Sacramento Taxpayers are Victims of a Rapacious and Uncaring State Government

The Sacramento City Council should immediately assign the City Auditor to determine the actual annual state freeloading impact upon city taxpayers through the state’s tax exempt properties, both owned and leased.  

There has been much talk that all should pay their “Fair Share” of taxes to support vital and necessary public services. 

In Sacramento a huge entity consumes copious quantities of city services but does not pay the property taxes, sales taxes, or all utility taxes, which are the primary sources of this city’s funding. This deadbeat rapacious consumer of city services is not a greedy corporation, or tax dodging rich people; the culprit is the State of California. 

The resulting systemic chronic fiscal problem is unique to this city, due to the huge amount of prime real estate that is off the tax rolls due to ownership or lease by the State of California. 

The result is that Sacramento residents actually subsidize state government through use of city services. School districts, county facilities, federal offices, courthouses, Sacramento Municipal Utility District, and joint powers authorities are of similar situations but have a minor impact on city finances when compared to the state.   

Some state government entities do render a few crumbs of financial compensation to the city, such as the possessory interest tax paid by the Capitol Area Development Authority, some types of utility taxes, and assessments for entities such as Property and Business Improvement Districts (PBID) and Business Improvement Areas (BIA).    

A cursory look at state owned and leased properties in Sacramento makes it appear likely that the property tax impact factor alone may exceed the city’s present sixty-six million dollar systemic budget deficit. 

Sacramento needs to undertake a detailed study to determine the full extent of the financial hole this situation creates. The city must fully understand the impact of this monetary deficit and adjust city expenditures to reality, including city employee pay, pensions, and post-employment health care. Current city budget practices in those areas are unsustainable and the constant resorting to raising taxes and fees only succeeds in punishing city residents, rather than solving this underlying problem – a deadbeat state government. 

Sacramento property taxpayers have been long victimized by the fact that there is no way to legally force the state to pay a fair share, however, withholding selected city services such as water, sewer, storm drain, and fire protection, might be a way to force the state’s attention. This issue has never been brought to the public as far as can be recalled in the decades that I have followed the machinations of Sacramento city government.

To get the state to pay its fair share may well be a process of many years to bring to fruition, which is why it is important to start as soon as possible.

If successfully pursued, this project may well remedy the city’s structural financial deficit.  

Sacramento taxpayers are victims of a rapacious and uncaring state government. 

The City Council should immediately order the Auditor to determine what the state actually would owe were those properties privately owned and operated.