San Jose political foes join forces against new taxes

Two very unlikely San Jose political leaders joined forces Friday against one common enemy: New taxes.

In a memo released late Friday, San Jose Councilmembers Johnny Khamis and Sergio Jimenez — who are often on opposite sides of most social issues — directed city administrators to stop studying placing any new tax measures on the 2020 ballot. The decision came after a city survey showed Silicon Valley voters are growing weary of new taxes, even to address social ills such as homelessness.

“We can’t tax our way out of the housing crisis,” Khamis told San José Spotlight. “We need to build. Squeezing middle-income families will exacerbate the problem.”

The survey of 1,251 registered 2020 voters asked about three fiscal measures to raise money for affordable housing: Two general obligation bond measures and one real property transfer tax. Only one of the three measures cobbled enough support to pass — the property tax — with about 59 percent of those surveyed saying “yes.” That measure would need a simple majority to pass.

But the two other taxes, which need to reach a threshold of 66.6 percent to pass, failed by polling at 55 percent and 59 percent, respectively. A similar tax hike, Measure V, for affordable housing, failed last year. Despite the dismal outlook, city administrators recommended doing “additional survey research regarding potential 2020 ballot measures.”

Khamis and Jimenez are saying no.

“It is no secret that the rising cost of living has been outpacing wage growth in San Jose,” the lawmakers wrote in their memo. “Day-to-day expenses like rent, gas, water, and electricity have risen even faster than the rate of inflation.”

The duo added that the tax burden of San Jose residents has increased exponentially in recent years. In addition to new property taxes to support local school districts and the statewide gas tax, they pointed to the following local measures that have passed in the last few election cycles:

• Measure T – a city-wide property tax to pave streets and improve infrastructure
• Measure B – a city-wide 1/4-cent sales tax to support General Fund needs like improved police staffing
• Measure A – the permanent extension of a temporary county-wide 1/8-cent sales tax to support the county General Fund
• Measure A – a county-wide property tax to fund a $950 million affordable housing bond
• Measure B – a county-wide 1/2-cent tax measure to fund transit improvements, such as BART to San Jose

“We supported all or many of these revenue measures to achieve important policy goals, but we must acknowledge that these additional taxes are placing a greater and greater burden on San Jose residents and putting the squeeze on our already-shrinking middle class and our disadvantaged communities,” they wrote.

Khamis and Jimenez said the new tax burdens are “squeezing people out of the middle class” or out of San Jose. Many of the taxes, they added, have a disproportionate effect on disadvantaged communities, working families and people of color.

Instead of “going to the same well” each time San Jose City Hall needs to fund the community’s needs, the councilmen recommended being more efficient and creative with existing resources and generating new revenue in ways “that don’t harm our residents who are struggling to make ends meet.”

The San Jose City Council will discuss the tax survey and next steps for pursuing a potential ballot measure in 2020 for affordable housing at its meeting Tuesday.