Opinion ID: 1412641
Heading Depth: 2
Heading Rank: 1

Heading: Statewide Concern

Text: Finding preemption evidences a strong indication that the subject matter is of statewide concern. Here the field has been occupied by a comprehensive statute, and local legislation has been specifically prohibited. The importance of preemption as one factor showing statewide concern is illustrated by the statement of Justice Peters in the Bishop case: If it be assumed that there are some matters so local in nature that the Legislature's power to regulate will be limited to nonchartered cities ... it is apparent that such matters must be very rare. ( Bishop case, supra, 1 Cal.3d at pp. 68-69.) The extraterritorial effect of the Oakland tax is obvious. This court has taken judicial notice of the rapid growth of suburban areas in California and the high rate of mobility of the citizens of the state. ( In re Lane (1962) 58 Cal.2d 99, 111 [22 Cal. Rptr. 857, 372 P.2d 897] (conc. opn.).) In the 1968 reaffirmance of the intent to preempt set forth in Government Code, section 50026, the Legislature declared: The Legislature finds and declares that the right of citizens of California to move freely about the state in search of employment is a matter of statewide interest and concern. Any unnecessary barriers which impede the mobility of citizens of this state or limit their choice of employment are contrary to state policy. (Stats. 1968, ch. 559, § 3.) Other factors evidencing statewide concern include: (1) the effect of the tax on out-of-county workers regarding free inter-city travel; (2) the effect on nonresident work decisions; (3) the redirection of business market forces; and (4) the effect on nonresident residential decisions. All these factors demonstrate extraterritorial impact. It appears that large numbers of commuters are subject to the Oakland tax. These persons have no voice in the adoption of such tax, the level of tax imposed, the duration of the levy, or even the expenditure of the tax proceeds thus extracted. It is taxation without representation, a matter of evident statewide concern. If the subject tax were held to be a municipal affair, the entire municipal field would be opened to creation of a crazy quilt of overlapping taxing jurisdictions. Drawing from the federal-state parallel: If fifty independent economic units within the United States are undesirable, 387 economic enclaves within California would be intolerable. (Sato, supra, 53 Cal.L.Rev. 801, 818 (1965); see also, City of Los Angeles v. Shell Oil Co. (1971) 4 Cal.3d 108, 119 [93 Cal. Rptr. 1, 480 P.2d 953].) Such taxation problems are indeed matters of grave statewide concern. The issue before us should not be encapsulated. Viewed from outside its geographic boundaries, it is apparent Oakland is not a law unto itself. Other communities will be affected by and react to the Oakland tax  in some the tax may well spark retaliation. These too are matters of statewide concern. Neither the economic wisdom nor the social propriety of a municipal income tax is within our purview. These are, however, matters of concern to the Legislature; and to the degree such taxing decisions affect nonresident citizens and other taxing structures, such matters are of statewide concern. Local income taxes, such as at issue here, have been criticized as regressive, imposing the greatest proportionate burden on those whose income is lowest. Excluding interest, dividends, and capital gains also favors the rich. The tax fails to recognize that gross income is not always an accurate measure of taxpaying abilities. ( Legislative Developments, supra, 7 Harv.J.Legis., at pp. 274-281.) Proponents argue that the low rate reduces the inequities. There is no guarantee such rates will remain low, especially in view of rising costs and increased reluctance to raise property taxes. The license tax form creates arbitrary results. Neighbors, one working within the city and one without, are taxed at different levels  yet receive identical services. Nonresidents do not receive the same benefits as residents, yet both are taxed at the same rate. The tax is also thought unfair to those commuters who may live in a community without income taxes but with resultingly high property taxes. Such commuters could be required to pay both taxes. All of these alleged inequities are not for us to evaluate, but they are matters of statewide concern, once one's perspective exceeds the geographic boundaries of Oakland. For all of these reasons, I respectfully conclude that the subject matter is of general or statewide concern and the instant tax is invalid. The judgment of the trial court should be affirmed.