Sit down for a bite with Carl Guardino, President and CEO of the Silicon Valley Manufacturing Group. It’s a consortium of high-flying tech companies putting their considerable economic and intellectual influence behind bold policy initiatives. Like daring to chip away at the seemingly impregnable Prop 13 by proposing to reduce to 55% the margin required to pass transit tax hikes.
Published: August, 2003
BC: What is the Silicon Valley Manufacturing Group?
CG: The Silicon Valley Manufacturing Group is a trade association of [about 180] high-tech, biomedical, and related employers in Silicon Valley who work on issues that impact, not only the economic health of their companies and the region, but also the quality of life of their employees and everyone else who lives in Silicon Valley. These employers collectively provide one of every four jobs in Silicon Valley.
BC: So what are the issues that you guys are working on?
CG: For the past several years, there have been five core issues: traffic, affordable homes, education, energy, and the environment.
BC: So let’s talk about your ideas on public transportation. I understand that you are working on making it easier for counties to tax themselves to improve transportation. How’s that going?
CG: It’s an idea whose time has been past due. In 1995, the State Supreme Court took away local voters’ rights to build critical transportation infrastructure. This decision said that, if you were going to pass a general purpose tax to be used for any purpose at all, without accountability to the voters, you would be rewarded with a majority vote threshold. If you were going to be specific and accountable with voters, and tell them what you were going to do with their money, you were going to be penalized with a two-thirds vote requirement.
For the last eight legislative years, we have been urging the legislature to let Californians decide, rather than nonelected judges, about what the threshold should be. For eight years, the legislature has done nothing about it. And this year with the budget crisis we stand to lose two to three billion dollars in state transportation dollars to meet local needs. So adding insult to injury, locals, you can’t do anything about it yourself, and we’re going to take away the state money that we promised. But we think it’s past time. And I think if the legislature doesn’t act, and it doesn’t appear they are going to do so, that private citizens and local leaders need to once again step forward, place a constitutional amendment initiative on the ballot, and return the threshold, if not to 50 percent, where it was before that 1995 Supreme Court decision, then to 55 percent, similar to what local school bonds are allowed to cap at after Prop. 39.
BC: Now, less than 6 percent of the population use public transit. What’s to say that that’s not going to continue?
CG: When we talk about infrastructure improvements and what the vote threshold should be, again, that is for infrastructure including roads and transit. And we believe that people should have options to the automobile. It is easy for folks to surmise that 90 percent of trips are by automobile until we peel back the onion even one layer, and realize that 99 percent of our transportation infrastructure in Silicon Valley are roads, and 1 percent is rail transit. How do we expect much more than 1 percent of trips to be taking place by rail when we’ve only made a 1 percent investment in the amount of miles that we can travel in that fashion? So we need to make sure that we give people options by building a network that actually gets you somewhere.
BC: Doesn’t a sales tax disproportionately affect the poor? Why not call for a gas tax to finance these transportation infrastructure improvements?
CG: You may recall that, about seven years ago, the Silicon Valley Manufacturing Group actually sponsored the state legislation that passed the legislature after a lot of effort, and Governor Wilson signed it, allowing a regional gas tax initiative to be placed on the ballot. Our hope is that transportation improvements would be funded through a user fee approach, such as a gas tax. In a democracy, at the end of the day, voters decide what they will support. And even though we were able to pass that legislation, that, again, we sponsored in the legislature, after seven years of polling on that periodically, it still would not pass voter muster. So the choice is to not do anything, or to do a funding approach that voters are willing to vote for. And that has led to, not only in this region, but throughout California, numerous sales tax initiatives because, for whatever reason, voters are willing to pay for transportation improvement through a sales tax.
There are pros and cons to any tax. And the sales tax certainly has both. The con is that it is at least somewhat regressive. The pro, a couple. One, voters are willing to support it, so pragmatically we can gain transportation improvements. Two, it fits our basic philosophy, as a gas tax as well, that it is a mechanism where everyone pays and everyone benefits. And our transportation system is something where everyone benefits when it’s improved. So at least it’s equal in that way across the board. In terms of its regressive nature, it can disproportionately fall on those of a lesser income; the sales tax, though, is a little less regressive than I think we sometimes think because people who make more, spend more. And so if you look at sales tax numbers completely, more sales tax is paid by people who have more money and spend more money.
The other thing that’s good about a sales tax, in at least Santa Clara County, for instance, is that 40 cents of every dollar collected in sales tax is paid for by employers. So as an employer organization, we think it’s an example of the deep belief in transportation improvements that our members have, that they have not only supported, but sponsored measures that are sales tax-based when they pay so much of that sales tax. And in an international marketplace, you can’t pass that along to your consumers because your competitors, even outside of this county, let alone this state or nation, are not paying that. So it’s really showing a commitment that they’re putting their wallets where their words are.
BC: Isn’t it really hypocrisy of the voters to continue to ride SUVs and have a car-centric culture, while expressing pro-environment points of view?
CG: We try to remind folks that our personal choices, whether it’s how we vote on an initiative at the ballot, who we vote for in terms of elected officials, and our personal lifestyle choices really do make a difference. In a region with seven million people in the nine-county Bay Area, I believe it’s easy to start thinking how individual actions or efforts don’t really matter. Stanislaw Lec said once, "No snowflake in an avalanche ever feels responsible."
BC: Can personal decisions solve the problem? Or doesn’t there have to be some larger communal commitment?
CG: Since the Manufacturing Group focuses mostly on local, regional, and state issues, and rarely ventures into federal waters, my next comment will be solely a personal view. The personal view on miles per gallon and the fleet of cars in America is that it would be nice if the laws required higher mileage per gallon, not only from an air quality and pollution perspective, but also from a dependence on foreign oil perspective.
BC: What do you all think about the idea of ferry services into the South Bay?
CG: I think the key to ferry service where it’s currently going, where it works well, as well as moving it further down the Bay, depends on ridership demand as well as linkages, making sure that folks have transport once they get to those docks. It works really well where it is in the northern part of the Bay. And as we move it down, we need to keep those two key criteria in mind.
BC: Returning to the issue of the sales tax measure, what are you doing to return the voter threshold to a majority vote? Do you have people out on the street collecting signatures for a petition measure?
CG: On the potential statewide initiative, out of respect for the legislature, the first thing we did was, for a month, encourage them to pass any of the number of bills that would allow California voters to make that decision for themselves. There is not much movement on that issue, or the budget, or a variety of other challenges facing our state in what is sadly becoming a very partisan legislature.
So within less than two weeks, we gathered more than 200,000 California voter signatures and turned those into the legislature in numerous boxes higher than the ceiling in the room we’re sitting in. That, regrettably, still did not break the partisan gridlock in Sacramento.
We are now pulling together statewide partners to meet within the next couple of weeks to review potential wording for a constitutional amendment so that we can place on the 2004 ballot an initiative on local control and accountability to pass local infrastructure improvement measures. Again, if not at 50 percent, then at 55 percent.
BC: Well, thanks a lot. We really appreciate it.
