Retiring County Executive Pete Kutras finds VTA/SVLG relationship troubling

In an interview by Scott Herhold on County Executive Pete Kutras' upcoming retirement:

Q. I want to talk a little about VTA and BART, which is not directly your portfolio, but certainly affects the county. When this first came up in 2000, Mayor Gonzales did an end-run around the supervisors and went straight to the VTA to put it on the ballot. And there was a replay this time when they went to the VTA for a one-eighth cent tax. Does the competition with the hospital parcel tax bother you?

A. Yes.

Q. Tell me why.

A. Because I think medical care is the number one issue in this county, in this state, in this country. And to say a capital project such as BART should be the priority troubles me. I see the priority as physical health, mental health, and frankly, education over BART. That’s my personal view.

Q. If I could follow that up, I’d like to ask a question about VTA’s governance. A recent public records request from former Monte Sereno Council Member Mark Brodsky suggested that the VTA and the Leadership Group work very much hand-in-hand. Carl Guardino asks Mike Burns to lobby people. Burns provides help for their lawsuit. They exchange information on speeches. This is quite extensive. Should a public agency and a private lobby be that close?

A. No, they should not. We’ve all in this valley looked at that relationship. I’ve seen the VTA board make decisions on private polling that’s been done by the Leadership Group. We have tried over the years to see the polling. The leadership group is very selective. They will show you some questions, some information. Because they paid for it and it’s a private poll, you don’t see it. But there’s always a sense of uneasiness. Is the VTA board making decisions in public based on what is on the public record? That’s what’s troubling. I don’t want to join in any accusation, but I’m troubled by it.

On the November ballot, although Measure A Valley Medical Center bond receives virtually no opposition (not even an opposition argument was submitted!), it is nonetheless competing with Measure B for votes.

Two years ago, it was SVLG, using private polls, that successfully lobbied the county to place a 1/2 cent general sales tax increase on the ballot. Voters saw through the backroom deal to transfer the money to VTA and rejected the measure.

When the needs are clearly identified, like the earthquake retrofit of the only general hospital in the county, political factions will come together. On the other hand, Measure B demonstrates just the opposite. Considering the fact that VTA is still withholding new cost estimates on the BART project, Measure B should never be placed on the ballot in the first place.

The high price of working with Carl Guardino

The 2000 Measure A Project Advisory Committee held its last meeting yesterday in Mountain View.

VTA's general manager Michael Burns argued that the committee should pass the revised expenditure scenario with the assumption of a new 1/4 cent tax, and said that VTA still have the option of placing a sales tax in November or in 2008. The committee approved the revised scenario, which prioritized some of the non-BART projects ahead of the BART extension. Despite the approval, the sales tax scenario is unworkable because voters rejected the 2006 Measure A.

During the meeting, two of the county supervisors (Kniss and Gage) on the committee, as reported by some in the audience, looked "mad," given their support for the 2006 Measure A and its defeat on Tuesday.

The county supervisors had a chance to place a 1/4 cent general sales tax only for county services, without diverting funds to VTA. Instead of listening to the transit advocates, the Supervisors chose to listen to Carl Guardino and place a dual sales tax instead.

In an email sent on January 25, Guardino wrote: "The county would need a very well funded campaign, and would need a very poorly funded and poorly organized opposition campaign, in order to be successful," and Guardino concluded, "Interestingly, if the county and the transportation advocates worked together - even though the total (a combined half-cent) would be the same as two competing quarter-cent measures - the chances of winning are very strong."

After outspending the opposition by nearly 100 to 1, voters resoundingly rejected Measure A, defying Guardino's expectation. With the restriction from Prop. 218, the next time the county could place a general tax is June 2008, or in November this year if the county declares a fiscal emergency.

It is unfortunate that the county services may be impacted by the failure of Measure A. The supervisors will be paying a high price for listening to Carl Guardino.

Another example of tweaking budget projections

It appears that VTA is teaching the Santa Clara County the fine art of tweaking budget projections to justify a new sales tax.

