Santa Cruz Good Times

Dec 01st
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Town Hall with Supervisor Ellen Pirie

ellen_pirie2Along with Supervisor Neal Coonerty, you urged the Board of Supervisors to vote to support Proposition 1481 (which they did, unanimously). What would the Proposition do, and why does the Board feel it is necessary to support?

Following years of cuts in California's education system, a coalition of students, professors, and other activists has begun a signature-gathering campaign to place the Oil Extraction Tax to Rescue Education Proposition Initiative Statute (Proposition 1481) on the ballot.

The Proposition would mandate a 15 percent fee on the value per barrel of crude oil extracted from California. This fee would produce approximately $3 billion annually for California education, which would be allocated to grades K-12 (30 percent), Community Colleges (48 percent), the California State University system (11 percent), and the University of California system (11 percent). These funds will be used to lower college and university tuitions, restore cut class sections, rehire laid-off professors and teachers, and reduce class sizes in grades K-12, as well as for other classroom instruction and non-capital needs.

California is the only oil producing region where the oil companies do not pay some kind of severance tax, a royalty paid for the right to "sever" natural resources from the land. Even oil taken from under federal waters off the coast of California is subject to an 18.75 percent federal royalty. Alaska's oil severance tax was raised to 25 percent by then Gov. Sarah Palin. The oil severance tax in Texas produces $2 billion annually for education. Twenty-five other major oil-producing states also have oil severance taxes. But in California, the third largest oil-producing state, there is no oil severance tax.

What did the Santa Cruz County Tourism Marketing District Annual Report for 2011-2012 include, and what actions will the Board take regarding it?

The Santa Cruz County Tourism Marketing District was created a little over a year ago for the purpose of raising money to market Santa Cruz County as a tourist destination. The first annual report on the District showed that although many of the District goals were met, the bottom line fell short of expectations. There was an increase in inquiries and requests for assistance in locating and booking overnight stays, which is one of the primary goals. However, the actual revenue from the $1 or $1.50 per room, per night [hotel occupancy] fee was substantially less than the $1.1 million that was anticipated.

The challenge now is to figure out why less revenue was received. As a first step, the County Tax Collector will be auditing motels and hotels to see if the fee was collected from guests and remitted as required by law.

What is behind the debate at the Regional Transportation Commission (RTC) about identifying a new Highway 1 project?

The federal government has put about $5.5 million into the Highway 1 HOV (high occupancy vehicle) Lane EIR over the last eight years. They recently decided to more strictly enforce rules regarding use of federal funds. If the project has not progressed to construction or right-of-way purchase within 10 years from the date the EIR was begun (September 2003), the RTC will have to pay back the $5.5 million. The alternative to repaying those funds is to identify a “Tier 2-project” which is within the Highway 1 project and is achievable in the next two years. “Achievable” in this case means that the environmental work is done, the improvements are designed and any right-of-way needed is purchased.

The RTC staff has identified a project that would satisfy the federal rules and would not require the RTC to repay the $5.5 million. The project will add auxiliary lanes between the Soquel and 41st avenue [exits] in both directions. It will also build a pedestrian and bicycle bridge over the highway at Chanticleer. The cost of the environmental study, design and right-of-way purchase is $4 million.

The concern is that local roads are deteriorating and we would like to spend that $4 million fixing local streets and roads. Unfortunately, those funds cannot be used for local road maintenance. The funds could possibly be used for major safety improvements on local roads. However, even that requires the approval of the California Transportation Commission (the CTC), which has consistently denied RTC’s past requests to do so. The CTC says that when there are needs on a state highway, the state funds must be applied to that first, before addressing any local road needs. If the RTC abandons the Highway 1 project now, it would mean that we have to repay the $5.5 million in federal funds. It would also mean that the Highway 1 EIR remains unfinished and unusable and that the $12 million already invested would be wasted.

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