City considers sales tax increase
By Reggie Ellis
visalia – Visalia residents may have to pay a little more for their purchases in the near future, but the extra money will fund four vital services that touch the lives of every tax payer.
At its Feb. 1 meeting, the Visalia City Council authorized staff to move forward with plans to place a sales tax increase on the November ballot. The half cent sales tax would generate approximately $10.8 million a year for the City to spend on roads, public safety as well as parks and recreation. The sales tax increase would cost the consumer 50 cents per $100 spent. It would require a simple majority to pass on the November ballot. If approved, the half cent sales tax would be in addition to Measure T, the quarter cent sales tax approved by Visalia voters in 2004, bringing Visalia’s sales tax to 8.75%, which would equal the City of Dinuba, the highest in Tulare County.
Richard Bernard – Senior VP of Franklin, Maslin, Maullin, Metz & Associates – was hired to conduct a survey to gauge public support for the ballot measure. Bernard surveyed 500 registered voters last November and found that roughly six in 10 voters would vote in favor of the half cent sales tax measure. He also found that about two-thirds of voters perceive the City is headed in the right direction and that slightly more than two-thirds think the City has some need for additional funds.
Before making its decision to move the measure forward, the Council was presented with recommendations by two committees formed last May to look at all options for revenue as well as a new sales tax measure. Janice Avila, chair of the Ballot Measure Advisory Committee (BMAC) said the committee agreed there was a need for the measure. She said Measure T, the quarter-cent sales tax passed in 2006, is falling short of predictions because car owners are driving more fuel efficient vehicles and consumers have shifted from buying taxed items at a nearby store to shopping online. The Police Department has planned on adding 28 officers through Measure T funds but could only afford 23 officers.
The State’s prison realignment has also created a greater need for officers on the streets. Proposition 47 sends convicted felons back to local jails and potentially releases them early for thefts under $950 and lowers most drug possession crimes from felonies to misdemeanors. Calls for service to the police department increased by 105,000 in 2005 to 134,000 in 2014 and 911 calls from 34,000 to 83,000. During that same time, calls for service to the fire department increased from 9,500 to 14,000 and calls regarding homeless/vagrants have gone from 100 to 2,200.
CalPERS, the State’s public employee retirement system, overpromised pensions creating a difficult situation for cities. The City’s contributions to public employee pensions will continue to increase from the current 16% to 29.2% of miscellaneous employees by 2020 and 29.5% to 44.7% of public safety employees by 2020.
As Visalia’s population has grown the ratio of employees per 1,000 residents has dropped, meaning there may be a drop in the efficiency of services. From 2005-2014, the ratio of employees per 1,000 residents fell from 5.7 to 4.8.
As Tulare County’s largest city, the Public Works Department is responsible for 472 miles of roadway. City staff estimated that maintaining good quality of roads will require an annual budget of $8.25 million, well over the current budget of $2.6 million. At the current budget, the pavement will deteriorate to the point that it will require $23 million annually for the next 20 years to recover. Similarly, parks and recreation facilities have been built to keep up with the demand but are not being maintained to keep up with the deterioration. The City is estimating it will take a budget increase of $500,000 annually to keep up with maintenance of the City’s 42 parks (269 acres), five recreation centers and 159 acres in trails, bike paths, etc.
The Citizens Advisory Committee (CAC) came to many of the same conclusions. Both committees agreed there needed to be strict control measures to ensure the tax revenue was spent wisely and that the tax measure would sunset if it was no longer needed. Control measures included that the tax must be reaffirmed by a 4/5 vote of the Council every six years, annual proposed City budgets must be given to an oversight committee, an independent audit must be completed annually on the funds, that the ballot measure include an expenditure plan.
The plan attached dollar figures to each of the four service departments – Roads ($4.5 mm ) Police ($4mm ) Fire ($1 mm ) and Park and Recreation ($0.5 mm). Any revenue in excess of the estimated $10 millon should be deposited in a fund to increase efficiencies through improved facilities.
“People enjoy the quality of life here but now we have to keep it moving forward,” said Kris Bruce, chairperson of the CAC.
There was also some brief discussion about a utility users tax instead of a sales tax measure of 6%. Tulare, Porterville, Dinuba and Lindsay all have UUT measures of 6 or 7% in addition to local sales tax measures of .5 or .75%.
However, both committees said this would force Visalia residents to bear the full burden of the tax while a sales tax measure would generate revenue on people visiting the community to buy goods and services. The survey also showed that about half of voters would not likely support a UUT.