Cotati's Measure G asks residents to raise sales tax

Residents of Sonoma County's smallest city will decide next month whether to enact the highest sales tax rate in the county.

Cotati city leaders, including the city manager and police chief, say consequences will be devastating — including the potential dissolution of the entire city — if voters don't approve the one-cent, nine-year tax called Measure G on the June 3 ballot.

But opponents argue that the city is overstating the financial risks and trying to scare voters into doubling the existing sales tax.

The campaign, as is typical in Cotati, has gotten heated and at times personal. Some business owners say they've been bullied for opposing the tax. Proponents were mocked in a flier that they say was designed to make them look silly.

The vote has, for some, become a referendum on the city's future.

Measure G would replace Measure A, which in 2010 increased the city's local rate by a half-cent to 8.75 percent. With that tax set to expire next year, city leaders declared a fiscal emergency and put a nine-year, one-cent tax hike on the ballot.

The measure needs a simple majority to pass. If it does, Cotati's local sales tax will be 9.25 percent, more than Sebastopol's current county high of 9 percent and the 8.25 percent lows of Petaluma, Cloverdale and Windsor. Sebastopol is poised to ask voters to hike that city's sales tax to 9.25 percent in November.

Cotati Mayor John Dell'Osso said the alternatives are intolerable.

"For people who are looking for services in the city — sewer, water, police, pothole repair, maintenance to parks — a lot of that could very well go away should this not pass," he said.

"We're not trying to scare people," he said, but the city would not exist in the same way if the tax fails. "You could either have a police department and no other city services or incredibly reduced services, and in my mind, neither is a real scenario."

A leading opponent of the tax, former Councilwoman Patty Minnis, says words like that are "immoral."

"Those are just scare tactics," she said. "It's scary when they say stuff like that."

City department heads have discussed potentially cutting staff, reducing City Hall hours from four days a week to one day a week, cutting back on road repairs, reducing or eliminating police services or disbanding the city completely.

Minnis and other opponents say the city can sell or rent unused building space, outsource dispatching and other services and could operate just fine with fewer administrators.

"Cotati has grown by 400 people in the last 18 years," she said. "Why do we have all these people in administration?"

Police Chief Michael Parish and City Manager Dianne Thompson co-authored a letter urging citizens to approve the tax increase.

In it, they say if the tax increase is rejected the city would consider "substantial reductions in city services, the potential elimination of the police department and even the possibility that Cotati will no longer be able to maintain itself as an independent city."

Thompson has said the city has already reduced staffing by 28 percent, cut employee benefits and trimmed 11 percent off the $4.86 million general fund budget.

Measure G is billed as a guaranteed source of funds that can't be taken by the state, as happened with redevelopment money.

South county political consultant Brian Sobel said it appears the city has made a good case for the need and has demonstrated the willingness to make cuts before asking for higher taxes.

"They have articulated to their public a case that the tax is appropriate and that they are trying to live within their means; absent this tax the city would be in dire straits," he said.

The anti-tax sentiment of a few years ago has lessened a bit as the recovery chugs along, he said.

Most of the vocal opposition in Cotati seems to be less about residents feeling overtaxed than a sense that the city could be more efficient with what money it already has.

"The job of the city officials is always to communicate the extent of the problem," Sobel said. "People generally get that government is doing with less, and they're seeing it every day in the little ways — the lawns not being mowed, buildings not being open as often, furloughs."

Proponents also highlight that much of Cotati's sales-tax revenue comes from "out of town" shoppers to Lowe's home improvement, the city's single-largest source of sales-tax receipts, suggesting that the tax bite would be felt by nonresidents.

Since 2006, the city's sales tax revenues have fallen about $300,000, from $1.6 million to about $1.265 million in the 2013-14 budget. The state took $600,000 in redevelopment funds, Thompson said.

Employee benefits and retirement costs have continued to outpace revenue.

Measure A has brought in between $750,000 and $900,000 annually, the city said. The proceeds from a 1 percent tax could double that.

"That's keeping us afloat," Dell'Osso said.

The recession, loss of redevelopment money and a slower-than-expected economic recovery makes Measure G just as important as Measure A, he said.

A city-sponsored poll showed about 63 percent of residents would support a tax increase for "essential city services."

You can reach Staff Writer Lori A. Carter at 762-7297 or lori.carter@pressdemocrat.com.