Taxpayers in cities less fortunate than Pleasanton are paying more taxes as their cities take advantage of a new tax ruling handed down last year by the State Supreme Court.

The Farrell decision upheld an increase in San Francisco's business license tax, stating that it did not violate Proposition 13's requirement that new taxes or tax increases be enacted by at least two-thirds voter approval.

Since that decision 14 months ago, many cities in the Bay Area have enacted utility users' taxes. Those cities include Livermore, Concord, Antioch, Benicia, Martinez, Richmond, Morgan Hill, Pacifica, Redwood City and San Pablo. Sixty-four cities statewide have implemented the tax and many more are expected to in the near future.

The taxes have appeared as surcharges of up to 11% on gas, electricity, telephone or other utility bills, and cost taxpayers from $10 to $100 or more per year.

To cities still unable to recover from the effects of Proposition 13, the utility users' tax is an alternative to less desirable taxation such as raising property taxes. It is easy for a city to implement and collect, and the tax-payer may not notice the cumulative impact as it is spread over one or more monthly utility bills.

Due to the approval of new commercial and industrial development in Pleasanton, it is highly unlikely that the city will ever have to consider this unpleasant alternative of raising funds through taxes on monthly utility usage. It has been estimated that revenue to the city from Hacienda Business Park alone will reach the $5.9 million mark by 1991. This revenue from Hacienda and other North Pleasanton development will provide the city with the necessary funds to provide new services and sustain existing services without resorting to additional taxes.

Critics of these utility taxes have many concerns:

• The ease with which they may be implemented.

• The undermining of the Proposition 13 mandate that voters must approve all new taxes by a two-thirds majority.

• The taxes hit hardest those who can least afford them - the poor, disabled and elderly who already have difficulty paying for necessary utilities.

• The taxes are unfair to all, as residents can not supply their own utility services, and have no alternative but to pay the tax.

According to the finance office for the City of Livermore, a 3% utilities user tax is levied on telephone service (excluding out-of-state calls), cable television, water and PG&E bills. In Redwood City, there is a 5% surcharge on power, telephone and cable television bills. The average resident in Redwood City pays a total of $75 per year in utility taxes, based on figures for average bills provided by the utilities.

Pleasanton has once again lived up to its motto "City of Planned Progress." The planning and foresight of community leaders and elected officials in approving commercial and industrial development in North Pleasanton, will allow the city to thrive without resorting to loophole taxation measures.

To see a reproduction of the original article and edition of Pleasanton Pathways, visit: December 10, 1983 Pathways.