The city
’s Finance and Audit Committee sat around the table last week,
reluctantly mulling over fees and taxes that might possibly, if all
else fails, be increased to help cover the on-going deficit.
The city’s Finance and Audit Committee sat around the table last week, reluctantly mulling over fees and taxes that might possibly, if all else fails, be increased to help cover the on-going deficit.
Councilwoman Hedy Chang bristled visibly at the idea of raising taxes but listened patiently with the others as Finance Director Jack Dilles led the committee through three pages of fees and taxes – what they are, how much they would add to the general fund if raised and what vote, if any is required. Most tax increases require a two-thirds majority.
Led by City Treasurer Mike Roorda, the committee consists of Council members Larry Carr and Chang, Dilles and other city staffers.
The budget shortfall in 2003-04 will be about $900,000, Dilles said. In 2004-05 it is projected to be more than $2 million. He said that the council has instructed staff to cut costs for 2004-05 by $800,000, but $400,000 must come from new sources. Council can decide to use some reserve funds to make up the difference or in ways to stimulate the economy and provide future increased revenues.
In 2005-06 the city will cut an additional $400,000 and generate $800,000 in new revenue and in 2006-07, another $400,000 in new revenues. The sum is $1.2 million in costs cut and $1.2 million in new revenue.
“That’s how we deal with the $10 million difference between revenues and expenditures by 2007-08. This will be on-going,” Dilles said.
A complete review of city services to single out those that could be cut without significantly effecting the health and well-being of residents is an on-going effort by staff and council.
On Tuesday, two items received an extra level of attention: parcel taxes and a lighting and landscape assessment. The parcel tax would need two-thirds approval by all voters, not just property owners and can be used for public safety, stormwater, cultural center, street maintenance, library and recreation services. They are excise taxes that could be applied at a flat per-parcel rate to property owners or on a unit rate – based on use, size and/or number of units.
A lighting and landscape assessment would only need a majority vote for approval. It could for park maintenance, landscaping, lighting, traffic signals, tree and sidewalk maintenance and graffiti abatement.
One which requires no vote is an emergency response, or 911, fee and has been adopted by San Francisco. The fee would potentially produce $500,000 a year.
An additional sales tax of one-half cent would earn $2.2 million; an admissions tax – on movie and concert tickets – would not bring in enough to bother about, the committee decided. A Mello Roos district tax – again a two-thirds yes vote needed – could pay for services, maintenance and operation of existing facilities, unlike Redevelopment Agency funds.
Other fees and taxes on the list include some already on the books: development, police and fire. They could be raised but would need a two-thirds vote. Business license, utility users and transient occupancy taxes (raised 1 percent from its current 10 percent) need only majority approval.
