Candidate for
State Board of Equalization; District 2; Republican Party

Why I fight so hard for taxpayers at the Board of Equalization

If you are like most people, you have no idea what the Board of Equalization does and why it matters who represents you on that Board. The Board of Equalization ("BOE") is California's elected tax appeals board, which is made up of four members elected from huge districts plus the State Controller. The Board operates like a court and sometimes as a special legislature for tax rules, but it may help to think of it as a defense attorney that stands between you and the awesome power of government.

The five elected Board members are your last hope when the government says you have a tax problem. If you lose your appeal at the Board level, you actually have to pay all the taxes the government says you owe before you can file suit in court. California's tax agencies have all the resources of the State at their disposal, even the power to empty your bank account, sell your home, or shut down your business -- without a court order. The elected members of the Board can stop them, so it really matters who casts those five votes.

The Board of Equalization was created in 1879 and the familiar adage "You've come a long way baby" is a perfect statement about the evolution of the Board. Originally created to "equalize" property assessments throughout the state, the Board now controls over 90% of all taxes and fees paid by Californians, either directly or indirectly.

How does the Board of Equalization do this?

• The BOE directly administers three dozen tax and fee programs, including the sales tax and the tax on alcohol, cigarettes, fuel, tires, hazardous substance, insurance, and timber. The Board administers many tax-like fees, including the waste management fee, marine invasive species fee, disposal fees, lead fees, oil response fees, underground storage tank fee, electronic waste fee, environmental fees, and water rights fees, to name just a few. Wow, if voters in 1879 could see us now!

• The BOE also serves as the appellate body for income tax appeals, property tax appeals, and various business tax appeals. This one is a biggie. If you and the Franchise Tax Board don't see "eye to eye," your last hope is to win the support of the elected BOE members.

• The BOE writes the rules and regulations to implement the tax laws enacted by the Legislature. The Legislature normally drafts vague "enabling statutes" that establish very general tax policies and programs, leaving the critical details to be written by the Board of Equalization as regulations. They have very broad authority to both write the rules and then implement those rules itself as the tax collection agency. Thus, Board members serve as judge, jury and executioner in our tax system.

• The BOE assesses the property tax value of railroads and utilities, including gas, electric, and telephone companies. There are very few checks and balances in this process, and Proposition 13 protections do not apply, so each year a three-member majority can raise property taxes on your utilities by setting higher property values. Higher utility taxes mean that your home or business will face higher utility bills.

• The BOE still writes the Property Tax Rules and oversees the assessment practices of locally-elected county assessors (the original reason for creating the Board).

Until they have a tax problem, most people never realize how vitally important it can be to have competent and helpful members on the Board of Equalization. And let's face it: we are all one audit away from having a tax problem.

Being right is not enough when you are fighting a tax assessment. You need three votes on the BOE to avoid being forced to pay the assessment, hire an attorney, and go to court to face a judge who may know nothing about tax law. Even the simplest tax cases take years to resolve in our dysfunctional and outrageously expensive court system, so the BOE is the last stop for most taxpayers with tax problems.

The power to tax is the power to destroy. Who you elect to the California Board of Equalization is at least as important as whom you elect to the Legislature. California has the only elected tax board in the United States. All others are appointed. To me, that means your elected member is there to protect you, the taxpayer. Your elected representative is accountable to the people and should listen to your case and assist you whenever possible, not be a "rubber stamp" for the government auditors, tax collectors, and bureaucrats.

The five elected members of the Board of Equalization write the rules, implement the rules, evaluate your evidence, and apply the rules to your tax appeal. They are your only hope for justice if you do not owe the taxes that the auditor claims you owe. Choose wisely when you cast your BOE vote. Today liberals are looking for every way they can find to take taxpayers' money to pay for some politician's favorite program. For your own survival you must choose someone who has the experience, knowledge, savvy and proven record of effectively advocating and defending taxpayers at the BOE. You don't need an amateur when you stand alone in the hearing room pleading for fairness. Today's financial crisis is no time for on the job training. Today taxpayers more than ever need a representative who "hits the ground running".

At the taxpayers' table of a quiet hearing room, your financial future rests in the hands of five elected members of the Board of Equalization.