Residents file tax claims against city

Eron Ben-Yehuda

Two Huntington Beach residents, with the support of a taxpayers’ rights

group, filed claims this week against the city demanding refunds for a

property tax they say is illegal.

The city, which will collect about $7 million this year from the tax,

uses the money to help pay for retirement benefits for city employees.

If the city grants the refunds, then all property owners should demand

their money back, said Tom Bittle, director of legal affairs at the

nonprofit Howard Jarvis Taxpayers’ Assn. “They’re being charged a tax

that we feel the law doesn’t authorize.”

The City Council voted in August to continue collecting the tax at a

fixed rate of about 5 cents per $100 of assessed value. That means a

homeowner would pay the city $150 this year for a house worth $300,000.

It may not seem like much, but that’s beside the point, said resident

Chuck Scheid, who filed a claim.

“It’s not the money, it’s the principle,” he said.

Officials argue that the city’s charter gives them the power to apply the

money toward pensions. But opponents counter that state law, specifically

Proposition 13, requires the tax be approved by two-thirds of the city’s

voters.

“It’s a blatant violation of Proposition 13,” said Scheid, who is a

member of the city’s finance board.

The bone of contention dates back to an election in 1978, when voters

passed the proposition and, at the same time, amended the charter. The

late Howard Jarvis led the grass-roots campaign in favor of Proposition

13.

While the proposition made levying taxes more difficult, the charter

amendment seemed more permissive, allowing the levying of property taxes

“sufficient to meet all obligations of the city for the retirement system

in which the city participates,” states a memo by City Atty. Gail Hutton

dated July 26.

The amendment proves that voters intended to permit the tax after a

simple majority vote of the council, she wrote.

“That is poppycock and a direct insult to the citizens of Huntington

Beach,” Scheid said. “We are not so stupid as to vote for two such

diametrically opposed positions on the same day, at the same time, and in

the very same voting booth.”

The city has until early December to respond to the claims, which must be

filed prior to a lawsuit.