TAX NEWS - June 2010

Taxation in California

The Santa Clarita Valley's two state senators have both won Republican bids for statewide office, and together they hope to change the face of taxation in California.

"I believe California is overtaxed, and the way we're going to get out of this recession is to keep people working and not going after more money from small business," Sen. George Runner, R-Lancaster, said Friday in an interview.

Runner was the top vote-getter among all candidates in the primary race for the state Board of Equalization District 2 seat last Tuesday. Runner's district takes in most of the Santa Clarita Valley.

Winning handily in a bid for the state controller's office was Sen. Tony Strickland, R-Thousand Oaks. His district takes in parts of the western Santa Clarita Valley.

Strickland will face Democratic incumbent John Chiang in the November election; Runner will face off against the winner of the Democratic primary for Board of Equalization District 2, Chris Parker, a tax attorney for the California Franchise Tax Board.

The Franchise Tax Board deals with state income tax. The Board of Equalization collects California state sales and use tax, as well as fuel, alcohol, and tobacco taxes and fees that provide revenue for state government and essential funding for counties, cities, and special districts.

The board consists of four members elected from four state districts, plus the state controller.

If both Runner and Strickland win, they will shift the board's makeup from predominantly Democratic to predominantly Republican.

Runner, who portrayed himself as a tax reformer and downplayed his Senate record during the first part of the campaign, said while he enjoys his work as a state senator, tax law has always interested him and a seat on the board will allow him to focus more of his energy on tax rates — something he can't do as a state senator.

"We obviously change gears now," Runner said Friday of his campaign between now and November. "There's clearly a little more interest on the Republican side but you gear up for the campaign like any other election."

"There's a much narrower focus on tax issues (on the Board of Equalization) as opposed to the Legislature itself which has a much broader focus," Runner said of the position he is seeking.

For Strickland, the November election will be a rematch of the 2006 election for controller, when Chiang beat Strickland to become California's top tax official by almost 1 million votes.

Strickland could not be reached for comment Friday, but on election night he said Chiang had been a week leader for California. His campaign for November will attack the controller's record the last four years.

"Chiang hasn't been aggressively auditing and maximizing the dollars we get in Sacramento," Strickland said on election night. "The state's on the wrong track, and we need new leadership."

If all goes as the two plan in November, Strickland and Runner would work together in their new positions, splitting up the billions of tax dollars California collects each year.