Revenue Responses To Proposition 13 in The San Francisco Bay Area
| DOI | 10.1177/095207679100600304 |
| Published date | 01 December 1991 |
| Author | Keith Hoggart |
| Date | 01 December 1991 |
| Subject Matter | Articles |
40
Revenue
Responses
To
Proposition
13
in
The
San
Francisco
Bay
Area
Keith
Hoggart
Department
of
Geography,
King’s
College
London
Abstract
This
paper
examines
whether
changes
in
sources
of
city
revenue
are
aligned
with
differences
in
local
power
structures.
Examining
change
in
per
capita
revenues
and
in
revenue
shares from
different
sources from
1977/78
to
1986/87,
the
results
show
that,
while
there
was
much
variety
in
inter-city
revenue
changes,
consistent
patterns
were
present.
In
particular,
patterns
of
revenue
collection
change
were
influenced
by
the
relative
importance
of
non-residential
sectors
and
levels
of
home
ownership.
Taken
together
these
indicate
that
new
revenue
patterns
were
more
favourable
for
home
owners
than
for
businesses,
although
there
were
countervailing
tendencies
in
areas
with
high
unemployment
and
large
non-white
populations.
Also
considered
were
political
party
effects,
which,
while
weak,
were
consistent
with
Democrat
Party
orientations.
The
literature
on
local
fiscal
stress
in
the
USA
is
a
substantial
and
varied
one.
There
are
studies
of
the
socio-economic
circumstances
of
stress
(Martin
1982;
Clark
and
Ferguson
1983;
Listokin
and Beaton
1983),
tests
of
theories
of
its
incidence
(Friedland
1981;
Morgan
and
England
1983;
Kennedy
1984),
evaluations
of
voters’
views
on
spending,
taxation,
and
tax
limitation
(Gramlich
and
Rubinfeld
1982;
Rosentraub
and
Harlow
1983;
Ladd
and
Wilson
1985),
and
examinations
of
the
unfolding
of
fiscal
disorder
in
single
places
(Rubin
1982;
Shefter
1985;
Swanstrom
1985).
Other
researchers
examine
dissimilarities
in
policy
response
across
municipalities
(Wolman
and
Davis
1980;
Levine et
al
1981;
Susskind
and
Serio
1983).
It is
in
this
last
group
that
this
paper
should be
placed.
Yet
what
is
offered
here
stands
apart
from
most
studies
of
this
kind,
for
the
norm
in
such
investigations
has
been
for
a
time
frame
of
two
to
four
years
to
be
adopted,
whereas
this
paper
examines
policy
change
over
a
decade.
The
reasons
for
adopting
a
longer
timespan
are
easy
to
appreciate.
In
the
immediate
aftermath
of
fiscal
trauma,
city
governments
act
quickly
to
alleviate
41
revenue
shortfalls.
At
this
time,
opportunities
to
cut
costs
and
increase
revenue
are
seized
without
necessarily
adhering
to
long-term
policy
goals.
Even
so,
the
new
circumstances
of
fiscal
disorder
offers
an
opportunity
to
challenge
existing
norms.
In
California’s
Alameda
County,
for
example,
the
passing
of
Proposition
13
provided
a
’justification’
for
massive
lay-offs
which
officials
had
long
favoured
(Citrin
and
Levy
1981).
It
follows
that
immediate
reactions
to
fiscal
stress
can
combine
short-term
palliatives
with
longer
term
goal
restructuring:
public
works
programmes
and
general
capital
outlays
are
cut,
new
project
implementation
is
delayed,
new
appointments
are
frozen,
wage
increases
are
resisted,
user
charges
are
increased,
new
revenue
sources
are
called
on,
budget
surpluses
are
reduced,
and
improvements
in
labour
productivity
are
sought
(e.g.
Levine et
al
1981;
Susskind
and
Serio
1983;
Walzer
1985).
Short-term
responses
might
be
essential
to
take
the
heat
out
of
a
turbulent
situation,
but
these
should
not
be
confused
with
longer
term
policy
aims.
Yet
the
combined
effects
of
immediate
palliatives
and
the
restructuring
of
basic
goals
is
likely
to
lead
to
’chaotic’
patterns
of
policy
change.
As
Saltzstein
(1986:
155)
reported,
three
years
after
Proposition
13
what
was
evident
in
the
reactions
of
California’s
largest
cities
was
that:
’There
is
no
common
response
to
Proposition
13
other
than
a
change
from
the
previous
budget’.
Yet
as
time
progresses
policy
changes
can
be
expected
to
’stabilise’,
as
new
strategies
are
tried
and
tested
to
meet
the
changed
budgetary
environment
produced
by
the
initial
fiscal
trauma.
Of
course,
local
governments
are
likely
to
establish
new
priorities,
if
at
all,
at
an
uneven
pace.
A
few
will
find
fiscal
disruption
the
catalyst
for
their
immediate
assertion,
but
elsewhere
it
will
take
time
for
new
compromises
and
accommodations
to
be
made
(Levine et
al
1981).
Hence,
in
order
to
assess
whether
fiscal
disruptions
produce
reorientations
in
policy
(and
not
simply
a
temporary
deviation
from
an
enduring
path),
a
longer
time
perspective
is
required
than
has
been
the
norm
in
evaluations.
This
paper
analyses
such
longer
term
trends,
by
examining
relationships
between
local
power
structures
in
the
San
Francisco
Bay
area
and
changes
in
municipal
reliance
on
different
revenue
sources
after
the
passing
of
Proposition
13.
REVENUE CHANGES
For
revenue
sources
which
accounted
for
at
least
half
of
one
per
cent
of
1977/78
’city’
income
in
the
California,
Table
1
lists
per
capita
revenue
changes
between
1977/78,
the
year
immediately
prior
to
Proposition
13,
and
1986/87
(the
most
recent
data
when
information
was
collected).
These
data,
as
with
all
figures
presented
in
this
paper,
do
not
include
the
City-of
San
Francisco
due
to
its
peculiar
legal
standing
(as
the
sole
institution
in
California
with
the
dual
functions
of
city
and
county).
Legal
differences
in
the
revenue
potential
of
cities
and
counties
(Mercer et
al 1985;
Raymond
1988)
mean
that
including
this
institution
would
distort
results
(state
figures
on
city
government
exclude
San
Francisco).
Table
1
therefore
draws
on
the
California
State
Controller’s
annual
Financial
Transactions
Concerning
Cities
of
California
for
data
on
the
58
other
cities
in
the
San
Francisco -
Oakland
metropolitan
area
that
were
in
existence
in
both
1977/78
and
1986/87.
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