However, if Los Angeles County or another “regional governmental entity with taxing authority over Beverly Hills” — to use the language of City Attorney Laurence Weiner — ever decides to raise the tax rate to 10.25 percent, then the hike would go into effect in Beverly Hills as well.
According to California law, the first entity to impose a tax gets to keep its revenues. If Beverly Hills does not adopt Measure RP, and LA County voters or another regional government vote to impose a higher sales tax rate on Beverly Hills, the city would not be able to keep that money. They would be able to spend it however they like.
But if Beverly Hills puts the tax rate on the books first — even if it’s not acted upon — the city would be able to keep for itself the extra $28 million that such a hike would generate if a new tax rate were imposed.
The measure passed in August with unanimous support from the City Council. The five councilmembers wrote a letter in favor of the motion, calling it “basically a Beverly Hills Tax Payer Protection Act.”
“By approving Measure RP you will be taking a defensive step to protect local control of our tax dollars,” they wrote. “Please understand that you will not pay an increased sales tax until the County seeks to raise taxes again. Your Council will defer the .75% increase you approve until the County acts. Once they do, the increase will begin and the dollars will be reserved for use in Beverly Hills.”
In all caps, the letter declares, “YOUR CITY COUNCIL MEMBERS ARE ALL OPPOSED TO ANY NEW SALES TAX,” and “AGAIN, NO CITY COLLECTION UNLESS THE COUNTY TRIES TO!”
Not all are in favor of the measure. While there has not been an organized movement against it, a reader on the Beverly Hills Renters Alliance website argued that if the city needs more money during a time of revenue shortfall, it should make the case to voters directly. “If Beverly Hills wants that money, they should make an honest case for it to their voters (as West Hollywood is doing by asking voters to approve a sales tax increase now) instead of letting the County be the bad guy, and then appearing to be the savior by claiming that tax money for the City,” the user wrote in an opinion highlighted by the Alliance.
In West Hollywood, voters are considering Measure E, which would increase the sales tax to 10.25 percent. 33 other cities in LA County, including Santa Monica, have raised their sales tap to the 10.25 percent cap.
The user also wrote that because Beverly Hills relies on many LA County services, including election services, grants, and renters’ protections, the extra funds will “come back to help us in the long run in this City many times over.”
The Renters Alliance also questioned the measure’s method of getting on the ballot. On Aug. 4, the City Council declared a fiscal emergency, which allowed them to adopt a resolution on an accelerated timetable so it could qualify in time for the November ballot.