman for state Sen. Rico Oller, R-San Andreas.

“Someone needs to tell the governor that we don’t have a revenue problem in California, we have a spending problem,” Oller said in a statement.

Assemblyman Tim Leslie, R-Tahoe City, expressed his disappointment in a statement fired off Wednesday afternoon.

Leslie took aim at the $4 billion increase in vehicle license fees, saying it “will cost California’s working families hundreds of dollars.”

Davis has been criticized for allowing an energy crisis and stock market plunge to turn into a runaway budget shortfall. Some believe his political career rides on the recovery of these dire circumstances.

“We’ve had substantial decline in revenues. In difficult times, we have to re-examine our priorities. I believe this is a budget road map to get us to where we want to be,” Davis said in a press conference call.

But when asked by editors why taxpayers should shoulder the burden of debt without a long-term plan, Davis was mysteriously cut off from the group conference call.

The governor acknowledged the difficulty in getting the plan by the state Senate and Assembly. Although they’re controlled by the Democrats, VLF fee hikes would require a two-thirds vote.

“Republicans will not vote for tax increases if their lives depended on it,” Davis said.

Those in the legislative branch facing re-election in 2004 know their constituents rarely view tax increases favorably.

— Susan Wood can be reached at (530) 542-8009 or via e-mail at