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Critics claim proposed new tax agency gives governor too much power

Manny Otiko | 6/15/2017, midnight

A plan to radically reshape the State Board of Equalization (BOE) has both Democrats and Republicans up in arms. Plans for the changes are contained in SB 86. According to the legislation, Democrats plan to create a new tax body that would be under the Governor’s Office.

The legislation reads, “This bill would establish, in the Government Operations Agency, the California Department of Tax and Fee Administration and would place the department under the control of a director appointed by the Governor and subject to confirmation by the Senate. The bill would also authorize the Governor to appoint a chief deputy director and a chief counsel.”

According to the Sacramento Bee, tax disputes would be settled by administrative judges, not board members of the BOE, who are elected.

The move was motivated by a March audit which revealed that the BOE couldn’t account for millions of dollars and also found that some board members were redirecting state employees to work on their own projects.

However, some Democrats and Republicans believe this a power grab by the Governor’s Office and some other Democrats.

George Runner, vice chair of the BOE, said the new law would only add another layer of government bureaucracy.

“This last-minute budget power grab would strip California taxpayers of their right to bring their tax appeals before their elected peers. In its place the bill would establish yet another unelected and costly tax bureaucracy,” said Runner, a Republican. “It’s a sad but true reality: the only real alternative to an elected official is an unelected state worker. The proposed changes go far beyond issues identified in recent audits, nearly all of which have been addressed and corrected by the Board.”

Jerome E. Horton, a BOE board member, said the proposed changes would cost more money in the long run.

“This measure adds an additional layer of bureaucracy and will eventually cost taxpayers billions for separate computer systems, administration, lawyers and facilities. This bill will also place minorities and small business at a serious disadvantage in their appeals of taxation,” said Horton, a Democrat. “It definitely requires additional thought, deliberation, and study.”

The bill is being reviewed by the Assembly and is currently with the budget committee.