Ex-Candidate: California Tax Board Shouldn’t be Elected

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By Laura Mahoney

A former California legislator ended his bid for a seat on the State Board of Equalization in 2018 because he has decided the tax board shouldn’t be an elected office.

Rich Gordon (D) told Bloomberg BNA May 5 he came to his decision after researching the board, watching it in action and reviewing the scathing recent audit from the Department of Finance (DOF) on misuse of agency staff for member-driven events with minimal ties to the SBOE’s tax mission.

“At the end of the day, if you’re performing an administrative role and a quasi-judicial role yet you get there through a political process, it creates an inherent conflict,” Gordon said. “For me, it became an ethical dilemma.”

Gordon made his announcement as the Legislature prepares to respond to Gov. Jerry Brown’s (D) request to enact changes to the troubled SBOE by June (see related story, this issue). In an April 14 letter, Brown stripped the SBOE of its personnel and contracting authority and asked the California attorney general to investigate its potential misuse of state funds reported in the DOF’s March 30 Office of State Audits and Evaluations report.

Problems Will Recur

Gordon was running for the seat now held by Fiona Ma (D), who was elected to the board in 2014 and is running for state treasurer in 2018. That district covers central and northern California coastal and inland counties from Santa Barbara to the Oregon border.

Gordon notified supporters of his decision in a May 4 email. He represented an Assembly district in San Mateo County south of San Francisco from 2010 to 2016.

The Legislature and the tax agency can fix some of the problems grabbing attention now, but the problems will recur as long as the board is elected, Gordon said.

For example, personal staff for the board members function more like staff members who work for legislators, meeting with constituents about their tax matters. Gordon questioned board rules allowing those constituents to later appear before the board to appeal their tax matters without disclosure of the ex parte communications.

No PAC Limits

Rules limiting campaign contributions to $249 in one year from taxpayers or their representatives with tax appeals before the board don’t preclude contributions from political action committees, Gordon said.

“Individuals and corporations can contribute to a PAC, and that money flows to the people making judicial decisions,” he said. “Can we trust that a decision was made based on legal analysis or on a campaign contribution? I don’t think the public should have to wonder.”

Gordon said the tax agency has a role in taxpayer education. “When the board is elected, the line between educating taxpayers and self-promotion can get blurred.”

Gordon said he will help lawmakers who are crafting changes to the SBOE in the next few months.

Two other candidates have active campaign accounts open for the 2018 race for SBOE District 2, according to filings with the Secretary of State. They are San Francisco County Supervisor Malia S. Cohen (D) and state Sen. Cathleen Galgiani (D), who represents and area south of Sacramento that includes Stockton and parts of Modesto.

To contact the reporter on this story: Laura Mahoney in Sacramento, Calif. at LMahoney@bna.com

To contact the editor responsible for this story: Ryan C. Tuck at rtuck@bna.com

For More Information

Text of Gordon's email is at http://src.bna.com/oAC.

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