Windsor to consider new 0.25% sales tax for 2024 ballot

The Windsor Town Council voted Wednesday to consider putting a sales tax revenue measure on a future ballot in order to close a $900,000 projected budget gap.

Following a presentation by consultants hired to gauge how Windsor residents might respond to a new sales tax, the council voted 4-1 to explore the idea of putting a 0.25% sales tax on the November 2024 general election ballot.

Mayor Sam Salmon voted no until staff can tell him how much it would cost to put a measure on the upcoming November ballot.

The town is working to recover from revenue losses largely attributed to the COVID-19 pandemic. Staff members and consultants have been searching for ways to make cuts and raise funds.

A local sales tax of 0.25% would raise the $900,000 needed to “address the town’s revenue challenges and allow the town to maintain service levels,” according to a staff report to the council.

Representatives from Management Partners, the Lew Edwards Group and Godbe Research spoke about the results from a focus group with business and community stakeholders, as well as phone surveys of residents conducted earlier this year that sought feedback on how the council is running the town, along with other issues and priorities.

Participants were asked to rate how Windsor addressed COVID-19, provided essential services and managed taxpayer dollars.

Ultimately, the town was rated highly in all areas; 54% of the respondents said they were satisfied with town services and 52% said they were satisfied with the management of public funds.

Overall, the majority of the respondents prioritized safety, infrastructure and parks, according to Catherine Lew, president and CEO of the Lew Edwards Group.

But when it came to a hypothetical sales tax, there wasn’t enough support for the idea for the 2022 ballot to merit going forward, but sentiment in favor of such a tax on the 2024 ballot was sufficient, according to the consultants.

The measure would require a majority vote of 50% plus one to pass.

“This is a challenging time,” Lew said. “Now does not seem to be the best of times for the town to proceed (with the tax).”

Windsor and Cloverdale are the only cities in Sonoma County that don’t already levy a separate revenue tax. Based on past results, 74% of similar sales tax measures are successful, according to Rick Haydon with Management Partners.

Other revenue sources researched by the consultants included a business license tax, an increase in the transient occupancy tax, a local excise tax on cannabis (which is not allowed to be sold in Windsor) and a utility users tax, as well as the creation of the community facilities district.

Alternate taxes would not generate enough revenue or would be too hard to pass, according to consultants.

Asked about a utility tax, only about 27% of respondents supported the idea, Bryan Godbe of Godbe Research said. The tax would need two-thirds of voter approval.

“Based on our analysis, as well as the results of focus groups and the polling performed by Godbe Research, we believe that a one-quarter of 1% local sales tax measure would be the only viable option to address the town’s needs,” Management Partners wrote in a report to the town.

Consultants said based on their research, residents who responded did not share the urgency the town is facing in terms of resolving the projected budget gap.

“If they don’t feel a sense of urgency, we need to have a discussion about what measures would have to be taken, because right now they’re not listening,“ said Council member Deb Fudge.

Lew recommended starting the conversation with town residents about the tax in January if the council moves forward.

Council member Esther Lemus said she wanted to continue to work with consultants “to get the word out” on the ballot measure if approved for November 2024.

Council member Rosa Reynoza was concerned about the cost of consultant fees and wanted to make sure their cost would be shared with the council before they were engaged for further work.

You can reach Staff Writer Kathleen Coates at kathleen.coates@pressdemocrat.com or 707-521-5209.