July 22, 2008

Council Delays Action on Revenue-Generating Measures

On Monday, July 21, 2008, the San Leandro City Council made no decision whether to proceed with three possible ballot measures to generate revenue for the City. The City Council recently approved a budget for the 2008-2009 fiscal year with a $4.4 million structural deficit and an ad-hoc committee was formed to look at ways to increase revenue for the City.

The possible measures recommended by the ad-hoc committee include an update to the utility users tax, originally adopted in 1972, which taxes telephone, electrical, gas, and cable television. The tax generates about $4 million each year and unless changes are made, the City may lose out on $3 million each year.

Another possible measure to protect existing revenue is to change the 911 fee to a tax without changing the $2.5 million in revenue it provides each year. The legality of the 911 fee has been challenged in other cities and there is a chance that if the challenges are successful, the City could lose this as a source of income. However, in order to change the fee to a tax, it would require the approval of 2/3 of voters.

The third measure to generate revenue under consideration is a parcel tax to support police services. According to the staff report, the tax would be linked to the Police Department Strategic Plan and staff recommends a sunset clause that would end the tax after four years. The parcel tax would generate an estimated $2.6 million annually. A parcel tax would also require the approval of 2/3 of voters.

Recent parcel taxes put forth by the City of San Leandro and the San Leandro Unified School District (SLUSD) have both failed. In November 2004, Measure DD, a police and fire parcel tax, failed with just 50.5% of the vote (66.67% was required to pass). That parcel tax would have assessed $78 for single-family residences, $46.80 per multi-family unit and $16 per thousand square feet for industrial and commercial properties and had a sunset clause of five and a half years.

In April 2006, Measure A, a parcel tax for San Leandro schools failed with 61.04% in favor (66.67% needed to pass). The tax would have assessed one-and-two tenths cents ($0.012) per square foot per parcel for a period of six years.

The meeting coincided with Mayor Tony Santos' 53rd wedding anniversary and the City Council approved a resolution to increase the Mayor's car allowance from $250 to $375 each month. The allowance had been set at $375 per month in 1997 and was decreased in January 2007 to $250 per month. City Councilmembers may receive up to $125 for travel reimbursement each month.

The City Council revised its contract with City Manager John Jermanis to extend his employment through September 5, 2008. Assistant City Manager Steve Hollister received a contract to be Interim City Manager from September 6, 2008, to June 30, 2009.

The three potential ballot measures will be revisited on July 28, 2008.

Posted by Mike Katz-Lacabe at July 22, 2008 12:24 AM | TrackBack
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