Skip to comments.State Budget Deal Includes Tax Break For Wealthy Firm
Posted on 10/06/2010 9:40:28 AM PDT by KingofZion
Buried in the details of the deal to close California's $19-billion budget deficit is a roughly $30-million tax break crafted to benefit a company owned by members of one of the state's richest and most politically influential families, according to a legislative analysis obtained by The Times.
The provision, which will allow the Humboldt Redwood Co. to deduct $20 million in old losses from future taxes, is also expected to cover penalties and interest for the firm co-owned by three sons of Donald G. Fisher, founder of the Gap and Banana Republic, said company Chairman Sandy Dean.
The tax break was inserted into the draft state spending plan during closed-door negotiations between the governor and legislative leaders, said people close to the talks. They spoke on condition of anonymity because of the secret nature of the deal-making.
*** Some budget watchers were dismayed that the governor and legislative leaders would fashion a measure giving a large tax benefit to a single wealthy family when California is suffering through a grueling recession.
"It's inappropriate to grant narrowly targeted tax breaks at a time when the state is making deep cuts...
*** Sons Robert and John both among the owners of Humboldt Redwood have contributed more than $1million each, the records show. In 2006, John Fisher contributed loans and cash totaling $826,436 to help defeat Proposition 82, a measure sponsored by Rob Reiner that would have taxed the rich to create a statewide preschool program.
Robert Fisher has given at least $1million to environmental causes, including $500,000 each to Californians for Clean Alternative Energy in 2006 and the Natural Resources Defense Council in 2010.
He also donated at least $22,300 to Gov. Arnold Schwarzenegger's reelection campaign in 2006 and $50,000 to the governor's California Dream Team in 2009.
(Excerpt) Read more at latimes.com ...
At the same time, taxpayers get shafted because state budget is $20B in the hole. Disgusting. And they wonder why the tea party is so popular.
And some think these people actually became billionaires the honest way.
Of course, Arnold would tell us that these are not “special interests.”
I don't remember the particulars on this but my foggy recollections tell me that there may be a good reason for this deal. If it is who I think it is, then as I recall, bogus ESA listings and TMDL regulations have made this man's property virtually valueless. He did everything right. He got certified. He hired the best forester available (Mike Janai). He tried to cooperate, but the State and the greenies have basically cut him off at the kneecaps (much to the preference of Red Emerson and the Simpsons, who have been using regulations to slowly corner the redwood market in this state for fifty years). He's probably up to sue, has the resources, and now, with that case in Humboldt Bay, the precedents to stick them for a huge chunk of change plus punitive damages. The problem for him is that he probably wants to see the results in his lifetime.
Hence the State doesn't want him to sue and is quietly buying him off. The LAT greenie real estate thugs (the Chandler family) don't want this new money newbie keeping his land or getting anything in compensation; it makes a bad precedent as far as screwing property owners is concerned. Hence this underhanded deal.
Just a guess, but my dim recall of this is ringing in my ears.
The Fisher’s set up Humboldt Redwood Co in 2008 after purchasing property from the old Pacific Lumber/Maxxam/Hurwitz.
Here is an article from 2008:
Yeah, that was the guy.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.