Richmond, California’s Measure T was struck down today in Superior Court of Contra Costa County. Passed in November 2008, Measure T represented a $16M per year windfall for Richmond City officials hoping to expand government spending at the expense of its largest employer, refiner Chevron (NYSE:CVX).
See ruling below
The court rejected Richmond’s claim that it could create a specific use tax that had not been adopted by the State of California. The court also rejected Richmond’s claim that the tax against Chevron was somehow different than the license fee for any other commercial enterprise in its jurisdiction, in violation of the Bradley-Burns law.
The court ruled that the City of Richmond, “is entitled to collect the alternative tax, i.e. the “employment” measured tax that was in effect before the Initiative was enacted. The refund to which Chevron would then be entitled can be calculated by simply deducting that tax from the tax actually paid.”
The Court recommended that Counsel for Chevron prepare a proposed judgment, consistent with the foregoing, and submit it to counsel for the City for review. The Court will hold a further case management conference to discuss any remaining issues on January 11, 2010, at 9:00 a.m.
Measure T, pushed by Mayor Galye Mclaughin and the so-called Richmond Progressive Alliance, was passed so Richmond could raise its business license fee on large manufacturers, charging a 0.25% of the value of raw materials they process. Large manufacturers, like Chevron, would be required to pay what leftist organizers considered its “fair share” for operating. The business license fee for landlords, retail, construction, service providers, restaurants and other non-manufacturing businesses would remain the same with NO increase. Additionally, the business license fee would be waived for all new businesses for up to the first 18 months of operation.
Clearly Measure T was a “GET CHEVRON” measure to specifically get into the deep pockets of the refiner and employer of more than 1000 workers to fund failing programs and overburdened budgets in the district.
Fortunately, rule of law, instead of mob rule prevailed.
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I opposed Measure T for some of the reasons cited by the court. It is unfortunate the citizens of Richmond will have to pay the legal costs for a measure that was written by people who did not know what they were doing.