Santa Rosa council agrees to explore tax hikes

<p>Santa Rosa's City Council Tuesday gave the go-ahead to explore putting a variety of tax measures before voters later this year in a desperate move to raise enough cash to help overcome a projected $10 million budget shortfall.</p><p>It is the third time in the past 19 months the council has reviewed a series of similar proposals, first in July 2008 when it faced a projected $8 million deficit and again last March when the deficit reached $23 million.</p><p>That deficit eventually was overcome last June when the city eliminated 100 jobs, expanded the use of Measure O sale tax revenues, received millions of dollars' worth of salary and fringe benefit concessions from hundreds of employees and dramatically reduced city services that included the closure of one of the city's 10 fire stations.</p><p>Council members agreed they are running out of cost-cutting options without eliminating entire services and said they will pursue further study of a half-dozen measures that could help reduce that deficit. Almost all would require voter approval.</p><p>Those that would require voter support include:</p><p>-- A $50 parcel tax that would raise an estimated $2.5 million annually.</p><p>-- Raising the city tax on hotel rooms from 9 to 12 percent, an increase that would generate an extra $1 million a year. A similar proposal submitted to voters more than a decade ago failed.</p><p>-- Expand the city's 5 percent utility user's tax to cover cell phone, satellite and Internet calls to generate $500,000. A similar measure also was rebuffed by voters in the 1990s.</p><p>-- Increase the $3,000 maximum business tax cap for larger businesses. It would raise from $500,000 to $2.5 million a year, depending on where the cap is set.</p><p>The one revenue-raising measure within the council's right to unilaterally enact is an emergency medical response fee it rejected last year.</p><p>It would be up to home and business owners whether to pay the $4-a-month, insurance-like fee but those who do would be protected from paying a $350 fee the city would begin charging when its paramedic crews respond to a medical emergency call. Currently there is no charge. The fee, coupled with the $350 charges, would raise about $1.2 million a year.</p><p>Council members, however, rejected two other revenue-raising ideas Tuesday, including putting another quarter-cent sales tax measure on the ballot that would raise $6 million a year.</p><p>It was just six years ago that voters approved Measure O, a quarter-cent sales tax increase targeted to bolster police, fire and gang prevention services.</p><p>The council also shot down a proposal to raise parking fines from $30 to $40 even though it would raise $400,000 more a year.</p><p>“We're already having trouble with that,” Councilwoman Jane Bender said, alluding to the constant complaints that Santa Rosa is anti-business, a common refrain among angry visitors who have received a $30 parking ticket.</p><p>But the bevy of proposals to increase taxes and fees raised concerns from Councilwoman Veronica Jacobi.</p><p>“I don't want to place three taxes on a ballot measure,” Jacobi said.</p><p>“That would probably be too much” for voters to take, she said.</p><p>City Manager Jeff Kolin, however, suggested the council might put one or two measures on the ballot and put another on a ballot at a later election if needed to soften the psychological impact on voters.</p><p>Mayor Susan Gorin noted the earliest any tax measure could go before voters would be Aug. 31 if done by mailed ballots, or Nov. 2 if held at polling places.</p><p>She said whether the city goes forward will not be known until the council studies the measures further and then, if it decides to move ahead, conducts a poll to determine what the chances for passage might be.</p>