NEWARK’S MEASURE L COULD BE A TEMPLATE FOR CITY’S TAX INCREASES
The Citizen
What started as an avenue for citizens to help the city make tough budget decisions is morphing into the realm of the political. The San Leandro City Council unanimously approved Monday night the creation of a 13-member Ad Hoc Citizens’ Budget Task Force hoping to provide the city guidance in prioritizing services and programs for the next year.
The committee, which begins work with an educational session Nov. 12 and concludes in January, will be preceded by a $75,000 informational mailing and consulting campaign on the need to raise revenue in the city. Some councilmembers criticized the politicizing of the issue before the committee even makes a single recommendation. Councilwoman Diana Souza said it was like “putting the chicken before the egg” while Councilman Bill Stephens questioned the city’s intentions with the campaign.
“Sounds to me what we’re trying to do is move an agenda forward and then also have an ad hoc committee that will support that agenda,” he said. “It think we have it backwards.”
The committee creation hopes to stay clear of vociferous outrage residents conveyed towards the mayor and council over cuts this year to services including crossing guards and access to the city’s recreational facilities. Mayoral candidate and former School Trustee Stephen Cassidy first suggested giving more voices input into the budget process, which some economist worry, despite recent news of the economy dipping out of a recession, the economy may worsen before getting better. Cassidy has recently blogged about City Manager Stephen Hollister’s $75,000 “contingency fund” for the informational campaign and wondered why money was not available for other services, such as school crossing guards.
“You want to hire outside consultants and spend $75,000 to convince the community you’re watching every nickel and dime and being spendthrift as possible,” said Cassidy. “It’s going to backfire on you. You should be conducting community forums, you should be getting out there yourselves. You shouldn’t be relying on third party consultants to be communicating with the public directly.”
Hollister says the campaign will be educational and would not advocate a specific revenue measure. He estimated mailers delivered across the city would cost $40,000 with the rest going to consultants. Observers say drumming up support for much-needed revenue enhancements is similar to the strategy the city of Newark is conducting to pass Measure L, a 3.9 percent utility tax initiative, voters will decide today.
Here is the 13-member Ad Hoc Citizens’ Budget Task Force named Monday night: Tom Dlugosh (Chamber of Commerce), Johanne Dictor (Bill Stephens), Vic Entrikin (Diana Souza), Mike Fitzgerald (HOA Rep), Patrick Grajeda (SLCEA), Surlene Grant (Ursula Reed), Edras Gustin (Tony Santos), Benny Lee (Joyce Starosciak), Bob Leigh (HOA Rep), Tom Overton (SLMO), Dale Reed (Michael Gregory), Kathy Sanchez (Jim Prola), Mike Sobek (POA).
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The mayor and city council are firmly on the path of placing a sales tax hike on the ballot next June. They may even put a second tax measure on the ballot as the proposed sales tax hike will not cover the city's projected annual deficits of $6 million in the coming years.
I am opposed because the increase will bring the sales tax in San Leandro to 10%. Our city would have the highest sales tax in Northern California. That is not how our city leadership should be distinguishing San Leandro. San Leandrans will start shopping outside our city for major purchases. Less consumers from outside San Leandro will buy cars on auto row and purchase goods and services from other San Leandro businesses.
Moreover, the sales tax is a regressive tax. It hurts working families and seniors on fixed incomes the hardest.
What's the likelihood a sales tax hike will pass? In 2009 there have been 9 attempts by local governments in California to raise their sales taxes. Seven of the nine measures failed, including 3 of the 5 measures on the ballot yesterday.
Why have sales tax measures done so poorly even though many other tax measures have been enacted? One liberal commentator on http://www.calitics.com has stated:
“Yesterday's election once again proved that, generally speaking, Californians are quite willing to tax themselves. Not every tax proposal passed, but in an extremely low turnout election (20% in Salinas, for example, a city which saw 80% turnout in November 2008) it's a sign of how open CA voters are to taxes that nearly 2/3rds of them are headed for approval. . . . 65% of local tax measures on yesterday's ballot are headed toward approval, putting to rest the notion that CA voters are inherently opposed to new taxes.
Granted, not every proposal passed. One common theme in yesterday's election was resistance to using the sales tax as a method of providing for local services. In an election defined by economic populism, voters in Salinas, Ventura, and San Carlos said they did not want a regressive tax to fund key services (though San Mateo and Gustine did pass those taxes). Voters would likely prefer more progressive taxes, those that ask the wealthy to pay their fair share. Unfortunately local governments don't generally have the power to levy those kind of taxes, and owing to Prop 13, have become dependent on the sales tax even against their own better judgement.”
Also of note, Newark's utility user tax measure is passing – barely. It leads by 8 votes.
Until all provisional and absentee ballots turned in a poll stations on election day are counted, we won't know if the tax passed. The 8 vote lead (out of 4,128 votes counted so far) does not give one confidence that Alamada County voters are ready to embrace new taxes for local governments.
For San Leandro, no Plan B is in the works. The mayor and city council are not actively working to reduce spending. In fact, despite the cuts that have occurred, spending this year exceeds last year. Part of the reason is police officers received 4% pay raises for 2009.
The mayor and city council are rolling the dice and placing the fiscal solvency of the city on a successful campaign to increase the sales tax.
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