December 22, 2015
West Hollywood will consider putting a measure to raise the city’s
sales tax on the ballot as early as June as part of a complex strategy
to get the L.A. County Metropolitan Transit Authority to include the
city in its west side rail extension plans.
measure, proposed by Councilmember John Duran, was approved by the
Council in a four-to one-vote, with Mayor Lindsey Horvath voting no. The
Council also voted last night to appropriate $200,000 to hire
consultants to organize and implement a lobbying effort to build support
for a light-rail extension to WeHo.
The city has been pushing for such an extension for years. In 2010 it
hired a lobbyist to try to convince the MTA to add a WeHo spur to the
planned extension of the Purple Line. Two options the MTA considered in
its Purple Line expansion study included an extension of the Red Line
from the Purple Line’s Hollywood/Highland station into or near West
Hollywood. That extension would run under Santa Monica Boulevard with
stops at La Brea, Fairfax and San Vicente and a station near the Beverly
Center. The MTA decided both of those options would cost more than it
would receive from a half-cent increase in the L.A. County sales
implemented in 2009 to fund the Metro expansion. The consultant hired by
the city would organize local businesses and residents and civic and
government leaders to press the MTA to consider connecting the Metro Red
Line to West Hollywood and as well as its Crenshaw/LAX northern
extension, which would provide easy access to the airport.
The first section of the Purple Line extension already is under
construction, funded by a half-cent increase in the sales tax approved
by voters in 2008 along with federal grants and loans. Now Metro must
find funding for the final two sections of the project. In October, Gov.
Jerry Brown signed legislation that will allow the MTA to put a measure
on the ballot that would raise the overall sales tax in L.A. County,
now 9%, to 9.5%, with the additional revenue going to fund its expansion
plans. Because of the nature of the measure, it would require a
two-thirds vote to pass.
Duran noted that the State of California has an overall cap of 10% on
sales taxes. Of that, 7.5% goes to the state and 1.5% goes to the
County of Los Angeles, with some portion of that revenue used to fund
local programs. If West Hollywood residents were to approve an increase
in the sales tax rate, pushing it closer to the 10% limit, the MTA would
be limited in the sales tax increase it could seek to fund its rail
expansion programs. Thus, Duran reasoned, it would be more likely to
negotiate with West Hollywood to receive some of its tax increase
revenue and extend its line into WeHo.
“This is the window of opportunity, and it will close,” Duran said.
“Either we will be in it or we will be out of it.” Duran also noted that
the money raised by the tax increase could be used for other purposes
if the city is unable to strike a deal with the MTA. For example, said
Councilmember John D’Amico, it could be used to fund affordable housing.
John Leonard, the city’s head of revenue management, said a sales tax
increase of .25% would generate about $4 million in revenue for West
Hollywood in its first year. Sales revenue in the city typically grows
4% a year, and a city staff report said that means such an increase
could generate $175 million over 30 years.
The Council voted in June to support Metro placing its sales tax
increase measure on the ballot next year, likely during the November
general election. If West Hollywood were to put a measure before voters
before that, it would have to get the support of at least two-thirds of
them for it to pass.
Horvath said she couldn’t support Duran’s proposal because she feared
it would be seen negatively by the county officials with whom the city
is trying to negotiate for support for a Metro extension into WeHo. “I
think this presents challenges to building relationships,” she said.