PROPOSED MEASURE "H"

AN ORDINANCE OF THE CITY OF HERMOSA BEACH, CALIFORNIA, REPEALING SECTIONS 3.36.040, 3.36.050, 3.36.060, 3.36.070 AND 3.36.080 OF CHAPTER 3.36 OF THE MUNICIPAL CODE OF THE CITY OF HERMOSA BEACH

CITIZENS' INITIATIVE ACT TO REPEAL THE UTILITY USERS TAX ON TELEPHONE, ELECTRICITY, GAS, WATER, AND CABLE TELEVISION

The people of the City of Hermosa Beach do ordain as follows:

SECTION I. Title . This Act shall be known as and may be cited as the "Citizens' Initiative Act to Repeal the Utility Users Tax on Telephone, Electricity, Gas, Water, and Cable Television."

SECTION II. Findings and Declarations . The people of the City of Hermosa Beach hereby find and declare all of the following:

1. The costs of electricity, gas and water, already high in Southern California, are escalating.

2. A 6 % utility users tax was imposed by a City Council vote in 1985. It was to "sunset," or expire, after three years but in 1986 the City Council deleted the sunset clause, and the tax still remains in effect.

3. Despite generous pay raises to police, fire and other City personnel, despite record purchases of new cars and trucks, and despite the costs of a major, ongoing, remodel of City hall, the City of Hermosa Beach has had budget surpluses of $1 million or more in each of its last three fiscal years. As a result, as of January 2001 the City had $20 million in bonds and other interest-yielding accounts - up more than 50% from two years ago.

4. Repealing the 6% utility users tax will benefit residents and help Hermosa's businesses to compete fairly with those in other cities that have no utility tax.

5. Should the revenue stream from this tax again be needed in the future, a new utility users tax may be instituted by a simple majority vote of the electorate.

SECTION III. Purpose and Intent . The people of the City of Hermosa Beach hereby declare their purpose and intent in enacting this Act to be as follows: To reduce taxation in order to help to offset the soaring cost of utilities.

SECTION IV. Municipal Code Amendment . Sections 3.36.040 through 3.36.080, entitled "Telephone Tax," "Electricity Tax," "Gas Tax," "Water Tax," and "Cable Television Tax," of Chapter 3.36 of Title 3 of the Hermosa Beach Municipal Code, are hereby repealed in their entirety.

SECTION V. Liberal Construction . The provisions of this Act shall be liberally construed to effectuate its purpose of providing tax relief.

SECTION 4. Severability . If any provision of this Act, or part thereof, or the application thereof to any person, property or circumstances, is for any reason held to be invalid or unconstitutional, the remaining provisions shall not be affected, but shall remain in full force and effect, and to this end the provisions of the Act are severable.

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