When I saw Mary England's letter ("A message to shoppers on sales tax day ") in today's Union-Tribune, I was surprised to read that she is the "President and CEO, La Mesa Chamber of Commerce".  England is a sitting member of the Lemon Grove City Council.  This fact makes it all the more difficult to take her message at face value, since reads like it was written by a staffer at La Mesa's City Hall, rather than by the head of an organization that allegedly advocates for La Mesa's businesspeople and their stores and companies.  How can she represent them if she is not only a government official, but one from Lemon Grove?

Granted, she does attempt to explain, at least at the beginning of her letter, why consumers should not stop shopping in La Mesa.  This is, undoubtedly, in response to Santee's effort to convince El Cajon's and La Mesa's residents to shop there, instead, to enjoy a relatively lower sales tax.  England urges La Mesans to "look at the real cost of buying outside their own community."  In the process, she attempts to minimize the impact of the tax increase:  "Most people will typically spend $100 to $300 when shopping for general items and the difference in sales tax on this is 75 cents to $2.25, hardly worth the gas and additional time going to an outside location."

While England might believe that saving on sales tax by shopping in another municipality is "hardly worth the gas and additional time", many shoppers are likely to disagree.  Santee is not the only place with lower sales tax.  The City of San Diego (on La Mesa's western border) and Lemon Grove (on its southern border and England's own turf) are also available to shoppers looking for the most value for their hard-earned dollars.  In effect, La Mesa is surrounded by shopping alternatives for its overtaxed consumers.  The cost in "gas and additional time" is therefore not material for most La Mesans.  It likely would cost just as much to drive to the nearest neighboring town as it would to drive to a La Mesa shopping destination.

Moreover, "$100 to $300" is not a small amount of money for many consumers.  An additional $0.75 to $2.25 in tax on such an expenditure is not "chump change", either, especially when it is multiplied by the number of times a citizen makes a purchase over the course of time.  It is basic "Econ 101" knowledge that a sales tax is by definition regressive, meaning that it hurts the most those who can least afford it -- those with the least income -- by penalizing consumption.  Increasing the sales tax literally takes the bread out of the mouths of La Mesa's poorest citizens.

This points out the first major problem with England's letter:  she does not acknowledge the "800-pound gorilla in the room", which is the root cause of the distress of both businesses and consumers in La Mesa: City Hall's refusal to follow the dictates of fiscal responsibility.  Instead, she focuses on the sacrifices that consumers and businesses must make because of the path not chosen.  For consumers:  "During this environment of tough economic times, rising unemployment and a lack of consumer confidence, citizens must make tough personal and business decisions every day."  For business:  "You can bet the local businesses will do everything they can to keep their customers." 

This is ironic because La Mesa's Mayor, Art Madrid, and his fellow City Council members have refused to make tough choices about La Mesa's budget.  They have done almost nothing to reduce the cost of city government, choosing instead to maintain expenditures, the bulk of which are for personnel (salaries, benefits, and pension contributions), and then to pass on the cost to businesses and consumers in the form of a higher sales tax (the second highest in San Diego County).  In the process, they are destroying the very tax base that they depend upon for revenue. 

How?  Unlike City Hall, which in a cash-flow crisis can simply extract more funds from taxpayers (on an involuntary basis, through force of law), businesses must earn revenue through attracting shoppers to make voluntary purchases of goods and services.  If they fail to do so on a consistent basis, eventually they will not be able to cover expenses.  In order to survive, they lay off employees, cut back on products and services and initiate other cost-saving measures.  If these measures are not successful, they fail and go out of business.

As more La Mesa consumers shop elsewhere because of the high sales tax at home, local business revenue will drop.  Businesses will begin to fail, despite cutting their expenses, because they cannot maintain the cash flow necessary to meet their fixed costs.  Such failures will lead, in turn, to unemployment for both owners and employees.  The newly unemployed will have no choice but to cut their own spending drastically, until they find other work, which will drag local business revenue even lower.  And if and when they do find new employment, it is likely that it will not be in La Mesa, which will have fewer and fewer opportunities for both employees and entrepreneurs as its business climate cools.   

The second major problem with the letter is that it clearly advocates for supporting La Mesa's newly-hiked sales taxes.  In the penultimate paragraph, England writes:

Voters saw the value of maintaining the services provided by La Mesa and overwhelmingly supported the sales tax increase at the ballot box. La Mesa boasts a new library, a new award-winning fire station, a brand new post office and construction has begun on a new police station. These city services help provide a quality of life second to none, so I urge you – the local La Mesa consumers – to continue doing what you have been doing for so many years. Keep shopping in La Mesa to make sure your local business community continues to prosper in these economic times and your sales taxes support the services provided by your city.

England insinuates that La Mesa's voters, not City Hall, wanted a higher sales tax because they passed Proposition L last November.  As she states earlier in the letter, the tax "should be no surprise to anyone, especially the voting public in La Mesa . . . ."  The truth is that Prop L passed by a simple majority, not a landslide, and then only because La Mesa's citizens (many of them retirees) were frightened by City Hall propaganda that threatened anarchy in the streets if the initiative failed.  England echoes that argument in her statement that citizens voted for the tax increase "to continue the level of service provided by the city and its services."  However, almost half of the La Mesans who voted were not fooled by this fear-mongering and cast their ballots against Prop L.  Those who voted for it will quickly experience "buyer's remorse" as the local economy suffers the inevitable negative consequences detailed above, which will be compounded by the same tax-and-spend stupidity that also reigns at the state and national levels of government.

Even if voters do see value in services both provided by La Mesa AND funded by sales tax revenue, not every service listed by England meets this definition.  A $25 million bond measure that voters approved in 2004 paid for the fire station and is also paying for the new police station.  These buildings house the very services that the Mayor and Council said would be "cut" if voters did not pass Prop L, yet the cost of these headquarters has already been vouched for by taxpayers, whose taxes will provide the "revenue" to pay off the bond debt.  What, then, makes basic public safety services so expensive in La Mesa that higher sales taxes are also warranted?

The City decided to pay for its new library and post office complex out of its general fund and with rent received from the U.S. Postal Service after it could not secure state bond funds.  Unfortunately, the Postal Service has not yet started paying rent because it has not completed its move to the new facility.  Moreover, the City might have to pay San Diego County for the land on which the old La Mesa library stood, which is the site of the new police station.  The parcel was transferred by the County, at no cost to the City, in exchange for a promise to build a new permanent library.  Yes, folks, the "new library" is actually a "temporary" facility.  Whether or not the City builds a new, "permanent" library, La Mesa taxpayers will be on the hook for more "revenue", either for building another library or paying for the land on which the new police station will be built. 

Building the library/post office facility and the new police station were, therefore, risky, irresponsible actions.  The City undertook the projects knowing that it did not have the funds to cover all of the direct and indirect costs.  In doing so, the Mayor and Council obligated taxpayers without their permission, then told them that they would have to vote for higher taxes, all to cover decisions in which taxpayers played no part.  So much for "no taxation without representation."  And they'll be coming back for more.