It’s election time again and I, along with all other registered California voters, recently received my sample ballot and voter information pamphlets. As I began to navigate through the usual cumbersome poorly written and confusing information my frustration began to build, reaching the boiling point when I noticed that, once again, the voter information that is contained in the Official Voter Information Guide issued by the Secretary of State and the Voter Information Pamphlet compiled by the Los Angeles City Clerk contain untruthful statements and arguments designed to sway voters’ decisions. The guide issued by the Secretary of State even provides a false sense of information security by presenting (on the front cover) a Certificate of Correctness signed by the Secretary. Here is the wording of the Certificate of Correctness: “I, Debra Bowen, Secretary of State of the State of California, do hereby certify that the measures included herein will be submitted to the electors of the State of California at the Presidential Primary Election to be held throughout the State on February 5, 2008, and that this guide has been correctly prepared in accordance with the law.” As you can see, the “Certificate” says nothing as to the truth of the information presented. I wonder how many voters will glance at the “Certificate” without reading and interpreting it completely and believe that the information presented is all true. The fact is that the laws do not require that the information presented to voters in the “Official” guides and pamphlets contain the truth or the full truth in the condensed descriptions or in the arguments presented for or against the measures. The only information in the guides that we can rely on to contain truth is the detailed text of the measure and, probably (in the case of the State measures) the analysis presented by the legislative analyst. Since many voters rely only on the condensed summaries, the arguments for and against and the names of the endorsers, when making their decisions, their votes are often based on untrue and incorrect information. Here are a couple of examples to further illustrate the problem: Proposition “S” (City of L.A.) Condensed description follows: REDUCTION OF TAX RATE AND MODERNIZATION OF COMMUNICATIONS USERS TAX: Shall an ordinance be adopted to reduce the City’s tax on communications users from 10% to 9%; modernize ordinance to treat taxpayers equally regardless of technology used; exempt low-income senior-citizen and disabled households; to fund general municipal services, such as 911, police, fire protection, street maintenance, parks and libraries; subject to an annual independent audit. The underlined words and phrases above are untrue and appear to be used to obtain a “yes” vote from voters. As I have written before, this proposition is for a new “communications tax” of 9 percent that will apply, not only to telephones, but will now include voice over internet protocol (VOIP), text messaging, instant messaging and T-1 lines (used by many businesses, large and small, for internet access) as well as other wireless services. This expanded application of tax is what is referred to above as “MODERNIZATION.” The 9 percent tax rate of Proposition S is not a reduction of an existing 10 percent telephone tax. That tax has been challenged as illegal and is expected to be struck down by the courts. At that point, the tax rate will be ZERO, thus it cannot be reduced. This new Proposition S tax is intended to replace a lost revenue stream that will occur as a result of the expected court action. However, it could potentially result in a significantly greater amount of taxes once VOIP and other services grow in volume of use, which is only a matter of time. Prop. S does not “treat taxpayers equally” as stated. It provides for you and me to pay a 9 percent tax while telemarketers are only required to pay a 5 percent tax. Additionally, taxes provided by this measure will be available for any use that the elected city officials deem appropriate. The words “such as” when referring to 911, police, fire, street maintenance, parks and libraries (above) do not guarantee funds from Prop. S will be used only, primarily or even at all for those purposes. I recently viewed a list of proposed reductions in City services in the event that the telephone tax is struck down and Prop. S fails. This list was purported to have been sent from the City Administrative Officer to the Mayor in October. The cost of the reductions totaled approximately $344 million or $74 million more than the shortfall anticipated from the loss of the telephone tax. The amount included for police and fire totaled $43 million, thus it would appear that there would be no necessity to make cuts in these services if Prop. S fails and if it passes the funds wouldn’t necessarily be needed or used for police and fire. Proposition 93 (State of CA) Although the condensed description (referred to as Official Title and Summary) contains truthful statements, it does not include the full truth. It appears that legislative term limits will be shortened from a total of 14 years in both houses to a total of 12 years for all legislators. What it doesn’t say is that because there are 80 seats in the Assembly and only 40 in the Senate, most legislators currently serve only 6 years. When they are termed out in the Assembly there are no Senate seats available for them. Since Proposition 93 allows 12 years in one house, these legislators will be able to serve an additional 6 years. To find this out, one would need to read the detailed text of the proposition. The other fact that is not stated is that due to a special exemption in Section 5 of the proposition, Don Perata, the current President Pro Tem could spend 14 years in the Senate rather than the 12 year maximum in one house. This also is only able to be determined by reading the detailed text of the proposition. I believe that all voters are entitled to receive the truth and nothing but the truth in official voter information materials. How else can one be expected to make a proper decision when voting? In the current situation, voting is truly a process where the term “Caveat Emptor” (“buyer beware”) applies. _____________________________ Gregory N. Lippe, CPA, is Managing Partner of the Woodland Hills-based CPA Firm of Lippe, Hellie, Hoffer & Allison, LLP, Chairman of the Valley Industry and Commerce Association (VICA) and a Director of First Commerce Bank.
