WESTSIDE INCORPORATION:

GOOD FOR THE COUNTY, BAD FOR THE RESIDENTS

Over the years, there has been a lot of talk about the Westside communities of Sunset Pointe, Stevenson Ranch, Westridge, and/or Castaic annexing into the City of Santa Clarita.  The talk used to focus just on annexation.  Recently, though, Supervisor Antonovich has tried to stress to the Westside residents that annexation is not their only option, that they actually have three options, which are, 1) do nothing and stay in the unincorporated County, 2) annex to the City of Santa Clarita, or 3) incorporate into a new and separate city. 

The benefits of staying in the unincorporated County (the first option) versus annexing to the City (the second option) are well known; the City has lower taxes and fees, has a higher level of municipal and police services, and offers more accessible and responsive local government representation.  The third option, incorporation, is at this point unknown.   No studies have been conducted to determine if a new city is feasible, viable, or even desirable.  However, recently Supervisor Antonovich pledged $25,000 to prepare an initial feasibility study to determine the viability of a new city on the westside.  This is not an in depth study, mind you, it is simply a preliminary study to determine if incorporation may be feasible.  Further in-depth study of the issue will be required.    

One might ask why Supervisor Antonovich would spend taxpayer money to fund such a study.  The answer is that the County would prefer the Westside to incorporate into a new city rather than annex into Santa Clarita.  Why?  Because the County would get to keep the huge tax revenue surplus that it collects from the Westside. This is actually required by State law under what is called "revenue neutrality".

In a study conducted by Applied Economics in October 2006, it was found that the County collected a bit over $42 million from the unincorporated areas of the Santa Clarita Valley each year in the form of property tax, sales tax, the utility users tax that all unincorporated County residents and businesses pay, and other taxes and fees.  The study also found that the costs of providing municipal services to the same unincorporated County areas were just under $21 million.  The study concludes that the residents of the unincorporated areas are paying over $20 million more than they are getting back in the form of municipal services!  Over 20 million dollars are being used to fund County programs and pay County bills outside the Santa Clarita Valley and this is a conservative estimate! 

If the Westside communities remain in the unincorporated County areas, this $20 million surplus will continue to the leave the Santa Clarita Valley.  If the westside incorporates into a new city, the majority of these taxes will STILL be taken away by the County.  According to the Cortese-Knox-Hertzberg Local Government Reorganization Act, the state law that deals with incorporations of new cities, incorporations must result in ?revenue neutrality?.  In other words, the County is required to give to the new city only the amount of funds that it currently spends on providing existing levels of services to that community.  In the case of a westside incorporation, the County would only be required to let the newly incorporated city keep the $21 million it is currently spending on services.  The County would still get to keep the extra $20 million that it collects from the unincorporated residents and spends outside the Santa Clarita Valley!  Any increase in services over what the County currently provides would have to be paid for by the new City.  Ask yourself, from where would this money come?  In fact, not a single incorporation has occurred in Los Angeles County since 1992, the year that the revenue neutrality requirement was included in State law. 

Annexation, on the other hand, has no revenue neutrality requirement.  If the westside annexes to Santa Clarita, the majority of the $20 million in taxes that the County currently spends outside the Santa Clarita Valley would be collected by the City and 100% of it spent locally, on parks, trails, more police, road improvements, and other things that directly benefit the westside communities as well as the Santa Clarita Valley in general.

Supervisor Antonovich?s offer of $25,000 to pay for an incorporation study may appear generous on the surface, but in actuality it is quite self-serving.  Incorporation of the westside will ensure that the flow of our tax money out of the valley continues.  It will ensure that we, as county residents who can vote for only 1 of the 5 supervisors who control our tax money, will have little or no input in how or where this money is spent.  Annexation to Santa Clarita, on the other hand, will keep that money in our valley, benefiting the residents who are paying it.  Also, as a City resident, you would have a full voice in how that revenue is spent because you would get to vote for all 5 members of the City Council.

Simply put:  Westside incorporation: Good for the County, bad for the residents.