Over the last six years, VTA has nearly perfected the fine art of tweaking tax revenue projections to sell sales taxes. Fortuately for the last few months, politicians in the north and south county rejected a new upwardly revised tax revenue projection for a proposed VTA sales tax. However with Measure A this June, the county government appears to forgo its more prudent financial planning and adopting VTA's approach of issuing new budget projection to demostrate its funding "needs."

Instead of over-projecting tax revenue, the county is over-projecting its budget deficit by adding in projected deficit of the county's hospital system to its general funds deficit, which the county did not back in February. According to the Mercury News, the new projected deficit for 2008 is now nearly matches the projected tax revenue from Measure A.

Could it be a motive to try to increase support for Measure A, or could it be a first sign of the anticipated food fight between the county and SVLG over spending priorities if Measure A passes? The fact that the county revealed its new projection in less than a month from election, instead of in February, should raise a red flag. Either way, this is another reason why we should vote no on Measure A.

Serving mystery sales tax in the county building

Remember the last time being served mystery meat? This time the county is serving something that tastes just like mystery meat: mystery sales tax. This mystery sales tax has a simple recipe:

Shall a sales tax of one-half of 1 percent be enacted for general county purposes such as:
The county hospital and clinics;
Trauma and emergency services;
Affordable homes for families and seniors;
Health insurance for uninsured children;
Prevention programs for at-risk youth, families and seniors;
Transportation improvements approved in city and countywide transportation plans;
Services for abused and neglected children;
with a Citizens Oversight Committee to ensure fiscal accountability by reviewing the Annual Audit?

From the list above, can you answer these questions:

1. Is there any guideline or assurance that any program mentioned would get the necessary funding?
2. Is there any assurance for the county that it won't use the sales tax revenue for other unstated purposes?
3. Is there any measure to protect social and geographical equity of the tax?

Carl Guardino was reportedly threatened the supervisors with opposing the 1/4 cent sales tax unless the county supports a 1/2 cent tax, along with a gentleman's agreement that half of the tax goes to Guardino's pet project: BART. Guardino and the county are refusing to admit this hidden agreement in order to sell this specific tax, which requires 2/3 voter approval, as a general fund tax, which requires 1/2 voter approval.

VTA Watch has earlier reported about the possibility of the county supporting transportation projects. With Guardino's recent influence, the currently proposed ballot measure could result in a worst case scenario, where the more than half of the new sales tax would go to the BART project without further input from voters.

While the county supervisors today may not want to spend the entire 1/4 cent, or a penny at all on BART, there will be turnovers on the board in the future that may change its spending priorities. Also, VTA could ask the county to pay for bus service with the county's new tax and then spend all the VTA's bus funding on BART. Unfortunately this proposal, which would make the sales tax in Santa Clara County highest in the state, offers no guideline nor protection against wasteful spending.

Carl Guardino's war against Caltrain

Recently posted in the VTA Riders' Union mailing list is an email from Carl Guardino regarding SVLG's private poll on the proposed sales tax. It will be posted in its entirety in the comment section.

Similar to the other "polls" done by SVLG, it is claiming that the BART extension is still the top priority. It is also claiming that Caltrain "service and station improvements," new light rail lines, and people mover to the airport have similar ratings, meanwhile singling out Caltrain electrification as the lowest priority. In its previous "poll," SVLG claimed that both the light rail extensions and Caltrain electrification are rated the lowest.

SVLG's earlier poll, which the initial tax proposal was based on, received criticisms from the San Jose City Hall in which the councilmembers believed that their city deserves all the countywide transportation tax revenue. Unsurprisingly this "poll" reflects the City Hall's beliefs.

SVLG claimed that the respondents maintain their priorities when given with project costs and ridership figures. What SVLG probably did not reveal to the respondents is that the ridership projections, especially for the BART project, is over-estimated beyond proportions.

SVLG also took a stab at the County poll regarding its proposed 1/4 cent general sales tax for county services. The group is suggesting that the "likelihood of passage of a quarter-cent general purpose tax in a contested campaign is on the bubble." The County poll says that there's 60% voter support for either a 1/2 or a 1/4 cent general sales tax, which requires 50% voter approval.

What Guardino did not report is how much voter support is out there for a sales tax.

