Legislation to increase county sales tax for transportation projects
Living on the Hill and working from home is close to paradise. Living on the Hill and commuting to work on the I-10 or state highways 74 and 79 is not fun and often stressful.
Assemblyman Eduardo Garcia (D) has submitted a bill that could help alleviate some of the county’s commuting conundrums. Garner Valley, Anza, Sage, Aguanga and and some of the desert cities are part of Assembly District 36 that Garcia represents.
In February, Garcia introduced Assembly Bill (AB) 1385 that would give Riverside County residents the option to increase local sales tax to improve transportation needs throughout the county.
A local sales tax is considered a transaction and use tax. Every county and city is limited to a cumulative total of 2% from transaction and use taxes. Currently, Riverside County imposes a 1.5% sales tax, which includes a 0.5% tax for the Riverside County Transportation Commission (RCTC).
AB 1385 does not levy another 0.5%. To impose and to collect this added tax, county residents would have to approve it through a countywide vote.
The current RCTC sales tax was originally approved in 1988 and extended to 2039, via a 69% approval of a Measure A vote in 2002.
In submitting AB 1385, Garcia stated, “Riverside County is California’s fastest growing and most diverse county. As the population and economy grow so does the need for other transportation measures. This bill would give the Riverside County Transportation Commission options should Riverside County’s voters choose to implement a new sales tax measure to fund future transportation needs.”
RCTC expressed several reasons for asking Garcia to support and to introduce the bill. “While California’s overall population decreased during the last few years, Riverside County is the fastest-growing county in the state and the fifth fastest-growing county in the nation. The California Department of Finance projects that by 2048, Riverside County will have 3 million people, up 20 percent from 2022 …”
“The increase in the county’s population necessitates evaluating how to fund much-needed improvements to our transportation infrastructure. Unfortunately, there is a significant backlog of critically needed transportation projects in Riverside County that existing fund sources cannot meet.”
According to the Assembly’s bill report, the California Taxpayers Association (CTA) has already announced its opposition to the AB 1385 and any added sales tax increase. The report says the CTA argues that “California has the country’s highest state-level sales and use tax rate, and some cities have combined rates among the highest overall in the nation. The sales and use tax is a regressive tax that has the largest impact on lower-income residents because it takes a larger percentage of their household income.
“Additionally, raising the transactions and use tax rate that the Riverside County Transportation Commission is authorized to levy would restrict the ability of other local government entities in the area to raise revenue. California law restricts the combined transactions and use tax in any part of a county from exceeding 2 percent.”
This limitation could affect the following county cities: Riverside, Palm Springs, Temecula, Coachella and Corona.
In the RCTC letter to Garcia, Anne Mayer, RCTC executive director, stressed, “AB 1385 does not raise taxes. The bill increases RCTC’s sales tax authority from one cent to one and a half cents per dollar and does not alter Measure A’s half-cent sales tax rate. Any changes to Measure A requires approval from Riverside County’s voters.”
