L.A. Voters Seem to Approve Giant Telephone Tax Backed By Unions

The L.A. Daily News reports:

Los Angeles voters appeared to broadly endorse a controversial citywide telephone users tax in early returns Tuesday, giving hope to city leaders that the measure would pass and preserve $270 million a year in much-needed revenue.

With slightly more than 10percent of precincts reporting by 11 p.m., some two-thirds of voters supported the measure. It needed a simple majority to pass.

The measure was written to withstand legal challenges to the city's telephone users tax, which generates $270 million a year. The measure reduces the tax from 10percent to 9percent, but expands it to include modern technology such as Internet phone use.

"The early returns are promising, and we are hopeful that the trend continues," Mayor Antonio Villaraigosa said.

"(Measure) S is critical to our efforts to keep crime at historic lows in this city, and we are encouraged the residents of Los Angeles are responding."

If voters reject the measure, however - and the city loses a legal challenge to the tax - the city would give up as much as $270 million a year, or about 4 percent of the city's $6.8 billion budget.

Villaraigosa has warned that the loss of that money could lead to layoffs and big cuts to city services, such as library hours and recreation centers. In TV ads, Police Chief William Bratton and Fire Chief Douglas Barry have warned of public-safety cuts if the city loses the money.

The budget shortfall would also likely trigger city

employee layoffs, and organized labor - including groups that represent city employees - contributed nearly $2 million for ads and mailers urging voters to support the measure.

Like the scam? Government workers fund a campaign for higher taxes with the taxpayers own money.