. . .

By singling out Caltrain electrification and suggesting it as the lowest-priority project, SVLG has clearly declared a war on transit advocates that include Sierra Club and BayRail Alliance, which strongly supported Caltrain electrification and related improvements.

Two months ago, Laura Stuchinsky, SVLG's transportation aide, wrote to a Sunnyvale neighborhood mailing list that Caltrain electrification doesn't have to be funded by VTA because the funding would be provided by the California High Speed Rail project. In the meantime, SVLG was also spearheading a "coalition" for supporting a southern alignment for HSR that would use the entire Caltrain alignment from San Jose to Gilroy.

SVLG's concept for electrification would work, just like the BART project, under a lot of assumptions. The issue currently at stake in Sacramento is whether HSR will happen at all. With all the debates between the San Jose folks and the Train Riders Association of California over the HSR alignments between the Central Valley and the Bay Area, HSR is not on most politicians' radar in the capital. The massive infrastructure (highway) bond proposed by Governor Arnold Schwarzenegger did not include any funding for the HSR project. Also, some Democratic legislators are also recommending to cancel the HSR bond vote scheduled this November and be replaced by a compromised version of the infrastructure bond which includes little of no funding for HSR.

If SVLG's coalition really supports HSR and Caltrain electrification, where are they in Sacramento to lobby for this? Why aren't the legislators who signed on to this "coalition" speak out in support of more funding to HSR? Or is SVLG just using the HSR as a smokescreen to take local tax funding away from Caltrain and spend it on the BART project?

VTA tax vote to be delayed?

On Friday, VTA board chair Cindy Chavez and general manager Michael Burns issued a memo recommending to delay the vote to place the 1/4 cent sales tax to March. Originally the tax vote was scheduled to be held in its February meeting. The staff cited insufficient time between the presentations to various groups and the originally scheduled vote in February 2nd to "to analyze and thoroughly consider all of the feedback and comments."

Although the new chairperson Cindy Chavez brings to the VTA board a less hostile leadership style than Ron Gonzales, there's isn't much room left to make a bad sales tax plan a good one.

The County Board of Supervisors, scheduled to meet Tuesday, January 24, will discuss and vote whether to support the VTA sales tax proposal. A staff memo was prepared showing that the Center for the Continuing Study of the California Economy has over-estimated the sales tax revenue growth for the 1996 Measure A/B 1/2 sales tax program, which is scheduled to expire this April. This is the same firm that VTA cited for predicting a higher revenue projection for its sales taxes in an attempt to deceive the voters.

County pushing out the VTA with one of its own?

While the SVLG's sales tax poll is private information, a different sales tax poll paid by Santa Clara County is now public information.

A part of the County's survey deals with the public's attitude on major issues. On page 4 of the poll presentation, Education is now a top concerns among the voters. Transportation, used to be the rated as the most important problem back in the late 1990's, has now ranked 3rd behind education and the economy.

The poll asked voters whether to support a general county sales tax either at 1/4 cent or 1/2 cent, which the voter threshold is 50%, over 60% of the respondents said that they support the tax.

Given that the County and the VTA each want its own sales tax increase, the question is who will win and who will lose. Basically, if the County and VTA each have a tax on the ballot in November, most likely both of them will lose. Although these two taxes could be staggered with one in the primary election and the other in the general election the same year, the latter one, which ever that is, would likely to have a higher chance of defeat if the other one passes in the primary.

No wonder why, according to this article, Jim Beall suggested to postpone the VTA tax until 2008.

Since the county proposal is calling for a general tax, it is possible for the county on its own to create a trust fund to support VTA. There's already a precedent with the 1996 Measure A/B tax, which the County Board of Supervisors and the VTA Board hold joint meetings at least once a year to approve transportation projects. On the other hand, the VTA cannot levy a tax that would provide some funds for health care and social services programs.

If the county chooses to support transit (at whatever direction they wanted to) with its general tax, then there is no need for VTA to have its own tax. The City of San Jose (which holds 5 seats on VTA) would not have as much power as they wanted. Perhaps the county could change the course away from the disastrous path since the approval of the 2000 Measure A.