Sebastopol city officials say they’re planning for financial security and future liabilities in submitting two tax measures for voter approval on Nov. 6.
One, Measure Q, would extend indefinitely an existing half-cent sales tax.
The other, Measure R, would raise the transient occupancy tax paid by hotel guests and other overnight visitors from 10 percent to 12 percent. Both require approval by a simple majority of voters to go into effect.
Combined, the two measures would account for about $2 million a year in mostly continued revenue for Sebastopol’s general fund, through which the city pays for “essential services” like police and fire protection, roads, public infrastructure, recreational programs and city staff.
With a general fund of about $8.8 million this fiscal year, revenue collected through the two taxes makes up a significant chunk of what’s needed to run the city, while setting aside emergency reserves exhausted during the recession a decade ago, officials said.
“We are a teeny, tiny city — $8.8 million general fund budget,” Councilwoman Una Glass said. “That’s not that much money.”
Moreover, while the city counts about 7,500 people among its residents, Sebastopol is a hub for tens of thousands of others in the west county who shop and work there or simply travel through on a daily basis, contributing to wear and tear on roads and greater demand for police and other services, Glass and fellow council members said.
That same dynamic means much of the tax would be paid by the estimated 50,000 people who do business in Sebastopol.
“There’s not a lot — at least that I’ve heard — a lot of controversy over it,” Mayor Patrick Slayter said. “I think the residents realize the council has been responsible and prudent with the funds.”
There are, however, scattered misgivings over the indefinite nature of the sales tax, first approved in 2012 as Measure Y with a sunset date of March 31, 2021.
The Sonoma County Taxpayers Association had drafted a ballot argument against the sales tax extension, objecting to it because it had no expiration date. The organization, however, missed the deadline to have it included on the printed November ballot, Assistant City Manager and Clerk Mary Gourley said.
The association said, in part, an indefinite extension robs voters of the chance to review their council’s performance before each tax renewal vote and puts the onus on the public to collect voter signatures if, at some point, they want the tax repealed. Gourley said four of five council members also could take action to repeal the tax if they decided to do so at some point.
Council members said the city’s reliance on various general and special sales tax revenues — which, combined, account for more than $4 million or nearly half of the general fund amount — means it’s unlikely there ever will be a time the city doesn’t need the special sales tax in place, particularly with a looming pension liability estimated at more than $12 million, Mayor Patrick Slayter said.
Renewing the special tax over and over takes time and money to put on the ballot, and risks having it lapse and cause a budget shortfall, Vice Mayor Neysa Hinton said.
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