Year may be taxing

New, renewed taxes could be reaching into NewportMesans wallets in 2006. Gov. may announce bond plan in speech tonight.If the plans of Gov. Arnold Schwarzenegger and Orange County officials come to fruition, 2006 could literally be a taxing year for Newport-Mesa residents.

The governor is expected to announce a major bond issue for infrastructure in tonight’s State of the State address. The package could cost as much as $25 billion and include construction of roads, levees, schools and hospitals, according to initial reports on the governor’s plan.

The Orange County Transportation Authority is forging ahead with plans to get a reauthorization of Measure M, a transportation sales tax that expires in 2011, onto the November ballot.

And in Costa Mesa, city officials are mulling several possible taxes, both for specific improvements and to boost general fund revenues. Council members are interested in putting utility lines underground and paying for it with a special tax, and they’ll likely resume an old discussion on whether to increase the city’s hotel bed tax or business license fees to help fund city operations.

All those projects have to be paid for, but they don’t all mean new taxes. Measure M would be a continuation of an existing half-cent sales tax that pays for road improvements around the county.

Its unclear whether the governor will propose a tax increase to pay for his bond plan, but even if he doesn’t, Newport Beach Republican Assemblyman Chuck DeVore believes more bond debt will ratchet up pressure to raise taxes.

The state already has a low bond rating, which means higher interest rates, he said. He estimates Schwarzenegger’s proposal could add up to $2 billion a year to the state’s financial obligations, on top of a budget that generally overdraws between $4 billion and $7 billion.

“If we encumber future taxpayers with these bonds, the next shoe that will drop -- and it will be an inevitable shoe -- will be the tax increase shoe,” DeVore said.

No estimates are yet available on how much putting Costa Mesa’s utilities underground would cost. City Manager Allan Roeder said he’ll probably recommend hiring a consultant to poll residents on how interested they are in the project and the best way to pay for it.

A consultant may also try to gauge voters’ responses to city tax issues that could be on the November ballot alongside the county transportation tax and a state bond issue.

“Does it cause the voter to go, ‘All of you go away’?” Roeder said. “I don’t know. There may be some threshold there that says this is too much to be placing on one ballot.”

And elected officials may have to work harder to court voters, because the Measure M tax and any special taxes in Costa Mesa would require approval from two-thirds of the electorate.

Orange County Taxpayers Assn. President Reed Royalty said while he hasn’t seen any specifics on the state, county or city proposals, he’s skeptical about most of them.

He chaired the first Measure M campaign in 1990, and he said he’s likely to support the 2006 initiative because “everybody pays it and everybody uses the roads, and we know exactly where the money’s going to go.”

But the possible bond issue and city taxes deserve closer scrutiny before a “yes” vote, Royalty said.

“My advice to the average voter is we’re being taxed to death. Vote no on everything -- that should be the starting position,” Royalty said. “Having said that, I’d go back and look at them all” more closely.