Let’s Do Our Part, Don’t Shirk : Minor temporary increases in state taxes to dig way out of earthquake

The Jan. 17 earthquake, whose magnitude is expected to be officially raised to 6.8 by the National Earthquake Information Center, was the most powerful ever to affect a large U.S. population. It was also the costliest, with Gov. Pete Wilson’s Administration now estimating losses at $13 billion to $20 billion. The question of how to pay for repairs and reconstruction remains as compelling as ever.

The Clinton Administration and Congress, demonstrating one of the virtues of federalism, are on track to treat Southern California generously, with close to $9.5 billion in aid expected eventually. Private insurance payouts could total about $2.5 billion more. Wilson’s office puts the state’s repair cost at $1.9 billion, with local governments facing a $135-million bill. Once upon a time the state could simply have tapped its considerable tax-revenue surplus to meet its obligations. But the cupboard has long since been emptied. How, then, should the state best meet its obligation?

Wilson continues to incline toward the slow, politically cautious and ultimately quite expensive route of a bond issue. Far more preferable, we think, is to apply pay-as-you-go financing to the repairs--as was done in the aftermath of the 1989 Loma Prieta quake in the Bay Area--using very modest, selective and temporary statewide tax hikes.

Sen. Quentin L. Kopp (I-San Francisco), chairman of the Transportation Committee, proposes boosting gasoline taxes a mere two cents a gallon for 3 1/2 years to raise$1 billion for earthquake-related repairs and vitally needed seismic safety retrofitting of bridges, overpasses and the like. Our own earlier preference was for a larger gas tax over a shorter period, not least because the price of gasoline has fallen so much. However, the Legislature now has before it bills calling for the smaller gas tax and a temporary one-quarter-percent increase in the sales tax; the sales tax boost would yield $1.5 billion. These are affordable and equitable increases, and they are clearly necessary to help restore normal civic and economic life. Washington is ready to do its share. Now it’s California’s turn.